The Fine line between responsible and selfish/material

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills

Re: The Fine line between responsible and selfish/material

Postby VictoriaF » Wed Mar 20, 2013 3:01 pm

Hikes_With_Dogs wrote:My mantra is pretty simple: Save the % I need to so I obtain my retirement goals, and spend the rest if I want. But also ever present in my mind is that money literally doesn't buy happiness. Experiences make you happy, so I am often more willing to spend money on that then on 'stuff.'

I am lucky and I make plenty of money to achieve both goals (saving & spending) without struggling. So, in general, I am a cheap and thrifty person. But on occasion I'll buy $100 pair of shoes, or spend $5 on a latte I don't need, or upgrade myself to a nicer hotel room. Not often, but enough that I still feel like I'm enjoying some of the things people should enjoy in life.

And while I'm sipping my latte, I'm watching my retirement funds grow, hoping my family and I will live long enough to spend it.


Hikes_With-Dogs, welcome to the Forum,

Recall the opening line of Anna Karenina, "Happy families are all alike; every unhappy family is unhappy in its own way." Frugality is similar. Frugal people are alike in attending to the fundamental tenets of frugality, i.e., not spending on houses, cars, clothes, parties, vacations, or anything else they can't afford. But frugal people also allow themselves splurges, and those they do in their own ways. For some it's shoes and lattes, for others it's travel, family, charity, watches, etc.

The analogy breaks in the assessment of happiness. Diverse, personalized splurges tend to improve it.

Victoria
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Re: The Fine line between responsible and selfish/material

Postby kenyan » Wed Mar 20, 2013 3:28 pm

HardKnocker wrote:
A key strategy to increase your wealth is not to increase your spending as your income increases. Maintain your current consumption and invest your increased earnings.


Of course, that does assume that your income will increase over time. I have been in the workforce for nearly 8 years and am making the same real salary as when I started - even after a couple of promotions. Personally, I reject the argument (that some make, you didn't) that you can just keep your nominal spending the same or similar - if you do that, you're not maintaining your current consumption, you're lowering it. Maybe that's fine for some, but it does require sacrifices.

Given the statistics on how real middle class wages are shrinking over the last couple of decades, I don't think I'm alone in this situation.
Retirement investing is a marathon.
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Re: The Fine line between responsible and selfish/material

Postby TSR » Wed Mar 20, 2013 5:28 pm

I think the numerous studies of happiness are instructive here, but not in the way you might think. Although those studies suggest that some material support is necessary for happiness, they say that you sort of "max out" around the $70,000 a year mark. That is, money can buy you happiness if you're lower- or middle-class, but you get diminishing returns after you reach that mark. On the other hand, similar studies show that we human beings are terrible at predicting what will make us happy in the long term. Buying a boat, buying a car, buying a fancy stereo, dating a specific person, being more generous -- all of these are things we tell ourselves will make us happy, but they won't. (Well, a lasting marriage does increase your happiness level somewhat, but I just mean the "specific person" part of it.)

What lessons do we take from this? I have been accused of being a bit melancholic in my worldview, but I think an honest-to-goodness positive conclusion from this is that YOU ARE NOT CURRENTLY UNHAPPY. You may feel slightly unfulfilled, but 99% of us go through life feeling slightly unfufilled. That should not be confused for "living a bad life." I say all of this just to note that (1) making more money won't make you happy, (2) spending that money won't make you happy, (3) saving that money won't make you happy, (4) giving that money to charity won't make you happy, etc. This is not to be a nihilist. You may feel a moral obligation to do any of the above, and I'd sure like to live in a world where more people feel obligated to do number (4) (or get a marginal boost of happiness out of it). But you may go through the rest of your life with a nagging feeling that you could be spending your time/money/energy better. That's ok. You're normal. Be nice to people, make sure you don't live in poverty, enjoy life to the extent that you can, and you'll be ok.
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Re: The Fine line between responsible and selfish/material

Postby avalpert » Wed Mar 20, 2013 5:36 pm

TSR wrote:I think the numerous studies of happiness are instructive here, but not in the way you might think. Although those studies suggest that some material support is necessary for happiness, they say that you sort of "max out" around the $70,000 a year mark. That is, money can buy you happiness if you're lower- or middle-class, but you get diminishing returns after you reach that mark.


That isn't what the most current research shows - money buys happiness all the way up the income ladder: http://www.ncbi.nlm.nih.gov/pubmed/23231724
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Re: The Fine line between responsible and selfish/material

Postby Hub » Wed Mar 20, 2013 5:39 pm

MnD wrote:I have some major goals that happen to require a lot of money.
I set our savings and frugality at just the level to reasonably meet those goals and no higher.

Savings comes out first and the game plan is to have as much fun as possible with the remainder.
It does not pain me to spend, even on items that are clearly just wants.
Well said. This is exactly my family's mentality.
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Re: The Fine line between responsible and selfish/material

Postby VictoriaF » Wed Mar 20, 2013 5:54 pm

TSR wrote:I think the numerous studies of happiness are instructive here, but not in the way you might think. Although those studies suggest that some material support is necessary for happiness, they say that you sort of "max out" around the $70,000 a year mark. That is, money can buy you happiness if you're lower- or middle-class, but you get diminishing returns after you reach that mark. On the other hand, similar studies show that we human beings are terrible at predicting what will make us happy in the long term. Buying a boat, buying a car, buying a fancy stereo, dating a specific person, being more generous -- all of these are things we tell ourselves will make us happy, but they won't. (Well, a lasting marriage does increase your happiness level somewhat, but I just mean the "specific person" part of it.)

