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How to shift gears from Saver to Spender?
Old 02-12-2018, 03:51 PM   #1
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How to shift gears from Saver to Spender?

Retired at 54 in 2016. Wife retires end of this week at 53. DINKs. For 30+ years we've been geared as savers, living off one income and saving the other. I've done my homework, met with my adviser at FIDO, and understand how much we can safely withdraw using the 'significantly below average' model on the FIDO retirement site.

As we near "real' retirement with no more earned wages/paycheck, I catch myself thinking maybe we should spend less just to be safe.

"Let's go to Florida instead of Maui next month"! Or, "let's wait to replace the 2006 car a few more years since this one is running fine." Both Maui and a new car are in the budget!

I don't want to cheat ourselves out of the benefits of our hard work.

Have any of you experienced similar mental challenges? Would love to hear how you overcame them to fully enjoy retirement.
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Old 02-12-2018, 03:54 PM   #2
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Easy:

Have someone you know well and who is your age or younger be diagnosed with a serious illness or pass away. That worked for me.
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Old 02-12-2018, 04:13 PM   #3
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Originally Posted by FIREHAPPY View Post
... Both Maui and a new car are in the budget! ....
That's why you budget! If it's in the designated budget item, then you know you already planned (saved) for it. So, spend it !
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Old 02-12-2018, 04:21 PM   #4
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Easy:

Have someone you know well and who is your age or younger be diagnosed with a serious illness or pass away. That worked for me.
Yes, this worked for me.

Wifey and I saved and invested, bought less house than we could afford, and bought only used cars.

She died 8 years ago of Pancreatic Cancer, 16 months after diagnosis.

Good thing she saved all that dough eh?

Blow That Dough before you die!
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Old 02-12-2018, 04:29 PM   #5
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Originally Posted by FIREHAPPY View Post
As we near "real' retirement with no more earned wages/paycheck, I catch myself thinking maybe we should spend less just to be safe.

"Let's go to Florida instead of Maui next month"! Or, "let's wait to replace the 2006 car a few more years since this one is running fine." Both Maui and a new car are in the budget!

I don't want to cheat ourselves out of the benefits of our hard work.

Have any of you experienced similar mental challenges? Would love to hear how you overcame them to fully enjoy retirement.
When I retired, I had enough $$ for a new car set aside from my retirement portfolio. The idea was to buy a "good for me" present for myself once I retired, without having to worry about a large WR that year.

After that, I splurged on bigger items only after I had saved the money from my allowed withdrawal amount. It was just like saving from a paycheck. I even did that when I bought my "Dream Home" - - because the amount that I spent was less than the unspent money (money that I safely could have spent with a 3.5% withdrawal rate, but didn't spend) from the previous years of retirement.

People say that retirees don't need to save - - I say baloney! Some, like me, do better this way because this is always what we have done before, when we wanted to splurge on something expensive. We save it, then we spend it.

So, I think that your instincts may be correct for now. In a few years, once the money has begun to build up, I am certain that you will feel much better about spending it.
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Old 02-12-2018, 04:54 PM   #6
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It has been said before, "saving is easy spending is hard." I retired in 2006 at 54, it took a little time to loosen the belt for me. Now 12 years later I realize that it was silly.
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Old 02-12-2018, 07:40 PM   #7
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Yes, this worked for me.

Wifey and I saved and invested, bought less house than we could afford, and bought only used cars.

She died 8 years ago of Pancreatic Cancer, 16 months after diagnosis.

Good thing she saved all that dough eh?

Blow That Dough before you die!

Sorry for the loss. But in her honor, just blew that dough on Big Island. Spent a mint but 5star amenities in the pacific isn't always cheap. Filet, Ono, Shrimp, ChocMacNuts or as the locals say "donkeyballs" and of course all the tourist attractions.
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Old 02-12-2018, 07:48 PM   #8
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It has been said before, "saving is easy spending is hard." I retired in 2006 at 54, it took a little time to loosen the belt for me. Now 12 years later I realize that it was silly.
Good for you. Let me guess;

You now have more dough than you retired with and 12 years less to spend it?
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Old 02-12-2018, 07:50 PM   #9
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Sorry for the loss. But in her honor, just blew that dough on Big Island. Spent a mint but 5star amenities in the pacific isn't always cheap. Filet, Ono, Shrimp, ChocMacNuts or as the locals say "donkeyballs" and of course all the tourist attractions.
Good job!

When travelling it is even more important to Blow That Dough as there is no place like home and one should make travel as bearable as possible -
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Old 02-12-2018, 08:12 PM   #10
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Originally Posted by REWahoo View Post
Easy:

Have someone you know well and who is your age or younger be diagnosed with a serious illness or pass away. That worked for me.
+1 (or 2)
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Old 02-12-2018, 08:19 PM   #11
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You saved that money to enjoy your retirement... go forth and enjoy! Your planned withdrawals are your budget... go spend.

