To what do you owe your ability to forego spending now and save for your future?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
BrownEyedGirl_27
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by BrownEyedGirl_27 »

My parents and my in-laws. They are frugal, generous, smart and use their fun money to spend vacation time with extended family. We are doing our best to become wise stewards of our wealth because of how they lived and continue to live.
"Your mind has a mind of its own. At the very moment when you are most convinced of your own rationality, you may be feeling rather than thinking your way toward a decision.” | Jason Zweig
stoptothink
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by stoptothink »

FI4LIFE wrote: Tue Dec 31, 2019 3:05 pm
dm200 wrote: Tue Dec 31, 2019 2:36 pm
stoptothink wrote: Tue Dec 31, 2019 2:25 pm I grew up in abject poverty: single mom (who did not graduate high school) who was a medical assistant, raising 5 kids in a 1,000sq. ft. 2bdr/1bath home in one of the most gang-infested neighborhoods in the country. A $45k/yr lifestyle (for family of 4) is luxury compared to what I experienced growing up. Being somewhat successful as a young adult then losing most of it (real estate crash, divorce), thankfully early enough in life to recover, was also a massive lesson I'll never forget.
Growing up in poverty, as I have observed over the years, can seem to have widely different results. While not in "abject poverty", both sides of my family grew up in the great depression and became, or were, frugal as a result. Many folks, though, that I see growing up in poverty, though, seem to have a propensity to spend and not save. Their "logic" seems to be "spend it while you have it".

I hate to sound unfairly critical of some low income or poor people/families, but some of this not saving and spending everything seems to be passing on from one generation to the next.
While there is some obvious truth to this, I think there are a number of influences that truly make a large percentage of those who grow up in poverty victims of their surroundings. Some of these include a lack of access to the knowledge needed to save and invest, lack of positive influences to show them the path to prosperity, a culture that discourages self improvement and a large number of friends and family who are in constant need of financial help from those who are able to provide it.

I am lucky to have grown up in an area with true economic and cultural diversity. As much as I believe in personal responsibility, I have seen first hand that if one kid grows up around poverty, drugs, alcohol, and criminal activity and another around success, doctors, accountants, stock market investors and extracurricular activities, one has an obvious leg up in life that cannot be discounted.
I'd say the biggest issue for me "figuring it out" was not that I grew up without money, but that in the environment I was raised, I had no mentors. Really, nobody around me was there to model success. Even though I ended up going to an elite university, surrounded by brilliant (and wealthy) people, I don't think I really started getting it until my early 30's. It wasn't that I wasn't provided the same opportunities (as a poor minority, I argue that I may have even been provided more), it's that I had no idea what to do with them because I had no role models. To this day, most of my childhood friends are stuck in this rut.

As far as what dm200 said, I am an outlier in my family. Several of us have gone onto be quite successful in the workforce, I am the only one that prioritizes saving. There is a lot of "I'm buying whatever I want because I didn't have it as a kid" going on in my family; total poverty mindset and I fear there are going to be some major repercussions pretty soon.
StealthRabbit
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by StealthRabbit »

To what do you owe your ability to forego spending now and save for your future?

My Grandparents... getting paid for work done today via "Calves".... = 24 month+ Delayed / fragile / fleeting compensation. (Especially when they died... coyotes, blizzards, disease, injury, Livestock market price tumble, drought) Tough lessons as a kid. Stamina of my very frugal and poor (and giving) pioneer grandparents was 'formative' to my idea of 'investments'.

History lessons. Realizing great people and projects peculated and arose from great challenges and barriers. (often very lengthy obstacles, and yet to be realized accomplishments)

Benevolent gifting of grandparents, parents, employer (Company founders), and people I valued. (ex and current military, immigrants, community leaders, teachers, librarians, historians my family made sure I knew). While these people may or may not have had much money themselves, they purposed to enrich my life and the lives of others. Including my 'country school' cook, janitor, bus driver, principle, teacher (often one in the same, sometimes multiple people served those roles).

Money does not buy happiness, it is only a tool to be used +/- It can also be misused to the detriment of those you love. I watched both my parents and in-laws loose all their health, wealth and their homes / farms / ranches AFTER retirement. That had a significant impact on my perception of the 'value-of-money' and things.

Poof, then we are GONE - hopefully that = :D for ourselves, and (non-financial) benefit for those we leave behind.

Legacy of learning / giving / growing
Last edited by StealthRabbit on Tue Dec 31, 2019 5:02 pm, edited 1 time in total.
H-Town
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by H-Town »

FI4LIFE wrote: Tue Dec 31, 2019 1:24 pm I will make an assumption that most on this forum save a sizable percentage of their income. Is there anything you can point to which lead you down this path? A situation that you overcame to get to this point? Feel free to pay yourself on the back.
It’s just my journey. Came from poverty, growing up alone and learning and doing everything by myself.
Smawink
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Smawink »

stoptothink wrote: Tue Dec 31, 2019 2:25 pm
I'd say the biggest issue for me "figuring it out" was not that I grew up without money, but that in the environment I was raised, I had no mentors. Really, nobody around me was there to model success.


