When Did You Ease Up On Saving Aggressively?

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RJC
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When Did You Ease Up On Saving Aggressively?

Post by RJC » Mon Aug 19, 2019 11:40 am

Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?

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Re: When Did You Ease Up On Saving Aggressively?

Post by Stinky » Mon Aug 19, 2019 11:50 am

RJC wrote:
Mon Aug 19, 2019 11:40 am
Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?
At time of retirement. That's when it's time to harvest the fruits of our labors.

We had reached our "number" before that time.
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HomeStretch
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Re: When Did You Ease Up On Saving Aggressively?

Post by HomeStretch » Mon Aug 19, 2019 11:50 am

We eased up a bit when we hit 25x. Better travel arrangements, more gift/charitable giving, ate out more often, traded in cars a little earlier, hired out a few services, etc. Our mortgage was already paid off.

We still save a lot, just not quite as much. We both saw parents become unemployed for a long while in their late 40s/early 50s so we wanted to hit our number as soon as we could in case of financial adversity further down the road.

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Re: When Did You Ease Up On Saving Aggressively?

Post by Jags4186 » Mon Aug 19, 2019 11:51 am

Easing up on savings means you need more savings.

Let’s pretend you make $100,000 and are saving $45,000/yr meaning you’re spending $55,000/yr. 25x of $55,000 is $1,375,000. If you decide to cut back your savings to 20% and increase your spending to $80,000/yr 25x is now $2,000,000. Congrats on having $1,375,000 but that is only 17x.

Strive to find a balance between spending and savings.

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Re: When Did You Ease Up On Saving Aggressively?

Post by ruralavalon » Mon Aug 19, 2019 11:54 am

RJC wrote:
Mon Aug 19, 2019 11:40 am
Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?
We eased up on aggressive savings when I retired. But we didn't really start young, we started in my late 30s. We paid off our mortgage about 10 years before retirement, and cash flowed college expenses for four four children.

So your situation seems very different. What debt do you have? Any children going to college? A savings rate of 45% is extremely aggressive. What is your age? When do you plan to retire?

Unless you plan on retiring early (the "25 x" rule of thumb is expected to work out for normal retirement age in the mid 60s), it may be reasonable to be less aggressive now.
Last edited by ruralavalon on Mon Aug 19, 2019 12:24 pm, edited 2 times in total.
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RJC
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Re: When Did You Ease Up On Saving Aggressively?

Post by RJC » Mon Aug 19, 2019 11:55 am

Jags4186 wrote:
Mon Aug 19, 2019 11:51 am
Easing up on savings means you need more savings.

Let’s pretend you make $100,000 and are saving $45,000/yr meaning you’re spending $55,000/yr. 25x of $55,000 is $1,375,000. If you decide to cut back your savings to 20% and increase your spending to $80,000/yr 25x is now $2,000,000. Congrats on having $1,375,000 but that is only 17x.

Strive to find a balance between spending and savings.
Good point. I'm hesitant to spend more because then you get used to it (slippery slope!).

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Re: When Did You Ease Up On Saving Aggressively?

Post by donaldfair71 » Mon Aug 19, 2019 11:56 am

Jags4186 wrote:
Mon Aug 19, 2019 11:51 am
Easing up on savings means you need more savings.

Let’s pretend you make $100,000 and are saving $45,000/yr meaning you’re spending $55,000/yr. 25x of $55,000 is $1,375,000. If you decide to cut back your savings to 20% and increase your spending to $80,000/yr 25x is now $2,000,000. Congrats on having $1,375,000 but that is only 17x.

Strive to find a balance between spending and savings.
This concept is covered, I believe, in the Bogleheads Guide to Investing.

The idea that big salary raises can actually be detrimental late in life if they lead to even a small lifestyle creep. You will need more portfolio to match it in retirement. Same applies if you "cut back" savings. Unless the retiree goes back to "pre cutback" levels.

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Just sayin...
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Re: When Did You Ease Up On Saving Aggressively?

Post by Just sayin... » Mon Aug 19, 2019 11:57 am

Stinky wrote:
Mon Aug 19, 2019 11:50 am
At time of retirement. That's when it's time to harvest the fruits of our labors.

