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The New Luxuries
Old 03-11-2004, 01:45 AM   #1
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The New Luxuries

This is a post from the Golden Era of the Motley Fool board. It was first posted on October 11, 2000.

The post is in two parts as it was too long to fit in a single post at this forum.

The text begins here.

Many people associate saving money with sacrifice. My experience is that there is no connection between the two. In my case, each increase in saving led to greater enjoyment of life, not only in the long-term, but in the short-term as well. So I've tried to understand better the widespread perception that to save more means to enjoy life less.

I've come up with a theory. Just as generals have a tendency to develop battle plans based on what worked in previous wars, consumers have a tendency to form viewpoints about money based on the experiences of earlier generations.

It's not that long ago that the pleasures derived from material goods were hard to come by. Television is a recent invention, as are the airplanes that make exotic vacations feasible for the middle-class. It's only the large productivity gains enjoyed in recent decades that have allowed many of us to even consider the possibility of eating out several times a week.

So we define luxury as the possession of goods and services--electronics equipment, restaurant dining, vacations. But are these things really luxuries in today's world? A luxury to me is something rare and precious that brings an unusual feeling of comfort or pleasure. I question whether the things that can be bought with a credit card still fit the bill.

Television was a luxury when television first became available. But today a small-screen color television with the ability to play videos in your home can be purchased for $200. It's not hard enough to come by to be considered a luxury.

Manufacturers have tried to restore television to luxury status by increasing the size of the screen. I don't think this works, however. A big-screen experience is better than a small-screen experience. But the difference is not great enough to justify calling the large-screen television a luxury. The jump from no television to a small-screen was far more significant than the jump from small-screen to big-screen.

I don't think you can buy luxury with money anymore. Consumer goods have become too plentiful and too cheap to make ownership of them all that special. There have been efforts to add expensive attributes that increase the feeling of specialness for those who own them. But does a hamburger cooked on a $5,000 grill taste that much better? If not, I question whether the increased price delivers genuine luxury.
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Re: The New Luxuries
Old 03-11-2004, 01:50 AM   #2
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Re: The New Luxuries

Part Two follows:

What are the true luxuries today, then? It's those things that are possessed only by a few, those things that offer an unusual degree of happiness and contentment. I can think of several things that fit the bill, but they aren't things you can attain by spending more. They are things you can only possess by saving more.

Freedom from anxiety over job loss is a luxury in today's world. Job security wasn't such a big deal in earlier times, when there were millions of middle-class workers who believed that it was unlikely that they would ever lose their jobs. Today, the smartest and hardest-working employee has no such confidence. Job security is rare. That makes it a luxury--one that can be purchased only by saving enough to become financially independent of a paycheck.

The ability to retrain for new types of employment is another of the new luxuries. The New Economy offers awesome opportunities for workers positioned to take advantage of the next growth surge. But it has become difficult to anticipate where the next growth surge will be taking place. Many of us need to leave the fields we have gained experience in to continue to move forward in our careers.

But only those who have put aside substantial amounts of savings early in life feel free to take the risks needed to take full advantage of the new opportunities. Possession of a savings cushion allowing one to take risks not viable for most others has become a luxury. It's the savings cushion--not the things that could have been bought with the money instead--that provides a rare comfort in modern times.

Yet another luxury in today's world is free time. All workers, from those earning minimum wage to those earning six figures, complain of the busy pace of modern life. Earning a high income and buying lots of goods and services offers no special status in this regard. High-earning lawyers and doctors are suffering from the same tensions as all the rest. Spending money on massages or on housecleaning services can ease the pressure a bit, but cannot eliminate it.

But achieving financial independence does eliminate this bane of modern life. The day I retired from my corporate job is the day I entered a world of luxury. I don't spend any more than before. But I enjoy the rare comfort of having time to think amid all the hustle and bustle.

When I was in the process of increasing my savings goals, I never took any action that I viewed as a sacrifice. It wasn't necessary. I was able to meet all my goals by taking steps that added to my sense of well being by making me feel more secure about my future and by bringing the dream of independence closer to reality.

