Breaking the Thrift Habit??

[SteveL]

Okay, so you save half your income for 30 years, invest it wisely, and retire with a pile. You come to the ER Forum and read about FIRE. Your draw down rate is only 2% because you have trained yourself not to eat out, not to spend money etc. etc. How do you cut loose, and spend up to your 4% limit w/o that little voice you have been hearing for the last 30 years saying "you don't need that".....
Saving is easy,,,,,spending is tough!

 

[Dawg52]

Okay, so you save half your income for 30 years, invest it wisely, and retire with a pile.  You come to the ER Forum and read about FIRE.  Your draw down rate is only 2% because you have trained yourself not to eat out, not to spend money etc. etc.   How do you cut loose, and spend up to your 4% limit w/o that little voice you have been hearing for the last 30 years saying "you don't need that".....  
Saving is easy,,,,,spending is tough!

Are you married? 

 

[dex]

Set up a budget and spend up to the budget.

When you were saving you had a budget and spent under it. Then you built a budget from the ground up by each line item. When you got to the total you either liked the total or said it was too much. If too much you reviewed each line item for where your could cut.


To spend:
First step figure out in total what you want to spend then fill in the catagories and spend up to those catagories.

 

[maddythebeagle]

Wow, thats a new one, most folks have a lifetime of over spending and consumer debt I have thought what I do and I think that I would consider to start giving some of the money away.

 

[poyet]

No reason to break a good habit (and I'm married with two children, well one is already 21...but costs much more !)

And I still have a 15 years old car, which I did not even purchase at the time. Why change this excellent car, it still works !
Why change good habits unless you feel unhappy with these ?
But do you

Patrice.

 

[farmerEd]

Okay, so you save half your income for 30 years, invest it wisely, and retire with a pile.  You come to the ER Forum and read about FIRE.  Your draw down rate is only 2% because you have trained yourself not to eat out, not to spend money etc. etc.   How do you cut loose, and spend up to your 4% limit w/o that little voice you have been hearing for the last 30 years saying "you don't need that".....  
Saving is easy,,,,,spending is tough!

When you figure out that one, let me know to...I have the same problem, and to be honest its one of the biggest negative suprises about Er'ing for me...its hard for me to spend money, and I stress about it constantly...and me with a 1.8% SWR....guess the earlier you ER, the easier it is to worry, because 40-50 years is a LONG time to ever feel completely confident about what the future holds, no matter what your spreadsheets, or firecalc say.

 

[unclemick]

Something about the horse you rode in on - and all that stuff.

Spending IS TOUGH - emotionally, physically, and mentally.

Especially - if you end up buying a lot of crap(house, cars, adult toys, etc) - that require care/mainetence.

In the end - who owns who - Yeah, yeah - I know they are inanimate objects. ?Are you sure

Frivolously bought two - off brand tires for my 1994 Sonoma this week $120 - instead of spending a half day at the junkyard and 'maybe spending $50' - and forgoing the adventure of how long will they last.

Just trying to let expenses drip up slowly and pretending not to notice.

 

[Jarhead*]

Have been viewing this board for close to two years now.

This thread is one of the most bizarre ones I've seen to date.

I remember years ago "Scrooge McDuck", Donalds Uncle, used to roll around in his room that was floor to ceiling in cash. (This was his life).

Do you guys live in a vacuum?

Rather than spend more than you are comfortable with, don't you have aging parents, adult children, neices or nephews, etc. etc. that could use a hand-up because of circumstances beyon their control. (Not everybody in this situation is there because of irresponsibility).

Well, don't want to continue, while I might be breaking even.

Jarhead

 

[shiny]

I don't really think it is strange at all. I know we'll have the same problem.

Since I was a child I have always been rewarded for my thriftiness and that has paid off in ER. I don't think it will be easy to just change my personality.

We do spend money, but compared to our incomes, etc. we don't spend much. I think there will always be that worry of outliving our money, etc. But... I will try to make the spending budget and actually spend it rather than seeing how much I can save of it!

 

[grumpy]

During our accumulation phase I was frugal in the sense of not spending on things we didn't need. I also was careful to find good values. That meant not buying the high-end whatever (TV, car, home, etc.) but also not just buying the cheapest model. I bought the one that gave good value for the price and I shopped for the lowest price on that model. Now in FIRE I still look for good values. But now I can find good values in the mid-range of products. They are higher quality overall but at a higher price. I still don't buy top-of-the-line of anything because they are not good values - you are paying for snob appeal.

I find that I don't have a problem spending my hard saved $'s as long as I believe I am getting good value for the price.

Grumpy

 

[Ol_Rancher]

I have the same 'problem'. I watched my depression-era parents wash and reuse plastic Zip lock bags, save rubberbands from the newspaper, keep the food pantry chock full of food, freezer & fridge full at all times, plus all the other standard behaviors. It rubbed off on me more than I realized.

