What do YOU want?

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OldPro
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Re: What do YOU want?

Post by OldPro »

jbrown79 wrote:Of course I want money. For my children and grandchildren's future, for my whims and needs, and to fulfill my goal of traveling the world! But, in reality living in a cabin in the woods or even in a tiny hut facing the beach with peace of mind is far more meaningful than having all the money in the world.
You do realize that 'reality' and 'living in a cabin in the woods' do not necessarily connect to 'peace of mind' or whatever romantic notion people often have of things like this.

It is far harder, time consuming work, to live in a cabin with little money than it is to live in a mansion with servants. I have met quite a few people who escaped to their 'paradise' only to find that they had ended up in a less 'peace of mind' providing lifestyle than the one they left behind.

Make no mistake, money DOES buy happiness. It is what buys you freedom from things you don't like. Sure there are poor and happy people just as there are rich and unhappy people but the fact is that there are more(by %) rich and happy people than there are poor and happy people.

The ideal is to have enough money to go and live in a cabin in the woods right up until you no longer want to live there and then have the money to go and live some other way if you choose to. Being unable to afford to leave that cabin in the woods when the romance of it all wears off, is not a good idea. Riding a bicycle is fine as long as you are happy doing so and not a day longer. Being able to choose to ride a bike or drive a car is a far better position to be in.

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fiby41
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Re: What do YOU want?

Post by fiby41 »

OldPro wrote: Make no mistake, money DOES buy happiness.
No OldPro, you are wrong.

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GandK
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Re: What do YOU want?

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OldPro
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Re: What do YOU want?

Post by OldPro »

Yeah he's right fiby41, it does buy 'crazy-ass happiness'. I just didn't want to rub it in, so I kept it down to a simple it does buy happiness. It's not easy hearing your $10k a year income or whatever ERE plans may have a flaw.
http://fpeluso.com/wp-content/uploads/2 ... Person.jpg

7Wannabe5
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Re: What do YOU want?

Post by 7Wannabe5 »

What is the mechanism by which it buys "crazy-ass" happiness? I live on less than $10,000/year, and I track the factors that contribute to my daily happiness level, and discretionary spending doesn't even make the top five. Currently, it seems to be the case that my biggest limiting factors would be something like "stamina" and something like "focus" rather than "money." Also, it has become apparent to me that happiness is necessarily cyclical and relative. It makes sense that if money has been the lynch-pin limiting factor that has prevented you from having or doing something you really wanted, then it would be true that a sudden increase in finances could suddenly greatly increase your happiness, but it wouldn't necessarily or even likely be a continuous or even level improvement. OTOH, I would also, unfortunately, say that this was true for such factors as free time.

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C40
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Re: What do YOU want?

Post by C40 »

OldPro wrote:Yeah he's right fiby41, it does buy 'crazy-ass happiness'. I just didn't want to rub it in, so I kept it down to a simple it does buy happiness. It's not easy hearing your $10k a year income or whatever ERE plans may have a flaw.
http://fpeluso.com/wp-content/uploads/2 ... Person.jpg
Huh??? Are you saying you think $10k/year spending means living like a homeless person? Or ending up homeless?

I'm sure you can understand that the "money buys happiness up to $75k/year of income(spending)" is from data relating to the entire U.S. consumer population and that individuals don't all adhere exactly to the mean.

OldPro
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Re: What do YOU want?

Post by OldPro »

7w5, I would think the 'mechanism' was obvious. Try being happy without a flush toilet for the rest of your life or whatever other thing you consider a necessity to be happy in your life. It requires money to have a flush toilet. Therefore, money buys happiness.

C40, the operative word in what I wrote, is 'may'. The more FI you have, the more room you have for the ups and downs that MAY come along. I keep saying here that FIREing is not an ending, it is simply a new beginning. You have no way of knowing what will happen 5, 10, 20 years down the road.

Let me give you a simple example. Part of the income my wife and I have, is derived in another country. That means it is paid in the currency of that country. That then means we must exchange it for the currency of the country we live in. A great many UK retirees living in Spain, found out just what that means when their UK pound based income started buying them less Euros. It didn't matter if they were living on 10k or 50k, if their actual living costs were at or near the full amount of their income, suddenly, they started having a widening gap between income and expenses.