This.
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GerryL
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by GerryL »

jebmke wrote: Tue Dec 31, 2019 1:28 pm Parents as example. They were raised during the depression.
Definitely this.
Combined with a parsimonious nature and cold reality that I would likely have no one to rely on but myself.

I have never forgotten chatting with a friend in the mid 1980s. She was complaining about trying to save for the future and maybe buy a house (in the super expensive Boston area). She said, "What's the point of trying to save? I'll never have enough to retire."

My response was, "Well what is the alternative?!?" And I made sure that her vision of the future would not be mine.
Tdubs
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Tdubs »

Fear.
sambb
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by sambb »

wanting to provide for family's future was a motivator
rbaldini
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by rbaldini »

I suspect a lot of it is innate. It just comes naturally to some, hard to others. Often two siblings raised in the same household will vary a lot in their spending habits.

I don't know why I'm a pretty good saver.
Hockey10
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Hockey10 »

As a young Army Lieutenant, I "volunteered" to be the company VITA (Volunteer Income Tax Assistance) Officer. I ended up helping probably half the guys in the company with their tax returns. This resulted in a lot of conversations with soldiers about their personal finances, even when it was not tax prep season.

One guy had a car loan at a 35% interest rate. :shock: Another figured out how much he had left over after paying his monthly expenses (none of which went to savings), and bought a Trans-Am with that exact monthly amount. A few months later he traded the car in for a cheaper model as he realized he could not afford the Trans-Am. :oops: Another was paying $19 per month for a couch with an APR higher than the guy with the 35% car loan.

Essentially, I learned from the mistakes of others while I was in my early 20s and decided that I never would allow myself to be in a bad financial situation. I spent very little on myself and saved every $ I could. This was also the time when I opened an IRA account.
ByThePond
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by ByThePond »

Good parental examples, fear of penury, and faith and understanding in investing basics.
Fallible
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Fallible »

Delaying instant gratification in order to save more probably results largely from a combination of nature and nurture, with the combination varying by individual. So, back pats are due me, but also my frugal parents and grandparents.
"Yes, investing is simple. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense." ~Jack Bogle
3funder
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by 3funder »

I grew up in a household where money was always available yet seldom wasted (my parents were not stingy, but they definitely had their priorities straight). Parents are their children's first and most important teachers and role models.
Global stocks, US bonds, and time.
harrychan
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by harrychan »

1) Upbringing - parents. My parents were the type that never took on debt to pay for luxuries. They always paid in cash and lived well below their means. There were some pros and cons but overall it instilled within me to do the same and learned how to acquire smart debt (mortgage for primary home, etc).

2) Started work early. I remember getting paid as early as 10 years old at my father's friend's business packing clothes. I got my first 'real' job as a soda delivery assistant in the Summer when I was 13. I lied about my age and it wasn't hard as I was already 6 feet tall. Those summer months were brutal. I told myself I would never do those types of job growing up and would retire.

3) Married into a frugal family. My wife and my in laws are living proof of the Rich Dad according to Robert Kiyosaki. They struggled early but started a business in their late 30's and acquired many properties in NE Asia when they had excess cash. They retired in their late 40's and now live off of their property's rental income.
This is not legal or certified financial advice but you know that already.
Old_Dollar
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Old_Dollar »

1. 2008 market crisis - I graduated from University right as it happened and had difficultly landing even the lowest paying job with a honors B.S. degree in a STEM field. As a result I lived through such a brutally tight financially constricted early adulthood. I sacrificed nearly everything to stay afloat financially and to avoid debt. Since another major negative financial event is not only possible but inevitable I vowed to do everything in my power to prepare so I am not hurt as much as the next time.

2. Profligate parent - I observed a profligate, spendthrift parent burn money like no tomorrow my entire life. If it's a new year, it's another year of repeated profligate spending habits; posh cruises, luxury hotels, lavish parties, and annual recurring trips to European countries just to name a few. Now this parent is filled with envy and bitterness over anyone who has the slight appearance of more wealth. Despite multiple decades of stable six figure salaries, retirement is still not possible for this parent who is shortly entering decade seven of life.

3. Automation/Discrimination/Medical Problems/Unforeseen Miscellaneous Negative factors. Whether it is age discrimination, automation taking over jobs, stagnant salaries, declining opportunity, name a problem. I know my current situation may not last. Nothing is permanent and everyone is replaceable. By saving more now I get to blunt the impact of major negative financial events in the future. I've seen many negative comments about FIRE. However, one of the FIRE models that everyone should prepare for is Forced FIRE.

4. 2008 market crisis - I should end with this since I started with it. I must have sent out hundreds of resumes during this time to no avail. I was told to "work harder". Now I see people who are many years my junior who did not experience the harsh punitive job searching environment of 2008 like I did. I also see younger people getting fancier cars; BMWs, Teslas, etc. For this group 2008 might as well not have occurred. I'm not blind as to what occurred and what value workers have during recessions.
I am here solely to learn about investing.
bayview
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by bayview »

I suppose this is rather grim and non-Bogleheadish, but I was in a bad marriage and knew that I would eventually be on my own. I stuck it out almost 30 years, trying to make it work, but I felt it was obvious that I’d be on my own eventually. It’s amazing how that focuses one’s concentration.

