Any regrets living a frugal life for high income/high networth individuals?

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am
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Any regrets living a frugal life for high income/high networth individuals?

Post by am » Sat Apr 22, 2017 10:07 pm

I am Top 5th percentile networth for my age group (40-49) and top 2-3% income with no debt thanks to being frugal and being a boglehead now for 10 yrs. We drive > 8 yr old cars and have a remodeled but modest house In a middle to upper middle class area worth about 650k. We can afford a house twice as much in a more affluent area that is nicer and closer to water. We can probably afford nicer cars and things. But with nicer things would come less savings. Our only splurge is travel but I wouldn't call our accommodations luxurious. I worry that my savings could be wiped out or perhaps health issues may make the future less enjoyable. Than there may be regrets with regards to saving hard and living modestly when we could have lived it up while we could. After all, you can't take it with you, Anyone else feel the same way?

WolfgangPauli
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by WolfgangPauli » Sat Apr 22, 2017 10:14 pm

No regrets at all... Living frugal is not only good for you financially but it is good for the soul. After a while you realize all the "stuff" is just crap anyway. A good family, good children, great life experiences beat cars and boats anyway.

Also, it is so liberating to know you are not a slave to your job. Great to know you live a life style which does not require you to work but allows you to work at something you enjoy.

Finally, it is great to know you don't have to worry. I hear this all the time, "You can't take it with you". Right, but if you turn 70 and something happens requiring a bit more money than you anticipated, you cannot get it either. to this, I am reminded of Pascal's wager:

When asked why he believes in God, Pascal said (all this is totally paraphrased but you get the drift):

"If I believe in God and live a religious life, and I am right, I am going to be in heaven for eternity. If I am wrong, the worst thing is I just lived a good life. If you don't believe in God and you are wrong, you have a real problem".

Same is true with investing... If I over save and I don't end up needing the money, who cares. But, if my neighbor does not and he needs the money, he is screwed.
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by basspond » Sat Apr 22, 2017 11:13 pm

WolfgangPauli wrote:No regrets at all..p
..... Also this, I am reminded of Pascal's wager:

When asked why he believes
"If I believe in God and live a religious life, and I am right, I am going to be in heaven for eternity. If I am wrong, the worst thing is I just lived a good life. If you don't believe in God and you are wrong, you have a real problem".

Same is true with investing... If I over save and I don't end up needing the money, who cares. But, if my neighbor does not and he needs the money, he is screwed.

I couldn't agree more. In my case it is the only reason I could retire early. Living life now!

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JoMoney
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by JoMoney » Sun Apr 23, 2017 12:06 am

I wasn't really sure how this measured, but I used this https://dqydj.com/net-worth-by-age-calc ... ed-states/
Which is using data from the 2013 Federal Survey of Consumer Finances (2016 survey data doesn't appear to be out yet)
:thumbsup to what WolfgangPauli said....
I can't think of anything I regret not buying, but there's plenty of things I wish I hadn't bought.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

SGM
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by SGM » Sun Apr 23, 2017 2:55 am

It is no hardship to keep cars for a long time. They tend to stand up pretty well with normal maintenance. We could spend more on vacations but we have difficulty getting away for long because of elderly relatives that need minding. I don't wash them often because they get dirty just going down the driveway.

We have no neighbors within a mile or so driving distance so why try and impress them with a new Mercedes.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Longdog » Sun Apr 23, 2017 4:42 am

SGM wrote:We could spend more on vacations but we have difficulty getting away for long because of elderly relatives that need minding. I don't wash them often because they get dirty just going down the driveway.


I would think for general health and hygiene reasons you should wash them daily - even if they do get dirty going down the driveway. :D
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by SGM » Sun Apr 23, 2017 4:53 am

Longdog wrote:
SGM wrote:We could spend more on vacations but we have difficulty getting away for long because of elderly relatives that need minding. I don't wash them often because they get dirty just going down the driveway.


I would think for general health and hygiene reasons you should wash them daily - even if they do get dirty going down the driveway. :D


I can be funny without even trying this early in the morning. :oops:
I do hire people to wash the elderly.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by mancich » Sun Apr 23, 2017 5:10 am

WolfgangPauli wrote:No regrets at all... Living frugal is not only good for you financially but it is good for the soul. After a while you realize all the "stuff" is just crap anyway. A good family, good children, great life experiences beat cars and boats anyway.

Also, it is so liberating to know you are not a slave to your job. Great to know you live a life style which does not require you to work but allows you to work at something you enjoy.

Finally, it is great to know you don't have to worry. I hear this all the time, "You can't take it with you". Right, but if you turn 70 and something happens requiring a bit more money than you anticipated, you cannot get it either. to this, I am reminded of Pascal's wager:

When asked why he believes in God, Pascal said (all this is totally paraphrased but you get the drift):

"If I believe in God and live a religious life, and I am right, I am going to be in heaven for eternity. If I am wrong, the worst thing is I just lived a good life. If you don't believe in God and you are wrong, you have a real problem".

