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Old 01-15-2013, 09:25 AM   #41
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Originally Posted by Major Tom View Post
For some reason, the acronym LBYM is starting to bug me. A whole cult seems to have built up around these 4 letters.
Sort of, especially since the market crash and subsequent depression recession it has suddenly become "cool" to be frugal again. Whereas "power savers" used to be called miserly, cheapskate and any other number of somewhat denigrating terms, these days it has become a badge of achievement for many folks. Now the opposite is true -- some people who save 2/3 of their income may scoff at those who save "only" 1/3 of a similar income as being irresponsible spendthrifts for not exorcising every last dollar of discretionary or "luxury" spending from their budgets.

In other words, people used to laugh at their cheapskate grandparents who never forgot the lessons they learned in the 1930s, and many of them stopped laughing in the last few years.
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Old 01-15-2013, 03:21 PM   #42
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Originally Posted by kaudrey View Post
Hi Alex,

This has been a great discussion! I think my "happy place" is at SAMAR.

I save about 25% of my salary. It used to be closer to 35-40%, and after a while my spreadsheets for retirement planning basically showed that I'd have more money than I knew what to do with at the rate I was going. I am now 43, and plan to FIRE at 57 with a FERS pension. I have to stay until 57 due to the desire to keep my gov't health bennies until Medicare kicks in.

With that realization, I decided to spend a bit more now, to enhance my "fun" time. My boyfriend and I bought a cabin in the mountains about 2 1/2 years ago, and I have not regretted it for an instant. We love the town, the mountains, the peacefulness. We go out there as often as we can, and invite friends to stay with us, etc. Yes, it means I have another mortgage, but I can afford it and still save and reach my retirement goals.

I am enjoying the journey even more, while still feeling comfortable with where I'll be in retirement.
how would an early out (with immediated pension and health care eligibility ) fit into your plans?
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Old 01-15-2013, 09:42 PM   #43
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Quote:
Originally Posted by kaudrey
Hi Alex,

This has been a great discussion! I think my "happy place" is at SAMAR.

I save about 25% of my salary. It used to be closer to 35-40%, and after a while my spreadsheets for retirement planning basically showed that I'd have more money than I knew what to do with at the rate I was going. I am now 43, and plan to FIRE at 57 with a FERS pension. I have to stay until 57 due to the desire to keep my gov't health bennies until Medicare kicks in.

With that realization, I decided to spend a bit more now, to enhance my "fun" time. My boyfriend and I bought a cabin in the mountains about 2 1/2 years ago, and I have not regretted it for an instant. We love the town, the mountains, the peacefulness. We go out there as often as we can, and invite friends to stay with us, etc. Yes, it means I have another mortgage, but I can afford it and still save and reach my retirement goals.

I am enjoying the journey even more, while still feeling comfortable with where I'll be in retirement.
A pension certainly can change ones view on what LBYM entails. I also, have a pension, and consider myself LBYM. Oddly enough probably more now than ever. I save between 15-20 % of my take home not counting my PT work that also gets squirreled away. Since I am on a monthly cash flow type of living, I think one can borrow for a car payment and still be considered LBYM. When my vehicle finally dies off in the next year or so, I will get a loan for it and still will continue to save, so in my mind I will still be LBYM despite some short term 0% financing of a few things and a car payment. Once a dollar gets socked away, it will never come out of its cage. Everything must be financed out of my monthly check while the saving also continues.
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Old 01-15-2013, 10:21 PM   #44
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The pedant in me says that "LBYM" is not limited to annual time periods but means spending less during your lifetime than the total financial resources available to you from all sources during that lifetime - i.e. your estate having a positive value.

Of course, that's not how the term is used but I would still look beyond a simple annual evaluation of income and expenses. Taking into account longer term spending issues during periods such as early retirement when income is more limited is also relevant (IMHO). A person who saves some money each year but then retires with insufficient savings and other sources of income to last for all of his/her expected retirement is not practising LBYM.
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Old 01-16-2013, 12:38 AM   #45
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While you're working LBYM is spending less than your take home pay.

In retirement LBYM is spending less than the sum of your pensions, SS and investment returns
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Old 01-16-2013, 08:41 AM   #46
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Before I joined this forum, I thought LBYM means Living Beyond Your Means. Honestly.
Being new here, I agree with KingB. I'm lost on many of the acronyms used on this forum. Literally, what do the letters stand for?
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Old 01-16-2013, 08:43 AM   #47
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gcg, this should help: * Acronyms and Slang Frequently Used on the Forum *
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