Learning how to spend

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
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SpecialK22
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Learning how to spend

Postby SpecialK22 » Thu May 18, 2017 2:02 am

Warning: Emotional Post

Since a major part of my identity is that of a saver, I've been wrestling with the fact that I may be oversaving. Wealth effect may also be playing a role as my aggressive saving started in 2008. As such I never really felt the pain of the bear market. It just seemed like my net worth stayed flat with some small increases or decreases. Then March 2009 hit and it's felt like my net worth has only increased quickly since then with the occasional hiccup along the way. Nothing that has made me feel panicked yet.

Just a quick background:

Age: mid-thirties
Income: Low six figures
Employment: Very stable. Career level federal employee and Air National Guardsman.
Liquid assets: High six figures (about half of that amount is in Roth accounts)
Spending: About $25k-$50k annually. Typically it's been towards the lower end until recently where I've been debating whether I'm saving too much.
No Debt

Pension estimates assuming average career growth for my mid-fifties in 2017 dollars:

FERS: $5,000/mo. Partial inflation adjustment. CPI-W under 2.0%, inflation adjustment same as CPI-W. CPI-W 2.0% - 3.0%, inflation adjustment 2.0%. CPI-W more than 3.0%, inflation adjustment CPI-W minus one percentage point. Additionally, retiree health benefits available at same cost as to employees.

Reserve Component Pension: $3,000/mo. Fully inflation adjusted.

FERS Social Security Supplement: $1,500/mo. This disappears when I become eligible for SS at 62. I probably won't claim SS until 70.

Trying to look at my situation from the outside it seems like I don't have a good balance between spending and saving when spending towards the low end ($25k-$30k a year). However, being a saver has become such a part of my identity that I feel strange spending "lavishly." I even feel guilty when I suggest doing something and someone mentions that it would cost too much. This usually involves something travel related as I still don't get much pleasure from material possessions. I even feel defensive if I feel someone is classifying me as a spender or worse spendthrift, especially if there is a comment to the effect of "You shouldn't be spending so much." #triggered

I'm wondering how others have coped with being predisposed to saving. Just give in and go for the richest guy in the graveyard? Thanks for reading.

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jharkin
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Re: Learning how to spend

Postby jharkin » Thu May 18, 2017 6:35 am

Maybe what you need isn't advice from other compulsive savers... but advice from spenders. :twisted: I can try to help there.

Think about it this way - life is all a balance. The compulsive savers on this board see spending as bad because they look at it as just having things for "status" purposes. That's a fair argument to make, but lets flip it around - if having a flashy house is a status item, well then whats the point of a 7 figure account balance. Inst that also "status"?

At a fundamental level the purpose of money is to be an exchange medium to trade for things one wants or needs. These things can be food, physical possessions, experiences, entertainment, services, gifts to charity, whatever. When you think about it like that saving all your life only to leave 8 figures unspent basically means that all that money, and the effort to accumulate it, went to waste.

Take it to the next level, once you wrap your head around the above it becomes a lot easy to make yourself comfortable with a balanced level of consumption today vs. saving for consumption tomorrow. Once you know you are saving enough to put your kids through school, retire comfortable and leave whether your feel is appropriate to any heir(s) than I see nothing wrong with spending the rest today. Spend it on what gives you joy. For some that might be a flashy car and "stuff". For you maybe its entertainment, or travel, or giving to charity.

FYI from a practical actionable perspective here is an example - my household probably makes a little bit more than you guys (high 100s potentially to low 200s next year) but we spend at least 50% more than the high end of what you do yearly and I still expect we will have enough saved to retire before 60 and leave a lot of money to the kids, using very conservative return estimates. I dont have status items like a 3000sq ft house or a German car, but we do buy midrange new cars every 8-10yr, we do take annual vacations domestic and occasionally international, we do have some not inexpensive hobbies, etc.

Grt2bOutdoors
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Re: Learning how to spend

Postby Grt2bOutdoors » Thu May 18, 2017 6:35 am

Take a nice vacation - some locale like Europe or Carribean, that will alleviate part of your spending issue while providing a different outlook on life. Life is not about accumulating, it is about living. Go live it!
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Tamarind
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Re: Learning how to spend

Postby Tamarind » Thu May 18, 2017 6:55 am

With that level of saving (40% or higher), I bet there's a thing that you want and would enjoy that you are denying yourself. Take a little time to identify one thing.

