Still can't spend even though FI

[52andout]

Does anyone else have this problem?

Scenario is I retired age 52. DH is working final two years to get health insurance, hoping for an early out opportunity. Before I got out, we had enough money per firecalc, no debt and a life plan. This past year since I have not been working savings have done very well thanks to asset allocation,minimal fees and prudent investment choices, as well as continuing to sock part of our one salary away. I would prefer DH get out of the workforce, however sometimes you have to do what you have to do. We have independent children. If we have leftover money when we leave this earth that 's OK, but I am not planning our life to leave a big inheritance.

The weird thing is that we really have a hard time spending money. Our circumstances with DH working beyond the FI point and our investments doing well is we could have some good splurges, but for some reason we just cannot do so besides some great vacations. We do focus on healthy foods and lifestyle, and don't scrimp in the grocery store or in the gym.

Has anyone been able to change from the cheapo mindset and loosened the purse strings, at least a little ? How did you do it? Do you have any regrets?

 

[W2R]

I am not retired yet, but will have considerably more money to spend than what I am spending now. I think it is very likely that I will not know how to spend more, since I have really never spent more than I am spending now.

I am trying hard to think of ways to potentially spend more. So far, I am thinking of upgrading my cable TV package. I am sure that eventually other ideas may come up.

 

[youbet]

Worrying about not spending money can be almost as troublesome as worrying about not having money to spend.

If your thrifty ways aren't causing any regrets, don't worry about it. Freedom is the biggest benefit of FI. And freedom includes doing what you want, even if a lot of those things don't cost very much.

Enjoy your ER......and maybe spend a few bux on some surprise treats for hubby, the working stiff!

 

[wcv56]

( Quote)
If your thrifty ways aren't causing any regrets, don't worry about it. Freedom is the biggest benefit of FI. And freedom includes doing what you want, even if a lot of those things don't cost very much.

This is a big problem for many that retire to foreign places a few years before they should of stopped working. They are a slave to money for years to come. Every aspect of their life is how much they spend or can spend. Going back home to a somewhat normal retirement is mostly impossible for them.

 

[Meadbh]

I'm having a hard time spending since I realized FI and RE were on the cards. Now that I know RE is possible, I don't want to screw up!

 

[Nords]

Does anyone else have this problem?
... but for some reason we just cannot do so besides some great vacations. We do focus on healthy foods and lifestyle, and don't scrimp in the grocery store or in the gym.
Has anyone been able to change from the cheapo mindset and loosened the purse strings, at least a little ? How did you do it? Do you have any regrets?

So you're only spending on the things that bring you value? Sounds like it won't be much of a problem.

The longer you're in ER, the more comfortable you'll get with your spending. You'll monitor a month's (or a year's) spending and realize that you're comfortably within the 3-5% range (whatever you've decided is your comfort zone). Some days the spending flies out the door, other times it just piles up like green waste.

You'll need to buy something and you'll realize that you've already replaced it twice this decade. You'll decide to spend up one or two levels in the hopes of getting something that will last a couple decades. Or you'll realize that you really really enjoy a certain activity (like travel or martial arts or cooking) and you'll dedicate a larger chunk of budget to it. Or you'll ride in a friend's new car and think to yourself "Self, I gotta git me one o' them."

You could start small... give at least $5 to every kid who comes by your door selling something. Donate $20 or $100 to a local charity that you know & trust. Watch an HGTV show like "Design on a Dime" and spend at least $100 fixing up something in your house.

Give it time. In a year or two you'll be spending your money on the things that deliver value to you, and staying cheap on the things that don't.

 

[old woman]

I haven't retired yet but I love watching my nest egg grow and know I won't want to see it grow slower.
I might buy the next house for cash so I have no mortgage so my monthly expenses are tiny then I will know even if I blow my entire life savings I could live on SS if I had to.

 

[chinaco]

I think it is natural to try to conserve. Especially when one ERs.

We are in the same situation, DW just ERd. I make more than we have ever spent in a year. So we are still saving. But we are budgeting to spend my salary yearly in ER.

I intend to spend it. We intend to travel, that will take a healthy chuck. While we will economize when we travel to a certain degree, we probably will not be traveling like back packers at 19 or 20 years of age. Nothing wrong with that mind you... just not our cup of tea. Or I should say not DW cup of tea. And as all the guys here know... she is the real boss.


