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Old 08-09-2011, 12:01 AM   #21
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We are still struggling with the shop expenses but we did scale back on the renovation and I did all the lighting purchases (no shipping and no tax and no middle man to take a 10% cut); I also did the installation of nearly 200 feet of track lighting.

We repainted but fixed rather than replace the floor. That saved us $6000 right there. The parts cost me $100 and it took me 8 hours to replace a 200 sq. ft. floor section.

We are cutting back on sales; may seem counter-intuitive but she has already had many sales in the past several months and we are already operating very close margins so no major sales for a while to see if we can pay off the shop upgrade expenses.

On the home front, I am doing more and more plumbing and electrical and mechanical parts replacement rather than hire it out. As long as I can find parts I am OK. We have a Wolf steamer that requires an authorized repair center to supply the parts so that is on hold for a while.

We have also cut back on charitable donations and are doing more volunteer time rather than $$$ right now. We have also dropped a number of charities and adopted only local ones that we know personally.

We are backing off on travel of any kind. We have taken no vacation trips this year and have none planned. Family visits for short periods yes but no fun trips for a while. The motorhome is parked to avoid fuel cost and insurance is scaled back while it sits.

No significant home purchases, minor clothing replacements only and no new cars or new toys of any kind. My car is 11 year old with over 100k on it already. DWs car is a 2007 and should last another 7 if she can keep from playing bumper cars with it for a while.

Our investments are a mix of security types but we are still pretty heavy in equities to fund our living expenses for the long haul so most of our nest egg is designed for use 20 years from now so I don't sweat that too much right now; just the close in cash flow stuff and will be coming from equity sales in the near future.

We are prepared to hunker down more if insanity prevails in the markets and the world. We are looking at melting down some gold jewelry we don't need to raise some capital.
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Old 08-09-2011, 12:25 AM   #22
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Down market or no down market, ever sinced FIRE'd been practicing LBYM pretty much all my life (out of habit).

But yes, probably will LBYM even more. Over the last week, been thinking alot about do I hire someone to do handyman more or not. Decided to do that on my own, now will surely try that. (Already took down old ceiling fan, put one up. Tommorrow, looking to replace old faucet, and fix leaking garbage disposal). By not hiring someone, probably saved several hundred dollars.
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Old 08-09-2011, 12:55 AM   #23
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I plan to keep working past my goal of 65 now. I had reached 110% of my savings goal with 2 years to go so I had a great cushion. Now I will work the two years to medicare plus what it takes to recover my investments.

I bought pretty much all new top of the line appliances on Sunday but lost about 50k Monday plus 55K the last couple of weeks. I am usually pretty cheap but all new appliances were mostly needed and why cheap out on something that will last long term and make the house look nicer when I sell to retire?

Working 3 more years instead of 2 more years will make up for many spending splurges as long as I am still very careful on day to day things.
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Old 08-09-2011, 01:43 AM   #24
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It never included re-using saran wrap, nor washing out tin foil, so won't start now
Don't tell us you use new stuff for hats? How LBYM is that? The rest of us re-cycle.
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Old 08-09-2011, 04:29 AM   #25
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Several of us have said that when markets fall, we plan to spend less than our usual SWR during a thriving market. I know that during 2008-2009, I wanted to spend less than I had been spending.

Are you starting to feel that way, yet? I am already thinking of putting off some furniture purchases, and I haven't browsed on Amazon even once since that first drop last week. We seem to be gravitating towards less expensive restaurants, and I am starting to turn the thermostat up when I can bear it. None of this is actually necessary, but it almost seems instinctual when faced with a falling market.
Although the markets have fallen heavily our savings are still up on the year (as of 8/9). If the savings take a big hit and the WR gets up to >3% then yes, we'll cut back.
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Old 08-09-2011, 04:43 AM   #26
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If the savings take a big hit and the WR gets up to >3% then yes, we'll cut back.
I'd be interested to know if anyone is cutting back even though Firecalc said that their proposed WR would have survived 100% of previous historical sequences - which would include, for example, retiring in late 1928.

To cut back in those circumstances would suggest (if analysed rationally, which is presumably what we are trying to do by using Firecalc or similar tools!) that people are looking to be even more secure than "worst possible case".

Here's the take which I've decided on (while editing my signature to remove 50K from the portfolio, but uprating the w*rk pension pot since DW and I have another year's worth of contributions in it): if the Dow drops to 9K, then compared with a month ago, we will be about 120K down. But firstly, the stocks part of the portfolio probably isn't going to be needed for drawdown any time soon, and secondly, one of the uses of the portfolio could be to buy a home for retirement - we're currently paying 1500/month in rent, which is the equivalent of 450K immobilised at a 4% WR. And since the home we buy may well be in an area where prices are falling as a result of the downturn, we might very well get that for 330K. All hot air, of course, but it helps me sleep better.