A vacation?
Amazing dinners with loved ones, whether home cooked or out?
Concerts or performances or sporting events​?
Supporting a charity that you care about?
Subscribing to a cultural service of some kind (news, podcast, stream, artist, etc)?
A particular food or drink item that you love?
Access to a fun activity or exercise or game?

Remind yourself that you aren't going to splurge on all of these things or lose your discipline.

But pick one thing you think you would enjoy and give yourself 1-3% of your gross to add that good thing to your life this year.

Then at the end of 2017, plan to evaluate if that thing was worth it. Look at your net worth and see that it didn't stop growing. Consider if you want to do the same thing again or try something different or allocate the enjoyment money back to savings.

jlcnuke
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Re: Learning how to spend

Postby jlcnuke » Thu May 18, 2017 7:00 am

IMO, you need to decide what your goals are. If your goal is to work until you're in your 50's and can collect your pensions, then you're doing great on that front. If your goal is to die with a lot of money, you also seem to be doing great. If your goal is to maximize your happiness while you're alive, I think you've got a lot of progress to make.

You say your spending is ~$50k/year on the high end and you're in your mid 30's. Based on that info, a 3% withdrawal rate from a portfolio would be (historically) pretty much safe to cover your spending for the rest of your life (inflation adjusted along the way). To pull that off, without your pensions, you'd need a portfolio of ~$1.5M. With a current portfolio in the "high six figures", I'm assuming you are already over halfway there. Another 5-8 years, without additional contributions, will probably put you there.

However, your post implies that you plant to keep saving/investing at the current rate for another 15+ years and then collecting two pensions that combined would pay the equivalent of $96k/year (or almost double your current spending levels). On top of that, you'll have 15 years of additional contributions and growth in your investments. Saving ~$30k/year between now and then, and assuming a current balance of $800k and 7% average growth, your portfolio in 15 years would be right at $3 million. Those investments alone would support ~$150k/year spending. Add in your $96k/year in pensions and you'd have ~$246k/year of income, a $194K/year surplus above your current high end spending. That's a lot of money to donate to charity/leave for heirs.

So, financially, I think you have a great outlook. However, personally, I imagine there are things you could be spending money on now that would bring quality of life improvements to you (more/better vacations etc) without putting any real danger on your financial plans.

One of the difficult parts of being financially well off is remembering that most people aren't. What you can afford with ease would be considered an extreme extravagance for people of lesser means. They won't "get" that you can afford to do a 2 week all-inclusive vacation regularly when that's the kind of thing they reserve for a once-in-a-lifetime honeymoon experience etc. That's fine, and there is no reason to bother trying to justify your spending to anyone but yourself.

IMO, I set goals (how much I want to save, when I want to retire, what kind of lifestyle I want then and now). I then fund my goals (set my savings rate). The rest of the money I make is there to pay my bills and be spent on enjoying my life. There's no reason to save more than I need to live the life I want later. The key is balancing the savings/spending so that you can live now and in retirement. The "easiest" way to do that (imo) is to increase or decrease spending now until it leaves just a bit more than you need to save in order to keep that lifestyle after you retire. Move the "retirement" year in or out as necessary to get that kind of balance, then enjoy your life now and in the future.

delamer
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Re: Learning how to spend

Postby delamer » Thu May 18, 2017 11:08 am

Part of this issue for you seems to be the reactions of other people to your spending. You are bothered when other people think you are spending too much.

My observation, based on reading lots of Boglehead posts and my personal interactions, is that many people overshare about their finances with family and friends. Outside of our immediate family of four, we don't discuss our income or expenditures with others. And if I comment, for example, that we are going on a cruise and a friend asks the cost, I always "forget" even though I know within $100.

The point is that 1) your finances are nobody else's business and 2) since the sharing is causing you anxiety, don't do it.

(I am a federal retiree. Because active workers' salaries are generally known to their co-workers, it makes for an interesting dynamic in the workplace. People with similar salaries live very different lives.)