Same is true with investing... If I over save and I don't end up needing the money, who cares. But, if my neighbor does not and he needs the money, he is screwed.


+1 The thing that spendthrifts often don't get is that it is not a matter of denial when we BH's live frugally. It is just that buying a bunch of "stuff" doesn't bring real happiness. I have a brother-in-law who always says "life is short, you could get hit by a bus tomorrow". Ummm, well yes, but chances are, you WON'T get hit by a bus tomorrow. I'm not going to spend a lot of money on stuff because something bad might happen to me in the short term. I enjoy the simple things in life. I always counter with "well, if you believe that, then cash out everything you have and go spend it all today". That usually shuts him up until the next time :beer

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Longdog » Sun Apr 23, 2017 6:35 am

mancich wrote:The thing that spendthrifts often don't get is that it is not a matter of denial when we BH's live frugally. It is just that buying a bunch of "stuff" doesn't bring real happiness. I have a brother-in-law who always says "life is short, you could get hit by a bus tomorrow". Ummm, well yes, but chances are, you WON'T get hit by a bus tomorrow. I'm not going to spend a lot of money on stuff because something bad might happen to me in the short term. I enjoy the simple things in life. I always counter with "well, if you believe that, then cash out everything you have and go spend it all today". That usually shuts him up until the next time :beer


The sooner in life you recognize that acquiring stuff does not bring you happiness, the happier you will become in so many ways. Ironically, so much of our economy relies on convincing people that if they just had this "one more thing" they'd be happier and their lives would finally be complete. But really, all of it is just a Grand Illusion.
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by retired early&luv it » Sun Apr 23, 2017 6:39 am

I lost my job during the early 80s when unemployment was double digits during Reaganomics. I financially was wiped out and had to move back in with my parents. I was unemployed for over a year and a half. When I finally found a really bad job that had zero benefits, I had to start all over re-building my career.

I did not save for retirement, instead I saved for the next time I became unemployed. Which fortunately did not happen, but I had the intense fear that it would. Thus, my savings grew and grew. I was one of those frugal people that abhor debt. Once in my life I did buy a new vehicle, but I drove that for 17 years. I got a loan when I bought my condo, but paid it off in three years. I invested well and lived well below my means.

I retired at age 56.5, which I was able to do. I still live below my means, I drive a 14 year old Land Rover. I have been steadily converting my IRA to a Roth each year, I will have it all converted before I turn 65.

Now for the flip side. I retired seven years ago and am at Flagship level at Vanguard. I got a new Titanium bicycle this past month. I do whatever I want, whenever I want. These are small luxuries, but because I lived a frugal life, I can get a lot of enjoyment without spending a fortune. For example, I spent a month in Iceland last summer. But because I was camping and staying in hostels, my month in Iceland was quite affordable.

And you never know what is coming down the road in the global economy. If my investment returns over the next decade are nil, I still will be able to spend at my current rate.

Do I regret living a frugal life? Absolutely not, if I had not lived a frugal life, I would still be working, and hating it.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by WolfgangPauli » Sun Apr 23, 2017 6:41 am

retired early&luv it wrote:I lost my job during the early 80s when unemployment was double digits during Reaganomics. I financially was wiped out and had to move back in with my parents. I was unemployed for over a year and a half. When I finally found a really bad job that had zero benefits, I had to start all over re-building my career.

I did not save for retirement, instead I saved for the next time I became unemployed. Which fortunately did not happen, but I had the intense fear that it would. Thus, my savings grew and grew. I was one of those frugal people that abhor debt. Once in my life I did buy a new vehicle, but I drove that for 17 years. I got a loan when I bought my condo, but paid it off in three years. I invested well and lived well below my means.

I retired at age 56.5, which I was able to do. I still live below my means, I drive a 14 year old Land Rover. I have been steadily converting my IRA to a Roth each year, I will have it all converted before I turn 65.

Now for the flip side. I retired seven years ago and am at Flagship level at Vanguard. I got a new Titanium bicycle this past month. I do whatever I want, whenever I want. These are small luxuries, but because I lived a frugal life, I can get a lot of enjoyment without spending a fortune. For example, I spent a month in Iceland last summer. But because I was camping and staying in hostels, my month in Iceland was quite affordable.

And you never know what is coming down the road in the global economy. If my investment returns over the next decade are nil, I still will be able to spend at my current rate.

Do I regret living a frugal life? Absolutely not, if I had not lived a frugal life, I would still be working, and hating it.


Hi, I am about to do the same thing (Retire at 56)... Mind if I PM you to ask a few questions?
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by CyclingDuo » Sun Apr 23, 2017 6:42 am

am wrote:I am Top 5th percentile networth for my age group (40-49) and top 2-3% income with no debt thanks to being frugal and being a boglehead now for 10 yrs. We drive > 8 yr old cars and have a remodeled but modest house In a middle to upper middle class area worth about 650k. We can afford a house twice as much in a more affluent area that is nicer and closer to water. We can probably afford nicer cars and things. But with nicer things would come less savings. Our only splurge is travel but I wouldn't call our accommodations luxurious. I worry that my savings could be wiped out or perhaps health issues may make the future less enjoyable. Than there may be regrets with regards to saving hard and living modestly when we could have lived it up while we could. After all, you can't take it with you, Anyone else feel the same way?