We had reached our "number" before that time.
+1. Saved at the same rate up to the day of retirement, then switched to a more generous spend model. I set this as a goal a few years before retirement as a reward I could look forward to. It’s been very nice...

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Re: When Did You Ease Up On Saving Aggressively?

Post by 9-5 Suited » Mon Aug 19, 2019 12:02 pm

Jags4186 wrote:
Mon Aug 19, 2019 11:51 am
Easing up on savings means you need more savings.

Let’s pretend you make $100,000 and are saving $45,000/yr meaning you’re spending $55,000/yr. 25x of $55,000 is $1,375,000. If you decide to cut back your savings to 20% and increase your spending to $80,000/yr 25x is now $2,000,000. Congrats on having $1,375,000 but that is only 17x.

Strive to find a balance between spending and savings.
A good warning especially since lifestyle creep can be mentally difficult to reverse. But the problem is easily solved by just acknowledging that the retirement spending needs to be lower than the spending while working to maintain the 25x. Seems totally fair to spend more of your income once you’ve hit your goal or close to it.

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Re: When Did You Ease Up On Saving Aggressively?

Post by KlangFool » Mon Aug 19, 2019 12:10 pm

OP,

I stopped savings because I used my annual savings to "cash flow" my kids' college education.

KlangFool

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Re: When Did You Ease Up On Saving Aggressively?

Post by financiallycurious » Mon Aug 19, 2019 12:10 pm

I understand the OP’s sentiment because for me, current expenses include (i) cost of raising kids (will go away); (ii) college savings for the kids (will go away); and (iii) retirement savings (will go away once retired). I think I could save less aggressively and not really increase my retirement lifestyle or create a slippery slope, because so much of my current expenses just go away as the kids leave the house. I feel like I could easily retire today if I didn’t have kids, but I understand that old age may bring new, unanticipated expenses. I often wonder if I’m at a place now where I could stop saving much at all, spend my current income, and let my nest egg grow, and still enjoy the same standard of living in retirement that I have now.

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Re: When Did You Ease Up On Saving Aggressively?

Post by RadAudit » Mon Aug 19, 2019 12:15 pm

Stinky wrote:
Mon Aug 19, 2019 11:50 am
At time of retirement.
+1

But, we starting having kids later (30's) and getting them through college took a while. Then, Mom's final illness / expenses and wrapping up her estate took a couple of years. So, we never had the time or opportunity to let up on the rate of saving until retirement.

Edit - However, I'm still saving / reinvesting the difference after tax between RMD and SWR. But, that amount isn't as large as pre-retirement savings.
Last edited by RadAudit on Mon Aug 19, 2019 1:05 pm, edited 1 time in total.
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Re: When Did You Ease Up On Saving Aggressively?

Post by dknightd » Mon Aug 19, 2019 12:22 pm

Never. If you have too much you will find a way to spend it ;)

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RJC
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Re: When Did You Ease Up On Saving Aggressively?

Post by RJC » Mon Aug 19, 2019 12:44 pm

ruralavalon wrote:
Mon Aug 19, 2019 11:54 am
RJC wrote:
Mon Aug 19, 2019 11:40 am
Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?
We eased up on aggressive savings when I retired. But we didn't really start young, we started in my late 30s. We paid off our mortgage about 10 years before retirement, and cash flowed college expenses for four four children.

So your situation seems very different. What debt do you have? Any children going to college? A savings rate of 45% is extremely aggressive. What is your age? When do you plan to retire?

Unless you plan on retiring early (the "25 x" rule of thumb is expected to work out for normal retirement age in the mid 60s), it may be reasonable to be less aggressive now.
I am 43, we still have a 30 year mortgage (focus on that next?), and are funding the kids through 529s. Honestly, I am not sure when we will retire. My spouse is motivated and loves working. I work for the Fed and so far it is interesting and quite flexible.

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Re: When Did You Ease Up On Saving Aggressively?