CoAndy
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Re: Learning how to spend

Postby CoAndy » Thu May 18, 2017 11:11 am

I would spend some money on something you enjoy. Do you like traveling? Would you enjoy some upgrades to your house? A Corvette is a great way to spend some money and an unbelievable kick to drive. If you reduced your savings rate down to 20% (still very respectable), enjoy the rest. Enjoy your life! Maybe donate to a children's hospital? Improve a deserving persons' circumstances? There are endless opportunities to enjoy some $. Good luck.

kd2008
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Re: Learning how to spend

Postby kd2008 » Thu May 18, 2017 11:40 am

I am of similar age and lesser wage and much lesser savings or no pensions compared you. I empathize with your conflicted feelings about savings and spending. Understand that you spend what you choose to. You earn based on your employment.

Understand that the nexus between spending and earning is strong for some. But for you it is not so. Let the savings accumulate. Live your life as you see fit without any consideration for or pressure for spending a certain amount.

There is a lot of life to be lived. There are no guarantees. Lots of curve balls to dodge.

May be focus more on relationships and community and not so much on what it all means to save so much. Know that you are very fortunate with the pensions and retiree healthcare. That will give you tremendous options once you are in your fifties.

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djpeteski
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Re: Learning how to spend

Postby djpeteski » Thu May 18, 2017 11:42 am

To me it all comes back to what it always comes back to: budgeting and goals.

In 2016 we paid off the house and were making large payments to do so, while also maxing retirement accounts.

With all the disposable income we were going to have, we decided to spend it on paper ahead of time, but this time a year in advance. I feel this is necessary as you may wish to buy more expensive items.

For example, lets say you plan on having 5K/month disposable for the year, so 60K

You want to put some in taxable accounts, say 1/3, so 20K.

You want to give some money to a colon cancer research center, so you set aside 10K for that.

You want to trade up in car, say you want a 30K car and could probably sell/trade your car for 12K, so 18K there.

You want an extra nice Christmas for the family this year, so 5K for that.

You want a vacation/bedroom furniture/hobby gear and have 7K left over. You decide to spend it on that.

By taking care of additional saving first, and giving second, you make it easier to spend on more frivolous things. Stick to your budget (which you are probably really good at) and force your self to spend the money on the designated items.

This works well for natural spenders as they are forced to save money first prior to going a bit wild on the spending.

hulburt1
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Re: Learning how to spend

Postby hulburt1 » Thu May 18, 2017 11:52 am

I'll ask my wife she knows how to spend. I was in the same boat saved 35 years. I'm 64 and still have a allowance same as 10 years ago. I started to take 2 yearly trips. force myself to do things. I still save but I take 10% every year of what I make from my accounts and use it on trips. I don't buy things. I use it on memories.

Lauren Vignec
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Re: Learning how to spend

Postby Lauren Vignec » Thu May 18, 2017 12:17 pm

SpecialK22 wrote:Warning: Emotional Post

Since a major part of my identity is that of a saver...

...However, being a saver has become such a part of my identity that I feel strange spending "lavishly." I even feel guilty when I suggest doing something and someone mentions that it would cost too much. This usually involves something travel related as I still don't get much pleasure from material possessions. I even feel defensive if I feel someone is classifying me as a spender or worse spendthrift, especially if there is a comment to the effect of "You shouldn't be spending so much." #triggered

I'm wondering how others have coped with being predisposed to saving. Just give in and go for the richest guy in the graveyard? Thanks for reading.


Hello SpecialK,

One thing that has really helped me, both in my relationships with others and my basic day-to-day happiness, is realizing that we all have deep values. And these values are very different for different people.

Saving, for some people, is a deep value. In other words, they don't save "for" anything. They save for the sake of saving. Saving is not a deep value of mine--but independence and order are. I save so that I can be independent.

But maybe for you, saving is just a deep value. If so, that's fine and there's no reason to seek a "balance" that you don't need. Balance is always about whatever your own deep values are.

So what I would say is this--do you want to travel? That could be about a lot of potential deep values, including curiosity, independence, maybe even social status. What I'm trying to get at here is that there are things for all of us that we value just for the sake of valuing them. And when it comes to spending money, we are usually happiest when we spend based on those deep values.

You already know that material stuff isn't important to you. Would donating to charity (which can be a part deep values such as honor or loyalty, and also deep values like social responsibility) mean anything to you? If so, there's no reason to wait until you're old to do it.