Strive to find balance.

Have you traveled overseas yet?

Do you have a nice comfy chair to sit in at home?

Comfortable shoes?

A good book to read?

A six pack of beer in the fridge, and a few bottles of wine in the house?

Enjoy some of the simpler comforts in life while still maintaining your discipline.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by blueman457 » Sun Apr 23, 2017 7:00 am

This question gets asked periodically. As someone still in the infancy of my career, I can't contribute much. But reading responses has helped me shape my thoughts.

Balance is key. One of the common reasons why folks have regretted being frugal because their spouse died in their 50-60s and they couldn't enjoy travel and retirement together.

Freak accidents do happen, and they shouldn't be ignored. But spending all your money on useless things isn't the answer.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Jags4186 » Sun Apr 23, 2017 7:23 am

OP, take a reality check. (and I mean that in a nice way).

You live probably a really really nice life style compared to almost everyone in the world. I could be wrong, but my guess is your total cash outlay over the course of a year is between $75,000 and $100,000 a year. That isn't living frugally. Sure you may be able to spend more, but the reality is your expenses shouldn't grow to fit your income, your expenses should grow to fit your needs. Don't compare yourself to others in your peer group, do what's best for you.

After all, if you earned 10x your income next year and spent 10x what you spent this year, with the same ratios, would you still consider yourself "frugal"?

My only advice would be....you want a new car go buy a new car.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Tycoon » Sun Apr 23, 2017 7:33 am

No regrets. I've watch friends and neighbors sink into financial ruin chasing happiness with money. In the end they wind up frugal by necessity.
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by JonnyDVM » Sun Apr 23, 2017 7:38 am

OP the ones who would have the most regret aren't around anymore to respond to your post.

I prefer to focus on experiences and not things. I think I would be considered far from frugal. There are some things in life that are worth splurging on which have been discussed in many other threads. Balance is what's most important. Somewhere on the gradient between spendthrift and miser there's a sweet spot that we should all be striving for.
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by rob65 » Sun Apr 23, 2017 7:41 am

The one caveat that I would mention is travel. It does become harder to travel, particularly internationally, after a certain age. Not suggesting blowing the budget, but I think the one regret my parents have is not traveling more while their health allowed it.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by pinecone » Sun Apr 23, 2017 7:49 am

No regrets. I value my personal freedom more than I value stuff. I like being financially incognito for a variety of reasons. If anyone judges me for it, it's their loss, not mine. I do splurge on a few things and experiences that bring value and joy to my life.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by afan » Sun Apr 23, 2017 7:51 am

JoMoney wrote:I can't think of anything I regret not buying, but there's plenty of things I wish I hadn't bought.


I can think of a lot of things I regret not buying- Microsoft when it went public, Google when it went public...

But not "stuff". My car gets me where I want to go, it is safe and reliable. What more could I want? My house is comfortable, warm in the winter, quiet and safe. As jags4816 points out, an American living a safe comfortable life is living in the lap of luxury by the standards of the vast majority of humans who have ever lived and of those alive now. Rather than congratulate ourselves for being frugal, just be grateful that we can live the way we do with plenty left for savings.

Once you get used to asking what you really want, you realize that much of what is available for sale is manufactured demand. Step back and ask not whether you want whatever is advertised, but why anyone would want that. I enjoy seeing my assets grow more than I would enjoy a trip overseas or a fancy dinner.

I think of consumption in units of VTI. I ask myself whether I would rather have that thing, that experience, or whatever or would I rather buy another share of VTI. VTI usually wins.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by MikeG62 » Sun Apr 23, 2017 8:06 am

am wrote:I am Top 5th percentile networth for my age group (40-49) and top 2-3% income with no debt thanks to being frugal and being a boglehead now for 10 yrs. We drive > 8 yr old cars and have a remodeled but modest house In a middle to upper middle class area worth about 650k. We can afford a house twice as much in a more affluent area that is nicer and closer to water. We can probably afford nicer cars and things. But with nicer things would come less savings. Our only splurge is travel but I wouldn't call our accommodations luxurious. I worry that my savings could be wiped out or perhaps health issues may make the future less enjoyable. Than there may be regrets with regards to saving hard and living modestly when we could have lived it up while we could. After all, you can't take it with you, Anyone else feel the same way?


I think living well within ones means while working (if income levels allows this without pennypinching) is the right move. However, once you retire, I think it's time to open the stopcocks and live "up to" the level of your net worth (I am not talking about physical asset accumlation here). After all, there will be so many places to go, things to see and stuff to do which you did not get to experience while you were working and saving. Now that you'd have unlimited time and the resources built up from a life lived well below your means, you'd actually be able to pull it off.