What lessons do we take from this? I have been accused of being a bit melancholic in my worldview, but I think an honest-to-goodness positive conclusion from this is that YOU ARE NOT CURRENTLY UNHAPPY. You may feel slightly unfulfilled, but 99% of us go through life feeling slightly unfufilled. That should not be confused for "living a bad life." I say all of this just to note that (1) making more money won't make you happy, (2) spending that money won't make you happy, (3) saving that money won't make you happy, (4) giving that money to charity won't make you happy, etc. This is not to be a nihilist. You may feel a moral obligation to do any of the above, and I'd sure like to live in a world where more people feel obligated to do number (4) (or get a marginal boost of happiness out of it). But you may go through the rest of your life with a nagging feeling that you could be spending your time/money/energy better. That's ok. You're normal. Be nice to people, make sure you don't live in poverty, enjoy life to the extent that you can, and you'll be ok.


You are correct that people cannot predict what would make them happy. Daniel Gilbert says that the best predictor of one's happiness in some future situation is whether people who are already in that situation are happy. Bogleheads polls and discussions are actually quite useful for providing a rough idea of what to aim for (and what not to).

Furthermore, studies of happiness distinguish experienced happiness and remembered happiness. Spending money and giving money to charity probably create experienced happiness. Making more money and saving money probably enhance remembered happiness. Remembered happiness seems to dominate one's decisions. For example, one may be miserable while climbing mountains but remember the excitement of reaching peaks, and thus continue returning to the mountains. Or one may have a perfect European vacation until she is robbed on the last day, and that would turn her off from returning to Europe.

If remembered happiness is dominant, and if making and saving money contribute to remembered happiness, then we are inclined to praise frugality and frown at disbursements. If, on the other hand, we attempt to live in the present (whatever that means) and catch glimpses of the experienced happiness, we may find prudence in spending and giving away money.

Victoria
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Re: The Fine line between responsible and selfish/material

Postby serbeer » Wed Mar 20, 2013 5:54 pm

VictoriaF wrote:Spending and saving have much to do with the mental anchoring. When you avoid certain types of expenses or use lower-cost products and services, these prices (including $0) are the anchors for what is normal for you. When you are faced with new or higher expenses than your current anchors you tend to see them as frivolous, as going against your frugal grain.

But the anchors can be easily reset. For example, if a frugal anchor is to use vacation time for doing home improvement projects, a new anchor could be to go to Europe for two weeks. You may tell yourself that this would be once in a lifetime trip. But the trip will become a new anchor, and a "trip of the lifetime" can become a "lifetime of trips."

The decisions on whether to reset your anchors and what to reset them to are in your control.

Victoria

This is VERY wise post which also happened to be quite actionable.

I started coming to the same realization recently but it has not formed sufficiently within my mind to be as eloquently stated. It has formed well enough though to be able to tell a gem when I see one.

I am going to add this to my collection of aha moments I used to keep a list of on this board.
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Re: The Fine line between responsible and selfish/material

Postby William4u » Wed Mar 20, 2013 6:04 pm

This research article answers much of your question...

"If money doesn't make you happy, then you probably aren't spending it right"

Elizabeth W. Dunn, Department of Psychology, University of British Columbia
Daniel T. Gilbert, Department of Psychology, Harvard University
Timothy D. Wilson, Department of Psychology, University of Virginia

Abstract
The relationship between money and happiness is surprisingly weak, which may stem in part from the way people spend it. Drawing on empirical research, we propose eight principles designed to help consumers get more happiness for their money. Specifically, we suggest that consumers should (1) buy more experiences and fewer material goods; (2) use their money to benefit others rather than themselves; (3) buy many small pleasures rather than fewer large ones; (4) eschew extended warranties and other forms of overpriced insurance; (5) delay consumption; (6) consider how peripheral features of their purchases may affect their day-to-day lives; (7) beware of comparison shopping; and (8) pay close attention to the happiness of others.

http://hvrd.me/KrJ3TO
http://www.ted.com/talks/michael_norton ... iness.html
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Re: The Fine line between responsible and selfish/material

Postby hsv_climber » Wed Mar 20, 2013 6:08 pm

What Victoria has nicely explained via anchoring, Mr. Money Mustache has explained via "building frugality muscle": http://www.mrmoneymustache.com/2011/06/ ... -a-muscle/

And "Power Of Habits" explains the same phenomenon via "building proper habits" (which is re-wiring our brain in a predetermined way).
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Re: The Fine line between responsible and selfish/material

Postby wshang » Wed Mar 20, 2013 7:05 pm

William4u wrote:"If money doesn't make you happy, then you probably aren't spending it right"

Funny, I was going to post the exact same quote from a book just finished, http://lauravanderkam.com/books/all-the ... the-world/
The book is a little cliche'ish, especially for BH's but the point is just as valid.

Our trick is to find how best to use this resource - money. Forget about the median described in studies, we have to apply money to its highest utility individually.
“. . . extraordinary wealth can be made by knowing the future" - Harry Dent
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Re: The Fine line between responsible and selfish/material

Postby William4u » Wed Mar 20, 2013 7:24 pm

wshang wrote:
William4u wrote:"If money doesn't make you happy, then you probably aren't spending it right"

Funny, I was going to post the exact same quote from a book just finished, http://lauravanderkam.com/books/all-the ... the-world/
The book is a little cliche'ish, especially for BH's but the point is just as valid.

Our trick is to find how best to use this resource - money. Forget about the median described in studies, we have to apply money to its highest utility individually.


The problem is that according to the studies, individuals usually miscalculate what will bring them highest utility.
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Re: The Fine line between responsible and selfish/material

Postby HardKnocker » Wed Mar 20, 2013 9:27 pm

kenyan wrote:
HardKnocker wrote:
A key strategy to increase your wealth is not to increase your spending as your income increases. Maintain your current consumption and invest your increased earnings.


Of course, that does assume that your income will increase over time. I have been in the workforce for nearly 8 years and am making the same real salary as when I started - even after a couple of promotions. Personally, I reject the argument (that some make, you didn't) that you can just keep your nominal spending the same or similar - if you do that, you're not maintaining your current consumption, you're lowering it. Maybe that's fine for some, but it does require sacrifices.

Given the statistics on how real middle class wages are shrinking over the last couple of decades, I don't think I'm alone in this situation.