Again, I have a feeling that for you saving is just a deep value in and of itself. If so, mostly keep doing what you're doing. Then, find your other values and spend on those.

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SpecialK22
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Re: Learning how to spend

Postby SpecialK22 » Thu May 18, 2017 12:49 pm

Thank you all for the responses and great suggestions. Finding the balance seems to be getting harder as I am definitely beginning to feel the wealth effect kicking in (I know there are many on this board doing much better than me though :wink: ). Maybe I just need a recession to bring me back to reality 8-) My more rational side says continuing to save so aggressively isn't striking a good balance between saving and spending, but my emotional side is so tied to saving that it associates it with my identity. The problem is that loosening the purse strings would definitely make me seem like a spendthrift to many in my peer group. And since I associate spendthrift behavior as a character flaw, I naturally cringe at being labeled in such a way. Many of the suggestions in this thread were great and I will most likely be acting on some of them. I particularly like the charitable giving suggestions as they both would be more altruistic and can be kept less flashy. I have upped my charitable giving but perhaps upping it some more would be a good course of action.

Tamarind
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Re: Learning how to spend

Postby Tamarind » Thu May 18, 2017 1:06 pm

SpecialK22 wrote:Thank you all for the responses and great suggestions. Finding the balance seems to be getting harder as I am definitely beginning to feel the wealth effect kicking in (I know there are many on this board doing much better than me though :wink: ). Maybe I just need a recession to bring me back to reality 8-) My more rational side says continuing to save so aggressively isn't striking a good balance between saving and spending, but my emotional side is so tied to saving that it associates it with my identity. The problem is that loosening the purse strings would definitely make me seem like a spendthrift to many in my peer group. And since I associate spendthrift behavior as a character flaw, I naturally cringe at being labeled in such a way. Many of the suggestions in this thread were great and I will most likely be acting on some of them. I particularly like the charitable giving suggestions as they both would be more altruistic and can be kept less flashy. I have upped my charitable giving but perhaps upping it some more would be a good course of action.


It's a good problem to have. Based on your reply I second @delamer who advised you to talk less about your spending to those you suspect would label you a spendthrift.

new2bogle
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Re: Learning how to spend

Postby new2bogle » Thu May 18, 2017 1:14 pm

delamer wrote:(I am a federal retiree. Because active workers' salaries are generally known to their co-workers, it makes for an interesting dynamic in the workplace. People with similar salaries live very different lives.)


It sure does! My dad works at a state univ. One of his colleagues (also a full prof, similar age) always has money problems even though I know for a fact they make approx the same salary (since it's public knowledge!).

kaudrey
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Re: Learning how to spend

Postby kaudrey » Thu May 18, 2017 1:23 pm

Tamarind wrote:
SpecialK22 wrote: The problem is that loosening the purse strings would definitely make me seem like a spendthrift to many in my peer group. And since I associate spendthrift behavior as a character flaw, I naturally cringe at being labeled in such a way.


It's a good problem to have. Based on your reply I second @delamer who advised you to talk less about your spending to those you suspect would label you a spendthrift.


+1 - why does your "peer group" know everything you spend? Why is it any of their business if you go on vacation or give your money away to charity? I would never tell my friends how to spend their money, unless they specifically asked me. I'd work on not worrying so much about what other people think about you.

delamer
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Re: Learning how to spend

Postby delamer » Thu May 18, 2017 1:28 pm

new2bogle wrote:
delamer wrote:(I am a federal retiree. Because active workers' salaries are generally known to their co-workers, it makes for an interesting dynamic in the workplace. People with similar salaries live very different lives.)


It sure does! My dad works at a state univ. One of his colleagues (also a full prof, similar age) always has money problems even though I know for a fact they make approx the same salary (since it's public knowledge!).


Part of the problem is that you get that one piece (albeit important piece) of information without knowing much about the other components of your co-workers' finances.

IlliniDave
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Re: Learning how to spend

Postby IlliniDave » Thu May 18, 2017 1:52 pm

I'd say whether you spend a lot, or a little, just spend wisely and you'll be fine. Is there a really a difference between the richest guy in the graveyard and the guy in the graveyard who burned through the most cash getting there? Not in the graveyard, there isn't. Aim to be the guy that goes to the graveyard happiest and most satisfied with his life. How much or little money you had at the very end or spent along the way is immaterial. For many of us happiness is not proportional to spending.
Don't do something. Just stand there!