So to me it does not have to be an either/or situation. You can/should do both (save diligently while working and live well when retired).

What is the point of living well below ones means while working if you never get to live up to the level of your means when retired? Just to leave it all to someone else when you die?

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by XDark_FenixX » Sun Apr 23, 2017 8:27 am

blueman457 wrote:This question gets asked periodically. As someone still in the infancy of my career, I can't contribute much. But reading responses has helped me shape my thoughts.

Balance is key. One of the common reasons why folks have regretted being frugal because their spouse died in their 50-60s and they couldn't enjoy travel and retirement together.

Freak accidents do happen, and they shouldn't be ignored. But spending all your money on useless things isn't the answer.


I'm in the same boat as you but from what I can tell it's more worthwhile to splurge on experiences than stuff. I still try to get the best deals on everything but i don't mind spending a good bit traveling. Those are memories and stories for a lifetime

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by sambb » Sun Apr 23, 2017 8:27 am

I am so glad that i didnt live frugally. I went to vegas with friends in my 20s, great dates with significant others, and great vacations, all sorts of other things. I dont think that it would have been as much fun in my 60s. I am so so happy that I blew some money, and that i continue to blow some once in awhile. For example, last expense was first class seats on a great overseas trip to dubai and australia. it was great. And yes, it made me way happier than being in coach for 10-14 hour flights. Loved the beaches and kite surfing in dubai.
I save a significant portion, but certain things are better enjoyed at younger age.
I have owned convertibles and other nice german sports cars, but also have had camry, accord, and outback. They arent equivalent in my mind, but I go back and forth.
Keep saving, but dont forget to LIVE!

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by blaugranamd » Sun Apr 23, 2017 8:41 am

The bottom line is this: if you're on pace to hit your goals financially and are still restricting yourself from things you can afford and would enjoy you're probably going to regret things. You might not be healthy enough to hike Kilimanjaro at 60 but you might have to splurge to do it in your 30s. The goal is not die rich and financial independence​ is useless if you can't enjoy yourself.
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Jimmie » Sun Apr 23, 2017 9:15 am

Every so often, a news article pops up that analyzes the monetary level to make the average person "happy". If I recall, it was somewhere around $70,000 a year last time I read an article of this sort. This amount gets you decent housing, keeps your belly full of food, and affords enough to keep you healthy and driving a reasonable car.

Additional monetary increases lead to diminishing returns of happiness. The houses and cars get bigger. Junior goes to better schools. Dinner is steak more often.

At the end of the day, this added "stuff" doesn't make you all that much more happy.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by TX_Man » Sun Apr 23, 2017 9:21 am

Another question for the high income frugal individuals.

How often did you have to bat off "Keeping up with the Joneses"? Did it come up regularly where you saw co-workers/friends/relatives taking their trips to Italy and Spain, getting their new (insert item here) and you felt a need to "keep up"? If so how did you combat it? What recommendations of you have for the younger crowd (early 30s) who try fight this "keeping up" mentality?

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by am » Sun Apr 23, 2017 9:30 am

I question the boglehead frugal crowd because many of my high earning peers buy expensive houses. Not to mention the abundant expensive properties > 1 mil a short drive from me that many own in my area and wealthier areas. Do all these people have it wrong?

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by MikeG62 » Sun Apr 23, 2017 9:50 am

TX_Man wrote:Another question for the high income frugal individuals.

How often did you have to bat off "Keeping up with the Joneses"? Did it come up regularly where you saw co-workers/friends/relatives taking their trips to Italy and Spain, getting their new (insert item here) and you felt a need to "keep up"? If so how did you combat it? What recommendations of you have for the younger crowd (early 30s) who try fight this "keeping up" mentality?


Yep, it used to happen all the time (from my wife).

Why does so and so drive x car or why is so and so going here and going there or why is so and so buying a beach home? My reply was to remind her (repeatedly) that so and so are probably spending every dollar they earn and perhaps beyond that using their home as a piggy bank to finance a lifestyle beyond their means. The discussion was quite difficult at times. However, my wife saw over time (a long time) that nearly all of these so and so's were eventually exposed as doing precisely what I suspected. This was especially apparent when any of them fell on hard times (such as one spouse losing their job or when things got tough during the great recession).

Living well within our means allowed me to fully retire at 53 (no pension) - DW wife is also retired and she has not worked outside the home in over two decades. We are now free to travel anywhere we want and do pretty much anything we want. And you know what? I still see these so and so's toiling away every day working - getting up super early and coming home late. Now we are probably the ones they are talking about behind closed doors, wondering how in the world we pulled this off. Many of these people I suspect won't retire until they are 70.

Reminds me of the saying, he who laughs last laughs best. :D

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by stinkycat » Sun Apr 23, 2017 9:54 am

TX_Man wrote:Another question for the high income frugal individuals.