Of course the costs of living go up with inflation. What I'm talking about is going from a Chevy to a Cadillac because you got a raise or buying your wife an expensive diamond necklace with your bonus, or taking a cruise with your bonus.

If you haven't got a wage increase in 8 years then start a part-time business, sell real estate part-time, get a part-time job, buy a rental property, get a better job, etc. Make something happen for yourself. Don't just sit there and complain. Create something for yourself. Create money for yourself.
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
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Re: The Fine line between responsible and selfish/material

Postby Professor Emeritus » Wed Mar 20, 2013 10:21 pm

What lovely thoughtful helpful even profound comments. Score a point for "social media"

To add one person's perspective, We are entering retirement in excellent shape, due to luck, skill and frugality. (emphasis on luck)
I carefully make sure that all necessities including eventual "long term care" are more or less covered with solid inflation protected guaranteed income.
Everything else is in the stock market casino and when it goes up, we can sell and spend on trips and other extras and when it doesn't we don't.
We developed this approach when I took Emeritus status and when there was extra income we traveled more.
The trick is to avoid making such luxury spending p-art of an unsustainable base.
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Re: The Fine line between responsible and selfish/material

Postby Keim » Thu Mar 21, 2013 12:49 pm

Hikes_With_Dogs wrote:...My miserliness comes from my father, who made a healthy income and saved and saved and saved for retirement. But he died young, and never got to enjoy it. All that money, and he's in the ground. He could have had another vacation, or enjoyed a new pair of shoes, or a finer lunch. But he didn't. And he never will.


I find comments like this interesting. About 10 years ago I was thirty years old, and had a brand new baby daughter. I was told I had a year to live. I dodged that bullet (obviously!) It caused me to up my savings rate, not lower it. Yes, there are lots of things I haven't seen and done. But if I die tomorrow I die satisfied. I die knowing that my family was as well provided for as possible. That makes me very happy.

New shoes and a finer lunch don't rate with me at all. Though I am trying to have more fun with trips now that the kids are old enough that we can get away. And, I have splurged on fixing up my classic Chevy. It's all about the experiences.

I consider the fun I can have with my money a bonus, providing for family is the important thing. Don't other savers feel the same way?
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Re: The Fine line between responsible and selfish/material

Postby HardKnocker » Thu Mar 21, 2013 1:32 pm

The post about the miserly father neglects to mention whether the father was happy? If he was happy then that's all that counts. The child is obviously not happy about it but guess what? It's not his money!

There is a study somewhere that said once you reach an income of $50k, further increases of income do not increase your happiness.

The number may vary but I agree with this idea.
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
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Re: The Fine line between responsible and selfish/material

Postby TSR » Thu Mar 21, 2013 1:53 pm

avalpert wrote:That isn't what the most current research shows - money buys happiness all the way up the income ladder: http://www.ncbi.nlm.nih.gov/pubmed/23231724


This is interesting. Thank you.
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Re: The Fine line between responsible and selfish/material

Postby Hikes_With_Dogs » Thu Mar 21, 2013 2:57 pm

I find comments like this interesting. About 10 years ago I was thirty years old, and had a brand new baby daughter. I was told I had a year to live. I dodged that bullet (obviously!) It caused me to up my savings rate, not lower it. Yes, there are lots of things I haven't seen and done. But if I die tomorrow I die satisfied. I die knowing that my family was as well provided for as possible. That makes me very happy.

New shoes and a finer lunch don't rate with me at all. Though I am trying to have more fun with trips now that the kids are old enough that we can get away. And, I have splurged on fixing up my classic Chevy. It's all about the experiences.

I consider the fun I can have with my money a bonus, providing for family is the important thing. Don't other savers feel the same way?[/quote]


Congrats on dodging the bullet! Maybe my father would have done the same had he lived? I don't know. We were provided for (well enough) after he was gone. But I think he was too much out of balance; too much a saver; not enough of an 'experiencer' if you will. I can't ever imagine dying satisfied with a young child at home. I won't be ok "leaving" my daughter until a long, long time from now, when she is older than me.

Going out to lunch with your family is an experience just as much as fixing up a Chevy. Just depends on your perspective. As an aside, my dad actually fixed up old Volvos and resold them for a profit. :)

I do have savings and retirement (and life insurance) as a #1 priority, but I also don't worry about blowing some of it. I think that was my point. Find the balance to where you are doing the things you should be doing, and spend the rest on experiences and the occasional pair of shoes. :)
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Re: The Fine line between responsible and selfish/material

Postby Hikes_With_Dogs » Thu Mar 21, 2013 3:04 pm

HardKnocker wrote:The post about the miserly father neglects to mention whether the father was happy? If he was happy then that's all that counts. The child is obviously not happy about it but guess what? It's not his money!



I'm assuming this is directed at me...

I'm not really sure if he was happy or not. It's hard (I think) for kids to really know that about their parents' true feelings. I grew up in a household where we didn't discuss such things. My older sibling seems to indicate that my dad would have been happier if he had spent just a tad more money.

I don't care about how he spent his money or not inherently- it's not like I needed or wanted an inheritance if that is what you are suggesting. (?!)

What I would have liked was to see him be a bit more carefree. Time is money, too, and I think sometimes people that are too frugal often forget that our time here is limited, and sometimes we should spend some money to give us more free time to enjoy the people and things that we enjoy.

I would have much rather spent 30 more minutes with my Dad then have him drive 5 miles out of the way after work to save 2 cents a gallon on gas. This is what I mean. You're right, it wasn't my money, but it was my time with him that is gone.
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Re: The Fine line between responsible and selfish/material

Postby Juniormint » Thu Mar 21, 2013 10:26 pm

Watch an episode of extreme cheapskates on TLC and be happy that you've got balance. I don't ever want to live like these people do.

Create a budget and allocate a portion for entertainment and wants. Whatever you don't spend at the end of the month rolls over to your next month's entertainment and want category. Have fun, spend, enjoy, structure it so you don't feel anxiety over spending money.

Give, give until it hurts.