To me now as with them, interest is to collect not to pay. Spend money on items that appreciate rather than depreciate. Blah Blah Blah

Spending is tough even though I am well layered against most any economic forces. I know I can't line my coffin with money but old habits are hard to change. I will force myself to take a trip or two soon and perhaps this will shake me up somewhat. However, I love my ranch and the critters on it. This might boomarang on me.

I look around and I realize that I have all the material things I really want. This is not the first time in my life I have felt this way.  

This thread is long overdue. I figure that this forum should have a reeelatively high number of like minded folks living below their means.

 

[riskadverse]

This is one of those problems you would like to have ... similar to what do you do with the millions you win in the lottery or what do you do when you have too many customers for your new business to handle. Think I'll worry about it when I get there.

 

[wildcat]

I think C-T is the authority when it comes to this particular subject. He may take a break from his Glacier NP trip and post his opinion.

 

[unclemick]

True, True - We need C-T to shake us (cheap SOB's) up.

Trouble is - I still find his Trout Bum vision the more appealing.

I just finished an hour long argument with my Mom - a Depression Era age 88 living with us - on why I need to take her to the bank and cash 30k of E bonds(1974) that don't pay interest anymore. I guess she likes to look at them.

Sigh - maybe Monday. So it goes.

BTY - in New Orleans - lack of money - never, ever - stops a party.

 

[Nords]

Are you married?

Do you have kids?

This thread is one of the most bizarre ones I've seen to date.
Do you guys live in a vacuum?
Rather than spend more than you are comfortable with, don't you have aging parents, adult children, neices or nephews, etc. etc. that could use a hand-up because of circumstances beyon their control. (Not everybody in this situation is there because of irresponsibility).

I have the same 'problem'. I watched my depression-era parents wash and reuse plastic Zip lock bags, save rubberbands from the newspaper, keep the food pantry chock full of food, freezer & fridge full at all times, plus all the other standard behaviors. It rubbed off on me more than I realized.

To me now as with them, interest is to collect not to pay. Spend money on items that appreciate rather than depreciate. Blah Blah Blah

Spending is tough even though I am well layered against most any economic forces. I know I can't line my coffin with money but old habits are hard to change. I will force myself to take a trip or two soon and perhaps this will shake me up somewhat. However, I love my ranch and the critters on it. This might boomarang on me.

I look around and I realize that I have all the material things I really want. This is not the first time in my life I have felt this way.  

This thread is long overdue. I figure that this forum should have a reeelatively high number of like minded folks living below their means.

I can't help but realize that we wouldn't be having this debate if we didn't have the money in the first place. Life is good.

This reminds me of Cut-Throat's other comments. I'm with you, SteveL, about the saving & spending habits, although apparently you don't cohabit with anyone willing to take care of the spending for you.

But I don't agree with "training not to eat out". Frugality is not intended to be deprivation. We eat out when we want to, but we realize there are many hidden costs in that experience... what really goes on in the kitchen of a restaurant, the high fat/carb content of the food, the ridiculous overcharging for the drinks, the hassle of getting to/from the restaurant, the service (or lack of it), and so on. I can count the number of truly awesome restaurant meals I've eaten on two hands and most of them have been awesome for the companions, not for the venue.

So eating out doesn't have a lot of value to us, especially when we were using that money to save for ER. Today our most frequent/expensive dining experiences are famly CostCo pizza on Friday nights, family/inlaw dinners at the local Chinese restaurant, Taco Bell lunches with my spouse when we're out shopping, and an occasional romantic Thai food dinner (which, I tell my spouse, is even better when it's with her).

Most of the things we would pay full retail for don't have a lot of value to us. But finding a bargain! That's another matter. Your enjoyment of the experience is amplified by the value of the great deal you're getting. Weeks later you'll reminisce about the experience and how you pulled it off, but I can't recall the exact flavor nuances of my last fiesta taco salad.

One advantage of a frugal lifestyle is that you rarely have to change it if your financial circumstances change. But it's good to indulge when you feel that you have a reason to. As Jarhead points out, it's even better to loosen up the wallet for charity or family. But it's not necessary to raise your burn rate just because you seem to have more than you need. Go for the quality, because the future may take care of the quantity for us, even if we try to hold on to it...

 

[SteveR]

I too grew up with parents from the "Greatest Generation". My father's family were share croppers and my mother's family lost the farm during the Depression so they did what ever they had to to survive. I guess some of that frugality crossed the placental barrier but not so much that I could not buy what I wanted (within reason). I have worked my butt off for the past 30+ years was finally able to start saving after my divorce (she was a wallet drainer). In 15 years I went from a negative networth to a very comfortable networth today.