How often did you have to bat off "Keeping up with the Joneses"? Did it come up regularly where you saw co-workers/friends/relatives taking their trips to Italy and Spain, getting their new (insert item here) and you felt a need to "keep up"? If so how did you combat it? What recommendations of you have for the younger crowd (early 30s) who try fight this "keeping up" mentality?


I only have one friend with a real need to keep up with the joneses. From what I see of him, it is clear that trying to do that is an expensive proposition. I mean when you make $300k plus and have to pull out money from your retirement fund for the second home, all I can say is ouch. Of course, I am in the wrong crowd because I am an academic economist, which as Dilbert says is: "an expert on money who dresses like a flood victim". Not hard to keep up with the Joneses there.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by afan » Sun Apr 23, 2017 10:03 am

sambb wrote:I am so glad that i didnt live frugally. I went to vegas with friends in my 20s, great dates with significant others, and great vacations, all sorts of other things. I dont think that it would have been as much fun in my 60s. I am so so happy that I blew some money, and that i continue to blow some once in awhile. For example, last expense was first class seats on a great overseas trip to dubai and australia. it was great. And yes, it made me way happier than being in coach for 10-14 hour flights. Loved the beaches and kite surfing in dubai.
I save a significant portion, but certain things are better enjoyed at younger age.
I have owned convertibles and other nice german sports cars, but also have had camry, accord, and outback. They arent equivalent in my mind, but I go back and forth.
Keep saving, but dont forget to LIVE!


I live. But I don't want any of that.

I would rather read a book at the library, listen to music at home or take a hike. An alternative to 14 hours in coach is not going at all. Far more comfortable than 14 hours in first class.

I buy my clothes at thrift shops or eBay. Cars, on the rare occasion they need to be replaced, bought used. Don't drink wine. No jewelry.

I don't worry about keeping up with the Jones. I don't judge acquaintances who spend a lot more than I do. I just don't care. They are living their lives, I am living mine. No reason they should be the same.

I certainly don't envy those who take fancy vacations. There is probably some number of shares of VTI that I would accept as enough payment to go on a foreign vacation. I am not sure what that figure is, but no one has offered me anything close to enough to make it worth it.

My last long distance business trip was to Asia for $10,000. They paid business class and a luxury hotel. It was not nearly worth it.

I plan to stay home, read a book, take a walk and be far ahead on my utility curve.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

Leemiller
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Leemiller » Sun Apr 23, 2017 10:04 am

The experiences make you happier than stuff mantra has been quoted ad nauseum on this site, but the studies that is based on found that was only true for certain people. It is also missing the important second part which is that giving and experiences with others means greater happiness. So giving away your money is the second part that is missing from that oft quoted mantra. I'm
looking personally to add more giving to my life.

For myself I enjoy both material things and experiences. My newly remodeled bathrooms have improved the daily quality of my life, especially my deep soaking tub. My daughter keeps saying they look like 'hotel' bathrooms. We've also had some nice vacations recently, at nice resorts and those were great 'experiences.' Why choose? My balance sheet improves every month, and we are more than on track to meet our long term goals. Then again my aunt died of cancer in her 50s with a paid for house that was in disrepair because she was too frugal to fix it (or to buy furniture) depite hundreds of thousands in the bank.

I'm currently reading Happy Money, the Science of Smarter Investing which touches on these issues.
Last edited by Leemiller on Sun Apr 23, 2017 10:04 am, edited 1 time in total.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by CWhea1775 » Sun Apr 23, 2017 10:04 am

Not spending more for the absolute best private schooling for my kids. Don't know if it would have made any difference, but do wonder sometimes. Not going to more exotic travel destinations; Botswana, Seychelles, etc.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by mindboggling » Sun Apr 23, 2017 10:04 am

One really needs to split the difference between spending and saving. If you save everything and die early, you've kind of wasted your life. On the other hand, if you spend everything and live a long time you may well end up broke and dependent on others.

I did a lot of foreign vacation travel in my 50s and I'm so glad I did. Now, in my mid-60s and retired, my feet and knees are not in great shape, and I probably shouldn't be wandering around foreign countries. And I'm not sure I could stand another 12- or 14-hour flight to Asia in economy class.
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by ResearchMed » Sun Apr 23, 2017 10:11 am

am wrote:I am Top 5th percentile networth for my age group (40-49) and top 2-3% income with no debt thanks to being frugal and being a boglehead now for 10 yrs. We drive > 8 yr old cars and have a remodeled but modest house In a middle to upper middle class area worth about 650k. We can afford a house twice as much in a more affluent area that is nicer and closer to water. We can probably afford nicer cars and things. But with nicer things would come less savings. Our only splurge is travel but I wouldn't call our accommodations luxurious. I worry that my savings could be wiped out or perhaps health issues may make the future less enjoyable. Than there may be regrets with regards to saving hard and living modestly when we could have lived it up while we could. After all, you can't take it with you, Anyone else feel the same way?


Please read the thread entitled "Priorities", started by protagonist.