When I left, we split everything that was jointly held down the middle, and I didn’t ask for anything more, although there was plentiful ammo had I wanted. I wasn’t interested in impoverishing or getting revenge on my children’s father. I just wanted out.

So I worked two jobs, paid for the kids’ education, minimized debt, and maximized my credit profile, and saved every penny I could. Now I’m comfortable, financially secure, and happily remarried. It worked.
The continuous execution of a sound strategy gives you the benefit of the strategy. That's what it's all about. --Rick Ferri
truenorth418
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by truenorth418 »

I attribute it to my desire for financial independence, not wanting to be controlled by others - and the self discipline and intelligence it took me to achieve that.

(God bless my parents but I can’t say they were a primary driver as my siblings are not like me at all in this respect).
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dodecahedron
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by dodecahedron »

jebmke wrote: Tue Dec 31, 2019 1:28 pm Parents as example. They were raised during the depression.
And let's not forget WWII. Wartime shortages and rationing and supporting the war effort encouraged frugal habits like mending clothes, repairing appliances, using leftovers and hand-me-down clothing creatively, bartering for what you needed, etc. Saving (in the form of US savings bonds) became a patriotic thing to do.
bampf
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by bampf »

Tdubs wrote: Tue Dec 31, 2019 5:27 pmFear.
This. I was poor. Dead broke. Abject fear of ever returning to that state ever again. I haven't always been "frugal" but I have always been frugal enough to save more than I spent. As a side note, I am not certain that fear is altogether a bad thing. I am also not certain that it is particularly healthy. I guess it was healthy enough such that I was able to do what I needed to do to squirrel things away and provide a nice upbringing for my family. I certainly did not inherit my carefulness with money from anyone around me. My wife has always been particularly good with money, so there is that I guess...

--bampf
sailaway
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by sailaway »

truenorth418 wrote: Tue Dec 31, 2019 7:09 pm I attribute it to my desire for financial independence, not wanting to be controlled by others - and the self discipline and intelligence it took me to achieve that.

(God bless my parents but I can’t say they were a primary driver as my siblings are not like me at all in this respect).
We spend like my parents, but earn like my in laws. A very healthy combination, indeed.

When I was growing up, money gifts and earnings went directly to passbook savings. We were saving for college, not budgeting for some toy. We got toys for Christmas and birthday, new clothes for school and Easter. When we briefly lived near shopping, I would take my lunch and bus money, skip lunch and walk, and buy candy and records. Sacrificing comfort was the only way to get extras, since hard work just went directly to the bank. I am sure others would have rebelled against such strict parents. Indeed, neither of my brothers are great savers.
akajoey
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by akajoey »

Mine is a negative example from my parents. They had too many kids and were horrible with money. I started earning my own money at a very young age, made my own mistakes, and quickly found strategies to ensure financial security.
Ron Ronnerson
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Ron Ronnerson »

In no particular order:

-Learning from past mistakes
-Desire for security and freedom
-Being content with what I have and my current level of spending
-The persuasion of compound interest
-A supportive spouse who sees things similarly to me
-Being taught about delayed gratification from parents at a young age
-Education that allowed me to get a job that pays decently
-Bogleheads
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canadianbacon
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by canadianbacon »

Nothing as interesting as most of you guys. I just reached a point where my spending was fairly comfortable and haven't changed it. My total spending this year was basically the same as it was in 2005, but my after-tax income is 80K higher. All that money has to go somewhere.

Doesn't mean there aren't things I could hypothetically enjoy... if someone offered me a Tesla and a supply of high-end Scotch, I'd accept it. It just doesn't fit into my current plan. My priority right now is to get to a VPW withdrawal that supports my current budget. At that point, if I continue working, I'll have the ability to ramp further up if I want.
Bulls make money, bears make money, pigs get slaughtered.
Dottie57
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Dottie57 »

Grandpa always said to make your money work for you.
Parents paid off debt and credit cards on time. Never overspent.
There were money discussions at the dinner table about dad’s business and I soaked it in.
I was good enough in math to figure out tha I needed to save for retirement since I did not have a pension.

The rest is luck.
finite_difference
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by finite_difference »

EnjoyIt wrote: Tue Dec 31, 2019 2:01 pm It took a CPA to try and sell me whole life insurance to really start learning about personal finance and finding Bogleheads. I did not buy the life insurance and fired the CPA.
LOL that made me laugh. So true. I am proud to be part of the Bogleheads anti-whole-life-insurance brigade. I always knew whole life insurance was a scam but the knowledge of the posters here that squash all the whole life threads were another indicator that I had found the right place.

Whole life — just say no.

