Am I a Miser?

[LRS]

I posted a question earlier that I removed when I realized it was dopey. It was based on a reluctance of mine to think about harvesting income from my stash. I mean, I groom my stash, feed my stash, think glowingly about my stash but it is hard to think about taking funds from my stash without feeling that I am making a dangerous mistake. It's an "all or nothing" trap where I can't envision making use of my money without the fear of depleting it.

In 2010, my hub and I will retire early. We wiil need to withdraw $25,000 from our savings for about 4 years (we'll have other sources of income, including my part-time job). We should be able to glean that from the recommended 4% SWR from our investments, barring sustained market downturns. Beyond that, we have pensions and a small income from a farm sale that should cover our retirement goal of 60K per annum income (pensions are cola'd). So anything further withdrawn from the stash is "mad money." Or perhaps back-up in case our pensions go bust.

I think the term I am searching for is "miser." Am I becoming one? I think I just need to put money matters on autopilot and take a long break from thinking about it!

 

[unclemick]

Normal mental gymnastics of ERhood.

Even 12 years into ER - I catch myself overcalculating expected outcomes - over analyzing the markets - etc., etc.

Expect a period of mental transition. It gets better.

I don't take my periods of angst as seriously anymore - just try to stay balanced, diversified and just stand there ala Bogle.

heh heh heh - expect the emotions - but work the numbers.

 

[youbet]

I think the term I am searching for is "miser." Am I becoming one?

Yes.

 

[Sheryl]

I think the term I am searching for is "miser." Am I becoming one? I think I just need to put money matters on autopilot and take a long break from thinking about it!

Not that it's a bad thing.

Seriously it sounds like a normal case of analysis paralysis. You had it right with take a break and not think about it - you have 4 more years to get used to the idea.

 

[MasterBlaster]

I think the term I am searching for is "miser." Am I becoming one?

The traditional definition of a "miser" is someone who loves money in and of itself and not for the stuff it will buy and the security it brings.

So to be extreamly frugal and overly cautious with your stash is just being that, frugal and cautious.

So, I'd worry less about being a miser and examine your relationship (headtrip) with money. Perhaps there are some issues here that need to be thought through.

 

[ESRBob]

LRS,
It is normal to have these feelings when you switch from years of having worked hard to save and add to your 'stash' to now actually tapping it for annual spending needs (up to 4% or so).

Just part of the normal transition until you feel comfortable that a safe withdrawal rate and method can really work over the long run.

I remember in my first months of ER being taken up short by the realization that I had no income coming in any more after years of always having fresh funds flowing in every month.

Take your time and read everything you can about SWR etc as a way of building confidence in the whole approach --knowing its limitations but also coming to believe, like Indy when he starts stepping out across that chasm, that the steps are going to be there for you. Hey, you worked hard for this money, you deserve to be able to spend some of it now! 8)

 

[Nords]

I think the term I am searching for is "miser." Am I becoming one? I think I just need to put money matters on autopilot and take a long break from thinking about it!

Perhaps on the first and definitely on the second, but it'll all work itself out.

When you retire you'll eventually reach a crossroads: (1) continue to be miserly and hoard assets, which means you'll need to seek a job to pay for your living expenses, or (2) stop being miserly and start spending the money you need to live.

Even Yogi Berra would know which fork in this road to take. You won't have any trouble making the transition, although you'll have several "Why am I being so miserly about this?!?" moments...

 

[sgeeeee]

The trick is to learn to seek the optimum value proposition. Money can buy you immediate gratification if you spend it on that kind of opportunity. It can buy you long term dream items if you save it till you can afford them. It can buy you long term safety and security if you invest it. Everyone has to find the right balance between short term gratification goals and long term goals.

While most Americans seem to be out of balance toward the instant gratification aspects of what money can buy, you can get just as out of wack toward the long term goals and up with money and no gratification. If you want to change the balance more toward spending, decide an amount you want to spend today, or this week or this month and set about spending it. Make that a goal. Don't blow it, but don't over analyze it. Be determined to spend it. At the end of the period, decide if you enjoyed it and can continue to afford it. Revise your spending goal accordingly.

 

[MasterBlaster]

I guess the big question to ask is...

Is it a greater loss to live well and spend ones money and live as a pauper towards the end of your life...

Or is it a greater loss to hoard your money so tightly that your life lived is not so great and in the end you have many regrets.

Perhaps some balance between the two is the best approach

 

[dex]

I guess the big question to ask is...

Is it a greater loss to live well and spend ones money and live as a pauper towards the end of your life...

Or is it a greater loss to hoard your money so tightly that your life lived is not so great and in the end you have many regrets.

Perhaps some balance between the two is the best approach

This is the crux of the matter. Good post.

 

[BUM]

You know you're a miser when:

you yell at spouse for boiling more water than needed for that cup of tea
you worry about wasting your blinker while waiting at a long red light
you manually change the channel so as not to squander the remote's battery
you save dryer lint and spin it into thread...


Otherwise thinking twice about each significant expense isn't miserly. Remember, however much or little money you have... you can only spend it once.

 

[LRS]

Thanks for the insights. I'm the type that enjoys planning things--to excess, sometimes--and basically our retirement is all planned. I just have to plunk money into our Roth IRAs or our 457(b) for the next 4.11 years and then retire. It's almost not fun anymore

I think I will try directing my energies into planning our next vacation. That ought to keep my demons at bay for a while (although I am not spending stash dollars--can't bring myself to do it.)

 

[hodadus]

Perhaps some balance between the two is the best approach

I sense an imbalance in the force, young jeti.