Life is not certain.

On the other hand, IF you really are not postponing things/experiences that you would really like, then it would be "spending for spending's sake", which is not the point of that thread.

And obviously the take-away lesson from that thread would vary depending if one is just starting out and has debt, vs. being well along the way with appropriate savings, vs. already pretty much "having arrived"... but still postponing the experiences/things that one would like.
It sounds like you might be in/approaching that third group?

RM
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Jimmie » Sun Apr 23, 2017 10:12 am

mindboggling wrote:I did a lot of foreign vacation travel in my 50s and I'm so glad I did. Now, in my mid-60s and retired, my feet and knees are not in great shape, and I probably shouldn't be wandering around foreign countries. And I'm not sure I could stand another 12- or 14-hour flight to Asia in economy class.

It may not end up being foreign, but my earlier years of retirement have been planned to be front-loaded with travel - while I am presumably the healthiest.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by delamer » Sun Apr 23, 2017 10:25 am

SGM wrote:
Longdog wrote:
SGM wrote:We could spend more on vacations but we have difficulty getting away for long because of elderly relatives that need minding. I don't wash them often because they get dirty just going down the driveway.


I would think for general health and hygiene reasons you should wash them daily - even if they do get dirty going down the driveway. :D


I can be funny without even trying this early in the morning. :oops:
I do hire people to wash the elderly.



Thanks to you both for my Sunday morning laugh!

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by anil686 » Sun Apr 23, 2017 10:27 am

Yes -

1) Waiting too long to remodel a house. Thus, right before we sell the house, we add paint or get a new appliance to replace one that is not working well and wish we would have done that sooner so we would have enjoyed it. That comes because my spouse and I don't like spending money and can "deal" with paint issues or a fritzy appliance. But after it is fixed/replaced - we realize how much we enjoy that.

2) Waiting too long to put hardwoods in the house. We both have allergies and knew hardwoods would be better as well as like the feel of them when we go over to other's homes. We put it in after delaying because of the cost - not that we needed to - and love the floors and wish we would have done that earlier too.

3) Wish we had bought experience tickets that are relatively rare earlier. The super bowl came to the DFW metroplex - I know I can watch it better from my house - but I have never been to one. I would like to go - and I would not have had to travel to go to one. It would have cost $4000 for two tickets - in retrospect - probably should have done it since I love football and like seeing games live (even high school).

4) Waiting four years to get my first iphone - never saw the advantages of having one but used an old flip style phone from 2007 to 2011. Love the texting and the emails from the phone. Love the apps and carrying music on the device. Should have paid a little earlier to get the iphone.

5) Not discovering higher end supermarkets earlier for prepared foods. Cheaper than eating out for the quality at this local supermarket and time saving so my family could eat healthier more frequently. We do not like to cook so we have a lot of quick meals that are cheap. Many are healthy but it gets repetitive - mixing in sides or some main dishes from a local supermarket with quality ingredients keeps it fresh for us. Of course more expensive than canned foods that we use a lot or crockpot recipes.

6) Lawn service - I have terrible allergies to pollen and ragweed. However, ever since I was about 10 - I mowed the lawn, edged, mulched, etc. but paid for it for a day or two with red/itchy eyes, wheezing and fatigue. I learned to buy masks in my 20s - helped somewhat. Then I realized how inexpensive (relatively speaking) it was to get my lawn cut/edged and mulched per month - about $125 per month for me. I do the bushes/trim the bushes - although will probably give that up this year. Should have done this years ago.

7) Education - I wish I would have been more forward thinking about the role of personal education classes like cooking, woodworking, home repair earlier. Learning how to use tools, cook, bake, etc. allows you to understand high quality tools used in those areas that may cost marginally more than the cheapest tools but allow you to finish particular jobs really fast and well. Example is replacing a toilet tank (took me three hours instead of 45 minutes), replacing the bifrost in my refrigerator - another 2 hour job that could have taken 30 minutes.

I am sure there are others. I think about this a lot. I have no frank regrets like wow my life is messed up because I was frugal - I think that would be like a humble brag. But it is not all roses doing this and I think us who are frugal make just as many mistakes with personal finance as those who are spendthrift - it is just that the magnitude of those mistakes for those who are spendthrift appear on the balance sheet, and our mistakes appear on the sweat equity portion of the balance sheet if that makes sense (i.e. time lost in activities, manual discomfort/aches, loss of of opportunity to experience events, and experiencing a significantly more comfortable life at the expense of marginally very little increased expense)

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by afan » Sun Apr 23, 2017 10:30 am

mindboggling wrote:If you save everything and die early, you've kind of wasted your life.


There is the crux of the matter. I could not disagree more. Spending a lot of money is not a goal. It is not as if the only thing restraining me is fear of running out of money. Saving money is good in and of itself. It is like saying "if you give money to charity you have wasted your life" or " if you treat people decently you have wasted your life". Those, like saving money, are goals in themselves. Not just means to an end.

