Why Not Spend More on Me Now than Later?

[pb4uski]

To me this thread is somewhat of the holy grail of early retirement. Few of us want to deprive ourselves of things and experiences that would make our retirement more enjoyable and die multimillionaires as a result. OTOH, few of us want to splurge too much today and end up being a burden to our kids or to society and subsisting on cat food in our old age.

Many of us have found it hard to go from savers to spenders. You don't reverse a lifetime of frugality and accumulation easily to spend without some trepidation and worry.

I was very conservative in my first year of ER as not having income was new and scary. We are now in our third year of ER and I am more confident that we have "enough" (the investment results for the last two years has helped) so we are spending more this year (currently in Hawaii on one-leg of a six week vacation away from snow and cold).

But if investment performance were to go sideways, we can always tighten our belts a little and would be fine. If things get real bad, we can always start my pension or SS earlier so we have a number of relief valves available to us if needed.

 

[Chuckanut]

I may not leave much money on the table, but that is because I would rather give it to my heirs now, while I can see them use it to improve their lives.

 

[Walt34]

Many of us have found it hard to go from savers to spenders. You don't reverse a lifetime of frugality and accumulation easily to spend without some trepidation and worry.

We're looking at this now too. We're putting off SS probably until I'm 67, perhaps later, and will be withdrawing from savings. The numbers work but it sure goes against the grain.

 

[mpeirce]

OTOH, given the choice between having a late model Lexus or BMW in the driveway or a few weeks in Europe, I'll go for Europe.

Of course there's the "both" option: go for European deliver on your new German luxury car and spend a week or two driving around the autobahns/autostradas/etc.

 

[Meadbh]

This is how much Canadians actually spent on goods and services in 2012.

Average household spending rose 2.0 per cent in 2012: Statistics Canada | CTV News

Of course, this does not include income taxes. I spent more than the average senior but less than the average household.

 

[W2R]

Many of us have found it hard to go from savers to spenders. You don't reverse a lifetime of frugality and accumulation easily to spend without some trepidation and worry.

It is hard, I agree. During my first year of retirement, I began to notice (and look forward to, and record) my dividends and regard that as an additional source of income. Dividends mean a lot more to me in retirement than they did before retirement.

So far my spending in retirement has been less than my dividends. However, after 5 years of retirement I am becoming more open to the idea of spending more. I have been increasing my spending gradually, because I don't want to "go nuts" and overspend.

Of course there's the "both" option: go for European deliver on your new German luxury car and spend a week or two driving around the autobahns/autostradas/etc.

Ew, none of this appeals to me at all! But, I have other ways to spend money. Different strokes for different folks.

 

[REWahoo]

I have been increasing my spending gradually, because I don't want to "go nuts" and overspend.

When you report you purchased a septic system we'll send the guys in white coats to pick you up...

 

[W2R]

When you report you purchased a septic system we'll send the guys in white coats to pick you up...

For sure! That would be the best thing to do if you ever saw me doing something like that, given my opinion of septic systems. And when I see the guys in the white coats, I'll know that they are coming to take me away due to having lost my mind completely!
Napoleon XIV: 'They're coming to take me away' - YouTube

 

[veremchuka]

Tough subject for me. I have always been frugal and as many have said this is a hard habit or character trait probably to change.

If I need something I will buy it, my water tank was going so I had to replace it. My roof may need replacing in a few years (big expense) as well as my well pump. But I don't buy things for myself, I don't need or want anything. I did splurge last year and spent $3636 last year on something I wanted, yes I did check the spreadsheet tracking money spent on that hobby! But interest in it has waned and I'm not spending money on it now. I have no interest in traveling, I'm a home body. I just don't know what I'd want, I need nothing.