Tamalak
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Re: Learning how to spend

Postby Tamalak » Thu May 18, 2017 2:05 pm

If you keep your spending low and continue to sock away and invest aggressively, you can retire early. Instead of a rich lifestyle you can live a free one. Does that sound more in tune with your nature?

Money is power and luxury and fun when you spend it. It's freedom, security, and stability when you don't spend it.

Figure out what you want out of life and take it. It doesn't matter if it's expensive or free.

kd2008
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Re: Learning how to spend

Postby kd2008 » Thu May 18, 2017 2:50 pm

Tamalak wrote:Money is power and luxury and fun when you spend it. It's freedom, security, and stability when you don't spend it.


Quote of the day! Thanks for sharing!

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Earl Lemongrab
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Re: Learning how to spend

Postby Earl Lemongrab » Fri May 19, 2017 1:09 pm

IlliniDave wrote:I'd say whether you spend a lot, or a little, just spend wisely and you'll be fine. Is there a really a difference between the richest guy in the graveyard and the guy in the graveyard who burned through the most cash getting there?

That's great if you know when you're going to die. Or whether you're going to have outsized expenses for assisted care or other medical events. So you have to balance spending with the reserves needed for life's unpredictable nature.

I'm the sort that has modest material needs and wants. Most of mine are intellectual, books and music, time with friends and family, but also live sporting events. All in all, I don't spend a lot now and don't plan to increase much in retirement other than adding insurance costs and such.
This week's fortune cookie: "You will enjoy doing something spontaneous this weekend." Apparently that meant working on a dead PC, but I didn't enjoy that much.

IlliniDave
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Re: Learning how to spend

Postby IlliniDave » Fri May 19, 2017 2:26 pm

Earl Lemongrab wrote:
IlliniDave wrote:I'd say whether you spend a lot, or a little, just spend wisely and you'll be fine. Is there a really a difference between the richest guy in the graveyard and the guy in the graveyard who burned through the most cash getting there?

That's great if you know when you're going to die. Or whether you're going to have outsized expenses for assisted care or other medical events. So you have to balance spending with the reserves needed for life's unpredictable nature.

I'm the sort that has modest material needs and wants. Most of mine are intellectual, books and music, time with friends and family, but also live sporting events. All in all, I don't spend a lot now and don't plan to increase much in retirement other than adding insurance costs and such.


I think we're similar in disposition. I used the word "wisely" for the reasons you state. My point was that spending more money isn't a guarantee of a better life nor is spending less a guarantee of a miserable existence. The best approach is for a person to have a good understanding of what makes them content/happy and let their spending follow that to the extent they maintain a level of prudence.

It seems like sometimes people who don't see a need nor have a desire to spend a lot of money feel pressure from the culture to go "enjoy their money" else they cheat themselves of a good life. I don't think that is universally true.
Don't do something. Just stand there!

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jeffyscott
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Re: Learning how to spend

Postby jeffyscott » Fri May 19, 2017 5:17 pm

IlliniDave wrote:It seems like sometimes people who don't see a need nor have a desire to spend a lot of money feel pressure from the culture to go "enjoy their money" else they cheat themselves of a good life. I don't think that is universally true.


For many of us happiness is not proportional to spending.


:thumbsup

For us, since it seems 2/3 of our children will have low incomes throughout their lives and none of the 3 will get a pension, that helps me to rationalize not feeling compelled to find some way to dispose of excess money. It gives us a nice safety factor, hopefully we don't need it and it can, instead, help fund their retirements.