I would say " if you have wasted your money on a lot of self indulgent junk then you have wasted your life". I dearly hope to have more money when I die than I do now. I plan to be a net saver through retirement, but that depends to an extent on the performance of the financial markets. There is nothing I would rush to buy, nowhere I would plan to visit, no experience I would seek out if I were to discover I had six months to live.

Spending all my money by death is not a goal.
Accumulating more money throughout life is a goal.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

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Tycoon
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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Tycoon » Sun Apr 23, 2017 10:34 am

Still... no regrets.
...I might be just beginning | I might be near the end. Enya | | C'est la vie

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by midareff » Sun Apr 23, 2017 10:42 am

JoMoney wrote:I wasn't really sure how this measured, but I used this https://dqydj.com/net-worth-by-age-calc ... ed-states/
Which is using data from the 2013 Federal Survey of Consumer Finances (2016 survey data doesn't appear to be out yet)
:thumbsup to what WolfgangPauli said....
I can't think of anything I regret not buying, but there's plenty of things I wish I hadn't bought.


Using that calculator, I guess by saving my pennies, nickels and dimes, net worth snuck up on me while never being high income. Had a written savings for retirement plan by year for at least 15 years prior to retirement in 2012. The last 8 years caused that target to be greatly exceeded. In my accumulation years, once I met the year's goals I was free to spend the discretionary as I choose. Had a very nice but modest townhouse, LOL, there is always bigger and nicer to look at if that matters to you, it didn't to me. After keeping cars long enough to either have to start a college fund for them or adopt them I started driving new Porsche's in 1998 and traveling more extensively domestically, with significant international travel starting a dozen years ago. Regardless of what I drove, where I lived, traveled or anything else, the year's savings always came first. I think being efficient with your money, keeping other's hands out of your pockets, and living a frugal life can get confused. No regrets here, it certainly wasn't a bad ride.

I like what WolfgangPauli said but for me it's not exactly true. Besides more travel there are a couple of things on the bucket list which I expect to handle in the next year or two, and anything I wish I hadn't bought goes on eBay and out the door like mental floss.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by vitaflo » Sun Apr 23, 2017 10:52 am

Only on BH would owning a $650k house be considered living the "frugal life".

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by tibbitts » Sun Apr 23, 2017 11:03 am

mindboggling wrote:Accumulating more money throughout life is a goal.

That's okay, as long as you realize that means you're treating money the same as other people treat coffee cups, or stamps, or art or whatever they choose to collect.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by delamer » Sun Apr 23, 2017 11:05 am

stinkycat wrote:
TX_Man wrote:Another question for the high income frugal individuals.

How often did you have to bat off "Keeping up with the Joneses"? Did it come up regularly where you saw co-workers/friends/relatives taking their trips to Italy and Spain, getting their new (insert item here) and you felt a need to "keep up"? If so how did you combat it? What recommendations of you have for the younger crowd (early 30s) who try fight this "keeping up" mentality?


I only have one friend with a real need to keep up with the joneses. From what I see of him, it is clear that trying to do that is an expensive proposition. I mean when you make $300k plus and have to pull out money from your retirement fund for the second home, all I can say is ouch. Of course, I am in the wrong crowd because I am an academic economist, which as Dilbert says is: "an expert on money who dresses like a flood victim". Not hard to keep up with the Joneses there.


My second laugh for the day thanks to Bogleheads!

I worked in government with a bunch of research economists, and no one ever accused them of being overdressed. One good friend always dressed like he was going home right after work to mow his lawn, and did not want to be bothered to change first.

I grew up with frugal parents and it took me way too long to realize that all families did not lived within their means. So I assumed if a family had fancy cars, expensive clothes, and an upper middle class house, then that meant that they had more money than we did. Life seemed simple...

There is a bias among many Bogleheads against the purchase of displays of wealth like cars, houses, and jewelry but towards paying for experiences like travel. While I generally share that bias, I don't kid myself that the cruise that we are going on this summer would be anyone's idea of frugal. (My parents would certainly be appalled.)

I actually do have some regrets that we did not live a bit less frugally when our kids were still at home. But that regret comes because I can look back now and see that we have more than we need. I had no way of knowing that it would all work out while we were making the decisions on how to spend and save in "real time." I will also say that my biggest regrets have little or nothing to do with money.

The best advice I've read on this thread is to 1) save to meet your goals and then spend the rest and 2) find your own sweet spot on the continuum of planning for the future and spending for today.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Grt2bOutdoors » Sun Apr 23, 2017 11:08 am

vitaflo wrote:Only on BH would owning a $650k house be considered living the "frugal life".