If you think of luxury in this new way, there is no such thing as a savings plan which is too “extreme.” It does not make sense to view steps in the pursuit of more fun, more freedom, and more fulfillment in negative terms. So long as those are the goals of your savings plan, you deny yourself nothing in going after them ever more intently.

There's only one downside to this new way of thinking about money decisions. Once you experience the benefits, you can't imagine going back to the old approach to spending. Luxury is hard to give up once you become accustomed to it.

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Re: The New Luxuries
Old 03-11-2004, 06:07 AM   #3
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Re: The New Luxuries

Interesting post.

One thing that you touch on is the idea of a "luxury" being defined by how hard it is to get - either by price, for material goods, or effort/savings, for things like free time and security. In one sense, I think it's a useful definition. On the other hand, I think that the fact that most people think of luxuries that way - in terms of how hard they are to get - makes the enjoyment of life into a kind of treadmill, with the delightful luxuries always a bit out of reach (because as soon as they're widely achieved, they're not seen as luxuries any more).

Apart from the big luxury of having a spending cushion to fall back on, and the planned-for luxury of lots of ER time spent with my husband, which fit your definition nicely, I have lots of little luxuries in my life: things or activities that I don't *need* but that are very enjoyable. A particularly interesting dinner (I enjoy cooking and I'm good at it). A lazy afternoon reading in the sunshine. I know I'm bending the definition of luxury here but I think it's worthwhile... Just because anybody could enjoy an afternoon reading in the sunshine doesn't detract (or influence) my sensation of luxuriousness while I'm enjoying it.

I think that being able to enjoy things for what they are, and enjoy things for what *you* get out of them, not what other people might or might not get out of them, is essential for living below one's means. Heck, I think it's essential for being happy and peaceful, in general.

For me, for instance, there's no such thing as a "luxury car": I don't like cars or driving, so all I want is a practical tool to get me where I need to go, and I'm not going to pay any more than I have to. Our little subcompact stands out among our neighbors' BMWs, but I just find that amusing. Let them have their fancy cars if that's what they really want. I'll choose to enjoy simpler luxuries!



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Re: The New Luxuries
Old 03-11-2004, 10:04 AM   #4
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Re: The New Luxuries

A very good post, and I think you just summed up "The Millionaire Next Door"'s primary philosophy in a lot less pages.

The part about the $5000 grill made me chuckle for two reasons. One is that I was thisclose to buying one that almost cost that much a short time before I ER'ed. Good thing I didnt because I'd have had to leave it behind at my old mcmansion when I sold it last year.

The other was the recollection of the best steak I ever had. On a river rafting trip after our first day, the guides had brought some steaks...started a fire, raked out the embers, and laid the steaks right on the hot wood. A quick flip a few minutes later, a vigorous brushing off and voila. I never tasted better.

The time I get to spend doing what *I* want, coupled with the lack of stress and aggravations IS the best luxury money can buy. I still get a chuckle out of people who tell me "Oh, I couldnt live without my big house, big car and my boat!" when I tell them I retired early. I hope they enjoy their time on the hampster wheel.

The best things in life ARE free. Long bike rides with my sweetie, chasing the dogs around the yard, sitting in the shade with a good book, and this morning...sleeping until 10:30!
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Re: The New Luxuries
Old 03-11-2004, 12:13 PM   #5
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Re: The New Luxuries

I grew up in a family that had little, with parents in poor health. Today I have more than I could possibly have ever dreamt of growing up. But I really have two luxuries. One is security: not worring about food, shelter, or chronic illness. The other is that my husband rubs my feet every day after work.

I'll bet the second is possessed by few. However, the first is possessed by many.

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Re: The New Luxuries
Old 03-11-2004, 01:37 PM   #6
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Re: The New Luxuries

Quote:
I'll bet the second is possessed by few.
Martha
Well Martha, I have a confession. Your husband rubs my feet every day too
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Re: The New Luxuries
Old 03-11-2004, 01:44 PM   #7
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Re: The New Luxuries

TH:

Oops! I get an F in logic today.