In our case, our foreign derived income dropped over 3 years by 25% due to exchange fluctuation. To absorb that, you would need to be living on $8k of your initial $10k income or be in real trouble. For us this was not a major problem since it did not represent all our income and we operate on a plan of thirds. Actual living expenses equal no more than 1/3 of income; 1/3 for discretionary spending; 1/3 for savings. We have a cushion of 2/3 of our income in other words to deal with any unforeseen or unavoidable hiccups. And trust me, there will be hiccups after you FIRE, just as there are before you FIRE. There are all kinds of circumstances that can impact your financial situation down the road.

The original question posted is 'what do you want?' To which I would reply, be careful what you wish for, you just might get it. If you want to FIRE on $10k a year, you might achieve that and then you MIGHT discover some unintended consequences of doing so are not what you expected. In other words the romantic dream of a cabin in the woods or whatever MAY turn out to be unsatisfactory. The more leeway you have in your FI the more room you have to deal with the problems IF they occur, that's all. Otherwise, if you FIRE on $10k and then find you need $12k, you may not end up a homeless person but you'll be closer to it than the person who FIRED with $20k of income and was living on $10k just like you.

7Wannabe5
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Re: What do YOU want?

Post by 7Wannabe5 »

OP said: I would think the 'mechanism' was obvious. Try being happy without a flush toilet for the rest of your life or whatever other thing you consider a necessity to be happy in your life. It requires money to have a flush toilet. Therefore, money buys happiness.
I've been quite happy camping without a flush toilet, but I agree that there are some base necessities for which I must currently spend money which are fairly essential to my continued happiness. These currently total up to around $6000/year. However, I do not think that is what you were implying. I think you were implying that having more money to spend can take you all the way up to "crazy-ass" level of happy. In my experience, that simply isn't true. Simplest possible example being that if somebody with an income of $100,000 isn't getting regular physical exercise, they will likely be less happy than somebody with an income that just covers base expenses who is getting regular physical exercise. Fun with friends, exposure to nature, successful completion of somewhat challenging tasks, great sex and/or romance, interesting reading materials or other forms of mental engagement, novel experience or adventure, etc. etc.; all of these can be had for very little money (certainly less than $4000/year) and, IMO, are more likely to take you from "happy" to "crazy ass happy" then further discretionary luxury or status spending beyond base necessities.

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C40
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Re: What do YOU want?

Post by C40 »

OldPro wrote:
C40 wrote:
OldPro wrote:.. It's not easy hearing your $10k a year income or whatever ERE plans may have a flaw.
http://fpeluso.com/wp-content/uploads/2 ... Person.jpg
Huh??? Are you saying you think $10k/year spending means living like a homeless person? Or ending up homeless?
C40, the operative word in what I wrote, is 'may'..... blah blah blah... blah blah blah.... really long-winded admission that no, it doesn't have anything to do with the picture I posted to troll and that the picture only makes sense in my head when I assume that someone who spends $10k must be spending $10k on their absolute minimum expenses and have no room for spending reduction...
:D ;)

7Wannabe5
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Re: What do YOU want?

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Dragline
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Re: What do YOU want?

Post by Dragline »

Is that money bath part of your Christmas tradition? :lol:

OldPro
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Re: What do YOU want?

Post by OldPro »

7w5, to compare you have to compare like to like. Two people who both do or do not get regular physical exercise for example with one having little or no money and the other having more than enough money to pay for what they need. You cannot suggest that everyone who has more money is not going to have and do all the things you list, just as someone without money could do. It is not a question of can someone be happy with little money. The person with more money can do all the things you list AND more. The person with little money is confined to those things which do not cost money.

I can do all the things you list AND afford to drink a bottle of expensive wine IF I want to. And please don't tell me you don't need to drink a bottle of expensive wine to be happy, it's an example of something money can buy IF you want it. Discretionary income simply adds to happiness. That really isn't debateable. https://www.google.ca/search?q=money+bu ... ss&ie=&oe=

C40, the picture represents the extreme of where piss poor planning can take someone IF their plan has a flaw. It is also a picture of where poor planning actually has taken people. I've met some. I consider anyone who FIREs based on a plan that provides them only the minimum they need financially to survive, has a piss poor plan. It's simply a warning to plan for more than you need. What do you see as your minimum required income to survive and what is the income level at which you plan to FIRE? If the second is double the first, I'd say it's a decent plan. If it's less than that, I'd say it's piss poor planning. I have a feeling though that many here are not planning to FIRE when they can generate a passive income of twice what they think they need to survive. They are leaving themselves with very little wiggle room.