I do have a huge dilemma right now and this is classic me. After 21 years my wood stove is worn out. If I used it only for supplement heating to the boiler then it is fine and would function for another decade at least but I use it to heat the house, the boiler seldom runs other than for hot water. I have observed it is not burning all night like it used to and I wake up 8 hours later to find that end of the house at 64 or 66 vs 70 or 72 and the bedroom end of the house is 56! Yep at 56 the boiler kicks on, this is a sound I am unfamiliar with. I was at a shop and the price for a new stove is $2200 to about $3000. I may want to sell this house in 2 or 5 years. I think I might want to move to AZ. Now if I stay here and die here then buying a new stove makes sense. But I may not be physically able to haul, stack and split wood, it is a lot of work and I'm healthy but I am noticing that I'm showing signs of aging. Spending money on that stove if I can't do what I have done for 20+ years would be foolish. Dilemma squared!

I never have owned a nice new car, my current new car is 21 years old and my old one is 41 years old. I'd like a nice new car, something in the $40k range to me would be like a Rolls Royce! But then the frugal guy voice says buy a used car and save money. Old habits or character traits are pretty embedded.

My game plan is to leave as much of an inheritance for my sister and that is a big impediment to spending money. I do wonder sometimes what I'd like to have but anything I think of I can find a reason to say but you really don't need that!

 

[Hermit]

I don't see a problem here. I've got a list of toys that would do any kid at Christmas proud. A couple ATVs and a trailer for them, a Harley, bigger tires for my Jeep, new toys for my soon-to-be wood shop, backyard observatory with a super-nice telescope, home theater. All these after I get my house built. So what did I spend my extra money on lately? A new ski outfit for DD.

 

[Hermit]

I do have a huge dilemma right now and this is classic me. After 21 years my wood stove is worn out. If I used it only for supplement heating to the boiler then it is fine and would function for another decade at least but I use it to heat the house, the boiler seldom runs other than for hot water. I have observed it is not burning all night like it used to and I wake up 8 hours later to find that end of the house at 64 or 66 vs 70 or 72 and the bedroom end of the house is 56! Yep at 56 the boiler kicks on, this is a sound I am unfamiliar with. I was at a shop and the price for a new stove is $2200 to about $3000. I may want to sell this house in 2 or 5 years. I think I might want to move to AZ. Now if I stay here and die here then buying a new stove makes sense. But I may not be physically able to haul, stack and split wood, it is a lot of work and I'm healthy but I am noticing that I'm showing signs of aging. Spending money on that stove if I can't do what I have done for 20+ years would be foolish. Dilemma squared!

I'm looking at a soapstone wood stove. It is supposed to continue to radiate heat for a couple hours after the flame has died down. They are rated for 12 or so hours, so with burning pine, and stoking it in the evening, I should be good 'till the morning. I'm hoping a power splitter solves the effort needed to keep up with firewood. I have enough down and standing dead trees to last my lifetime and probably my kids too.

 

[pb4uski]

....I do have a huge dilemma right now and this is classic me. After 21 years my wood stove is worn out. If I used it only for supplement heating to the boiler then it is fine and would function for another decade at least but I use it to heat the house, the boiler seldom runs other than for hot water. I have observed it is not burning all night like it used to and I wake up 8 hours later to find that end of the house at 64 or 66 vs 70 or 72 and the bedroom end of the house is 56! Yep at 56 the boiler kicks on, this is a sound I am unfamiliar with. I was at a shop and the price for a new stove is $2200 to about $3000. ....

Have you checked or replaced the gasket material that makes the stove airtight? From what you described, it sounds like the gasket may be worn so the stove is letting in more air than needed and that is why it no longer will burn all night. Similarly, given it age it might be that the firebrick needs to be replaced. My point is that a good refurbishment of your existing stove may be a better alternative than a new stove.

 

[pb4uski]

I'm looking at a soapstone wood stove. It is supposed to continue to radiate heat for a couple hours after the flame has died down. They are rated for 12 or so hours, so with burning pine, and stoking it in the evening, I should be good 'till the morning. I'm hoping a power splitter solves the effort needed to keep up with firewood. I have enough down and standing dead trees to last my lifetime and probably my kids too.

