Blow that dough (It's official now)

[Ed_The_Gypsy]

Forget legacy for us. My concern is having enough to cover us for late-in-life medical expenses.

 

[aja8888]

Forget legacy for us. My concern is having enough to cover us for late-in-life medical expenses.

Agreed, the legacy is not as much in my mind as the $45 K I blew this year on dental work. That would have been a nice new pickup truck that I could have used (enjoyed?) and left as part of the legacy.

 

[FIREd]

My plan is that when the market tanks I won't have to decrease my spending.

That’s my plan as well. I am only giving myself a 1.35% raise for 2018 (less than the CPI increase for the trailing 12 months). Even if the market dropped 50% tomorrow, my WR would remain well below 4% and I would not have to decrease my spending.

 

[daylatedollarshort]

I gave myself a $200 a month raise for entertainment earlier in the year but ended up not taking the raise and cutting the entertainment budget by $75 instead. We don't go out less, we just spend less. Over time I just keep finding more and more good deals and ways to save. Last night we went to a ballet performance in the city, walked around the fountains and Christmas lights at Yerba Buena Gardens and had drinks at a roof top bar with pretty city views. For us that was a fun night out so I don't see a need to spend more. The bargain hunting part is half the fun for me.

 

[NW-Bound]

The market return this year is 6.5x my 2017 expenses. And this year's expenses still included some significant non-recurrent charges that will go away.

So, I should have a lot more discretionary spending, but I do not feel I need anything. Surely, buying a 3rd home will blow that money in a hurry, but I do not want one, so why do I put myself through the hassle?

Getting the balance right between current consumption, risk, and legacy is something I think about a lot. I am very much in the minority here, it seems.

I do think about it, but not a lot. Not yet anyway. Two reasons: 1) I am not that loaded yet, and 2) I am 61 and still have time to think of things I really "want". I must be sure what I spend money on gives me pleasure and not more hassle.

Yes, probably. But we seem much more interested in discussing honey glazed hams, cognac, wine, knives, shellfish,iPhones, etc. More fun and easier? Well we do live in a consumer society, I guess.

Consumables are something we all have to buy. So, it's easiest to upgrade these. It is true that they do not really make a dent. To really blow some dough, one needs another home, or at least a luxury car. I do not have enough for, nor want a 3rd home. And having a Tesla in my garage would not bring up my happiness level any.

So, consumables it is. Even there, I only eat and drink so much. I like to travel, but doing too much of it, then it becomes tedious like work.

 

[Chuckanut]

Yes, consumables it is for me also.

• Faster Internet.
• $15 a bottle wine bought from a local wine store replaces some of my $5-$12 bottles from Costco and TJ's. And, it is part of the buy from local business that I like to support.
• grass fed beef
• a bottle of fancy bourbon recommended by folks on this site
• cashmere travel sweater
• searching for a very nice Fine Art matte photo paper to replace the cheaper and more ordinary paper I have been using.
• upped contributions to charitable causes that put at least 85% of the money to good use. (OK, not my consumable, but consumed by others.

And, while not a consumable, probably the most expensive vacation year yet.

I am looking to upgrade some of my photo gear, but as of today I just can't justify the expense against the added benefit. Spending for the sake of spending is not my idea of Blowing Dough.

 

[wmc1000]

Just got done replacing 800 sq. ft of carpet with wood flooring. Was going to do it in 2018 but DW convinced me we could "do it ourselves" when she saw it discounted 20%.

I guess it was a win-win because we are still on target with our budgeted 2017 numbers and now we remove it from the 2018 budgeted numbers too!

 

[Spanky]

We spend a lot more this year for new windows, furnace, and water heater. Next year, we probably need to spend $$ on roof and car.

 

[GalaxyBoy]

One of the kitties has developed chronic kidney disease so she’s doing her part to move the money out of my account.

 

[unclemick]

Yes, I understand. A reasonably conservative approach. I am currently spending more than ever but when the market tanks I will just go back to spending divs. My divs are rock solid and weren’t cut in 2008-2009.