Nor can you simply plan for a 'spending reduction' if required. You may need a spending increase. Why would you assume you might only need a reduction? Let's suppose the price of heating doubles. You can't heat less, so you will have to spend more. You might be able to 'rob Peter to pay Paul' from some other part of your budget but then again, you might not be able to. I don't know, you don't know. You may simply have to spend more.

It's really just a question of how big a 'hiccup' you can absorb with your strategy. If you have 10% of your total income as discretionary, you can absorb a small hiccup. But if you hit as an example a 25% hiccup such as I gave as an example above, then you have a real problem, as those who were in that position found out in Spain. Do you think they retired thinking, 'well I know I can't handle a hiccup'? Do you think that such a thing is unusual or unlikely to happen to you? I gave the example I did because I think it shows just how easily and how big a hiccup anyone could encounter. Over a period of 3 years, a 25% increase in the income needed to stand still.

It's a warning C40, that's all. Plan to have more income than you need and the more it is the better, as has been proven by others who have gone before you. I have been retired for a long time and have met a lot of others who have been retired in that time. I have met quite a few who were struggling financially for one reason or another. As I've said, a successful FIREing is not about do you or don't you FIRE, it is in do you continue to be FI over the long haul. So 'what do you want' from the financial viewpoint should be enough to STAY FI.

I really don't know what your issue is with that warning.

theanimal
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Re: What do YOU want?

Post by theanimal »

OldPro wrote: I can do all the things you list AND afford to drink a bottle of expensive wine IF I want to. And please don't tell me you don't need to drink a bottle of expensive wine to be happy, it's an example of something money can buy IF you want it. Discretionary income simply adds to happiness. That really isn't debateable. https://www.google.ca/search?q=money+bu ... ss&ie=&oe=
Those links all discuss how money buys time, experiences and the ability to give away. You don't need a lot of money (i.e. more than typical ERE assets) to do that. People here have time, and if they are not able to give monetarily, they are able to give their time. You are also discounting the fact that if someone is trying to truly become ERE it is much more antifragile than FI, even with lower monetary assets. While similar, ERE does NOT equal FIRE. So it really is debatable.

Dragline
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Re: What do YOU want?

Post by Dragline »

OldPro wrote: I can do all the things you list AND afford to drink a bottle of expensive wine IF I want to. And please don't tell me you don't need to drink a bottle of expensive wine to be happy, it's an example of something money can buy IF you want it. Discretionary income simply adds to happiness. That really isn't debateable. https://www.google.ca/search?q=money+bu ... ss&ie=&oe=
You know, this premise (discretionary income creates additive happiness in a simple way) is not well supported by this citation and is, in fact, refuted in many ways. You can start with the first article in the search, which explores the limits by which money can buy happiness:

http://www.wsj.com/articles/can-money-b ... 1415569538

In the end, the conclusion should be that money is a tool that may or may not be useful in improving well-being, depending upon how it is used. Hedonic adaptation is a very serious limitation, as is mimetic desire (wanting what others have/want/or to be like them). These are evolutionary traits that were great for propagation of the species, but not so useful for improving individual satisfaction in modern life.

The more interesting realization is the converse proposition -- that increased happiness/well-being is possible with less money if one can overcome the unconscious tendencies toward hedonic adaptation and mimetic desire. Which in some respects is why we are all gathered here around this campfire.

"For it is money that they have and peace that they lack."

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Ego
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Re: What do YOU want?

Post by Ego »

OldPro wrote:If the second is double the first, I'd say it's a decent plan. If it's less than that, I'd say it's piss poor planning. I have a feeling though that many here are not planning to FIRE when they can generate a passive income of twice what they think they need to survive. They are leaving themselves with very little wiggle room.
OldPro wrote:As I've said, a successful FIREing is not about do you or don't you FIRE, it is in do you continue to be FI over the long haul.
I really don't know what your issue is with that warning.
My issue is the black/white nature of the argument and the unwillingness to entertain the idea, for instance, that people might define FI differently. Either follow this prescription or we're piss-poor idiots. It's not very much fun having a conversation when the issues are constantly divided with such sharp contrasts. Right/wrong. Good/bad. Smart/dumb. My plan/piss poor plan.

