Thought Experiment/Question

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Dragline
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Joined: Wed Aug 24, 2011 1:50 am

Thought Experiment/Question

Post by Dragline »

Curious to your collective opinions/answers on this:

"What if you woke up one day with a special discount where everything you purchased/consumed cost only 15% of the regular prices?"

What things would you consume more of? What things would you dump or exchange in favor of others (i.e., upgrades)? What common items/experiences that you see others buying/consuming would you continue to avoid? Would you spend your time substantially differently than you do now? Would you acquire new hobbies or interests?

Note, this is a personal preference question. I'm not interested in business/arbitrage/investment opportunities in this scenario, so assume that you would only be able to sell something for exactly what you paid for it, or less. You are also allowed to buy things/experiences and give them away if you so choose. Assume the discount applies for the rest of your days.

enigmaT120
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Re: Thought Experiment/Question

Post by enigmaT120 »

Vintage motorcycles.... and maybe a Daytona 675.

I went to the vintage show in Corvallis Sunday and wandered around with my friend Dave, and almost every motorcycle I admired, he pointed out that I could buy. He was right, I could probably afford 90% of the bikes there, but I guess I don't want one as badly as I want to retire early. Which by the way is getting more difficult, as I only have 2 years 5 months to go anyway.

enigmaT120
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Re: Thought Experiment/Question

Post by enigmaT120 »

Wait, I have another one: a tractor and logging equipment. Or is that disqualified because I would use it to log my property?

Dragline
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Re: Thought Experiment/Question

Post by Dragline »

No, that's fine, except you'd get no profit from selling the logs, just the satisfaction of having cleared land.

I should have also mentioned that you are allowed to pay for services at the same discounted rate, too. But again, only in the personal context -- like having someone clean your house, fix your roof or mow the lawn -- not in the business or wealth generation context.

chenda
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Re: Thought Experiment/Question

Post by chenda »

I honestly don't think it would have any significant impact on my purchasing.

jacob
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Re: Thought Experiment/Question

Post by jacob »

Apparently not much. My SWR is 0.85% currently, so that's like paying 21% if adopting the 4% rule, and yet I don't really desire to change a lot of things. Currently, I'm thinking about upgrading to this: https://www.amazon.com/dp/B002PEF4BE/ from this: https://www.amazon.com/dp/B003NFO528/

There seems to be two kinds of people: Those who look at price and those who look at value. The latter wouldn't pay $50 for a cup of coffee no matter how many zillions they were worth. There are probably some interesting prospecting theory to be worked out here given how the question of cost is phrased here. Another way of asking is "How would you spend $$$$ if you had to spend and not save?" Ferris asked MMM this question on their podcast episode. If you're FIRE+ in the value-category, the typical answer is 'hem and haw' because you're "already there".

Another issue is that spending comes with consequences. For example, instead of the powered auger above, I could also hire a plumber at 15% of the cost. But now I have to deal with hiring and being at home(*), etc. which may be more hassle than just DYI'ing it. Even if I buy the fancier tool, I need to take better care of it than the cheap version. Rust never sleeps. And I would become more dependent on electricity which goes against my goal of being less dependent.

(*) In this town, I keep bitching about how seniors who are perfectly capable of mowing their own lawns get it done for free (other people's money) by the city. Once you cross the magic age threshold, the city simply starts mowing your lawns for you. I'd take that!

In terms of living situations. If I could move into a $60/night level hotel/motel for $10/night ... it's quite likely I would prefer that over any other housing arrangement. But then I should compare that to what monthly standard rents would be. If they were equally low, I'd prefer standard renting.

For experiences: http://www.virgingalactic.com/human-spa ... y-with-us/ or at least http://www.skycombatace.com/experiences ... -red-flag/

... here again though. These are "cheap" touristy rides and I'd be more inclined to go all in and be "more real" about it. Thus, I'd rather get a flight certificate or a job in the space industry. But that would take time and effort away from things I'd rather do. (Like posting on this forum?! ;-) :-P )

It's Liebig's law of the minimum. It's not for lack of money. It's for lack of other resources that money can't buy.

IlliniDave
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Re: Thought Experiment/Question

Post by IlliniDave »

I'd probably by a small boat/motor for fishing. I don't anticipate a lot of change in day-to-day stuff. I don't live my life feeling financially constrained.

That's an edit, I think my first answer was based on a misreading of the question.
Last edited by IlliniDave on Tue May 23, 2017 12:17 pm, edited 1 time in total.

ThisDinosaur
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Re: Thought Experiment/Question

Post by ThisDinosaur »

First of all, +1 to a trip to outer space. But the price would have to come down more than 15% for a "real" trip to space. (A ride to the ISS on a Russian Soyuz costs civilians 20million.)

