Personal Money Management Ideology

[VladtheImpaler]

Originally Posted by Locke

Good God man, I have a hot tub, a pretty nice one, and it didnt cost anywhere near that, what the hell is she buying? A hot tub for Godzilla?

Hey, Hey. We like to be called differently weight advantaged.

[CliffFletcher]

Agreed that it's about balance.

The most frugal people have extreme personality types that are impossible to mimic. You either are that personality type or you aren't. The Globe and Mail recently ran an article about a guy who had his house paid off at 30. He also put himself through university without any help, and paid rent to his single mom while he was at school. He did it by working 100 hours a week and never going out, from when he was a teen until 30.

I know a guy who had his house paid off by 33 and retired at 46. He worked, had an inexpensive hobby, bought only the cheapest groceries, never went out, didn't date, get married, or have kids. Had a cheap used car, didn't make any changes to his house for 20 years, and put 80 per cent of what he earned for 25 years into his mortgage or savings. Even now, when he has a huge pile of money in the bank, he rarely spends it. You could hand him $10 million and he would still be exceptionally frugal.

Personally, I had a blast in my 20s, even though I didn't save anything financially, and I wouldn't trade those experiences for anything.

On the other hand, the prospect of being poor for the last 20 or 30 years of life is not appealing. Being poor was fine when I was in great physical shape, had a lot of energy, was surrounded by friends, and had no needs besides a place to rest my head every night. I don't want to live that when I'm 75. I want to be comfortable and have peace of mind when my body starts breaking down and my energy declines.

And frankly, with the disappearance of private pensions, people carrying mortgages into their 60s, and life expectancies pushing past 90, a lot of Canadians are going to live in squalor for the last 20 years of their lives. And it's easy to say you'll just work until you die, but even if the spirit is willing, the body can fail. When you're 68 with chronic back pain, and you wake up to -25 and snow-choked roads, you're not going to be clicking your heels to get on the bus to your job at Petland. Or wherever it is that will be employing 68-year-olds in the future.

I expect assisted suicide will become a socially-acceptable thing. As will designer drugs that make living in a tiny apartment staring at enhanced reality video screens all day and eating ramen noodles while your body fails more tolerable (or maybe good old alcohol will suffice). More optimistically, multi-generational households will make a big comeback. So make sure those family bonds are strong. Pro-tip: Marry someone who shares your attitudes about money (from what I've witnessed happen to friends, divorce is a great wealth destroyer).

[polak]

I'm going to play the woe is me card and complain that everything seems to be hitting the fan right as I'm trying to get my feet under me so the plan is spend as little as possible and save as much as I can.

Unfortunately I committed to a trip this summer before I purchased a place which I would love to back out of but can't.

[tvp2003]

Interesting topic. I think frugality is a microcosm of a larger ideology of being happy with what you have and what you need (which in western culture usually means being happy with less). Personally, I consider myself to be pretty frugal, although I will blow money on stupid things if I find value in it. At the end of the day I don't feel like I'm missing out on anything because I either didn't really need it to be happy, or it wasn't worth the extra cost.

Having kids has also changed my perspective on spending. We used to spoil them with toys (and probably still do), but we've realized that's not what they want (or need) in order to be happy. Similarly, things like a big house, nice car, and expensive trips mean absolutely nothing to a kid -- it's not like they'll care or remember when all is said and done.

[Sliver]

Originally Posted by Slava

Over the last few years I have gotten a lot less frugal. Much of this has to do with my work and helping clients retire. Its not that I don't save or invest for myself and my future, because I absolutely do and much like Croflames noted I just feel a sense of satisfaction knowing that I have money set aside and working for me.

At the same time I have had a number of clients work like dogs, save and invest and then right after, or just as they retire they die. I deal with their widows still, and we have some heartfelt conversations and I've realised that this has made a huge impact on me personally (which isn't surprising really). One told me point blank that "they could've saved more, but those memories of travel and enjoying life are all she has with her late husband" and that really struck me. When I read these blogs and advice columns of people who don't buy lattés or won't allow whatever entertainment or travel purely to save a few bucks I actually feel genuinely sorry for them. I know that I would look back at myself and think "what a complete idiot!" to miss out doing things or enjoying things just to increase my bank account.

I'm not for a second suggesting that people should throw caution to the wind, save zero dollars and run up debt. But saving every nickel just to build a bank roll when you could do some stuff in your life without endangering your financial situation is just as stupid, only you don't realise that yet.

For sure, but you absolutely have to save as a priority and the fun stuff has to be secondary. If you can't afford the fun stuff, you just don't get it and you have to accept that. The problem I see when people hear what you are saying is they don't internalize every point. You were very clear when you said that you save money, but the more engaging part of you post was about how pleasurable it is to spend it; how people don't regret giving themselves great experiences.

Surely, you must have seen plenty of people who gave themselves so many great experiences that they are now experiencing a super crappy retirement or no retirement at all. Or maybe not. Maybe those types never set foot into your office, which wouldn't surprise me.