Remember that money doesn't control you, you control it. You're boglehead so that you can live the lifestyle you want, not to hoard money.
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Re: The Fine line between responsible and selfish/material

Postby bdanes » Thu Mar 21, 2013 10:55 pm

Great thread! I also battle with this and wonder if I am saving enough. I did buy an expensive home, and I would call it a lifestyle home. It is on wonderful property with views. My justification is that although it may take longer to save for retirement, I get to enjoy all the journey to retirement in this home. I feel in a lot of respects I delayed gratification with med school and residency.

I don't give charitably (excluding donating old items and clothing) mainly because I view most of my taxes as a form of charity.

Unfortunately, I am more of a spender. I've always known this, and its a major reason I chose a high paying profession. I max out tax deferred savings every year. To me this is a lot of money to save. After I refinance my home ill be able to free up substantially more money which I can then put into saving or paying off the home (which I plan on keeping until I die).

I find that while I do spend a lot of money on things such as remodeling, there will be a time when that money will be available for saving bc the remodel will be done. I am essentially used to living day to day on about 1/3 of my take home pay. Could I be saving more? Of course!

I do agree there is a balance, and I think it starts by being honest with yourself. I think a major component of happiness is the aspect of achievement/growth. I must constantly have a goal and be working towards something that, when met, will personally bring me a level of satisfaction and achievement. I also fully recognize that the fun is in the journey towards the goal, not when it is met. Once I reach that point I am ready for a new phase.

I also think we are meant to be in or involved with nature in some capacity. This is why I am currently consumed with landscaping my property. I spend money on plants and try to care for them as best I can. This consumes little money, but forces me to connect with nature. I know that over the course of years the garden will grow, just like my savings.

Slow and steady spending, just like saving, wins the race for me.
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Re: The Fine line between responsible and selfish/material

Postby af895 » Fri Mar 22, 2013 8:44 am

I'm an avid reader of "Mr. Money Mustache" as well and will put in another vote for that forum.

For what it's worth, I struggle with this as well. I'm still trying to find a balance between enjoying life now (in context of spending) and saving hard to move my date of financial independence closer.

I actually derive enjoyment from knowing I could afford something but choosing not to spend on it. I happily rent as it saves me money versus buying a home.

I get a lot of satisfaction from helping friends with projects - sometimes projects they're spending a lot on, like a car restoration or home renovation. I don't need to be the one on the hook financially to get satisfaction from seeing a project through.
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Re: The Fine line between responsible and selfish/material

Postby coldplay221 » Fri Mar 22, 2013 8:58 am

This thread has been really helpful. Thanks to the OP for bringing out the subject and other posters for weighing in.
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Re: The Fine line between responsible and selfish/material

Postby leonard » Fri Mar 22, 2013 10:57 pm

I think people manufacture a lot of the tension between immediate gratification and saving. It's not real for most.

Once the immediate needs - shelter, food, and enough money for a reasonably priced hobby or 2 - are met - everything else is for most part superfluous wants. Constant upgrading of cars, houses, smartphones - I would argue - does nothing really to improve ones life - but does a huge disservice to retirement and rainy day saving.

Get rid of the noise and extra stuff and I think you will find much less pain in delaying gratification.
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Re: The Fine line between responsible and selfish/material

Postby zaboomafoozarg » Sat Mar 23, 2013 12:50 am

countofmc wrote:And then there's the whole balance issue you discuss in your OP. I don't want to wake up at age 50 (I'm 30 now) with a solid nest egg but without any "fun" experiences to remember.


Same position here - 90% sure I'll wake up in 20 years with way more money than fun.
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Re: The Fine line between responsible and selfish/material

Postby jeffyscott » Sat Mar 23, 2013 9:01 am

leonard wrote:Once the immediate needs - shelter, food, and enough money for a reasonably priced hobby or 2 - are met - everything else is for most part superfluous wants. Constant upgrading of cars, houses, smartphones - I would argue - does nothing really to improve ones life - but does a huge disservice to retirement and rainy day saving.

Get rid of the noise and extra stuff and I think you will find much less pain in delaying gratification.


To me a lot of extra spending just sounds like a burden, like I'd have to be constantly shopping or something. When I read posts like "I need $100,000+ per year to spend in retirement...", I wonder what the person is doing to "require" so much constant spending. It seems to me it would be a lot of trouble to find a way to spend an additional $50,000, or whatever, every year, year after year.
press on, regardless - John C. Bogle
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Re: The Fine line between responsible and selfish/material

Postby HardKnocker » Sat Mar 23, 2013 10:10 am

For most, spending rises to consume available income.
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
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Re: The Fine line between responsible and selfish/material

Postby 6miths » Sat Mar 23, 2013 11:14 am

Great thread. Thanks for all of the insightful comments.

The origins of my wife's and my frugality are manifold I am sure. Both sets of grandparents went through the great depression and our parents were born during it so we both grew up in middle class households run by parents who were fairly frugal and could stretch a dollar quite far and planned well for the future and retirement. We both wound up with the same outlook on spending and 'needs v wants' and it has served us well. We feel very thankful to have grown up in a period that provided huge opportunities and both landed satisfying, secure and well paying jobs. So I would say that we both have the frugal gene and it has been nurtured but I would say that the factor that now keeps us on the path when it would be so easy to stray is our children. It is not lost on us how our parents did us a major service by setting a solid example. Sometimes out of necessity but often out of desire to do so. We don't know what the future holds but as parents we think that the values imparted to us by our parents are very important. The chance that all, or perhaps even any, of our 4 children will attain the level of income/wealth that we have seems unlikely and even if they do the idea that it is not from that wealth that their happiness will come is very important to us. To us, living well has less to do with income and wealth and more to do with personal satisfaction and happiness and making a positive contribution to the world. In a world seemingly fueled by consumption, it is sometimes hard to make the message heard but hopefully some of it will get through - and yes there are some positive signs in this regard! :happy
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Re: The Fine line between responsible and selfish/material

Postby enderland » Sat Mar 23, 2013 12:45 pm

What is the balance between being responsible for oneself and saving/delaying gratification and being a miser and being overly materialistic? How do you balance these things mentally and emotionally, and of course, financially?