No sense hoarding it.... lots can happen.
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Old 02-13-2018, 01:05 AM   #12
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Well I know how some are doing it.

We have been travelling in Asia for the past month. We have seen an increasing number, over the past four or five years, of fifty something North American men with extremely attractive young Asian women on their arms. And I doubt very much that they were all nieces.

Both, it would seem, hanging on for dear life. Each for their respective reasons.
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Old 02-13-2018, 02:09 AM   #13
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Originally Posted by FIREHAPPY View Post
Retired at 54 in 2016. Wife retires end of this week at 53. DINKs. For 30+ years we've been geared as savers, living off one income and saving the other. I've done my homework, met with my adviser at FIDO, and understand how much we can safely withdraw using the 'significantly below average' model on the FIDO retirement site.

As we near "real' retirement with no more earned wages/paycheck, I catch myself thinking maybe we should spend less just to be safe.

"Let's go to Florida instead of Maui next month"! Or, "let's wait to replace the 2006 car a few more years since this one is running fine." Both Maui and a new car are in the budget!

I don't want to cheat ourselves out of the benefits of our hard work.

Have any of you experienced similar mental challenges? Would love to hear how you overcame them to fully enjoy retirement.
We've retired at similar age & time. To us, it has been a slow transition, more so for my wife than me. I found that old "saving" mode habits die very hard. For a small example, when dining, I have to force myself to order the best glass of wine instead of going for a cheaper wine as I used to do. It's a small example but you get the picture. But I am making progress. I am more and more living par to our means and that's so refreshing. No more constant LBYM. Life is too short, and getting shorter.

My most often used phrase when spending money we can afford to? Let's go spend my son's future inheritance. A few of my friends heard me say this and they laugh about it.
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Old 02-13-2018, 04:00 AM   #14
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Originally Posted by FIREHAPPY View Post
As we near "real' retirement with no more earned wages/paycheck, I catch myself thinking maybe we should spend less just to be safe.

"Let's go to Florida instead of Maui next month"! Or, "let's wait to replace the 2006 car a few more years since this one is running fine." Both Maui and a new car are in the budget!

I don't want to cheat ourselves out of the benefits of our hard work.
Go to Maui. Go to Florida too in the new car! I RE'd last March and have had some of those thoughts, but our situation is so solid that we spent about 20% over the first year's budget, mostly on travel. "There ain't no hearses with luggage racks" (Don Henley)
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Old 02-13-2018, 04:10 AM   #15
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In my last few years leading up to retirement---for me April 2018 (age 54)--I have been a saving and tracking expenditures with diligence. Probably didn't need to save so strongly since I have been ahead of my plan for quite a few years.

I know I'm going to struggle a bit in the transition from saving to spending---looking forward to figuring it out.
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Old 02-13-2018, 08:21 AM   #16
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Appreciate all the good advice. I suggested to wife this morning that we go ahead and book the trip to Maui as planned. (we've been to Maui almost every year for 25+ years) She responded "not at $500 per night". She would have been fine with the cost while we were working. I can tell it's going to be an adjustment for us. Too bad the market correction happened close to her last day working.
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Old 02-13-2018, 10:42 AM   #17
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FH, my situation is similar to yours. I retired in mid-2016 and DW retired just two months ago. I'm 60; she's 52. Our projected annual withdrawal rate based on our January 1, 2018 portfolio value is 5%, and the plan is for it to stay there for the next ten years. Then we'll both begin SS at my age 70 and her age 62 and our WR should drop below 3.5%.

An aggressive plan? Definitely. Have I had a small knot in my stomach over the last few weeks thinking we may have retired directly into a bear market? Absolutely!! And no doubt those concerns will continue to be there for the foreseeable future.

But we also know that 1.5% of our 5% withdrawal rate is for travel, wine/booze, hobbies (golf) and charity. We also both understand the reality of our decision to stop w*rking and have vowed to do what it takes to make it. Cut back on our discretionary spending, go back to w*rk; downsize even further than we have.

We know we could have w*rked longer, been more comfortable from a financial perspective, and not had these small (first world) nagging issues like Hawaii versus Florida, new car versus older car, etc. But there was a reason we retired early: to live life on our own terms; to not be obligated to anyone but each other and our small circle of family and friends. We definitely make small compromises in our spending now that we don't have an income. That seems reasonable to me regardless of what the retirement calculators say.

I say go to Maui and adjust your travel budget in future years if you must. But bottom line, you and your DW should be on the same page if not the same paragraph, if not the same sentence! If compromise is necessary to make her feel good about how/where/when you spend your hard earned money, then compromise it should be!

Best of luck.
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