It’s pretty common sense to me, even though I may lack common sense, that if you save nothing you will have to work forever.

But I 100% credit Bogleheads for providing me with an investing philosophy that completely makes sense to me. That investing philosophy strongly supports my ability to forego spending.
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh
EnjoyIt
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by EnjoyIt »

finite_difference wrote: Tue Dec 31, 2019 10:14 pm
EnjoyIt wrote: Tue Dec 31, 2019 2:01 pm It took a CPA to try and sell me whole life insurance to really start learning about personal finance and finding Bogleheads. I did not buy the life insurance and fired the CPA.
LOL that made me laugh. So true. I am proud to be part of the Bogleheads anti-whole-life-insurance brigade. I always knew whole life insurance was a scam but the knowledge of the posters here that squash all the whole life threads were another indicator that I had found the right place.

Whole life — just say no.

It’s pretty common sense to me, even though I may lack common sense, that if you save nothing you will have to work forever.

But I 100% credit Bogleheads for providing me with an investing philosophy that completely makes sense to me. That investing philosophy strongly supports my ability to forego spending.
That CPA tried to convince me to spend $50k/yr in a whole life policy in addition to a Sep Ira. The IRA made sense although now I use a 401k. The whole life was just too complicated at the time and I was not going to spend $50K a year on something I did not fully grasp. From there I did a bunch of research with the plan of understanding the product enough so that I can explain it to my wife and if she did not get it, I would assume it meant I still did not understand and should not be buying the policy. Turned out I understood it well enough. The CPA was trying to rob me.
A time to EVALUATE your jitters: | https://www.bogleheads.org/forum/viewtopic.php?f=10&t=79939&start=400#p5275418
finite_difference
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by finite_difference »

EnjoyIt wrote: Tue Dec 31, 2019 10:23 pm
finite_difference wrote: Tue Dec 31, 2019 10:14 pm
EnjoyIt wrote: Tue Dec 31, 2019 2:01 pm It took a CPA to try and sell me whole life insurance to really start learning about personal finance and finding Bogleheads. I did not buy the life insurance and fired the CPA.
LOL that made me laugh. So true. I am proud to be part of the Bogleheads anti-whole-life-insurance brigade. I always knew whole life insurance was a scam but the knowledge of the posters here that squash all the whole life threads were another indicator that I had found the right place.

Whole life — just say no.

It’s pretty common sense to me, even though I may lack common sense, that if you save nothing you will have to work forever.

But I 100% credit Bogleheads for providing me with an investing philosophy that completely makes sense to me. That investing philosophy strongly supports my ability to forego spending.
That CPA tried to convince me to spend $50k/yr in a whole life policy in addition to a Sep Ira. The IRA made sense although now I use a 401k. The whole life was just too complicated at the time and I was not going to spend $50K a year on something I did not fully grasp. From there I did a bunch of research with the plan of understanding the product enough so that I can explain it to my wife and if she did not get it, I would assume it meant I still did not understand and should not be buying the policy. Turned out I understood it well enough. The CPA was trying to rob me.
Yeah, and I should say that I strongly suspected it was a scam just like you. But I didn’t truly know why until I found this site. That anyone, but particularly a CPA, can try to sell a policy for $50k/yr like that is truly criminal!
The most precious gift we can offer anyone is our attention. - Thich Nhat Hanh
furikake
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by furikake »

I had a long commute at my first job out of college, and I borrowed a lot of audio books from the library to listen to in the car, one of them was Millionaire Next Door.
5280Tim
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by 5280Tim »

I had the benefit of seeing examples of two very different financial philosophies.
My grandparents were farmers and very generous throughout their life. They lived comfortably but were not what I would consider wealthy. My parents have always spent at or right around their means. Dad was laid off and has essentially retired even though I’m not sure he really wanted to. I chose early on that I did not want to have a small financial emergency derail my ability to save and give. My wife is of the same mindset and while we “only” save around 18% of our gross plus employer matches, we feel blessed to be able to give that amount away as well. We will never reach some of the levels of financial wealth on this board, but are grateful for all that we have and I’m thankful to have been able to learn from my grandparents and to have a spouse that shares the same values.
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by helloeveryone »

FI4LIFE wrote: Tue Dec 31, 2019 1:24 pm I will make an assumption that most on this forum save a sizable percentage of their income. Is there anything you can point to which lead you down this path? A situation that you overcame to get to this point? Feel free to pay yourself on the back.
This forum made me REALLY realize that you can achieve financial independence through diligent savings, control of spending etc.... ie - I really really like cars - but with what I've learned on this site and the mindset I've developed - I look at a car purchase based on total costs spent in one sitting ($40k+) - and how that money would grow over the next 15-20 years and could fund 1, 2, or 3 years of retirement (thus early retirement). I use the car as an example as cars and housing are the largest ticket items that make a huge difference in achieving high savings rate but choosing vacations etc... play a role as well.
sg2060
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by sg2060 »

Fear. My frugal grandfathers who taught me the benefits of saving. And my parents, who haven’t saved.
StrawMan
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by StrawMan »

bampf wrote: Tue Dec 31, 2019 7:27 pm
Tdubs wrote: Tue Dec 31, 2019 5:27 pmFear.
This. I was poor. Dead broke. Abject fear of ever returning to that state ever again. I haven't always been "frugal" but I have always been frugal enough to save more than I spent. As a side note, I am not certain that fear is altogether a bad thing. I am also not certain that it is particularly healthy. I guess it was healthy enough such that I was able to do what I needed to do to squirrel things away and provide a nice upbringing for my family. I certainly did not inherit my carefulness with money from anyone around me. My wife has always been particularly good with money, so there is that I guess...