I save 25% of my income today and yet still spend $$ to buy things that make me happy. If you deprive yourself all your life you may die before you can spend enough of it to make you happy. What is the point in starving yourself most of your life with the intent of gorging once you have "enough" to buy that dream meal you have been saving for? You could die before you get to enjoy it and that would be such a waste of life. Been there done that have the T Shirt to prove it.

Being frugal is fine but don't go crazy with it. Self denial over a long period of time creates unreasonable expectations that may never be fulfilled. Disappointment will follow as will regret when one is looking back on a life spent in excessive denial.

Adequate frugality shoudl be the goal; adequate to save for your goal but no too restrictive as to cause life to pass you by. Stop and smell the roses along the way.

Eat, drink and be merry... for tomorrow we die. But, in case you don't die tomorrow, then save for your ER but still eat and drink.

 

[Andre1969]

This is a problem that I can identify with. My grandparents grew up in the Great Depression, and I think a lot of their mentality got instilled upon me. I saw how irresponsible my father was, and decided I didn't want to be end up like that. And then I went through a bad marriage that left me about $27,000 in debt. So I think it's just ingrained in my mind to not overspend, live below my means, etc.

I know some people who always have to have the latest of everything. And then when some new model or style comes out, they get it, too. They get a few minutes of flash-in-the-pan excitement, but then they'e bored with it, AND stuck with the bill! Then there are people who spend money to try and make themselves happy. I never learned that trick, thankfully.

I finally got to the point where I finally feel financially stable about 8 months ago, when I sold my condo and banked/invested the profit. If I suddenly lost my job, I could go for years without having to get another one. Or, I could take a lesser job and still get by. If the car blew up, I could buy a new one if I had to.

But since I got to this point, I really haven't changed my spending habits much. About the only real difference is that I'll buy Rolling Rock or Yuengling in the bottle instead off IceHouse or Miller Genuine Draft in the 30-pack of cans! But I still get it at the discount liquor store!

Oh, and I might eat out every once in awhile, but that usually consists of McDonald's, or maybe Wendy's or Burger King if I'm reallly feeling ritzy some night! Or maybe hitting the Chinese place across the street from work on occasion.

 

[retire@40]

Okay, so you save half your income for 30 years, invest it wisely, and retire with a pile.  You come to the ER Forum and read about FIRE.  Your draw down rate is only 2% because you have trained yourself not to eat out, not to spend money etc. etc.   How do you cut loose, and spend up to your 4% limit w/o that little voice you have been hearing for the last 30 years saying "you don't need that".....  
Saving is easy,,,,,spending is tough!

I said this http://early-retirement.org/forums/index.php?topic=1624.msg24638#msg24638 a few months ago about spending being tougher than saving.

Reversing your money mentality is a difficult thing to do if you are stupid.  Most people I know who work and work to save and save keep wanting to save and save even when they stop working.  They never realize what they are saving for and they never realize they will die some day with all saved and not much enjoyed.

 

[TromboneAl]

I"ve experienced this problem in miniature when on vacation.  We'll be on a vacation camping, and say "Well, we really should live it up, and try to spend $1,000 in the next few days."  But we don't spend anywhere near that.

 

[Jay_Gatsby]

Well, I'll jump on the bandwagon. Being FIRE-oriented, I really find it difficult to spend money without feeling guilty (read my recent threads on car repairs :). I'm coming around to the idea, however, that sometimes you really need to spend money to "buy" yourself some security, piece of mind, or even to make your life easier. Unclemick's tire purchase is a good example of this, since in many cases, you're better served in the long run to forego the "adventure" that frugality may require.

Money is a tool, and maintains that power though constant use. Money has no power without being used. Every time you spend money, you're making an "investment", with some investments being very good (i.e. those that appreciate) and some that are very bad (i.e. those that depreciate rapidly). Yet in some cases, even if you make a "bad" investment and lose your money (or the item you purchased loses its value rapidly), you still may receive a benefit from your investment in some other way. For example, you might buy your wife a new car, which we all know is a rapidly depreciating asset. What you will gain from your investment in such a depreciating asset is usually peace of mind -- both from a safety/mechanical perspective, as well as the absence of complaints from your wife about the such issues.

 

[Momtwo]

I also struggle with this but to a much lesser extent than before we were retired. DH and I love to eat out at expensive restaurants with good service and exceptional food. We do this about once a month. We would much rather do this than eat at fast food joints or chain restaurants more frequently.

We do travel for vacation and to visit children about 4-5 times a year. We spare no expense- fly first class, stay in the best hotels and eat at fine restaurants. We enjoy sight seeing, shopping etc. This year we have gone for a week or more to Park City and Salt Lake City, Utah. On our way this month to N.Y., next month to Chicago and the next month to Tampa,FL.