 

[Wayno 347]

Food for thought:
When you're old and tired and suspicious and plagued with doubt, you'll still hear the world calling to you.
You'll wish with all your heart you'd taken time to listen to it, and you will be filled with regret.

Live well....

I guess the big question to ask is...

Is it a greater loss to live well and spend ones money and live as a pauper towards the end of your life...

Or is it a greater loss to hoard your money so tightly that your life lived is not so great and in the end you have many regrets.

Perhaps some balance between the two is the best approach

 

[free4now]

This does bring up an interesting issue: Our emotions aren't necessarily tied to our financial situation. This I think causes problems for many people. Feeling more miserly than your financial situation requires is unhelpful. As is feeling more spendy than your financial situation allows. Ideally we would have the exact emotions in the range from miserly to spendy that reflect our current financial situation. But practically that doesn't seem to happen often.

 

[ESRBob]

Good point, fireme--

I think the only real solution is education -- so we have an accurate and realistic view of what the facts of our situation are, what the real risks and possibilities are and thus can tune our actions to reality instead of emotion. But its tricky stuff! Pscyhologists could (and presumably do?) fill big volumes about all the head trips people have about money and spending...

 

[haha]

To me, who cares? Miser is just a word. Probably a word created to try to modify some rich person's behavior who was keeping more of his money to himself than the village thought seemly.

I say if you are happy and you aren't creating social losses with significant others, don't let anyone’s labeling you influence what makes you feel comfortable. In particular, don't let anyone make you feel bad because you don't feel like spending 4% or any other portion of your stash.

Money represents power. Once consumed, that power is gone. Individual people feel differently about this fact; but fact it is.

Ha

 

[Eagle43]

My rule is financial independence. Call me what you want, as long as I can take care of my business and don't need you. "Sticks and stones ...."

 

[Jay_Gatsby]

Money represents power. Once consumed, that power is gone. Individual people feel differently about this fact; but fact it is.

True. Likewise, those who label others as "misers" want to get their hands on the money that such misers are hoarding.

 

[SteveR]

Being a Miser to one person is being a spendthrift to another.

It is all about what works for you. If you have an emotional need to hoard money and feel guilty or sick when you spend it, then perhaps you need some "adjustment" in your thinking about money.


Money is a tool; it is the means to live the way you want and not the reason to live. Once you have enough....you have enough.

If you feel the need to hoard money then you may have a deeper emotional need that is not being met in other areas of your life. Get a hobby that will allow you to hoard things like coins or stamps or baseball cards; then maybe you will be less obsessed about hoarding money.

 

[haha]

Being a Miser to one person is being a spendthrift to another.

It is all about what works for you.  If you have an emotional need to hoard money and feel guilty or sick when you spend it, then perhaps you need some "adjustment" in your thinking about money. 


Money is a tool; it is the means to live the way you want and not the reason to live.  Once you have enough....you have enough. 

If you feel the need to hoard money then you may have a deeper emotional need that is not being met in other areas of your life.  Get a hobby that will allow you to hoard things like coins or stamps or baseball cards; then maybe you will be less obsessed about hoarding money.

Steve, I think your posts are usually right on. But IMO, this is Freudian fraudulent bull. "Once you have enough"... the problem is no one can know this until both his life and the live of those that may legitimately depend on him are over.

The only thing is some people interpret the world differently than others. Those differences are to be respected, not referred for treatment.

Ha

 

[free4now]

Being a Miser to one person is being a spendthrift to another.

It is all about what works for you. 

I think the lense of "what works" is very useful here. If your miserliness is on the whole serving you well then keep it up. If on the whole it's causing you more problems than it solves then it's time to let go.

 

[LRS]

SteveR:  "It is all about what works for you.  If you have an emotional need to hoard money and feel guilty or sick when you spend it, then perhaps you need some "adjustment" in your thinking about money. "

It's not guilt so much as worry. I can't imagine a place between spending nothing and spending everything. It springs from a basic insecurity about money. I grew up pretty poor, and it still surprises me to think that I am now almost a millionaire. I haven't assimilated it yet.

And to be honest and disclose all, the bulk of our stash was inherited--so it happened overnight. (I give myself credit for getting rid of all credit card and loan debt prior to the inheritance, though.)

So yeah, I need some adjustment in thinking about money ... I think a vacation from fretting over it would do me a world of good.

 

[free4now]

I'm the kind of person that is always looking for the downside of things and I found a lot of downsides to having paper wealth. Dating is one area where it can be a real conundrum deciding how spendy to be. You don't want to give your girlfriend the idea that you are a money machine, and especially don't want to attract people who see you that way, so I find myself trying hard to hide my wealth, especially in the beginning stages of the relationship. But meeting women is not something I'm great at doing and wealth does attract. I often end up feeling like I'm being silly hiding my wealth when most men overspend in dating to impress. Sometimes it seems selfish to be somewhat miserly, e.g. by insisting on camping instead of hotel rooms for instance.

And the worry thing is there too... people who don't have wealth don't worry about losing their wealth. It took me a long while to start to trust my wealth; it shot up in the dotcom boom and dropped down a lot soon after. I think it's probably the same kind of thing that housewives go through... they get married and hubby buys a new home for them, but she doesn't know if hubby will leave her for some bimbo and take everything when she gets wrinkly. I have the symmetrical fear: that I will marry a woman and it will end in a divorce that takes my financial independence away.

The other thing that seems really daunting is finding a woman who is compatible financially. If I'm retired at 35 living off my money but have a spouse that continues to work for her expenses, it seems like that would get annoying for her after a while, so I almost feel like I'll have to take the role of provider.

 

[tozz]

fireme,

Sorry, I haven't followed all of your messages. But would a prenup lessen your concerns?

tozz