Figure out the things which give you the most meaning and spend money on them. Don't miss the importance of figuring these out - this is somewhat different for everyone and even details can vary (such as how you give, etc). America will tell you it's to spend more money on everything... but what are these things for you?

Then realize spending money (or time) is not only about temporary gratification, it's about a longer lasting state of being where you feel your life meaning being fulfilled on a daily basis.
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Re: The Fine line between responsible and selfish/material

Postby kamo » Sat Mar 23, 2013 4:32 pm

frugalhen wrote:My challenge is balancing saving a responsible amount for a retirement I can enjoy at 60, versus enjoying life TODAY. I struggle spiritually with it as well (please do not take this thread in a direction that will be banned) because I find my ultimate question is this:

What is the balance between being responsible for oneself and saving/delaying gratification and being a miser and being overly materialistic? How do you balance these things mentally and emotionally, and of course, financially?


Lots of great posts on this thread. Thanks for kicking it off.
In addition to enjoying the present in your retirement I would guess that you'll also want to remember pleasant memories of your past, especially family-related ones. So the family adventures/experiences you spend money on now could be seen as prepaid moments of happiness when you remember them in 20 or 30 years. My siblings and I still roll on the floor when we remember some of the not-so-fun-then camping fiascos we had when we were young. That was 30 years ago. Hope they keep making us laugh 30 years from now. Their value is priceless and cannot be replicated today for all the money in the world.
He who knows he has enough is rich. Lao-Tzu
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Re: The Fine line between responsible and selfish/material

Postby kamo » Sat Mar 23, 2013 4:45 pm

MnD wrote:I have some major goals (paid off house, two State U college educations fully funded, retirement mid-50's) that happen to require a lot of money.
I set our savings and frugality at just the level to reasonably meet those goals and no higher.
The objective of money is to meet our goals, not a contest to see how big a pile of unspent money we can build.

Savings comes out first and the game plan is to have as much fun as possible with the remainder.
It does not pain me to spend, even on items that are clearly just wants.
An inherently frugal/stingy person following my wife or I around for a few days would probably have a stroke. :mrgreen:

Life is short and their are no guarantees of a long retirement - or even tomorrow.
My test would be if you found out you had just a few months to live, would you regret the balance you made between enjoying life, being responsible and delaying some gratification?



Good post.
Like the simple approach of setting your goals, setting your savings rate to achieve those goals, and spend the rest carpe diem. Is this complementary to the 'Pay yourself first' maxim for good personal finance?
He who knows he has enough is rich. Lao-Tzu
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Re: The Fine line between responsible and selfish/material

Postby linguini » Sat Mar 23, 2013 4:54 pm

jeffyscott wrote:
leonard wrote:Once the immediate needs - shelter, food, and enough money for a reasonably priced hobby or 2 - are met - everything else is for most part superfluous wants. Constant upgrading of cars, houses, smartphones - I would argue - does nothing really to improve ones life - but does a huge disservice to retirement and rainy day saving.

Get rid of the noise and extra stuff and I think you will find much less pain in delaying gratification.


To me a lot of extra spending just sounds like a burden, like I'd have to be constantly shopping or something. When I read posts like "I need $100,000+ per year to spend in retirement...", I wonder what the person is doing to "require" so much constant spending. It seems to me it would be a lot of trouble to find a way to spend an additional $50,000, or whatever, every year, year after year.


Maybe travel? My fiancee and I spent thousands last year to visit her birth country, and we had free lodging and cheap food and were only there for a couple weeks. I can imagine that if you take four or five big ticket vacations every year, it could add up quite a bit. Imagine how much a month-long trip to Paris while staying in a nice hotel, attending theaters and museums, and eating only at restaurants would cost. A particularly lavish vacation for a wealthy retired couple could easily go through tens of thousands of dollars on one trip on a combination of air fare, lodging, food, and entertainment. It's not required spending by any means, but it's one of the few areas of spending where spending a lot more genuinely brings a lot of enjoyment and nice memories to many retirees.
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Re: The Fine line between responsible and selfish/material

Postby MP173 » Sat Mar 23, 2013 7:18 pm

This is a great thread.

Today is my wife's 57th birthday and we are celebrating this entire weekend. Last night we picked up a Samsung Note 2 smart thing. She is learning that today. There is a section in the "Dummies" book called "Find yourself" (GPS). Somehow that seems appropriate for this thread.

Find yourself. Use your personal GPS to discover what you want and where you are in your life. Set goals, not only financial, but more importantly personal. I "rent" a number of hobbies. Right now I am obsessed with gardening and guitar. I am planning the vegetable garden and trying to learn "New Kid in Town" (Eagles, 1977...my senior year in college)...."they will never forget you till somebody new comes along." How appropriate.

Right now I am also writing small snippets of my life, two or three pages of something that occured in my life at a certain point in time. It opens the doors of memories.

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Re: The Fine line between responsible and selfish/material

Postby leonard » Sun Mar 24, 2013 1:16 pm

jeffyscott wrote:
leonard wrote:Once the immediate needs - shelter, food, and enough money for a reasonably priced hobby or 2 - are met - everything else is for most part superfluous wants. Constant upgrading of cars, houses, smartphones - I would argue - does nothing really to improve ones life - but does a huge disservice to retirement and rainy day saving.

Get rid of the noise and extra stuff and I think you will find much less pain in delaying gratification.


To me a lot of extra spending just sounds like a burden, like I'd have to be constantly shopping or something. When I read posts like "I need $100,000+ per year to spend in retirement...", I wonder what the person is doing to "require" so much constant spending. It seems to me it would be a lot of trouble to find a way to spend an additional $50,000, or whatever, every year, year after year.


Good insight. Had an uncle that once told me - "Everything you own owns a piece of you."