We buy whatever we need whenever we want it for our home. We have spent money for interior designers and architects for our home and probably will in the future. DH has a bad back so we pay for landscapers to take care of our property weed, trim trees, bushes, etc.
When we had our pool put in, we spared no expense for a special stone waterfall. It took 10 men to carry the 700lb, lintel in. We made sure the pool had a self-cleaning system and a salt system so that it would be low maintenance. We also needed a misting system to cool it down since it gets hot here.

We buy our veggies and meats at an organic food store and like real veal cutlets, filets, seafood, etc.

However, we have a real problem spending more than $22,000. for an automobile. We only need transportation, not a show piece. I will only pay for cable plus - no HBO or other premium channels. Don't need them! DH and I share a cellphone- we are usually together.

And I have to agree with Nords, I hate paying recurring monthly bills- phone, water, sewer, electric, garbage, newpsaper, etc. I also will shop around for auto and homeowners insurance. I will do whatever it takes to lower them.

We only buy clothing when we really need it but only buy Eddie Bauer because their clothing lasts and lasts.

We love going to the movies but only go when we have Free movie passes. Otherwise we rent DVD's.

Quirky! Probably, but we live our lives on our terms and enjoy it.

Momtwo

 

[flipstress]

SteveL, I wish I had your problem 

Seriously, I wish I had been more frugal in my earlier years of working.  As it is, I am not retired yet although I have gotten the FIRE and LBYM "religion".

Would it help if you spent not so much on material possessions or things, but on experiences that you would enjoy or find enriching? 

For me, that would mean learning skills or pursuing interests, like learning to paint, to play a musical instrument, to do carpentry, or to make pottery; pursuing hobbies or sports; taking classes for fitness (yoga, Pilates) or out of curiosity (physics, history); or even going on a spiritual retreat. 

It's already been brought up but if you were so inclined, it would also be a form of enrichment for you to help out others by donating to causes important to you or by helping people you care about.  There are even "working" vacations to help the less fortunate here or abroad.  (Even ER's need a vacation to vary the routine, right?)

I am echoing something that HaHa said once about spending on skills/interests that become part of you or your life--they are more lasting and are remembered longer than spending on knick-knacks or material stuff that quickly loses value ("bad investment", per Jay_Gatsby).

Edit:  Oh, and I agree with unclemick on the feeling that possessions kinda possess you--you've gotta find a place for them, dust 'em, clean 'em, maintain 'em, count 'em, insure 'em, move 'em, haul 'em, store 'em, worry about 'em, etc.  So if you're thrifty on buying stuff, maybe it's a good thing and you can balance that with spending more on non-material stuff.

 

[BUM]

Have been viewing this board for close to two years now.

This thread is one of the most bizarre ones I've seen to date.

I remember years ago "Scrooge McDuck", Donalds Uncle, used to roll around in his room that was floor to ceiling in cash. (This was his life).

Do you guys live in a vacuum?

Rather than spend more than you are comfortable with, don't you have aging parents, adult children, neices or nephews, etc. etc. that could use a hand-up because of circumstances beyon their control. (Not everybody in this situation is there because of irresponsibility).

Well, don't want to continue, while I might be breaking even.

Jarhead

ex-Jar,

Since when does frugal living mean turning your back on others? My folks (and in-laws) are the tightest of the tight. I could write a book. Chapter 1 Everythings Beige One time Pop got a great deal on 50 gallons of beige paint. Everything was beige...everything!

However they always were there for us. And the grandchildren, forget about it! Pop's always said, "Give with a warm hand."

Being thrifty allows one to be generous.

 

[Jarhead*]

ex-Jar,

Since when does frugal living  mean turning your back on others? My folks (and in-laws) are the tightest of the tight. I could write  a book.  Chapter 1 Everythings Beige   One time Pop got a great deal on 50 gallons of beige paint. Everything was beige...everything!

However they always were there for us. And the grandchildren, forget about it! Pop's always said, "Give with a warm hand."

Being thrifty allows one to be generous.

Agree 100%.

However, various posters were "agonizing" about not being able to spend the amount they
should be spending.

Just gave them some ideas on how to take care of some of the "long-fall".

 

[SteveL]

Glad to read that we aren't the only ones....I am married (37 years), couldn't have the pile without the fervent support of my wife, who, if anything, is tighter than I am .....
We do buy good stuff when we buy something, because it seems to last better than cheap stuff. Old habits are just tough. During the last ten years of pulling the plow, we put away more than half our gross out of our net....We do stuff for our kids and grandkids, but, we aren't going to make much of a dent in the pile. We do travel. Last year we did a month in China and the prior year in East. Eur. But even then, we squeeze, and pass up stuff.
It is very funny, because I have a sister who never met a dollar she couldn't say goodbye to.