We have a soapstone woodstove and like it. It does a good job of retaining heat. If I load it up when I go to bed and turn the damper down I usually still have coals in the morning that I can put a piece of wood on, open the damper and it takes off from there. Ours is a Hearthstone Phoenix.

 

[NW-Bound]

...
Now, some four years into my own ER, I have gradually convinced myself to loosen my wallet and buy stuff that I wouldn't have otherwise in my early years. (Such as a $100 sub-woofer for my 1970s Sansui 7070 stereo.)...

I have a pair of classic 70-era Pioneer speakers with 12" woofer. They do not sound that good anymore in the high-frequency range compared to modern speakers. So, I use them as sub-woofers, and when driven with my 5-channel 100W/ch amplifier, their thunderous bass will rattle furniture. Thought I might want to experiment with bi-amping some day, but have not done so. I guess my interest has waned.

I also have 3 subwoofers in my collection. One was the Bose subwoofer in the Bose 5 Acoustimass set. It was sold for $5 by Goodwill because the satellite speakers were missing. I have read that Bose stuff is overpriced and not very good, so for $5 I wanted to see for myself. Opened it up and saw that the components inside were indeed not high-quality.

When I was in my teens, thought that I would one day get an Altec Lansing Voice of the Theater set. Now that I can afford it, and have a home to house them, I am not interested anymore.

 

[explanade]

Yeah I spent a lot of money when I was young on stereo equipment.

Now, I mostly listen to podcasts on my iPods and iPhone.

Did get a decent set of surround sound speakers and receiver for my TV but I haven't used them in stereo or music only mode, though the receiver supports Airplay so I could stream my music to it.

I still have a 100 CDs I could rip, but I no longer have a computer with a CD or DVD drive, though when I do listen to music, it's stuff I've had for a couple of decades or more, nothing new.

 

[veremchuka]

Have you checked or replaced the gasket material that makes the stove airtight? From what you described, it sounds like the gasket may be worn so the stove is letting in more air than needed and that is why it no longer will burn all night. Similarly, given it age it might be that the firebrick needs to be replaced. My point is that a good refurbishment of your existing stove may be a better alternative than a new stove.

No firebricks in this stove. I know that gaskets are shot that's why it's burning a bit too fast but I don't know what gaskets, given the age and use probably 90% if not all of them. I have replaced gaskets that I can get at over the years. I know the damper gasket is in bad shape, I have repaired it twice, but it's hard to replace the entire gasket without removing parts. The damper door may be warped so replacing every gasket in the stove wouldn't fix anything in that case.

There is no way to fix this stove or I would. It's cast iron and lots of parts are warped so you can't get them out like the fireback. To pay to disassemble the stove and replace all the gaskets would be cheaper than a new stove but could that be done ie could the stove go back together given warping? I prefer that but I fear it's good money wasted. This is like a 20 year old car with 304,500 miles and it has a structural rust safety problem, was there in August 2012.

We have a soapstone woodstove and like it. It does a good job of retaining heat. If I load it up when I go to bed and turn the damper down I usually still have coals in the morning that I can put a piece of wood on, open the damper and it takes off from there. Ours is a Hearthstone Phoenix.

I had a soapstone stove prior to this one. Soapstone is nice and retains heat much longer due to the thermal mass. However, soapstone has to be heated slower than cast iron or stones can crack. Cast iron heats up fast and you can push it but warps from over heating like falling asleep and the air is open ok for now but an hour later too open. Plate steel doesn't look as nice as the other 2 but is welded, no seams, from what I remember they don't warp but they have firebrick in them so maybe that cracks beside they look too contemporary for my tatse but I am considering one vs cast iron.

I would spend the money if I could be sure I'd be physically capable of doing the work required for another 10 years but that puts me at early 70's and maybe that's asking for too much. Maybe winter won't be so much "fun" to me in a few years and AZ would be desirable, this winter is a hard one!

No easy answers and no one but me can sort this out. i hate these types of problems!