It would be a real bummer to find out that I am in such a rut that I have more than I am willing to spend... that would mean that I am w*rking for nothing.

 

[sweetana3]

I get so much enjoyment from finding a great bargain that it would be difficult to change to a higher priced lifestyle. In fact, we are hoping to do more shopping at garage sales and thrift stores when we retire for the hunt. Found two velour new pantsuits for $2 each this summer and have worn each several times already.

But, we have upped our travel considerably and travel first or business class on vacation and rent a larger car. Still use Elderhostel for all inclusive educational trips but the travel too the locations is at higher cost. When we cruise, we get a balcony but we still deal with a discount consolidator.

Buy better food especially cheeses but still enjoy the cheaper wines. So it all is what specific things give you the most pleasure. For me it is not diamonds, although I like some of the jewelry worn by others. For me it is not the Prius but maybe a step up Civic.

 

[Spanky]

Has anyone been able to change from the cheapo mindset and loosened the purse strings, at least a little ? How did you do it?

We have not retired yet but mostly continue to be conservative in our spending. We may spend on travel, however.

One of our retired friends have been spending more than they did before retirement. They recently bought a brand new SUV and a Toyota Athlon. They appears happy.

 

[ziggy29]

A couple of thoughts:

* Being "too cheap" is better than being "too extravagant" in retirement, at least if all legitimate needs are being met;

* I don't see this as a big problem unless the two of you disagree on how much to loosen the pursestrings.

I think it's more natural to be "tight" with your money in the first few months or even years of retirement until you get used to the changes in cash flow. Once you get used to changes in cash flow, you may have a better idea of whether or not certain "splurges" will fit in the budget.

If not spending even for stuff your cash flow can easily afford becomes an obsession that doesn't resolve itself over time, then it could be another story -- especially if the two of you are in conflict about it.

 

[Dawg52]

I've only been retired 7 months so not a good one to respond to your question. I did buy a new golf cart and a new set of irons when I retired but that was from money given to me to be used for that purpose. Haven't been on any long trips yet but plan to do so next year.

I guess it will be hard to loosen up the wallet as I am just 53. The financial plan looks fine for the long haul but the fear of screwing up is there. Time will tell.

 

[Moemg]

Good subject ,
I'm pretty thrifty when at home but when traveling I open the purse strings wider . I have everything I need or want so why spend more just because I can ?

 

[aenlighten]

Consider 'spending' on investments

that you can appreciate. Antiques? Classic cars? Home improvements? Second home? Business opportunity? Something that throws off dividends that you can appreciate and something you can expect to appreciate as well.

 

[Rich_by_the_Bay]

I wonder if all this is related to stuck spending habits, or to fear of the black swan.

In my mind, we could probably FIRE and maintain a lifestyle close to what we have now (all this being a recent milestone) while working half-time. When I sit down to plan, I come up with a million "what ifs." Suppose inflation roars. Suppose the market hit s big, long, miserable decline.

My philosophy is that planning for the worst case scenario is very inefficient, resource-intensive, and probably does more harm than good. But a little cushion to cover the more likely curve balls would be a good thing.

Back to the OP, though, given that cushion I don't think I would have any trouble spending every penny within my 4.25% SWR.

 

[Donzo]

I have been free for 17 months now and find that spending does not bother me like it did shortly after pulling the plug. At first I hated the idea of my portfolio shrinking instead of expanding as it had for the last couple decades. It is still expanding and I have been tracking our family spending carefully - we are well within the spending budjet that I had planned. I still shop for value, but- do not worry about spending. Now if the market tanks......I may tighten up and worry again, but I am comfortable with my allocation and am enjoying the ride.

PS. Time seems to go faster now than when I was working - that surprised me!

 

[lazygood4nothinbum]

this january a friend is coming down from new jersey to spend a few weeks with me. while here, he wants me to fly with him to spend a week at the home of a friend of ours in southern california. i guess i was bemoaning a bit too much the extra expense that wasn't in my plan since i planned only travel in summers as winter here is so nice.

anyway, i just found out from my california friend that my new jersey friend was planning to pay for half of my airfare out to california just to get me out there. so now i guess i'll have to pay for the entire $300 ticket. my calif friend has wanted me to visit for some time now. i'll get there but it seems my reputation preceded me.