Depends on what you get for $650k. In parts of Brooklyn NY, you "might" be able to find a single family house with a 1970s kitchen, a 1970s bathroom with pink and black tile, wallpaper throughout on a 18 x 90 foot lot and no driveway. Sound appealing to you?
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by corwin » Sun Apr 23, 2017 11:38 am

My parents were frugal and always bought the cheapest item regardless of quality. My wife's parents were frugal and always bought the least expensive high quality item. My wife's parents did much better financially but that was only one factor. However, it is a much better way to live. It is no fun as a kid to have your shoes fall apart halfway through the school year.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by gips » Sun Apr 23, 2017 11:50 am

I don't have any real regrets but as I got older, I learned to pay for quality. For me, this meant an extra $300 for a well-designed, light laptop, an extra $500 for a TV, $250 for shoes, etc. In the end, I've found goods with better quality last longer and give more pleasure in their use. I wish I'd come to that conclusion earlier in life.

we did make a conscious decision on spending more for our house and taxes to live in a top 2% school district. We have three smart kids and I'd like to think it was the right decision. We are also in the midst of paying for their college...that's a crazy cost and if you have kids, it would be best to start planning now for that.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by HueyLD » Sun Apr 23, 2017 12:00 pm

No regrets.

The ability to retire when one is still young and active is priceless. It is possible because of frugal lifestyle during one's work years.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by fposte » Sun Apr 23, 2017 12:04 pm

afan wrote:Saving money is good in and of itself.


There may be a bit of a schism on this topic, because I don't agree with that or other intimations on this thread that there's a moral aspect to this. Acquiring tools and options is good, and money provides that. But there's nothing inherently virtuous in saving if for sure you don't need to; money is ultimately just stuff too. If you know you have enough, and would enjoy spending money on something with a high cost, there's no points to be scored by deciding not to. The risk is the creep that takes you beyond your means.

And, as noted upthread, I think "frugal" means different things to different people; I have a sneaking suspicion it really just means spending less than the people we personally know. A person making $500k a year can be frugal while still outspending me, who makes under $100k, like crazy.

Warren Buffett gets brought up as an example, but I think sometimes his old car/Midwest living practice gets overinterpreted. AFAICT, Buffett doesn't care about cars and therefore doesn't think that's a good place to spend more money, which makes him a good example of resisting lifestyle creep without hedonic gain; if he wanted a pricier car but denied himself for pure frugality, however, I'd think he was being silly.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by DiMAn0684 » Sun Apr 23, 2017 12:13 pm

corwin wrote:My parents were frugal and always bought the cheapest item regardless of quality. My wife's parents were frugal and always bought the least expensive high quality item. My wife's parents did much better financially but that was only one factor. However, it is a much better way to live. It is no fun as a kid to have your shoes fall apart halfway through the school year.


There're lots of online resources nowadays that can help with getting higher quality items for less (deals, coupons, cashback, etc). Often times you can get higher quality items for the same price or less than what you'd pay for a similar item at discount retailer. Same applies to travel. If you have a good strategy you can often travel with better airlines and stay in better hotels for the same money as you'd spend with budget airlines and staying at cheap hotels.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by Barefootgirl » Sun Apr 23, 2017 12:20 pm

Just a few years older than the OP and catch myself now from time to time, questioning whether the price has been worth the cost.

Those thoughts are having a direct influence right now as I decide how to use my resources...time, energy & money, perhaps differently than in the past.

Balance is always easier in concept, than application, but it's a worthwhile goal, IMO.

PS/there have been times when I felt like I could spend more $$, but then realized the spending would not bring as much contentment as having more time....so that becomes the quandary, hence planning for earlier retirement.
How many retired people does it take to screw in a lightbulb? Only one, but he takes all day.

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Re: Any regrets living a frugal life for high income/high networth individuals?

Post by stoptothink » Sun Apr 23, 2017 12:26 pm

mancich wrote:
WolfgangPauli wrote:No regrets at all... Living frugal is not only good for you financially but it is good for the soul. After a while you realize all the "stuff" is just crap anyway. A good family, good children, great life experiences beat cars and boats anyway.

Also, it is so liberating to know you are not a slave to your job. Great to know you live a life style which does not require you to work but allows you to work at something you enjoy.

Finally, it is great to know you don't have to worry. I hear this all the time, "You can't take it with you". Right, but if you turn 70 and something happens requiring a bit more money than you anticipated, you cannot get it either. to this, I am reminded of Pascal's wager:

When asked why he believes in God, Pascal said (all this is totally paraphrased but you get the drift):

"If I believe in God and live a religious life, and I am right, I am going to be in heaven for eternity. If I am wrong, the worst thing is I just lived a good life. If you don't believe in God and you are wrong, you have a real problem".

Same is true with investing... If I over save and I don't end up needing the money, who cares. But, if my neighbor does not and he needs the money, he is screwed.


+1 The thing that spendthrifts often don't get is that it is not a matter of denial when we BH's live frugally. It is just that buying a bunch of "stuff" doesn't bring real happiness.


This. "Stuff" does not improve my quality of life, in fact, I have found it often decreases it. I actually derive pleasure from going through our stuff (my wife and kids find this much harder) about once a month and culling the herd; tossing or donating or giving to neighbors all the stuff we don't use on a regular basis. Quality of life, to me, is about time and freedom.

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