I agree there is a burden to simply owning stuff - let alone some people who have a compulsion to buy more all the time.
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Re: The Fine line between responsible and selfish/material

Postby at ease » Mon Mar 25, 2013 10:59 am

...i see you note Eccl 5:10-11......also Note Hebrews 13:5 (NIV).....it looks like you are ok, you will be ok, you have enough, and you have help....so it's ok to give yourself permission to set aside some funds for fun/joy....however you choose to define it....it will be ok.......now, see PSALM 90-10 as a point for consideration and 90-12 as a follow up...
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Re: The Fine line between responsible and selfish/material

Postby MathWizard » Mon Mar 25, 2013 12:13 pm

linguini wrote:Imagine how much a month-long trip to Paris while staying in a nice hotel, attending theaters and museums, and eating only at restaurants would cost.


I was just in France (much of the time spent in Paris) last July, during peak tourist season, and spent several
"nice" nights in a 4 star hotel in Nice.

Extrapolating from 2 weeks to 4 weeks and using the Nice hotel price, and adding in our coach round trip
airfare, a month would have cost about $14K. (We did spend quite a bit on rail and car travel
going around the country, but we usually ate fruit for breakfast, getting it from sidewalk stands
next to our hotel and eating it while walking to the metro.)
No theatre, just museums.

Had I used taxis rather than the metro, paid for hotel breakfasts, and flown first class, the price would have
gone up. (I almost booked first class when I misheard an announcement just before the flight took
off of an upgrade price of $80, the price was actually $850.) Maybe when I am older, I will chek all my bags
and I fly first class, it sure looks much more comfortable than the most comfortable seats in coach.
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Re: The Fine line between responsible and selfish/material

Postby floydtime » Tue Mar 26, 2013 3:57 pm

I hate spending money. It is rare that I'll enter a store willingly, and I get a positive rush when I walk out of a store without having bought anything. I know there are lots of others like me out there. We might even be the silent majority 8-)
"Do not value money for any more nor any less than its worth; it is a good servant but a bad master" - Alexandre Dumas
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Re: The Fine line between responsible and selfish/material

Postby Kulak » Wed Mar 27, 2013 12:45 pm

Is maximizing happiness the point of life? I find that dubious.

Even assuming it is, then (as Victoria points out, paraphrasing the hedonic psych/behavior econ gurus) which kind of happiness: experienced joy moment by moment, or retrospective appraisal? They are different and often at odds, given the scarcity of time and money. Most people bias their decisions heavily in favor of the latter, to the point of basically choosing between alternative anticipated memories.
Depriving ourselves to boost our 40-year success probability much beyond 80% is a fool’s errand, since all you are doing is increasing the probability of failure for [non-financial] reasons. --wbern
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Re: The Fine line between responsible and selfish/material

Postby tom0153 » Wed Mar 27, 2013 3:44 pm

scouter wrote:I found that we naturally loosened up our spending as we gotten closer and closer to "our number". There were years where we had to tighten up to stay on track, and other years where we could splurge a little. But what we've always told our kids is: "The best thing money can buy is not stuff. It's not even experiences, like great trips. It's the freedom to spend your time doing what you really want to do, and to be able to give when you want to help." (of course, "doing what you really want to do" may involve a Ferrari and world travel, so never mind...)


My immediate thoughts in reading the OP was to figure that "the number" would be helpful in making objective those spiritual worries expressed. A dutiful personal finance plan intended to protect spouse and children (and self) would assist further in resolving concerns.

Like others, I can understand some of the inherited concerns. I grew up in a family of seven kids, five of whom were all Irish twins, all born either during the War (one child) or four more before 1953, and then, two to round things out, 8 and 10 years after the last of the first group. For those final two, it was like they had different parents. In some sense, my parents had reached their number (although there were great complications later on), and my father was no longer working a sixth day as had been his norm all his life, and my mother was able to dabble in this or that to bring in some pin money. However, the struggle for bathroom time resonates well for me, and I also saw that my mother's spending was not frugal, at all, while my father's instincts were for frugality.

I inherited this conflict. Recently, following my mother's death, we read the existing letters that survived the war, from my father to my mother. My father was not able to retain what must have been a large volume of notes. From this one sided view of their early days of marriage, during the war, my father is trying to convince my mother that the purchase of a fur coat was not the way to go to use the funds she had saved from his allotments. She was living with her parents, even as a young mother, and they covered a great deal of her personal costs. She was even able to continue a post graduate education for a teachers' license, and somehow, that fur coat was important. Eventually, she spent as much on that coat as they were to spend as a down payment on the home in which we grew up, and from which both my parents died. So, we lived with a good deal of financial conflict growing up. I have seen the resolution play out with how my siblings have lived.

The personal story is to highlight the nature of the attitudes we inherit, and in establishing our number, and in balancing our actions as we proceed towards that number, these psychological or spiritual attitudes need to be examined and similarly quantified so we know why we are following such and such regimen in attempting to achieve this balance between being the attitude of being frugal, and knowing that we are living with enough.

It is that enough moment, which is an "ah-ha" moment, that permits many to go on ahead and reset that comfort clock which is the internal attitude that I think that Victoria is describing. It isn't a license to spend indiscriminately, but it is a license to know that one's comfort zone now includes a broader set of advantages, like travel, and the ability to appreciate them for their worth.

This quantification of both the math of investing and the principles of accumulating a sum to invest, and a manner of investing it wisely, plus this understanding of psychology and spirituality, which seems to be behind what I see described as "bogleheadism" in this thread.
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Re: The Fine line between responsible and selfish/material

Postby Fallible » Wed Mar 27, 2013 4:52 pm

tom0153 wrote:
scouter wrote:I found that we naturally loosened up our spending as we gotten closer and closer to "our number". There were years where we had to tighten up to stay on track, and other years where we could splurge a little. But what we've always told our kids is: "The best thing money can buy is not stuff. It's not even experiences, like great trips. It's the freedom to spend your time doing what you really want to do, and to be able to give when you want to help." (of course, "doing what you really want to do" may involve a Ferrari and world travel, so never mind...)