But I think it also depends on your age. I’m 67,been retired 11 years, and the portfolio is at an all time high. I figure if I don’t enjoy things now, I will soon get to the point where all I will want to do is “sit on the porch” (figuratively). This will likely mean a very large legacy left behind. I certainly don’t mind leaving a good size legacy but not something outrageous.

Getting the balance right between current consumption, risk, and legacy is something I think about a lot. I am very much in the minority here, it seems.

Ditto.

Post 70 1/2 sharing with my new found Pals at the IRS those non Roth portfolio parts is legacy I have mixed emotions about. Also the mental adjustment from early ER 'cheap SOB' to spend it before you croak is a work in progress.

heh heh heh -

 

[W2R]

We spend a lot more this year for new windows, furnace, and water heater. Next year, we probably need to spend $$ on roof and car.

Once you are done with that, you probably won't have any more big irregular expenses for years! Those are most of the big ones for a house, it seems to me.

Oh, that is.... unless your teeth are bad. Dental implants can really add up.

 

[flintnational]

While you folks were debating spending, I was out..... well, spending. We just returned from a short cruise this week. Okay, it has been planned for awhile and in our regular budget. We did buy two glasses of wine on board to supplement the 2 bottles we brought on board. Clearly our increased net worth is causing us to throw caution to the wind. With tip, the wine was $12 per glass.

 

[MuirWannabe]

Yes, consumables it is for me also.

• Faster Internet.
• $15 a bottle wine bought from a local wine store replaces some of my $5-$12 bottles from Costco and TJ's. And, it is part of the buy from local business that I like to support.
• grass fed beef
• a bottle of fancy bourbon recommended by folks on this site
• cashmere travel sweater
• searching for a very nice Fine Art matte photo paper to replace the cheaper and more ordinary paper I have been using.
• upped contributions to charitable causes that put at least 85% of the money to good use. (OK, not my consumable, but consumed by others.

And, while not a consumable, probably the most expensive vacation year yet.

I am looking to upgrade some of my photo gear, but as of today I just can't justify the expense against the added benefit. Spending for the sake of spending is not my idea of Blowing Dough.

Do tell. What bourbon did you choose to blow dough on?

 

[NW-Bound]

While you folks were debating spending, I was out..... well, spending. We just returned from a short cruise this week. Okay, it has been planned for awhile and in our regular budget. We did buy two glasses of wine on board to supplement the 2 bottles we brought on board. Clearly our increased net worth is causing us to throw caution to the wind. With tip, the wine was $12 per glass.

The last cruise we took, we had an unlimited booze package. Even then, I took only 3-4 drinks a day. Could not blow more dough on booze if I wanted to. Guess I could have ordered some premium and rare shots.

 

[SteveNU]

New kitchen and some living room furniture this year $$$. Even paid someone to do the lawn for the last half of summer and told my DW she could let the hairdresser color her hair instead of doing it at home! ☺

 

[RobbieB]

Good for you, I'd do it too.

Wifey let one of her friends (who was a pro stylist) color her hair in our house. That stuff stinks. The nose you save is your own -

 

[dtbach]

We will be doing a lot more travel next year and upgrading meat, wine, booze, etc. It's hard to spend the windfall.

 

[iloveyoga]

Getting the balance right between current consumption, risk, and legacy is something I think about a lot. I am very much in the minority here, it seems.[/QUOTE]

+1

 

[RobbieB]

I'm still trying to get the balance right. I'm having trouble blowing dough as fast as I make it. My net worth continues to rise therefor I'm not blowing dough as fast as I should.

I want to see my net worth decreasing. Then I'll worry about blowing dough too fast.

One problem at a time -

 

[W2R]

I'm still trying to get the balance right. I'm having trouble blowing dough as fast as I make it. My net worth continues to rise therefor I'm not blowing dough as fast as I should.

I want to see my net worth decreasing. Then I'll worry about blowing dough too fast.