About 8 years ago, it didn't seem like we'd have that much extra. Kinda surprised that we have ended up with about double what I estimate we need. Basically pension and SS would probably be enough without any savings and meanwhile the savings alone would probably be enough also.
press on, regardless - John C. Bogle

nanoanalyzer
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Re: Learning how to spend

Postby nanoanalyzer » Fri May 19, 2017 9:50 pm

SpecialK22, I'm about 10 years behind you in both career and personal finance, minus the Reserve pension, but learning how to spend at the same grade level as you. I find it imperative to set 1 or 2 reasonable goals and stop caring about optimizing the rest. For me, after doing the math on a FERS pension at the salary cap, with 30 years of maxed out TSP and catch-up (see jlcnuke's similar numbers above), on top of two maxed out IRAs, this meant:

1. Leave town at least once every two months. Sometimes this is a 3-day trip 200 miles away, sometimes leave in conjunction with a work trip with family in tow, sometimes a longer vacation on leave. In any case, if I don't plan these things at least a couple months out on nonrefundable fares and reservations, I will never go anywhere.
2. On the savings side, target the top of 15% using 401ks, DCFSA, HSA, etc., then fill the Roth IRAs with deduct-and-convert (if your state allows it). That leaves around $63K to my bank account annually to pay bills and live on with little care and only slight attention to cashflow. In my LCOL area, nearly half that amount is disposable. I can choose to pay down debt, eat whatever I want off the menu 3-5 times per week, and not blink at the $400-$800 flights for item 1.

The priority might seem odd, but the perspective and experiences gained through prioritizing and enacting item 1 made item 2 much easier to perform. Plus, as a result, I was able to set a third goal:

3. Initiate and sustain charitable giving.

SpecialK22 wrote:The problem is that loosening the purse strings would definitely make me seem like a spendthrift to many in my peer group. And since I associate spendthrift behavior as a character flaw, I naturally cringe at being labeled in such a way.


It's healthy to want to avoid character flaws. However, while it seems you spin this in such a way to do it for yourself, you may actually be avoiding spendthriftiness for someone else, which is not healthy. I end up on the other side of this coin. I feel pity for my peers, some of which earning nearly double my own healthy salary, who can't seem to make ends meet while I'm off to the next vacation or making another $5,000 loan principal payment. Let them wonder how you make it happen. Live your life as you know it. For all we know, they actually think we are misers and we could be completely wrong about our perceptions of their struggles.
"If you think stocks are like physics, you believe there must be smart people who can measure exactly where the Dow Jones Industrial Average will be in five months." -Morgan Housel

IMO
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Re: Learning how to spend

Postby IMO » Fri May 19, 2017 10:54 pm

SpecialK22 wrote:Since a major part of my identity is that of a saver, I've been wrestling with the fact that I may be oversaving. Wealth effect may also be playing a role as my aggressive saving started in 2008. As such I never really felt the pain of the bear market. It just seemed like my net worth stayed flat with some small increases or decreases. Then March 2009 hit and it's felt like my net worth has only increased quickly since then with the occasional hiccup along the way. Nothing that has made me feel panicked yet.

Trying to look at my situation from the outside it seems like I don't have a good balance between spending and saving when spending towards the low end ($25k-$30k a year). However, being a saver has become such a part of my identity that I feel strange spending "lavishly." I even feel guilty when I suggest doing something and someone mentions that it would cost too much. This usually involves something travel related as I still don't get much pleasure from material possessions. I even feel defensive if I feel someone is classifying me as a spender or worse spendthrift, especially if there is a comment to the effect of "You shouldn't be spending so much." #triggered


When I read your post, my 1st question is what do you do now with your time off of work? Do you not have any activities you enjoy, or any activities that you wish you could do? I think that could be a major contributing factor. Usually when you have interests that you do, or wish you could do, the bigger question is how can I do those activities and not spend too much on doing those things. That can be a physical sport, a hobby, or even travel. You say you don't derive pleasure from material possessions, but I always find that in interesting thought in that sometimes it takes a material possession to often enjoy much of what life has to offer. For example, maybe you're an avid rock climber and to fully enjoy the activity it will involve material possessions (i.e. climbing gear) and transportation (i.e a car), or a fisherman (fishing gear/boat sometimes), etc, etc, etc.... Or perhaps it's travel, do you not have at least some level of bucket list of places you'd like to go/see in your life? Perhaps you have some charitable organization your are involved with that could more than just you're time? I know you mention upping charitable giving in your post, but I mean getting physically involved at the same time bringing something or buying something to also financially help that charity. For example, maybe you're involved physically with an animal shelter, and while involved, you also spend some money buying supplies that the shelter may need?

My second question is who are you hanging out with that is making a judgment that you are spendthrift? Who is your peer group (hardcore MMMer's)? Maybe you need to find a new peer group that has good balance in their lives?