--bampf
I’ll echo this, Fear.

I’m not old , late 40’s, but I still remember the stories from my grandparents talking about growing up in the depression era. There’s other factors; I didn’t grow up with much. So, I have kids to raise and provide for. I want them to have all the things I didn’t - and the opportunities I didn’t. So fear, fear of the future.
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black jack
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by black jack »

mptfan wrote: Tue Dec 31, 2019 3:39 pm I think some people are born frugal and others are not, it's a simple as that. Yes, nurture can have an impact, but I think nature predominates.

I know people who were raised in the same house with the same parents and yet they handle money differently. Someone who is naturally frugal and is raised with frugal parents will say "I got it from my parents," whereas someone who is naturally frugal who was raised with spendthrift parents will say "I saw how my parents spent too much and struggled with not having enough money and I vowed never to be that way."
Bingo, we have a winner.

Making a pretty good income helps a lot too. It's easier to save a sizable percentage of income when that income is sizable enough to save a lot and still cover all my (relatively modest) needs and many of my wants.
We cannot absolutely prove [that they are wrong who say] that we have seen our best days. But so said all who came before us, and with just as much apparent reason. | -T. B. Macaulay (1800-1859)
DiploInvestor
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by DiploInvestor »

Growing up with parents who didn't handle money well and were always fighting about it. Also started working early (12) and hated the feeling of spending what I earned when I really wanted to save it - had this feeling reinforced in different jobs in my youth, and luckily found a career in my 20s I really liked that had good pay, benefits, and a 401k. Said I would never have my parents' money issues and haven't (except for the year after the birth of our twins when we had an 18-month-old at home and were scraping bottom for a while). We are dual income and now save around 60% of our gross. We'll always be frugal, even though we don't really need to be anymore.
"History doesn’t repeat itself, but it often rhymes." -- Mark Twain // "If you have a garden and a library, you have everything you need." — Cicero
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Dandy »

1. Mom opened a savings account for me at an early age to put my savings and earn interest!!
2. Parents set a good example of wise spending
3. Father was forced to retire just before qualifying for a full pension and they had to move to Florida from the NE.
Lessons learned don't count your chickens as far as company benefits and better save for yourself.
4. First job in 1971 had a savings and company match plan that eventually turned into a 401k.
5. Saw the benefits of delayed gratification e.g. growing assets and the ability to put a down payment on first home that
we are still living in.
6. A spouse that had a decent attitude toward spending and saving. Need a sane partner for savings and a peaceful marriage.
7. Living below our means - after awhile it is just a normal way of life doesn't feel like a terrible burden. Someone said
there are people in your town that are making less than you and are doing fine - you can save some of the difference.
8. Early on an older co worker advised that each time you get a raise or bonus put some away for the future -- you won't miss it. So, I would up my savings bond contribution or increase my 401k percentage etc. If you never had it in your net pay you really don't miss it.
9. Always had some emergency funds to prevent unexpected expenses from having us incur debt.
10. Luck
pennywise
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by pennywise »

Smawink wrote: Tue Dec 31, 2019 3:07 pm I was not always a saver. 2 things changed that.

I’ve spent several years partnered to a high earning single father 16 years my senior. I sacrificed my career to help out. I used my vacation time to help with his elderly parents or help get houses ready for him to sell. I skipped lunch every day and literally ran home from the bus so I could be home to cook dinner. I helped with his gravely ill son. Then one day, after contemplating his parents’ struggle to pay for long term care, he asked whether I would help him in his old age. I readily agreed. My mother was a nurse. I knew what it involved and thought I would be good at it. I asked whether he would help me and he said yes and that my best chance was to someday qualify for Medicaid. He also said he thought he would outlive me and that the help he was offering was direct care should I become ill, not financial help.

When I fully grasped the position of unmarried women approaching retirement age, the likelihood that I would have to leave the workforce early for caregiving or my own health problems, and the possibility of outliving savings, I started to put the energy I had previously put into my relationship into saving and investing for myself. I hope someday to help other unmarried women gain financial security.
The experience above illustrates a sad but all too common dynamic for women. Saving and managing my own money to avoid that trap started very young for me and it's guided me for all my working and now retired life.

Growing up, although she didn't seem to mind, I recall watching my mother's complete financial dependence on my father. That triggered a deep determination I would never live like that. My dad was a pretty good provider (military officer) but in a household with a single income and a large family I often was told no when I wanted something that cost money he didn't want to or couldn't afford to spend. And his word was the deciding one; my mother had no say other than her powers of persuasion.

