Reversing the savings mode?

[cj]

Hi!  I'm a new poster; I posted in the "Introduce yourself here" section, but posted before I noticed the "But hey - start a new thread" note, so don't know if anyone saw my post.  I'll learn, sorry!   

Here's my info (again):  Hubby (52) retired in 2003, then got another job, then quit that job to go back to his original company for 6 months and is back to being retired again.  I (50) am planning (carefully!) to work for 2 more years where I am.  I love my job but the commute is lousy, and I just want to have more time to do what I want.  I am planning to work part time no matter what, as I love the social part of working, but I also want to do some volunteer work.  We've planned and saved pretty carefully to get to where we are.  Not having kids sure helps. 

My biggest "fear" (that's not really the right word) is the thought of spending when I've been a saver for more than 30 years.  From a very early age, I have socked it away, and the money in the bank (or other investments, now) was considered almost sacred.  Once it went in, I never touched it.  I never did understand people taking $ out of 401Ks or other savings for whatever reason. 

So has anyone else had problems with telling yourself, it's OK to spend it now?  Don't get me wrong, we're not misers!  We have lived comfortably, but always below our means.  We are just content without the (as you say) McMansions and fancy cars.  I drive a 1994 Honda Accord that I will be happy with for years to come!!


If this has been discussed before, can you point me to it?  Or tell me how you were able to switch gears?

Thanks!  I really enjoy reading what you all have to share on this board!!

cj

 

[REWahoo]

My biggest "fear" (that's not really the right word) is the thought of spending when I've been a saver for more than 30 years. From a very early age, I have socked it away, and the money in the bank (or other investments, now) was considered almost sacred. Once it went in, I never touched it. I never did understand people taking $ out of 401Ks or other savings for whatever reason.

So has anyone else had problems with telling yourself, it's OK to spend it now?

You bet we have. Like you, we saved for 30 years, not living as misers, but spending very conseratively to build our nest egg for retirement. Now less than a month into retirement (age 58), we are no longer building/accumulating, and starting to for the first time to spend (reduce! deplete!) what it took so many years to build. Frightening? A little. But we saved it to spend it for our retirement. Is that why you are saving, or is it to leave it to your heirs?

REW

 

[unclemick]

"I get high with a little help from my friends." - Beattles I think.

It does help to have some women in the household to remind you what a cheap SOB you are and - you can't take it with you!

Even so - we're underrunning our Firecalc allowables by quite a bit.

I'm trying to lighten up after 11 yrs of ER - but it's hard - frugal is my comfort zone - and really really cheap gives me my jollies - but the good old days are gone forever.

Try and rock up and spend a little - use Firecalc as an excuse - at least that's what I'm going to try.

 

[preben]

Good point. It helps to start of with some cash for 1-2 years of expenditures liquid in MM-account or similar with access via debit/credit cards. THe cash buffer and easy access makes the start of spending a bit easier I feel. Cheers!

 

[cj]

REW said/asked, "But we saved it to spend it for our retirement. Is that why you are saving, or is it to leave it to your heirs?

We have no heirs. So, ideally, we'd bounce the check to the undertaker when the second of us dies.

It's just a state of mind, I guess. My theory has always been the there are 2 classes of people: savers and spenders. Bad when you have a marriage with one of each - I've seen this with my one brother and his wife! But my hubby and I are both savers, which has made life easier overall, and let us be in the position we are in. We have "spender" friends that might never be able to retire.

cj

 

[OldAgePensioner]

cj,
Welcome to posting here.

I'm going thru the same situation of turning from growing an account to shrinking an accout and if you've seen my posts, I'm pretty rattled by it.

I've had some savings since I was 15 and in adulthood I put everything I could afford into savings. My portfolio has only declined in one year (2000) because I was always putting in the spare salary.

Always felt the same as you said "once it went any, don't touch it". Pretty hard to reverse gears after 40 years for me. Hope you have a better time of it.

 

[Ginger]

CJ, I relate to your post! I drive a 1994 Honda Civic. My husband drives the Lexus, but he is the bigger saver in our family and that car was a total splurge. Going to be difficult to reverse from being a saver to dipping into savings once in awhile. Goes against the grain.

 

[cj]

Ginger & OAP - thanks for the reinforcement! I know, it's a nice problem to have. I don't know how the saving mentality gets manifested, all I know is that I started early. I think I was influenced by my grandparents who were born in 1900. They were two of the happiest, most contented people I ever knew. Paid $5000 for a house in 1927, and lived there until they died, in 1991. Liced on a small pension and Social Security. Left their 2 sons $40,000 when it was all over. They weren't miserly, they just didn't need or want a whole lot.

When my hubby retired, he could have taken a pension, but we investigated & opted for a lump sum, which has been invested conservatively & is growing. Given our personalities, we maybe should have taken a pension, since it seems more like "income" than spending down savings. Guess when we need it, we can always annuitize it. Geez, it's so psychological!!

Thanks for your comments!
cj

 

[shiny]

We have the same "problem" both DH and I were praised when we were kids for saving our money and were "scarred for life" by that! It has worked out well up until now, but I do envision being a bit like UncleMick and playing a mindgame with myself to go for the personal best in cheap living!

Really though, we do spend on trips, we have ONE nice car. Recently moved to Seattle, so only need one car. But, I agree with Ben, we are going to have to put money in a moneymarket account and draw that down the first year or two until we get the hang of it.

 

[kz]

I'm in total agreement with Ginger...it really does go against the grain. I'm in the process of trying to figure it all out since hubby retired a few months ago. (I retired yrs ago)

One of the things we've done is to earmark all of our savings/investment accounts.

457 accounts....long-term health care
CDs/MM....automobile purchases/vacations
Savings accounts....emergency/home improvements
Stocks....inheritence for our sons if we don't need them

We opted for pensions instead of lump sums and don't need to withdraw money for everyday expenses at this point in time. By doing what we did I won't feel "guilty" by withdrawing money for the large expenses from these accounts since that's what it is earmarked for. Hope that helps a little.


kz