Life should be about balancing the present and the future. Seems you have enough concern about the future and you hardly seem like someone who will end up eating cat food when you are 90 yrs old. Try to put a little balance on doing things in the here/now because life is too precious to only obsess about something that may be 40+ years in the future. You may not make it to 40+ yrs in the future, or you may not make it in the best of health.

Best of luck.

IlliniDave
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Re: Learning how to spend

Postby IlliniDave » Sat May 20, 2017 6:29 am

jeffyscott wrote:
:thumbsup

For us, since it seems 2/3 of our children will have low incomes throughout their lives and none of the 3 will get a pension, that helps me to rationalize not feeling compelled to find some way to dispose of excess money. It gives us a nice safety factor, hopefully we don't need it and it can, instead, help fund their retirements.

About 8 years ago, it didn't seem like we'd have that much extra. Kinda surprised that we have ended up with about double what I estimate we need. Basically pension and SS would probably be enough without any savings and meanwhile the savings alone would probably be enough also.


I can definitely relate to that. Both my kids appear headed to a lifetime of low to moderate household income, and of course you never stop being Dad (more so because both are daughters). And I'm expecting a fourth grandchild next December. It looks like my generation (cusp of Boomer/X) will leave behind a lot of debt that someone's got to pay, too, so between everything I would not feel bad if my terminal wealth was non-trivial. At the same time I'm not going to mix up powdered milk and pour it over dry Alpo while huddling under a bridge either. I participate on a site that specializes in FI/early retirement, and sometimes get mildly chided there for wearing a belt and suspenders with a one-piece coverall, but having multifaceted goals means sometimes I do things that don't make sense to others.

I also know what you mean about being a little surprised to wake up one day and realize you have a little wealth. In late 2011 I was facing a potential layoff in January 2012 and spent Christmas break calculating how many months I could go without a comparable job before I'd have to bail on my house. Around four years later I hit what I called "fragile" financial independence and now I've reached a more comfortable degree of FI. Having a low appetite for lifestyle spending helps that a lot!
Don't do something. Just stand there!

scienceguy
Posts: 96
Joined: Sun Feb 16, 2014 5:26 pm

Re: Learning how to spend

Postby scienceguy » Sat May 20, 2017 7:08 am

Interesting question that I think helps one mature and know oneself. I view it as a lifelong project - figuring out what use of financial resources ACTUALLY makes me and spouse/kids happy. Most spending doesn't really for us - cars, fancy things to buy, etc, though I do like looking reasonably OK so buy some new clothes every so often. Also expensive travel really doesn't do it for us - we find meandering, cheap road trip travel to be often more fun. Chipotle when we don't feel like making dinner makes us happy. Having parties makes us happy, but too busy to do it very often. Free great public schools makes us happy. Everyone loves our great local public library. Ice cream after bedtime makes everyone happy. Knowing we're financially settled makes me happy. Knowing that if my kid wants to do a relatively low income job he/she will inherit enough $ to be easily comfortable anyway makes me happy. OK, our new 75" Samsung (Costco) makes EVERYONE happy.

J295
Posts: 955
Joined: Sun Jan 01, 2012 11:40 pm

Re: Learning how to spend

Postby J295 » Sat May 20, 2017 7:27 am

Specialk22 ... It's not clear from your post why you want to learn how to spend. Apparently it will make you feel guilty and be viewed unfavorably by your peer group. Certainly you are not looking for ways to increase guilt and negative perceptions from your peer group You didn't articulate any potential increases in happiness, health, or virtue that might result from increased spending.

I'm not suggesting you should or should not increase spending. I'm inquiring because I think if you want to change such a fundamental behavior you need a deep understanding of why you want you change and a commitment to the high value of the benefits to be achieved ( which will help you tolerate the difficulties in making the change).

Will be interested to hear your insights.

hulburt1
Posts: 179
Joined: Tue Jul 15, 2014 9:17 pm

Re: Learning how to spend

Postby hulburt1 » Sat May 20, 2017 7:34 am

I'm 64 I don't get excited when I buy something. I get really happy when I hit a money goal. I do travel a lot. I love meeting new people. When I'm on the road I will sometime pole over and yell and do a little dance looking at the mountains or a lake. It's the same feeling I get when I hit a new level in saving. I'm not a good dancer anymore.


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