Post by ruralavalon » Mon Aug 19, 2019 12:52 pm

RJC wrote:
Mon Aug 19, 2019 12:44 pm
ruralavalon wrote:
Mon Aug 19, 2019 11:54 am
RJC wrote:
Mon Aug 19, 2019 11:40 am
Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?
We eased up on aggressive savings when I retired. But we didn't really start young, we started in my late 30s. We paid off our mortgage about 10 years before retirement, and cash flowed college expenses for four four children.

So your situation seems very different. What debt do you have? Any children going to college? A savings rate of 45% is extremely aggressive. What is your age? When do you plan to retire?

Unless you plan on retiring early (the "25 x" rule of thumb is expected to work out for normal retirement age in the mid 60s), it may be reasonable to be less aggressive now.
I am 43, we still have a 30 year mortgage (focus on that next?), and are funding the kids through 529s. Honestly, I am not sure when we will retire. My spouse is motivated and loves working. I work for the Fed and so far it is interesting and quite flexible.
How many years are left on the mortgage note? What is the current balance and the interet rate?
Last edited by ruralavalon on Mon Aug 19, 2019 12:54 pm, edited 1 time in total.
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Re: When Did You Ease Up On Saving Aggressively?

Post by cherijoh » Mon Aug 19, 2019 12:53 pm

Jags4186 wrote:
Mon Aug 19, 2019 11:51 am
Easing up on savings means you need more savings.

Let’s pretend you make $100,000 and are saving $45,000/yr meaning you’re spending $55,000/yr. 25x of $55,000 is $1,375,000. If you decide to cut back your savings to 20% and increase your spending to $80,000/yr 25x is now $2,000,000. Congrats on having $1,375,000 but that is only 17x.

Strive to find a balance between spending and savings.
Excellent point that eludes some people when they decide they have "won the game". IMO, if you are going to "loosen up a little" you are better off taking a "once in a lifetime" vacation than permanently increasing your expenses by purchasing a vacation home or other items that require ongoing spending. Plus you never know if your health will support taking the trip later when you have retired.

But with a saving's rate as high as the OP's and 25x in current expenses, IMO they can afford to ease up some. But perhaps not as much as the OP's spouse would like. :wink:

I eased up on my savings when I ended up doing a mid-career transition and taking a ~20% cut in pay. My savings rate went down, but my spending level didn't go up. And I was still able to max my 401k and Roth, but I stopped taxable investing. And a couple years after making the transition, I finished paying off my house, so my expenses went down. At that point, I decided I didn't need to divert the extra cash flow towards taxable investing and I started spending it on myself - mostly on nice vacations and other experiences.
Last edited by cherijoh on Mon Aug 19, 2019 4:16 pm, edited 1 time in total.

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Re: When Did You Ease Up On Saving Aggressively?

Post by Smoke » Mon Aug 19, 2019 1:05 pm

The day I retired.
Arguing for the sake of arguing is something I am not going to engage in.

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Re: When Did You Ease Up On Saving Aggressively?

Post by jebmke » Mon Aug 19, 2019 1:45 pm

I think my last big option payout was 3-4 years after I retired so it would have been then.
When you discover that you are riding a dead horse, the best strategy is to dismount.

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Re: When Did You Ease Up On Saving Aggressively?

Post by Starfish » Mon Aug 19, 2019 1:47 pm

I never saved or stopped saving.
I spend everything I need because I believe in living now and 1 minute today is 10 times more valuable than 1 minute 10 years from now.
I invest the rest.
If your goal is 25X expenses, when you increase your expenses your new goal will be 25X your new expenses.
Last edited by Starfish on Mon Aug 19, 2019 1:49 pm, edited 1 time in total.

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Re: When Did You Ease Up On Saving Aggressively?

Post by mhc » Mon Aug 19, 2019 1:48 pm

I had a dollar amount I wanted to hit by a certain age. Once I did that, we did ease up on saving. We had deferred some necessary house work and car purchases until after hitting the goal. One could argue that we also decided to save more for retirement and cash flow college for the kids. Cutting back on saving doesn't necessarily mean life style creep. Even though, we have allowed a certain amount of life style creep. It really comes down to finding a balance between enjoying it now or later.