(Of course, I could give myself a further morale boost by evaluating my signature in US$ rather then Euros... but I reckon that a Euro in France buys about the same as a $ in the US, so this reflects my situation better for US readers. In case anyone's interested. )
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Old 08-09-2011, 06:04 AM   #27
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I'd be interested to know if anyone is cutting back even though Firecalc said that their proposed WR would have survived 100% of previous historical sequences - which would include, for example, retiring in late 1928.
Since we ER'ed at 55 and have planned for a 40 year survival, 3% is the target WR for us, particularly during this first 10 years. After that we'll have (hopefully) another 4 income streams coming on-line in the form of SS for DW & I, UK SS for me, and a DB pension from a former employer.

Of course, these are only just plans, and I really don't know if my nerve will hold if we get close to that 3% self imposed ceiling, or if we'll start cancelling vacation plans etc.
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Old 08-09-2011, 07:02 AM   #28
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Not us. If I suggested to DW that we should cut back because of investments, she would just "suggest" I go back to work. We'll stick to the plan.
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Old 08-09-2011, 07:25 AM   #29
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In answer to the question posed "Not really.". At least, not yet. I do admit to feelings of apprehension, though, that have translated into banishing any passing fancies for the acquisition of totally unnecessary bits and bobs. I had not planned any really large purchases this year or next in any case.

I plan to continue to spend the same amount in my daily life as I am still w*rking, got a substantial raise at the beginning of the year. I did increase my cash position since 2008 by stuffing more of my take-home into a short term bond fund and checking for ready access. And I also sold some stock a couple of months ago to lock in some gains. I rid myself of one big loser of a fund then too (which has only gone down further) and will have long term capital losses to carry over for a couple of years on my taxes.
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Old 08-09-2011, 07:28 AM   #30
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It's a little late for us. We have already booked our flights and hotels for a trip to Seattle and Vancouver. We may refrain from spending too much there.
DW and I are leaving for Italy at the end of the month and have a trip to Kenya and Tanzania booked for February. But they are paid for and we still plan to bank a bit from the 2011 withdrawal in the "rainy day fund." If things get bad enough that rainy day could come I suppose.
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Old 08-09-2011, 07:46 AM   #31
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No reduction in any area.

That's what a retirement budget (and a healthy retirement cash bucket) are for ...

The market can do its thing...
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Old 08-09-2011, 08:05 AM   #32
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yes, we had the enhanced "austerity" discussion this past weekend. we are cutting back by about 10%....no NFL Sunday ticket for me...:-(
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Old 08-09-2011, 08:06 AM   #33
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I am rethinking the purchase of that 2nd sound front home we have a contract on. We are able to get out of the contract anytime up to August 26th. We will probably cancel the contract if the seller doesn't come down on the price by the amount of repair work needed. We've had the inspection and have the numbers for repair as quoted by a general contractor..etc.
Still ...not sure whether to get out of it or not. It will tie up some money but it does generate 10% gross return thru rentals...IF renters don't go away!. Mortgage rates are low, price is relatively low so the other side of my brain ....says...continue on.

Other than that, haven't started cutting back regular expenses....but even if we wanted to...not sure where we would cut. Like others here....I am starting to get that "feeling" of "oh no, I don't "feel" positive about things now". Things feel like they are on a precipice and any move in the wrong direction could send markets way down.
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Old 08-09-2011, 08:06 AM   #34
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DW and I were talking last night and we've decided to cut back. We're going to let Jeeves change the oil in the Bentley rather than take it to the dealer...
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Old 08-09-2011, 08:10 AM   #35
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Old 08-09-2011, 09:16 AM   #36
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We had been paring back expenses going into the 2008 debacle and made even more serious expense reductions then (while DW was unemployed). We have stuck to our recession spending (still living very comfortably), and plan to forever if possible. We are not hoping for the economy to heat up so we can spend more, we're happy at this expense level. And we aren't doing anything as a result of this past months market activity, just a blip in time so far at least, and nowhere near as dangerous as 2008.

Ironically, when you hear the wizards talk about our economic headwinds, they usually cite 'relucatant consumers' as part of the problem. Yep, that's me...it's a new world.
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Old 08-09-2011, 09:45 AM   #37
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One day when Microsoft stock dropped a lot, Jay Leno had a joke:

"Yesterday Bill Gates lost about a billion dollars. Do you think that when he went to lunch today, he said 'Well, maybe I'll only have a single burger instead of a double burger'"?
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Old 08-09-2011, 10:21 AM   #38
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No changes here. We generally follow a LBYM lifestyle, and that continues. Stuck with our plans for our annual family vacation. If we weren't already doing the LBYM thing, now would be (another) wake-up call to start, however.
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Old 08-09-2011, 10:39 AM   #39
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I had planned on making offers for two rental properties in Las Vegas. I suspect I am only going to make one offer since I am not comfortable borrowing money in this environment.
Since others will also be hesitant to buy right now, maybe a really low-ball offer would be accepted. Just a thought.
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Old 08-09-2011, 10:46 AM   #40
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No changes. We had no big purchases or trips planned.
Same old, same old.
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