My immediate thoughts in reading the OP was to figure that "the number" would be helpful in making objective those spiritual worries expressed. A dutiful personal finance plan intended to protect spouse and children (and self) would assist further in resolving concerns.

Like others, I can understand some of the inherited concerns. I grew up in a family of seven kids, five of whom were all Irish twins, all born either during the War (one child) or four more before 1953, and then, two to round things out, 8 and 10 years after the last of the first group. For those final two, it was like they had different parents. In some sense, my parents had reached their number (although there were great complications later on), and my father was no longer working a sixth day as had been his norm all his life, and my mother was able to dabble in this or that to bring in some pin money. However, the struggle for bathroom time resonates well for me, and I also saw that my mother's spending was not frugal, at all, while my father's instincts were for frugality.

I inherited this conflict. Recently, following my mother's death, we read the existing letters that survived the war, from my father to my mother. My father was not able to retain what must have been a large volume of notes. From this one sided view of their early days of marriage, during the war, my father is trying to convince my mother that the purchase of a fur coat was not the way to go to use the funds she had saved from his allotments. She was living with her parents, even as a young mother, and they covered a great deal of her personal costs. She was even able to continue a post graduate education for a teachers' license, and somehow, that fur coat was important. Eventually, she spent as much on that coat as they were to spend as a down payment on the home in which we grew up, and from which both my parents died. So, we lived with a good deal of financial conflict growing up. I have seen the resolution play out with how my siblings have lived.

The personal story is to highlight the nature of the attitudes we inherit, and in establishing our number, and in balancing our actions as we proceed towards that number, these psychological or spiritual attitudes need to be examined and similarly quantified so we know why we are following such and such regimen in attempting to achieve this balance between being the attitude of being frugal, and knowing that we are living with enough.

It is that enough moment, which is an "ah-ha" moment, that permits many to go on ahead and reset that comfort clock which is the internal attitude that I think that Victoria is describing. It isn't a license to spend indiscriminately, but it is a license to know that one's comfort zone now includes a broader set of advantages, like travel, and the ability to appreciate them for their worth.

This quantification of both the math of investing and the principles of accumulating a sum to invest, and a manner of investing it wisely, plus this understanding of psychology and spirituality, which seems to be behind what I see described as "bogleheadism" in this thread.


This post rightfully takes its place alongside many others that I think have made this an outstanding thread, and the last paragraph offers one of the most succinct yet comprehensive descriptions of Bogleheadism I've seen. I have nothing worth adding to it, just a thanks to all for an enjoyable read.
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Re: The Fine line between responsible and selfish/material

Postby tom0153 » Wed Mar 27, 2013 8:08 pm

Fallible, I visited your web site, it looks like fun.

So, what are the traits of frugalness? Visit: http://www.wisebread.com/frugal-factors ... vers-share

Be sure to see how you might have inherited some frugal behaviors: http://www.wisebread.com/30-signs-that- ... al-parents The article was well received, so this was added: http://www.wisebread.com/20-more-signs- ... bref=slide

From the latter, I pulled the keys of "tradition" and "spirit of frugality." He recalls a time when being frugal was not a learned behavior, just how it was done.

When I was a kid, and just assigned the job of mowing the lawn (with the push mower, that my father would have sharpened every couple of years by the grinder who came around on his truck with a whole mess of machinery in the back ... sometimes the women would bring him their scissors, too), I asked my father how the heck the lawn had all these dips and stuff all over, making it so hard to mow. He said, "well, it is going to take me a few more years to fix up where the victory garden was ...."
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Re: The Fine line between responsible and selfish/material

Postby Fallible » Wed Mar 27, 2013 10:31 pm

tom0153 wrote:Fallible, I visited your web site, it looks like fun.

So, what are the traits of frugalness? Visit: http://www.wisebread.com/frugal-factors ... vers-share

Be sure to see how you might have inherited some frugal behaviors: ...


Glad you liked the website; it's also fun to do.

I checked out the WiseBread links and saw many of my inherited traits, mostly from my Depression-era grandparents. Distinguishing between needs and wants, though, is always tricky even when that's my goal. You sometimes have to look pretty deep within yourself to come up with the right answer each time but it's always a money-saver. Thanks for the links.
“Knowing yourself is the beginning of all wisdom.” ~Aristotle
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Re: The Fine line between responsible and selfish/material

Postby tom0153 » Wed Mar 27, 2013 10:56 pm

The difference between a need and a want was something that I was surprised that my kids did not understand. These kids learn by experience. They charge their wants, and can't figure out how come they can't afford a need (smile).

When I was growing up, I'd always marvel at how the boys in the family all had pictures taken wearing sailor suits, cute little photos. As a young adult, someone finally clued me in that they were carefully delivered from one family to the next as hand me downs.

I learned to ride a bike on a girl's bicycle, and did so for quite some time until some kid in the neighborhood with a new Schwinn clued me in. Then, a new Schwinn became a need ... (smile).

My father was born in 1919, I think it was tough to see things go from a land of plenty to going to work right out of high school, no college (not until he had the GI Bill), but he did some trade school so he could work for one of the airplane manufacturers here on Long Island until the war. Somewhere in there, too, his mother died, and his sister went to live with an Aunt.

My mother, born in 1921, had no such experience; her father had plenty of work the entire time, and her mother raised her three children to carry themselves with a silver spoon in the mouth ....

No wonder I was conflicted (smile). I shared your web site with some folks, Fallible, who I believe will enjoy the strips.
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Re: The Fine line between responsible and selfish/material

Postby Fallible » Thu Mar 28, 2013 4:07 pm

tom0153 wrote:The difference between a need and a want was something that I was surprised that my kids did not understand. These kids learn by experience. They charge their wants, and can't figure out how come they can't afford a need (smile)....

...I shared your web site with some folks, Fallible, who I believe will enjoy the strips.