Otherwise I'd say housing and travel. Most consumer products I am comfortable giving up for sooner FI. Its no sacrifice. But I would probably have a big house and lavish vacations if money was no issue.

Chad
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Re: Thought Experiment/Question

Post by Chad »

Assuming the 15% is taken off of new purchases and not current/old purchases, such as apartment rent. If it's off of old too, I would be very tempted to just invest the 15%.

I basically have all the material goods I need and want, so other than a couple things I have been eyeing like a SUP board or kayak I would mostly buy more services. I would potentially upgrade my apartment slightly (potentially a condo, as the 15% would also lower the condo fees), so I had one with a washer/dryer in it and not in the basement 4 floors away. I might also go with a cleaning service for the apartment some time in the future, as I really like to structure my life to eliminate daily chores. I mostly dislike cleaning my house, doing yard work, etc., as it is always preventing me from doing something more interesting.

Also, join the local crossfit/MMA gym. This will probably happen without the 15%, but the discounted price would definitely help encourage it.

Dragline
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Re: Thought Experiment/Question

Post by Dragline »

To be clear, its an 85% discount. And yes, it would apply to your next month's rent and thereafter.

ThisDinosaur
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Re: Thought Experiment/Question

Post by ThisDinosaur »

Yeah, 85% discount. I followed, I just typed it wrong.

Since the discount applies to *everything* I buy, I would be FI already with my current savings, and then some. I could afford to be much more generous with gifts for family and friends.

Toska2
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Re: Thought Experiment/Question

Post by Toska2 »

Go back to college for two master's , one in electrical eng and the other in industrial processes.

Solvent
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Re: Thought Experiment/Question

Post by Solvent »

I'd eat more fish. No hesitations.

This is actually a very interesting question. Several things I thought of and then actually discarded... Air tickets, for example... Yeah, maybe I'd travel a bit more, but the time cost and hassle of moving around really is a big disincentive... Would I really do it so much more? I actually would probably eat out more, not because the food is any better, but I'd spend less time washing dishes.

Chad
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Re: Thought Experiment/Question

Post by Chad »

Well, that was poor reading comprehension on my part.

JamesR
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Re: Thought Experiment/Question

Post by JamesR »

With an 85% discount and as a bachelor, I'd probably make way more of an effort with getting much nicer clothes, getting a proper haircut (from one of those $100 hairdressers ($15 after discount)). I'd also eat out significantly more, and I'd get a vehicle, and live a much more "spendy" lifestyle.. And I'd still spend less anyways.

The 85% discount would essentially enable me to target quality of life factors that I normally don't value highly. Like what Jacob said about value, I generally am not willing to spend much money on looking good or eating out because those typically cost too much from my perspective.

However, the value isn't going to be completely fixed, instead it would be based on my actual monthly retirement income.

BRUTE
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Re: Thought Experiment/Question

Post by BRUTE »

brute would consume more of things he currently limits on price, and no increase in consumption of item where he already doesn't care about the price (tooth paste). so his consumption curve would shift towards higher quality / pricier items.

said differently: a reduction in monetary cost would increase consumption of things currently limited by monetary cost (steak), but not consumption of things not currently limited by monetary cost (tooth paste). sounds almost tautological.

Riggerjack
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Re: Thought Experiment/Question

Post by Riggerjack »

More land, further back, with a paved driveway. Maybe a Bigger, Brighter Bunker...

ducknalddon
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Re: Thought Experiment/Question

Post by ducknalddon »

The main justification for keeping my expenses so low is the environmental cost of consumption so I can't imagine much changing really. The only thing I've put off recently due to cost is taking a masters in mathematics.

Eureka
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Re: Thought Experiment/Question

Post by Eureka »

I would take courses in how to direct and make documentary films. And then start making some, including hiring staff.

Probably also attend more long term yoga workshops.

SustainableHappiness
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Re: Thought Experiment/Question

Post by SustainableHappiness »

Food, rent, transportation wouldn't change much, but I'd feel better about our rent.

Invest more in skills training (from professionals) that I think might bring me and my family joy and function that I am currently either teaching myself "good enough" right now, or avoiding entirely due to time constraints. E.g. Yoga teacher training, Mechanic training and tools.

I'd be more inclined to do activities that cost $$ with my friends that I don't have the equipment for -> Paintball, Zombie Survival Camp take 2, 3, 4, Adventure rooms, Kayaking, Snowboarding, etc... All things I do once within a couple year time frame for various reasons, but not worth doing a lot and I currently reject sometimes.

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