As a penance, I will rub you feet with dryer sheets.
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Re: The New Luxuries
Old 03-11-2004, 03:58 PM   #8
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Re: The New Luxuries

Purr...
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Re: The New Luxuries
Old 03-11-2004, 05:03 PM   #9
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Re: The New Luxuries

Excellent post by *****. I had back surgery a few years ago. I asked the surgeon how long I would need to be off work and expected him to say a week or two. He said, "at least one month and probably six weeks". Having that much time off was a true luxury, even under those circumstances.
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Re: The New Luxuries
Old 03-13-2004, 12:40 AM   #10
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Re: The New Luxuries

Dear *****:

I loved the elegance and philosophical nature of your post regarding the "New Luxuries". I used to see FIRE as merely a "good thing". But after reading your post, now consider FIRE a "priceless commodity".

Even though the stock market had a bad week, I will have no trepidation about handing in my resignation letter to my boss Monday morning. I was going to
"early-retire" a little later this year but decided (after reading your post) that sooner is better than later. I can't wait to own this "priceless commodity". I can't wait to enjoy this New Luxury you speak of.

Thanks for the beautiful post!

Sincerely,

Toejam

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Re: The New Luxuries
Old 03-13-2004, 02:07 AM   #11
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Re: The New Luxuries

I used to see FIRE as merely a "good thing". *But after reading your post, now consider FIRE a "priceless commodity".

Thanks for those kind words, toejam.
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Re: The New Luxuries
Old 03-13-2004, 07:42 AM   #12
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Re: The New Luxuries

Hey *****, Thanks! This is the kind of thing that I think most of us youndreamers think about during the quest. I realized a long time ago that the most valuable thing in the world to me is time, specifically my time. Having the freedom to do with it what you will is to me the ultimate priceless luxury.

Keep them old posts coming back, these are the things I like to look to and read after a particular trying day at work !

pan-
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Re: The New Luxuries
Old 03-17-2004, 09:42 AM   #13
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Re: The New Luxuries

Thanks *****. Now I understand what everyone was raving about. Poetic.
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Re: The New Luxuries
Old 03-18-2004, 04:14 PM   #14
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Re: The New Luxuries

Maybe I'm misread things but I think we all owe Toejam a large "Congratulations!"

Congratulations Toejam - tell us how it all goes/went...

Spark
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Re: The New Luxuries
Old 03-19-2004, 11:50 PM   #15
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Re: The New Luxuries

Hi Spark:

Well, I finally did it, and it was the most liberating feeling in the whole world! *I carefully composed my resignation letter and handed it to my boss on Monday morning. *(I am taking SalaryGuru's advice and want to have a "classy" exit - the letter was diplomatic and expressed my appreciation and enjoyment in working for the company). *

My boss had a rather quizzical look on his face when I told him I had decided to resign. I am sure he wasn't prepared for it and was quite surprised. * However, I gave him at least the usual 2-week notice out of common courtesy, so my last day will be March 31.

I have to admit, though, that once I did it I also became a little emotional inside (didn't show it outwardly). *I guess that is normal, considering I have been employed for 30 years. *

Still, it's a great feeling! *I will most certainly enjoy this "priceless commodity" and "new luxury". * *

Sincerely,

Toejam
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Re: The New Luxuries
Old 03-20-2004, 12:58 AM   #16
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Re: The New Luxuries

Congratulations, ToeJam! And good catch, Spark.

Ah, retirement is still a distant dream to me, although I'm rapidly approaching the major milestone of being debt free.
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Good job, ToeJam.
Old 03-20-2004, 07:20 AM   #17
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Good job, ToeJam.

Just watch out for those April Fools' jokes while you're trying to enjoy your first day of freedom FIREdom...
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Re: The New Luxuries
Old 03-20-2004, 11:32 AM   #18
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Re: The New Luxuries

Woo hoo!!!
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Way to Go, Toejam!
Old 03-20-2004, 04:42 PM   #19
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Way to Go, Toejam!

Congratulations!

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