For example, we can travel with our kids now. In 10 years that may not be an option. I love family travel.

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Re: When Did You Ease Up On Saving Aggressively?

Post by JPH » Mon Aug 19, 2019 1:52 pm

Never. I am retired and still try and "save" a portion of my RMD.
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Re: When Did You Ease Up On Saving Aggressively?

Post by Cycle » Mon Aug 19, 2019 1:53 pm

When children can no longer see how I spend money, ie when they are in college or whatever kids will do after highschool 17 years from now
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Re: When Did You Ease Up On Saving Aggressively?

Post by Dottie57 » Mon Aug 19, 2019 3:03 pm

I became more agressive in amounts as I made more money. I had a bit of lifestyle creep but kept the big ticket items in check.

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Re: When Did You Ease Up On Saving Aggressively?

Post by Dottie57 » Mon Aug 19, 2019 3:04 pm

JPH wrote:
Mon Aug 19, 2019 1:52 pm
Never. I am retired and still try and "save" a portion of my RMD.

:beer

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Re: When Did You Ease Up On Saving Aggressively?

Post by mervinj7 » Mon Aug 19, 2019 3:11 pm

RJC wrote:
Mon Aug 19, 2019 11:40 am
Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?
Let's look at it from another approach. Are there any specific areas you may want to increase spending on? Are there purchases/trips/experiences that would make your life more enjoyable NOW rather than later in life? For example, this year we went to see Hamilton and took a trip to Hawaii with the kids. No regrets on either.

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Re: When Did You Ease Up On Saving Aggressively?

Post by prd1982 » Mon Aug 19, 2019 3:20 pm

Since you have been on this forum since the beginning of the year, I'm pretty sure you knew you would get lots of support for not increasing your spending. I'm actually surprised I didn't see people saying 45% was not enough.

I didn't see any indication of how much you are spending on non-essential, or even frivolous (to you) items. If you are living as-if you can barely pay for essentials, then I would vote to reduce your level of savings. If you save "only 30%", it sure seems enough to me. Remember, the spouse should get an equal vote on saving/spending.

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Re: When Did You Ease Up On Saving Aggressively?

Post by Mullins » Mon Aug 19, 2019 3:25 pm

For me, quite the other way around. I save more aggressively the closer I get. One reason is because I can... I make more than some years prior. And that savings plan will end when there's no new income to accumulate.

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Re: When Did You Ease Up On Saving Aggressively?

Post by tyrion » Mon Aug 19, 2019 3:29 pm

Cycle wrote:
Mon Aug 19, 2019 1:53 pm
When children can no longer see how I spend money, ie when they are in college or whatever kids will do after highschool 17 years from now
This is an interesting answer.

We have kids who are a young teen and a preteen. We recently 'eased up' on retirement savings after paying off the mortgage. Or maybe a better way to say it is we decided we could spend a little more on the small things to make us enjoy the 'now.'

Along the way we have always stressed to the kids the value of money, and spending less than you earn, and the cost of keeping up with the Joneses, and all of those concepts. But I do think it's important to keep in mind the idea that you are modeling behavior for your kids.


Back to the OP - I would say if you have a dual income scenario and are 2-3 years away from 25x expenses that yes, you could ease up a little. Pick and choose things that you think will deliver the most value to you.

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Re: When Did You Ease Up On Saving Aggressively?

Post by eldinero » Mon Aug 19, 2019 3:46 pm

We eased up when we hit 25x.

I still continue to work, so we have allowed our lifestyle to inflate a bit. Every year we set the spending budget at 4% of our invested assets, then save the rest. Still saving ~40%

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Re: When Did You Ease Up On Saving Aggressively?

Post by Wiggums » Mon Aug 19, 2019 3:59 pm

Stinky wrote:
Mon Aug 19, 2019 11:50 am
RJC wrote:
Mon Aug 19, 2019 11:40 am
Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?
At time of retirement. That's when it's time to harvest the fruits of our labors.

We had reached our "number" before that time.
Similar situation here. We kept saving until retirement without respect to the balance. Now we talk more about charitable giving and fixed income performance.

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Re: When Did You Ease Up On Saving Aggressively?