One problem at a time -

Me too. But y'know, I'm having so much fun playing free games on my new "2017 iPad" that I bought on Black Friday, that I don't want to stop to look for other ways to spend money. Not yet.

What a terrific value that iPad was for the money! Anyway, my point is that when you get that deck done you'll probably be too busy out there with your sweetie, hot tubbing, grilling, and having fun, to shop for other things for a while.

 

[Danmar]

The market return this year is 6.5x my 2017 expenses. And this year's expenses still included some significant non-recurrent charges that will go away.

So, I should have a lot more discretionary spending, but I do not feel I need anything. Surely, buying a 3rd home will blow that money in a hurry, but I do not want one, so why do I put myself through the hassle?



I do think about it, but not a lot. Not yet anyway. Two reasons: 1) I am not that loaded yet, and 2) I am 61 and still have time to think of things I really "want". I must be sure what I spend money on gives me pleasure and not more hassle.



Consumables are something we all have to buy. So, it's easiest to upgrade these. It is true that they do not really make a dent. To really blow some dough, one needs another home, or at least a luxury car. I do not have enough for, nor want a 3rd home. And having a Tesla in my garage would not bring up my happiness level any.

So, consumables it is. Even there, I only eat and drink so much. I like to travel, but doing too much of it, then it becomes tedious like work.

Thoughtful post. You appear to be an extreme example of someone whose spending could easily increase if you wanted it to. You have said you like to see the balance of your portfolio climb, so you should be deriving quite a bit of pleasure from that.

I agree that spending for spending’s sake is sub optimal. I also agree that at age 61 you have time to think more about the balance between current consumption/risk/legacy. At some point though, you will need to address it. I’m older than you and feel it’s an issue that’s relevant for me now.

Yes, also agree, that to seriously move the “spending dial” multiple homes, luxury cars, luxury travel, large boat, large gifts, are probably the most effective “tool”. Consumables are really pretty inconsequential. Easy to identify and discuss though. Happy Holidays.

 

[Danmar]

I'm still trying to get the balance right. I'm having trouble blowing dough as fast as I make it. My net worth continues to rise therefor I'm not blowing dough as fast as I should.

I want to see my net worth decreasing. Then I'll worry about blowing dough too fast.

I would think that in a market that’s increasing at close to 20% this year, you don’t really want to see your net worth decline. See my previous post for ways to really “blow the dough” if you are serious though.

 

[Major Tom]

One of the kitties has developed chronic kidney disease so she’s doing her part to move the money out of my account.

Sorry to hear that GalaxyBoy, but it's good you at least have the money to take care of her in the first place. Quite a few people I know stress over not being able to afford to take their pets to the vet. Being able to pay for the care for our animal companions is a luxury in itself.

 

[NW-Bound]

...Yes, also agree, that to seriously move the “spending dial” multiple homes, luxury cars, luxury travel, large boat, large gifts, are probably the most effective “tool”. Consumables are really pretty inconsequential...

If one has a lot of money, charity is the best way to dispose of some, if one does not want to spoil his children rotten. I read that Bill Gates would be worth $150B if he did not give away to his foundation. His net worth is $90B now.

It is a lot easier for Bill Gates to give away 90% of his money than for me to give away 10% of mine, the simple reason being that I still do not know if I will have enough. The market may turn, and I may find myself hoping to survive on 4% WR instead of drawing only 2.5% that I do this year.

In the future, if my finance continues to do well, I will step up the charity donation as well as funding my grandchildren's education, if I will have any. I can also fund my children's Roth accounts. I have given them money and helped them get established. They are doing very well right now compared to their peers, and I do not want to pump more money to them and cause them to become dependent.

 

[kcowan]

Oh, that is.... unless your teeth are bad. Dental implants can really add up.

Our friend finally had a big dental procedure before coming to PV last year and she spent the time feeling like crap. When she got back to Canada, they discovered bacteria from the operation had settled around her aortic valve. Open heart surgery resulting from indiscreet tooth surgery! Look after your teeth!

(One thing I am doing this year is spending on essentials without budgeting. After January, I will reconcile and see how we made out.)