I like your charge-wants-can't-afford-needs comment (which unfortunately also applies to some of us adults). I also understand your "needing" a new Schwinn. :wink: And I remember hand-me-downs in the family (including Schwinns) and never minding them I think because I knew mine would then be handed down, so we were all in the same thrifty boat.

Thanks again for sharing the website with friends and I hope they do have some fun with it as that's what it's meant to be.
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Re: The Fine line between responsible and selfish/material

Postby Kulak » Thu Mar 28, 2013 4:27 pm

I don't believe in the distinction between needs and wants, except in the most trivial sense (needs being air, water, temperature regulation, enough calories, etc.). Today's needs are yesterday's wants.
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Re: The Fine line between responsible and selfish/material

Postby tom0153 » Thu Mar 28, 2013 6:08 pm

Kulak wrote:I don't believe in the distinction between needs and wants, except in the most trivial sense (needs being air, water, temperature regulation, enough calories, etc.). Today's needs are yesterday's wants.


Kulak, I can understand the belief, but I think you have yourself highlighted a few needs that need to be taken care of before we tackle the wants - adequate housing, food, etc. I don't personally find the distinction trivial (for instance, consider the position of someone seeking food stamps or section 8 housing).

It is true, and has been pointed out in this thread, that once you have achieved a certain level of comfort, your wants seem to convert to needs, and more wants are then entertained as activities that might still fall within the range of being frugal.

I worked for a number of years with persons with psychiatric disabilities. There was an aspect of funding which permitted some to go on outings to see Broadway shows and similar. At the time, these weren't activities my wife and I could permit ourselves, as we struggled to meet the needs of the kids, and had to defer our wants, instead being satisfied with a free walk along the beach.

The struggle was to understand and accept how important such activities were in terms of a therapeutic and spiritual sense for these persons with disabilities, and to rejoice in our good health.
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Re: The Fine line between responsible and selfish/material

Postby William4u » Fri Mar 29, 2013 12:32 pm

Kulak wrote:I don't believe in the distinction between needs and wants, except in the most trivial sense (needs being air, water, temperature regulation, enough calories, etc.). Today's needs are yesterday's wants.


I usually think of "need" in the sense of "requirement." So if I need to have money to eat, it is just a requirement to use money to get food. So when people say "I need an iphone" this means that they see it as a requirement for something (as in the iphone is a prerequisite for a certain kind of social life that they consider essential to fitting in with their peers and being happy).
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Re: The Fine line between responsible and selfish/material

Postby tom0153 » Fri Mar 29, 2013 1:23 pm

There is certainly a continuum along which we find "needs" and "wants." As suggested by the OP, the definition of how these items fall along this linear way of thinking is important in seeking to be frugal so as to properly safeguard inflows of wealth (whatever size that might be) and dispense of them in a responsible manner.

No matter our economic status, we are all going to struggle with this. Maybe someone is trying to figure out how to maintain the private airport on their lands, and keep their jet in good repair. There is one famous actor with a 747 out back. If your hobby is piloting jets of that size, maybe this is important to you. That same famous person has had tremendous pressures presented recently, huge life lessons to deal with. Nobody is exempt.

Trying to fix then that gray area where we distinguish this line of requirements into groups of needs and wants takes into account some of these issues. I can see such a person as the actor that I have in mind deciding that the linear definition needs to be adjusted, and all of his wealth will be redefined to support a discovery of the nature of causes of autism and a potential cure. It is possible that he feels that he can contribute to that work and still maintain a 747.

Nobody is called to be a monk, unless the calling is there. We respond to these inner voices in deciding how we are going to live our lives. Some will hear "enough," and adjust their risk tolerance, relax, and live on what they have. Others will keep on working, setting aside, and shooting for a lifestyle that may not provide for a 747, but none the less provide for comfort that may not be in someone else's definition of frugal living, yet, they still say, "I am providing for my needs, and allow myself sufficient wants to make me happy from time to time."

I have to qualify how I quantify this, since I have never been able to equate money with happiness, only freedom from fear and want ... a stage at which many are able to pursue their happiness and can stop worrying about food and warmth.

I have also steadfastly avoided trying to buy into a social life essential to fitting in with peers. I don't want to sound preachy, but the way I resolved some of these conflicts within how I was raised was simply to determine I didn't have to keep up with the Joneses. I have not in fact, and have no regrets. However, I have a firm grasp on where that gray area along that line of requirements would sit that distinguish needs and wants. For some, it would be a want outside of the realm of possibility to have wi-fi at home running a computer and Netflix on the TV; for me, it is within the realm of possibility, and possibly unhealthy, keeping me inside too much, instead of taking a walk to the library to use the computers there (grin) and borrowing more books to read.
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Re: The Fine line between responsible and selfish/material

Postby umfundi » Fri Mar 29, 2013 1:52 pm

... was simply to determine I didn't have to keep up with the Joneses.


My Mother was Iris Jones. On keeping up, she loved to say, "I am the Joneses!"

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Re: The Fine line between responsible and selfish/material

Postby tom0153 » Fri Mar 29, 2013 1:55 pm

Trying to figure where one stands on this continuum of responsibility has been reduced to some fun here: http://www.americasaves.org/blog/547-ma ... ncial-four
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Re: The Fine line between responsible and selfish/material

Postby tom0153 » Fri Mar 29, 2013 2:09 pm

umfundi wrote:
... was simply to determine I didn't have to keep up with the Joneses.


My Mother was Iris Jones. On keeping up, she loved to say, "I am the Joneses!"

Keith :happy


Here's a fun read on the Joneses: http://en.wikipedia.org/wiki/Keeping_up ... he_Joneses If you study the footnotes, you'll see a reference to Shiller (1984) who suggests our portfolio decisions (our indexing asset allocations) are also influenced by keeping up with the Joneses.

Now, this begs the questions, how much of this social phenomenon is in evidence in this forum? Who are the Joneses, and who is trying to keep up?

Interesting. I'm not going to touch it with a ten foot pole, but you might know a sociologist (or, a college professor studying investment) who might find the thought intriguing enough to figure out how to measure such stuff (who posts most often?) :)
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