So from that childhood family dynamic, I deeply internalized the importance of having my own resources so I could make decisions and purchases for myself. Getting my first job at 16 YO made me so happy! I still recall my dad (of course) taking me to the bank to set up my first account so I could begin saving some of my earnings. Saving was important so I wouldn't get caught if I wanted or needed something for myself in the future.

For all the vaunted single income paeans to 'our' money, in the end the golden rule always applies: he who has the gold makes the rules. I've seen far too many women utterly shocked not to mention left in dire financial straits when their money turned into his money once the separation and divorce papers got filed.

I also give enormous credit and appreciation to the tremendous fiscal value of a good partnership to a spouse who shares one's values of saving. My husband is and always has been a saver. We built a marriage in which we may have sometimes disagreed on how to spend our money but never on how important it is to save a good chunk of it! Then too being equal financial partners has given us so much more power in our joint fiscal life; my husband never had to shoulder the entire burden and he was able to retire sooner because I was still working.

So that early experience of seeing and experiencing what it means to not have agency in life because of financial dependence made a deep impression on me. Marriage and an adult life with a partner who is cautious and careful with money solidified how important it is to save and manage your funds.
tigermilk
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by tigermilk »

An understanding of mathematics.
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by TheOscarGuy »

meowcat wrote: Tue Dec 31, 2019 1:44 pm Fear.
I've saved in a 401(k) since I was 23 years old, jut not enough. In 2000 we moved to Florida and I needed to get a new Social Security card. If you want a crystal clear picture of what it's like being old and broke, you owe it to yourself to go visit a Social Security office. For me, it was a wake up call. I did not want to be part of that statistic.
I need to go to local office, have been putting it off for ages. I should do this! Like you, it works wonders for me..
mptfan
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by mptfan »

pennywise wrote: Wed Jan 01, 2020 9:06 am Growing up, although she didn't seem to mind, I recall watching my mother's complete financial dependence on my father. That triggered a deep determination I would never live like that. My dad was a pretty good provider (military officer) but in a household with a single income and a large family I often was told no when I wanted something that cost money he didn't want to or couldn't afford to spend. And his word was the deciding one; my mother had no say other than her powers of persuasion.
To each his own. I see nothing wrong with a wife being financially dependent on her husband and the husband's word being the deciding one, that is how it was for thousands of years of human history and there are people who continue to choose to live that way today. And as far as children being told "no" when they want something that the family could not afford, I don't see anything wrong with that either, that is how I was raised and I think it helps to build character and an appreciation that you cannot have everything you want and you learn to better appreciate the things you do have.
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Nicolas
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Nicolas »

For me it was an adulthood of relative privation. But I’m in my future now and still can’t spend.
Minty
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Minty »

tigermilk wrote: Wed Jan 01, 2020 9:09 am An understanding of mathematics.
I think I am thinking along the same lines as you. I would say reason and free will (or the illusion of those things).
Core Four w/ nominal bonds & TIPS. Refi Rampage: Purchase: 3.875% 30 -> R1 3% 20 -> R2 2.375% 15 -> R3 1.99% 15
offthetop
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by offthetop »

My father was born in the mid 40s, his parents were flat broke but ran a small business to make ends meet. He learned to save and got married when he was 20. He started a small business and had 2 kids in his 20s and then divorced in his late 20s. His wife got everything but his work trailer, she even got his grave plots next to his parents, 35k he had saved, the lake house with 4 lots worth 1M today. He quit believing in saving and spent every dime he had when he got it from then on. He found my mother years later and got married. They had 3 kids in the 80s and an accidental child in 2000s (so 6 kids total for my dad). They both worked hard, they kept seperate accounts and my mom bought bonds for us kids before we were born until she died in 2010.

When we were young and interest rates for kids were good she opened a bank account for each of us and made us save every dime we made. She led us to believe we couldn't afford the best or coolest toys, lived below our means, and kept us active in the community volunteering or in sports. When I got my first real paycheck I spent it on an ipod and headphones. She was furious and told me how importiant saving was. I regretably ignored her for many years until her death.

She left us kids some money about 100k each. Funny story was my father had been giving her money for the house payment for years and wanted to finish paying off the house with the money he got. We called the bank and they couldn't find record of the loan which made my dad angry, a week later they called back and informed my father that the loan had been paid off for 10 years. The whole time my mother was taking the money and saving it for their retirement. This is when I realized my father was financially illiterate. He made about 90k a year and never knew it because he spent it as soon as he got it on useless junk.

I got with EJ after our lawyer suggested we go to a financial planner at EJ that he had good success with. I got my year end statement and realized how much I didnt know, but I knew the fees were a couple thousand and that erked me so started reading about finances when I stumbled upon this site. It was an interview with Warren and Jack. I started to look into who they were and found this site through a google search. The wiki links were informative and I started saving because of Bogleheads. I dumped EJ, and try to teach my athleats the importance of not needing new flashy shoes or cars and that saving young is importiant. If one of them listens then I will be happy.