Post by nguy44 » Mon Aug 19, 2019 4:06 pm

We kept saving aggressively until I retired. My last full year of work we got our savings rate to over 38%. But we still lived very well with that rate.

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Re: When Did You Ease Up On Saving Aggressively?

Post by beyou » Mon Aug 19, 2019 4:11 pm

When college tuition bills came. When they stop, would continue saving, if still employed at same level of income. But many people at that age are forced into retirement, which is the next reason to stop saving, lack of income.

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Re: When Did You Ease Up On Saving Aggressively?

Post by whodidntante » Mon Aug 19, 2019 4:22 pm

Once a squirrel becomes conditioned to save his nuts, he has a hard time letting his nuts lay on the ground.

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Re: When Did You Ease Up On Saving Aggressively?

Post by leftcoaster » Mon Aug 19, 2019 4:26 pm

On the topic of lifestyle creep, I believe there’s a distinction worth making.

With respect to increased spending, there are two kinds that we could consider: hard spending and soft spending.

Hard spending would be expenses that are difficult to reverse or unwind. Examples could include a larger home with a bigger mortgage, leased cars, vacation homes, etc.

Soft spending is something you can ramp up and down with relative ease. Expensive vacations can become inexpensive vacations. Business class seats can become coach seats. Frequently replaced cars can be driven until it’s time for the junkyard.

Of course after years of being frugal, it can be difficult to suddenly flip a switch and become profligate. This is a good thing and hopefully will allow people to enjoy some Indulgences In the soft spending category while preserving the discipline to ease up if circumstances warrant.

In the end, however, it is important to remember that there is no luggage rack on a hearse.

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Re: When Did You Ease Up On Saving Aggressively?

Post by mak1277 » Mon Aug 19, 2019 4:26 pm

The question doesn't fit for me. I've always "paid myself first" by spending what I wanted to for the life I wanted to live. When I didn't make much money, that meant I had credit card debt. WHen I made more, than meant I saved. Now I make (relatively) a lot, so I guess I am "saving aggressively".

I think people who save first are doing it backwards.

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Re: When Did You Ease Up On Saving Aggressively?

Post by Jags4186 » Mon Aug 19, 2019 4:29 pm

whodidntante wrote:
Mon Aug 19, 2019 4:22 pm
Once a squirrel becomes conditioned to save his nuts, he has a hard time letting his nuts lay on the ground.
You haven’t met the squirrel in my front yard:

Image

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Re: When Did You Ease Up On Saving Aggressively?

Post by Jags4186 » Mon Aug 19, 2019 4:32 pm

mak1277 wrote:
Mon Aug 19, 2019 4:26 pm
The question doesn't fit for me. I've always "paid myself first" by spending what I wanted to for the life I wanted to live. When I didn't make much money, that meant I had credit card debt. WHen I made more, than meant I saved. Now I make (relatively) a lot, so I guess I am "saving aggressively".

I think people who save first are doing it backwards.
That mentality works if you end up making a lot. It lands you in elder poverty if you don’t. Most people never make a lot.

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Re: When Did You Ease Up On Saving Aggressively?

Post by mak1277 » Mon Aug 19, 2019 4:33 pm

Jags4186 wrote:
Mon Aug 19, 2019 4:32 pm
mak1277 wrote:
Mon Aug 19, 2019 4:26 pm
The question doesn't fit for me. I've always "paid myself first" by spending what I wanted to for the life I wanted to live. When I didn't make much money, that meant I had credit card debt. WHen I made more, than meant I saved. Now I make (relatively) a lot, so I guess I am "saving aggressively".

I think people who save first are doing it backwards.
That mentality works if you end up making a lot. It lands you in elder poverty if you don’t. Most people never make a lot.
True - I always knew that I was making a bet on my future earning potential.

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Re: When Did You Ease Up On Saving Aggressively?

Post by SusieQ » Mon Aug 19, 2019 4:34 pm

I stopped saving when I retired. I didn't think I would ever see the day.

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Re: When Did You Ease Up On Saving Aggressively?