 

[HFWR]

I would humbly submit that you are not financially "independent" if you are having this problem...

 

[lazygood4nothinbum]

nothing to be humble about. never suggested i was. i preferred the life with parents and allowance. i would settle for a rich & loyal boyfriend. i never liked working, i never liked handling money. i just want to play all day. i must be peter pan.

 

[twaddle]

Has anyone been able to change from the cheapo mindset and loosened the purse strings, at least a little ? How did you do it?

Why don't you tell us how much is in your "splurge" budget, and we'll give you ideas on how to spend it.

I find that home remodeling is the best way to create a spending black hole, if that's what you're looking for.

 

[Alan]

It is hard to change spending habits ....

A couple of weeks back, I'd finally had enough. We know we can manage if I quit now but hanging on for another 28 months gives us far more than we can ever spend I think as I would get a pension immediately plus health insurance. If I quit now it would be over 9 years for a pension and no health insurance.

So I called my HR manager from where I am paid out of in Louisiana to verify my pension details and told him what I planned to do. He was very understanding and said, if it was corporate IT that I was sick of, then they were looking for a EE project engineer with experience that just about suited my own, plus I was very well known and respected at the site. I said I was interested so he checked with the VP in charge ( a very good friend of ours)and came back to me within 2 hours and offered me the job - same salary, slight reduction in bonus.

DW and I talked it over and decided it was well worth doing for the benefits it would give in terms of money and long term affluence. But then in planning the move and the next 2 years it took a while to get out of our penny pinching habits and decide to not scimp on expenses in this 2 year assignment, but it was hard to change the mindset.

So, we are retaining our 3 bed apartment here in Texas, our son is going to move in and pay us rent at the same rate he is is paying now for his 1 bedroom place. We'll rent a 2 bedroom place in Baton Rouge, and "so what" if living expenses are much higher for 2 years. We will retain our links to the place we have come to call home, we'll have plenty of trips back (5 hr drive) as every 3rd week I have Friday off, and the pay-off is huge in long term security.

However, I still feel guilty about the prospect of upping the spending and also not having the courage to jump ship and RE right now. However, I am really looking forward to going back to my roots career-wise and also back into a place where we have lots of friends both inside and outside of work. ( The new job starts Jan 1 )

 

[audreyh1]

Does anyone else have this problem?
Has anyone been able to change from the cheapo mindset and loosened the purse strings, at least a little ? How did you do it? Do you have any regrets?

I think it takes several years to really get used to what your portfolio will support and just to get used to the general idea of living off your investments.

We've been retired 8 years, and I think it's really only in the last 2 that I relaxed considerably about expenses. The first 2 or 3 years we were pretty cautious although we had set aside a large travel budget for the first few years and indulged in that.

Audrey

 

[TromboneAl]

We've had this discussion a few other times on this forum. There's no easy solution.

I've sometimes thought that I should take the amount that firecalc says we should spend in a given year and put it in a separate account. We will then force ourselves to spend all of the money in that account by the end of the year.

It reminds me of my first time jumping off the high diving board as a kid. I remember thinking "I know it seems like I'm going to kill myself, but I've already decided that it's safe and worth doing, so I'm just going to do it." And I jumped.

 

[W2R]

It reminds me of my first time jumping off the high diving board as a kid. I remember thinking "I know it seems like I'm going to kill myself, but I've already decided that it's safe and worth doing, so I'm just going to do it." And I jumped.

You thought that too?? I thought I was the only one. All the other kids seemed so unconcerned.

 

[52andout]

thanks everyone. I thought some might have a similar feeling. We have bought a few electronics recently, as DH is a gadget junkie. I took a nice trip with a friend and we are taking one soon together. I am not actually worried, as I tracked the last few years and we are spending well under a 4% SWR. I guess what we need is some time to get used to it a little more, especially with Dh still working.

and even though DH is still at work with me home now he walks into a neat house, lawn mowed, clean undies in the drawers and good food on the table. It used to be much more of a shared proposition, so now he has time to pursue his interests much more as well. He promises to go back to sharing when he pulls the plug.

Now all we can do is hope they have an early out - he will be the first in line.