THANK YOU GUYS for taking the time to keep the site running and keeping information flowing! I will be forever greatful.
dcw213
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by dcw213 »

Interesting thread. I think generally the example of those involved in one's upbringing is very important, but, as another poster said, I think some of it is just due to chance and how one's personality and outlook develop. I may be a good example of this.

My parents provided a great life for us growing up but were not overly frugal. They were certainly responsible with money and never over extended but they generally established a small cushion early on, maxed retirement accounts, and then spent the rest (not saying this is bad and clearly above average, but not the mentality of this forum). My siblings all live at their means but for some reason I felt from a young age the desire to live below my means and accumulate more savings.

I'm currently in my late 30s, so did teenage years mostly in late 1990s and started working professionally mid 2000s. Looking back I think the most significant influencing event was probably my parents insisting that I start working a part time schedule during school and full time over summers when I was 15. At this age almost none of my friends worked. At this point, I was responsible for paying for anything I wanted (parents still covered necessities and the occasional big ticket items like a trip or attending an out of area sports event). Every thing that came up to do with friends (going to get food, going to movie, driving somewhere far away, etc) I had to weigh whether it was worth it. I recall a few times early on when I went along with some half baked plan that resulted in having to pony up more cash than I thought and being annoyed about how it was 3 days worth of work (or whatever it was) to do something that wasn't worth it. Suffice to say, it just clicked. I got teased occasionally but it's not like it impacted my life or friendships and I learned to not care what others thought about my approach. Good lessons during formative years. My siblings experienced similar things and constantly complained to my parents. I just didn't and accepted the situation, not sure why, this is where I think the chance comes into play.

I also have a distinct memory of when I started working full time. I was terrified taking on the financial obligation of my own apartment in a big city and feeling in over my head at work. I researched personal finance aggressively feeling the fragility of my situation (negative net worth, pressure to keep earning). This led me to this site and others that have been invaluable to my education. Similar to my teenage years, I recall one event when I went out with some old friends for a night out in the city. Everyone was liberally spending their new big boy paychecks at the restaurant and bars. I joined in and had fun, but remember reflecting afterwards that I spent in one night more than the interest I projected to earn all year on my new online savings account that I just set up and spent days researching and planning (6% rate by the way). This was a bad feeling and again made me realize that these decisions were important. I still had fun but splurged only on special occasions rather than a weekly thing as so many of my friends and coworkers did.

Eventually things just clicked and I have become comfortable with my plan and balance, but the urge to save remains an ingrained part of me. My siblings are not the same, and generally live paycheck to paycheck and dont seem to be concerned. Same upbringing, different results. I will say, nobody is completely reckless or over extended, which I'm sure is due to parental influence.
Last edited by dcw213 on Wed Jan 01, 2020 11:14 am, edited 1 time in total.
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galving
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by galving »

jebmke wrote: Tue Dec 31, 2019 1:28 pm Parents as example. They were raised during the depression.
Parents were definitely shaped by their experiences following the depression as well.
That was an initial example. Though my brother and I have very different approaches towards money. Spending. Needs vs Wants.

My experience with the chemical industry reinforced the need for discipline and efficiency.
In effect, that discipline bled over into our personal finances.
anon3838
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by anon3838 »

FI4LIFE wrote: Tue Dec 31, 2019 1:24 pm Is there anything you can point to which lead you down this path? A situation that you overcame to get to this point? Feel free to pay yourself on the back.
I had the kind of childhood that many here fear. Lived in squalor, spent many hours in government offices asking for money to cover basics like food. The occasional bag of groceries donated to my family. We were those people.

It was a combination of parent's bad decisions and their bad luck.

Likewise, I contribute a lot of my success as an adult to good decisions and good luck.

I read Millionaire Next Door when it first came out. I've always been fascinated and interested in the idea of "living off the interest". Now that's my goal, but by outwardly appearances, I don't fit the profile described in the book.
kjsammy
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by kjsammy »

Imo it was helpful to navigate my early life without credit cards. It was very clear what was a need and a want.
No cash, so did not develop mindless habits of buying every cup of coffee and item of food and more.

Credit cards are not helpful to poor people. It turns out they want they same stuff as others, they just cannot afford it. Who would have guessed.

My parents had no money. Built house, kitchen cabinets, desks for our homework. Grew and preserved food, sewed clothes, kept old cars running. We never ate out. In the end, the family owned a home. There was some security. Really, owning your own home is the most important thing you can do for your own security. Sure, it is different if you have a lot of money.