Post by Wiggums » Mon Aug 19, 2019 4:35 pm

I don’t know if this is part of your question or not. Even in retirement, we still have a budget because that works best for us. So the source of income has changed, but our philosophy has not. we continue to invest with excess funds that were budgeted for but not spent. We track all our accounts and expenses in Quicken because my DW enjoys it. It also helps us to maintain rather increase our lifestyle without a conscious decision to do so. If the stock market is good to us, we discuss the best use for that money, including more charitable giving.

I hope this helps.
Last edited by Wiggums on Mon Aug 19, 2019 4:37 pm, edited 1 time in total.

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Re: When Did You Ease Up On Saving Aggressively?

Post by smitcat » Mon Aug 19, 2019 4:37 pm

Jags4186 wrote:
Mon Aug 19, 2019 4:32 pm
mak1277 wrote:
Mon Aug 19, 2019 4:26 pm
The question doesn't fit for me. I've always "paid myself first" by spending what I wanted to for the life I wanted to live. When I didn't make much money, that meant I had credit card debt. WHen I made more, than meant I saved. Now I make (relatively) a lot, so I guess I am "saving aggressively".

I think people who save first are doing it backwards.
That mentality works if you end up making a lot. It lands you in elder poverty if you don’t. Most people never make a lot.
OR - motivates you to make more.

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Re: When Did You Ease Up On Saving Aggressively?

Post by EddyB » Mon Aug 19, 2019 4:44 pm

RJC wrote:
Mon Aug 19, 2019 11:40 am
Dear Friends,

At what point do you let up on the aggressive savings gas pedal? When you are close to your number? After reaching? Never?

Financial calculators suggest that we may reach our number (~25x expenses) in 2-3 years depending on the market. We LBYM (save ~45%), however, my spouse thinks we could let up a bit since we are close to our goals. I think I am more conservative and more conscientious of potential black swan events.

What do you think?
With luck, I'm a little bit closer to my goal than you are, and this has been on my mind, too. For some time, I wouldn't want to increase my expenses wildly out of line with my increasing ability to support those expenses from my investments. So to the extent I continue to bring in income, I think I will ramp up spending and ramp down savings for at least several years. Realistically, while there are a few specific large purchases I could imagine making, I have trouble imagining our consistent year-to-year spending going beyond about twice what we spend now, even if I continue to work; even at that rate, if I maintain my current income, we'd still be saving almost as much as we would be spending.

It is entirely possible that I would further decrease the amount I work, and my income, though.

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Re: When Did You Ease Up On Saving Aggressively?

Post by mrspock » Mon Aug 19, 2019 4:46 pm

Lots of good advice on this thread. I think it depends how you planned your “number”. I actually chose mine such that it’s a solid 2-2.5x current (frugal) spending, so if you base your 25x off planned vs current spending, and planned > current spending, then feel free to loosen up.

In other words, pick your retirement number on which you base the 25x on your desired retirement spending, then loosen up accordingly as you get closer.

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Re: When Did You Ease Up On Saving Aggressively?

Post by MotoTrojan » Mon Aug 19, 2019 4:49 pm

What input are the calculators using? 2-3 years could see a flat market, 15% CAGR, or cut you in half. Also 25x is not nearly enough for me to sleep well but to each their own.

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Re: When Did You Ease Up On Saving Aggressively?

Post by fposte » Mon Aug 19, 2019 4:52 pm

Even for here these answers seem pretty drastic. "Ease up on saving aggressively" doesn't mean "Stop saving at all and buy a solid gold Lamborghini"; it can mean "opted to take a vacation after several years without," or "got a cat," or "upgraded the winter coat" or even "started buying Ben and Jerry's" :D . It's not like your savings rate when you start saving is the eternally correct one and you're cast into perdition if you ever deviate from it.

I loosened the purse strings a little when projections demonstrated I'd be fine in retirement even if my pension failed. I didn't change my day-to-day budget but I started tackling some home repairs and maintenance that could have waited, but I decided I'd rather enjoy it now, so I was freer with the one-off expenditures.

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Re: When Did You Ease Up On Saving Aggressively?