Though I must say, it is probably good for us to understand the risks we face in a long drawn-out early-retirement. I've danced around this in several somewhat related threads here recently. Some very important traits can be use-it-or-lose-it. Financial-Independence can buy a sort of indulgence from those around us and we can then lose the ability to think or speak with nuance.

I hope that was clear.

skintstudent
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Re: What do YOU want?

Post by skintstudent »

OldPro wrote:7w5, to compare you have to compare like to like. Two people who both do or do not get regular physical exercise for example with one having little or no money and the other having more than enough money to pay for what they need.
By definition this is not comparing "like to like". At some point the people must have done something different to have such different financial positions. Perhaps one learned how to do DIY instead of spending extra time earning more money at work, leaving them able to maintain their home at a significantly lower cost than the other.
OldPro wrote: I can do all the things you list AND afford to drink a bottle of expensive wine IF I want to. And please don't tell me you don't need to drink a bottle of expensive wine to be happy, it's an example of something money can buy IF you want it. Discretionary income simply adds to happiness. That really isn't debateable. https://www.google.ca/search?q=money+bu ... ss&ie=&oe=
That is dangerously close to this https://www.youtube.com/watch?v=U8Kum8OUTuk
OldPro wrote: C40, the picture represents the extreme of where piss poor planning can take someone IF their plan has a flaw. It is also a picture of where poor planning actually has taken people. I've met some. I consider anyone who FIREs based on a plan that provides them only the minimum they need financially to survive, has a piss poor plan. It's simply a warning to plan for more than you need. What do you see as your minimum required income to survive and what is the income level at which you plan to FIRE? If the second is double the first, I'd say it's a decent plan. If it's less than that, I'd say it's piss poor planning. I have a feeling though that many here are not planning to FIRE when they can generate a passive income of twice what they think they need to survive. They are leaving themselves with very little wiggle room.
OldPro wrote:
When I FIREd, I hoped to be able to live on less than $12k per year. I hoped to generate an income of $20k per year from a capital of $200k. Those numbers worked out fine initially for me.
Has your own "piss poor plan" worked out (at a 6% withdrawal rate)? If so, why would somebody whose plan requires a 3-4% withdrawal rate work out worse?
OldPro wrote: Nor can you simply plan for a 'spending reduction' if required. You may need a spending increase. Why would you assume you might only need a reduction? Let's suppose the price of heating doubles. You can't heat less, so you will have to spend more. You might be able to 'rob Peter to pay Paul' from some other part of your budget but then again, you might not be able to. I don't know, you don't know. You may simply have to spend more.
Why not? If you have budgeted for luxuries, these can be cut out. We don't need to drink expensive bottles of wine, even though we may have budgeted for them. Plenty of people live with neither heating nor air conditioning.
OldPro wrote:It's really just a question of how big a 'hiccup' you can absorb with your strategy. If you have 10% of your total income as discretionary, you can absorb a small hiccup. But if you hit as an example a 25% hiccup such as I gave as an example above, then you have a real problem, as those who were in that position found out in Spain. Do you think they retired thinking, 'well I know I can't handle a hiccup'? Do you think that such a thing is unusual or unlikely to happen to you? I gave the example I did because I think it shows just how easily and how big a hiccup anyone could encounter. Over a period of 3 years, a 25% increase in the income needed to stand still.


It's a warning C40, that's all. Plan to have more income than you need and the more it is the better, as has been proven by others who have gone before you. I have been retired for a long time and have met a lot of others who have been retired in that time. I have met quite a few who were struggling financially for one reason or another. As I've said, a successful FIREing is not about do you or don't you FIRE, it is in do you continue to be FI over the long haul. So 'what do you want' from the financial viewpoint should be enough to STAY FI.

I really don't know what your issue is with that warning.
Rather than lecturing people on how inadequately they are planning at 3-4% withdrawal rates, how about you tell us what safeguards were in place to provide this cushion with your 6% withdrawal rate (with no healthcare consideration)? Experiences such as your post retirement printing business and bar investments illustrating that post-FI income does not necessarily have to come from savings/investments are invaluable.

Many people on here are planning on retiring with incomes similar to that I currently earn. That is at 3% withdrawal rates (my income, although not massive, is well above the country's average). I doubt I will be able to significantly increase my earnings in the near future, so other methods of providing security in retirement are of great interest to me, and no doubt to others. However, I also do not want to spend much longer than I have to working 40+ hours per week. I think the risk that money gets tight is less serious than the risk of never taking the chance to have more freedom with how I spend my time. THAT is what I want.