 

[MBAustin]

Like several others, we started off maintaining our normal frugality when I ER'd. For example, staying at the $69 basic motel instead of the $100 nice place when we travel. After 3+ years of not needing to dip into our investments (except to purchase our RV, which was planned), I've loosened up. I'll buy the occasional $18 bottle of wine (although still stick to $11-12 for normal consumption). As a few others mentioned, I now don't stress about buying the good stuff at the grocery store or farmers market (the $5/dozen eggs really do taste better than the $2/dozen from the store). But I still do clip coupons for stuff we buy all the time. Old habits die hard...

 

[pb4uski]

....I would spend the money if I could be sure I'd be physically capable of doing the work required for another 10 years but that puts me at early 70's and maybe that's asking for too much. Maybe winter won't be so much "fun" to me in a few years and AZ would be desirable, this winter is a hard one! ...

Have you considered a pellet stove? They seem to heat well and (I think) would be easier than cord wood. It might be a good compromise.

We considered a pellet stove when we bought our woodstove but ultimately decided we wanted something that could operate without electricity since we get occasional power outages. We probably could have gone pellet with a battery backup that will operate the pellet stove for 24-48 hours, but we decided we liked cord wood better.

If I was doing it today I might go pellet.

 

[Alan]

I've divided our savings into 2 "accounts". An LTC account, and a retirement account. I don't touch the LTC account, either the kids will get it or we'll spend it on nursing home costs. Our SWR is calculated on the retirement account. We also have 2 non-COLA pensions, with another 4 COLA income streams due to come on line over the next 10 years. (a pension, SS for me and DW and UK SS for me).

Consequently, we feel confident enough of long term financial security survival that we are spending high now on experiences* while we are still fit and enthusiastic. The first 3 years of ER we spent about the same each year on healthcare, last year we spent 3 times as much, due mostly to health issues, and realistically we can expect to have one or more issues each year going forward.

*Experiences for us are mostly about living in different places for a few weeks or months at a time

 

[veremchuka]

Have you considered a pellet stove? They seem to heat well and (I think) would be easier than cord wood. It might be a good compromise.

We considered a pellet stove when we bought our woodstove but ultimately decided we wanted something that could operate without electricity since we get occasional power outages. We probably could have gone pellet with a battery backup that will operate the pellet stove for 24-48 hours, but we decided we liked cord wood better.

If I was doing it today I might go pellet.

I wouldn't consider a pellet stove. I don't want to rely on electricity for heat, that's how the boiler runs. A wood stove allows you to have heat, cook, warm water all without power and wood smoke smells nice too. I like handling wood and splitting it so to me part of the fun is the wood itself. I'm sure pellet stoves are better today but I knew someone that bought one about 14 years ago and it was nothing but problems.

 

[Birdie Num Nums]

...Now, some four years into my own ER, I have gradually convinced myself to loosen my wallet and buy stuff that I wouldn't have otherwise in my early years. (Such as a $100 sub-woofer for my 1970s Sansui 7070 stereo.)...

I didn't purchase that subwoofer for the sake of just "buying something," but to (I hoped) enhance my listening experience, 'cause I just love, love music!

Just got that speaker two days ago, plugged it in, and man oh man! Works just perfectly well with my 40-year-old Advent speakers (as it carries the heavy, beefy bass load) and my Sansui 7070 receiver. (Did I mention that most of my stereo system is some 40 years old?)

That was money well spent! (Today, rather than tomorrow.)

 

[Badger]

I've spent the past 30-some years saving more than I've spent, to be able to retire early.

Now, some four years into my own ER, I have gradually convinced myself to loosen my wallet and buy stuff that I wouldn't have otherwise in my early years. (Such as a $100 sub-woofer for my 1970s Sansui 7070 stereo.)

Wow! You still have one of those? They are great receivers! I had one of the models below that one and they had great specs. Somethings just don't need replacing as long as they continue to work well.

Cheers!

 

[haha]

Meta-issues regarding pleasure, spending, lbym, etc.

Do many small pleasures beat fewer larger ones?