People use credit cards to their detriment and they are doing the same with smart phones.
This was a great story:
https://www.bostonglobe.com/magazine/20 ... story.html
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by Dottie57 »

mptfan wrote: Wed Jan 01, 2020 9:46 am
pennywise wrote: Wed Jan 01, 2020 9:06 am Growing up, although she didn't seem to mind, I recall watching my mother's complete financial dependence on my father. That triggered a deep determination I would never live like that. My dad was a pretty good provider (military officer) but in a household with a single income and a large family I often was told no when I wanted something that cost money he didn't want to or couldn't afford to spend. And his word was the deciding one; my mother had no say other than her powers of persuasion.
To each his own. I see nothing wrong with a wife being financially dependent on her husband and the husband's word being the deciding one, that is how it was for thousands of years of human history and there are people who continue to choose to live that way today. And as far as children being told "no" when they want something that the family could not afford, I don't see anything wrong with that either, that is how I was raised and I think it helps to build character and an appreciation that you cannot have everything you want and you learn to better appreciate the things you do have.
I grew up in a home where dad worked and mom stayed at home to raise the kids. They were equal financial partners. Mom did the daily finances and dad planned long term /retirement finances. Both had to say “ok” to big purchases. It worked well. Different roles but equal footing worked well .
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by LittleMaggieMae »

I was taught to save as a kid and that's save as in "you save this and you never ever ever spend it. Spending it is BAD!". I was kind of taught how to "budget" my money - as in save a little out of each paycheck to pay for Christmas gifts or for some new something to be bought in the next couple of months. but spending MORE than you saved is bad. You might not have enough money.

I would have to say that the biggest motivator to forego spending and save for any type of goal (short term or long term) is my prodigious skill at Avoiding bad feelings not having enough money/spending money. I want to avoid the stress/worry/all ways thinking about some big expense (planned or unplanned) just over the horizon. I can guesstimate how much I will need to eventually spend and can therefore attempt to save up that money (to spend (or for more complicated things - a combination of savings and debt to achieve the goal))

I will happily watch as large amounts of my paycheck are "pre allocated" to future expenses (season tickets, holiday travel, retirement, a new investment property, whatever) or moderate amounts being paid to debts (related to assets that move me closer to long term goals) as a way to NOT have to think/worry/agonize daily about "how am I gonna pay for that?!? Can I really have that?!? I'm gonna be in the poor house if I do that!!!" I KNOW I can pay for that, really have that, won't necessarily be in the poor house. OK, you can't really know but my math sez it's not too likely. :)

I find my ability to forego spending now is all about avoiding feeling awful right now and in the future (when I spend the money I 'saved" up..) I have fully embraced the idea of a sinking fund (saving up money I will happily spend in the future). The "oh, I can't spend this now how sad" feeling is tempered by the "but, I'm gonna have this awesome something in the future!" And I have gotten some "awesome somethings" so I know it's not
a hopeless "dream". :)
kjsammy
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by kjsammy »

mptfan wrote: Wed Jan 01, 2020 9:46 am
pennywise wrote: Wed Jan 01, 2020 9:06 am Growing up, although she didn't seem to mind, I recall watching my mother's complete financial dependence on my father. That triggered a deep determination I would never live like that. My dad was a pretty good provider (military officer) but in a household with a single income and a large family I often was told no when I wanted something that cost money he didn't want to or couldn't afford to spend. And his word was the deciding one; my mother had no say other than her powers of persuasion.
To each his own. I see nothing wrong with a wife being financially dependent on her husband and the husband's word being the deciding one, that is how it was for thousands of years of human history and there are people who continue to choose to live that way today. And as far as children being told "no" when they want something that the family could not afford, I don't see anything wrong with that either, that is how I was raised and I think it helps to build character and an appreciation that you cannot have everything you want and you learn to better appreciate the things you do have.

Ugh. Financial dependancy is terrible. Take a pause and think of all the women you know who put up with crap because they are dependant. Who allow mistreatment of a child because they are dependant. Who say nothing when the king of the castle yammers on without a filter on holidays or any day. They will sometimes share the same stupid opinions because it is easier.
Think of the women you knew/know that made a bad decision when they were young - who to marry - and paid for it for decades, maybe for the rest of their lives.
It still goes on though less than in the past.
The ending of this thousands of years old tradition is why life is better now.
MoonOrb
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Re: To what do you owe your ability to forego spending now and save for your future?

Post by MoonOrb »

1. The good fortune to be born as a white, male, able-bodied American, which has given me a lot of advantage right from the start and the ability to make my own way in the world without the headwinds that others in different circumstances face.

2. Being born to college-educated parents who intentionally moved to a safe area with good public schools and raised me with an expectation that I would go to college.

3. My parents paying for the vast majority of my undergraduate education, leaving me free to go to professional school without already having a debt load.

4. Lessons from my single-parenting mother, an owner in a family business, who was never sure how much income she might have from year to year and thus lived within her means and saved a lot in anticipation of lean years.

5. Marrying a person who, although significantly different from me (first generation American), had life experience that caused her to have an aversion to debt and a propensity to live within her means.

6. Translating 1-3 above into fairly high-earning jobs, making it relatively easy to pay myself first and still have money left over to spend on things I want to do now.

Short version: values instilled from mom + marrying someone with similar mindset + a whole host of advantages leading to opportunities to get high paying work with little debt.
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