Dragline
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Re: What do YOU want?

Post by Dragline »

skintstudent wrote:
That is dangerously close to this https://www.youtube.com/watch?v=U8Kum8OUTuk
Priceless!

7Wannabe5
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Re: What do YOU want?

Post by 7Wannabe5 »

Dragline said: Is that money bath part of your Christmas tradition? :lol:
Unfortunately, on my income I can only afford a foot basin full of pennies..(sigh)


@OldPro: What everybody else said. And...

One thing you don't seem to be understanding is that many or most of the people on this forum regard frugality to be a sort of fun sport that they are good at. Different people on this forum are better or worse at different aspects of this "sport", or approach it from different perspectives, but that is pretty much the whole point of the "extreme" in ERE. I absolutely do not believe that most people could live as well on less than $10,000/year as I do because I am practiced at the sport or art of frugality. I am also a self-aware, slothful sensualist. I rarely deny myself anything. If I wanted to drink a fine bottle of wine on a regular basis, I would figure out how to best afford that without spending very much money. First off, I would assume that with wine, as most things, quality and expense don't always go hand in hand, and I could educate myself in that regard. Second, I would ask myself if there was anything I could barter for fine wine, and the answer would be maybe some fresh heirloom variety produce from my garden, or maybe the pleasure of my company over dinner. Third, I would try to examine and break down what it is I am really craving when I think "very fine wine", maybe what I really want is something like "alcoholic beverage I have never before sampled." IOW, what I am truly craving is something that will give me a bit of a warm, glow buzz combined with the enjoyment of novel experience. So, then my much less expensive solution might be to dig around in my used cookbook archive for a cocktail recipe from the 1930s. Next, if I was really a bit of a wino and wanted it very frequently in rather large quantity, I might consider in what situation fine wine might end up on the discard market. My answer would be that maybe at very upscale eateries fine wine is regularly discarded, and I would consider getting some sort of part-time job at such an establishment, because the opportunity to collect dregs might be worth even more to me than the tips. Etc. etc. etc. Maybe the ability to walk into some chi-chi market and pay full price for a bottle of fine wine is a win in the competitive sport of "pile up the most money" (which I admittedly suck at-lol- part of the reason I joined this forum was I want to get better at this) , but it is a solid lose in the creative sport of frugality.

If I believed that I could render myself significantly happier by spending more money, then I would do it. As I mentioned above, I currently keep track of the factors that influence my happiness on a daily basis. The least happy day I had in the last month was a 2.2 on a 4.0 scale. My unhappiness was due to the fact that I agreed to care for my sister's 3 spoiled-rotten dogs simultaneous with agreeing to teach kindergarten 3 days in a row, and I suffered sleep deprivation. More money would not have fixed my poor planning and weak boundaries that resulted in this unhappiness. My three happiest days in the last month, registered over 3.75, so solidly in the "crazy ass" zone, and my notes for those days on my spreadsheet include "jumped rope with children", "danced" , "figured out how to fix greenhouse", "lounged about", "wrecking ball sex" ,"worked on karakuri model", "six people said "Hi" to me on the way to the store", "watched very interesting film" and "lovely note from lover." More money would not have much improved or influenced any of these factors for me.

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C40
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Re: What do YOU want?

Post by C40 »

OldPro wrote: It's a warning C40, that's all. .... I really don't know what your issue is with that warning.
It's annoying because it's the kind of objection that ignorant people make out of cognitive dissonance. The kind of objection that people who don't understand ERE make on news comment sections. I hope for better from people who participate on the forum and who should understand ERE better.

A realistic warning would be something like this: http://www.arnoldsofficefurniture.com/w ... ubicle.jpg

The worst that will happen to people 'fail' at ER/FI is that they go back to work. That's it. They aren't going to spend their last cent and become homelss. For most people here, even if they did spend all their money, they could get almost any job and cover their expenses. ERE'ers are possibly the least to end up homeless compared to any other group of people.

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C40
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Re: What do YOU want?

Post by C40 »

Wrecking ball sex!!?? Is that just an adjective? Or something specific? I searched and all I found was this: http://www.urbandictionary.com/define.p ... cking+ball

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