Post by tesuzuki2002 » Mon Aug 19, 2019 5:00 pm

It doesn't hurt to ease up a little bit... I had a really good savings year in 2017.... 2018 I had some on controllable expenses... I let the reigns out a little this year 2019... I'm planning to reset the budget for 2020 and get a bit more aggressive just because I can...

I'll likely let up in 2021 again.. Keep a balance..

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Re: When Did You Ease Up On Saving Aggressively?

Post by almostretired1965 » Mon Aug 19, 2019 5:01 pm

If you were to use % of income saved, it has actually been on a one way upward trend over the years. My wife and I are both fairly frugal by nature, but we've have never really bothered to track our spending or savings, though I keep track of our total assets. We've never had any serious emergencies, medical or otherwise, so cash flow has always been positive, even at the start of my career. (We bought a house early and stayed in it for 25 years.)

We have not changed our habits much. When I do retire, we will probably spend a bit more on travel and stuff since my wife enjoys that, but I don't really see our spending habits changing very much. The things we enjoy doing tend not to be things that get significantly more enjoyable if you decide to increase funding.

It is in some ways more psychological than anything else. It took a long time for it to happen, but I'm now much more relaxed when stuff happens, like when the radiator starts leaking or the heat pump fails. It's just money ........

A

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Re: When Did You Ease Up On Saving Aggressively?

Post by dboeger1 » Mon Aug 19, 2019 5:13 pm

I'm 28 with a long way to go to reach house+25x, so still fairly young to "ease up" in a permanent way. That being said, this is the first year my wife and I have both had high paying jobs simultaneously. Prior to this, only 1 of us worked at a time. We've always been very aggressive savers (our biggest splurge was buying a new car, but even that's a fairly modest percentage of our income over the past 6 years or so, and we take several road trips per year, as well as carpool to work). We're pretty much penny pinchers, coupon clippers, you name it. We're very skeptical of just about anything that costs us money. We're the kind to manage different credit cards for different spending categories to maximize rewards. The most expensive vacation we've ever done was a single night in a hotel for about $350, and I won $150 of it back gambling, lol.

My wife recently started her new job in international sales, which more than doubled her income, but since then, her (and by extension my) stress levels have gone through the roof. She's constantly getting called into meetings at 2AM with folks in China. To be honest, I don't think this job is a great fit for her in the long run, not because she can't do it, but because it'll make her miserable. I'm a firm believer in life being too short to spend it doing something you hate. That being said, I don't think it's fair to call it quits without at least giving it a fair shot for a year. She had been aspiring to make more income for quite some time, so now that she has it, I think she should tough it out for a bit to see if she can make it work.

So as a compromise, I made the executive decision to splurge on a nice vacation next year. I've never taken a week off of work, and I always wanted to go to Las Vegas when prices are low during the week. As an added bonus, we'll be going with some of my old high school friends with whom I've kept in touch, and my wife has been wanting to meet them for years. I'm definitely planning on spoiling her with spas, nice restaurants, etc. It recently hit me that this might be our last big vacation before reaching our financial target for having children. So to me, this is less about lifestyle creep and more about recovering psychologically as a couple before the next big savings marathon.

I think it's okay to reward yourself from time to time for all the frugality along the way. After all, beyond covering absolute necessities, there isn't much of a philosophical difference between saving to splurge in retirement and saving to splurge in your 20's/30's/etc.

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Re: When Did You Ease Up On Saving Aggressively?

Post by z3r0c00l » Mon Aug 19, 2019 5:35 pm

1 in 5 American men won't live to see 65 and 1 in 10 won't make 55. There is a strong argument for enjoying life before retirement too. If you enjoy things that cost money, like travel, good food, music, time with family, hobbies, then I think you need to enjoy them now also. Don't mortgage the future, but don't squander the present either. Because tomorrow is a probability, not a guarantee.

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Re: When Did You Ease Up On Saving Aggressively?

Post by sergeant » Mon Aug 19, 2019 5:42 pm

I guess we still save aggressively since were putting away low six figures every year. I retired 3 years ago and wife retires next month. We started spending much more aggressively a few years back when we hit our number.
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