I have never been really into LBYM as many here seem to practice it- shutting off day to day out of pocket expenses. I may misunderstand, but that seems to me a bit joyless. I have been very careful with what I would call consumer capital equipment- fancy stereo, fancy TV, expensive car, big house, elaborate hobby equipment, etc. I got interested in woodworking, but I could see that it might become an obsession requiring a lot of expense and crap sitting in my garage- so I limited myself to whatever I could make with the few tools I bought for house repairs plus a 9" Craftsman table saw and a little book about how to make jigs. It was still expensive, and I never made anything very good, but it all worked and that worked for me.

I have 3 or 4 restaurants that I really like, and are fun for lunch or hors d'oeuvre but if I took special friend there at dinner I could not get out with enough to eat for less than $150-$175 so that happens very seldom, and I do it for her, not me.

Not possible that I would ever feel bad about not spending all my money before I died. My kids do not need it, but I would like to give it, and that's enough for me.

I can get as much or more pleasure from finding a new place to have an unusually good cup of espresso for $2.25-$2.50, as from something costing 100 times or even likely 1000 times as much. For me at least, there is no correlation between the grandness of an experience and its hedonic kick to me. Wherever I go, I talk to people and this adds immensely to my enjoyment of life.

I am not optimistic about the world, I am neutral to pessimistic, but have always been happy, so after many years of living I have concluded that although one must be optimistic about his chances in challenging, circumstances, overall optimism or love for mankind at large has diddle-squat to do with how happy or satisfied s/he feels.

My oldest friend, 60 years and counting, recently told me that he will have to stop traveling and cruising, not because he body is not up to it, but he can no longer afford it. Typical upper-middle class guy, used an FA who always told him all systems go, until suddenly he said, you might run out of money. Maybe two years ago this same friend asked me if I were trying to preserve principle, and I said yes. He explained how that was passé, that the FA told him he could burn his capital and still have plenty for himself and his wife as long as they lived. Well, he is a long way from broke, and he has many satisfactions in his life that do not cost like long trips or cruises, so he will be fine, but likely he has been spending 3-4 times as much as I, and certainly not getting any more satisfaction or pleasure from his spending than I do from mine. At least as best one can observe things like this from outside

Ha

 

[W2R]

For me at least, there is no correlation between the grandness of an experience and its hedonic kick to me.

Interesting point!!! I have independently thought about this recently as well, and came to the same conclusion. I was thinking about expensive purchases, vs expensive experiences, but the principle still applies.

Oddly, I have noticed that buying several little things on Amazon seems to give me more immediate pleasure for the dollar than buying big things. It should be the opposite but it isn't. There is a childlike glee at "getting a present" from UPS, even if the package only cost a few dollars.

When I purchase something big and expensive, sometimes I even feel a little disappointed or let down after receiving it.

On the other hand, some big and expensive things probably provide more pleasure over the long term, so maybe there are two sides of this coin. Still contemplating and I don't have it all figured out yet.

 

[misty57]

Wow, this is a tough one. We have not yet reached the one year anniversary of DH's early retirement and we (hopefully) have a long way to go as we're only 57.

Early retirement was made possible for us as a result of smart shopping habits that allowed us to save and invest more of what DH earned. We still try to buy what we need when it is on sale, but we are also trying to dip our toes into a less "frugal" lifestyle through more splurges, indulging in no one thing enough that it becomes habitual or passe in its pleasure. For example, we seem to be preparing lobster at home more often and recently spent $475 to see the Eagles (tickets, dinner, parking). I guess that's a good start.

We kind of want (not need) a new SUV (not exactly a "little splurge") and have been shopping for one on and off for a few months. That one seems to be a little tougher for us to do since neither of our cars have turned 100K miles (one is in the 80s and one is in the 90s), are reliable, and are pretty cheap to insure and register. We've spent on wants in the past (cruises, quality furnishings, etc.), but when it comes to cars, we've never purchased one before it was necessary.

Learning to spend money we might not have in the past is a "work in progress", but I think we're slowly making headway.