It's easy for an old widow to wax poetic about how they should have gone to Paris more when they were younger and that's easy to say from the position of somebody comfortably retired, but to get to the point of being comfortably retired you need to save a lot of money and sacrifice a few toys and trips on your way to get there.

I know I could die at 64 and everybody would be all 'poor guy, all he did was work and save,' but they'd be wrong. I'm planning for a long and happy life. I know I can't work productively/lucratively when I'm 75, so I have to do that now. If I die early, that's the way it is, but I want the opportunity to live an awesome retirement, not blow it all on crap I don't need now.

I think you're a bit older than me (I'm 39), but I too have been able to become less frugal in some ways as I've aged. My wife and I deliberately tried to frontload stress and financial obligations when we were younger in order to get more comfortable with age and it has worked with the added benefit of instilling some really good habits. Being able to become a little looser with the purse strings is a reward for good money management that you have to earn.

Sounds like you're there and that's good. But the value of being there as it relates to other people is the manner in which you got to that point (unless you're from a wealthy family in which case your experience isn't transferable to the average person looking to earn more financial freedom). Young people (or any person) need to earn that comfort. Too many people are taking the comforts of wealth on debt and their future selves and families will pay the price, with interest.

[CroFlames]

Originally Posted by polak

I'm going to play the woe is me card and complain that everything seems to be hitting the fan right as I'm trying to get my feet under me so the plan is spend as little as possible and save as much as I can.

Unfortunately I committed to a trip this summer before I purchased a place which I would love to back out of but can't.

It's not always sunshine and rainbows for anyone financially. Keep working hard (be thankful you have a job) and you'll get to the place you want to be financially. Think positively too. I find it helps.

Oh, and enjoy Euro 2016. Forget about your finances for that trip and it'll be an experience of a life time watching Lewandowski drag the rest of the Polish team around the pitch.

[polak]

Originally Posted by CroFlames

Oh, and enjoy Euro 2016. Forget about your finances for that trip and it'll be an experience of a life time watching Lewandowski drag the rest of the Polish team around the pitch.

That's a good point. It's bucket list territory.

Appreciate the post.

[Slava]

Originally Posted by Sliver

For sure, but you absolutely have to save as a priority and the fun stuff has to be secondary. If you can't afford the fun stuff, you just don't get it and you have to accept that. The problem I see when people hear what you are saying is they don't internalize every point. You were very clear when you said that you save money, but the more engaging part of you post was about how pleasurable it is to spend it; how people don't regret giving themselves great experiences.

Surely, you must have seen plenty of people who gave themselves so many great experiences that they are now experiencing a super crappy retirement or no retirement at all. Or maybe not. Maybe those types never set foot into your office, which wouldn't surprise me.

It's easy for an old widow to wax poetic about how they should have gone to Paris more when they were younger and that's easy to say from the position of somebody comfortably retired, but to get to the point of being comfortably retired you need to save a lot of money and sacrifice a few toys and trips on your way to get there.

I know I could die at 64 and everybody would be all 'poor guy, all he did was work and save,' but they'd be wrong. I'm planning for a long and happy life. I know I can't work productively/lucratively when I'm 75, so I have to do that now. If I die early, that's the way it is, but I want the opportunity to live an awesome retirement, not blow it all on crap I don't need now.

I think you're a bit older than me (I'm 39), but I too have been able to become less frugal in some ways as I've aged. My wife and I deliberately tried to frontload stress and financial obligations when we were younger in order to get more comfortable with age and it has worked with the added benefit of instilling some really good habits. Being able to become a little looser with the purse strings is a reward for good money management that you have to earn.

Sounds like you're there and that's good. But the value of being there as it relates to other people is the manner in which you got to that point (unless you're from a wealthy family in which case your experience isn't transferable to the average person looking to earn more financial freedom). Young people (or any person) need to earn that comfort. Too many people are taking the comforts of wealth on debt and their future selves and families will pay the price, with interest.

We're the same age actually and probably at a similar stage in terms of thought process. I think that some perspectives change as you age and see your parents and older people go through some things. For a lot of the super frugal Internet posters or bloggers they haven't been through that yet, or maybe they have through grandparents and saw them struggle financially and never want to be there. I just think that moderation in all things, including moderation makes sense though.

[Muta]

I'm making the most I've ever made right now, and I live in the same condo with a crappier car than I previously had when I was making half as much. I'm living frugally, yes, but I save my money for experiences like traveling. When I'm on my death bed, I'll have a collection of awesome memories, and honestly, at the end of your life, that's what's going to be the most comforting.

My retirement dream is to move back to New Zealand and live modestly on the coast while traveling, camping, surfing and enjoying the outdoors as much as possible. I don't give two craps about having a Lamborghini or a massive house or anything like that.

Someone said it earlier in this thread, and the advice is great - 'To have more, want less'.

[troutman]

Originally Posted by Ozy_Flame

I think we'll see legal euthanasia come to fruition in our lifetime. And I think it will be more likely given that the average age of Western world humans is expected to grow, especially with breakthroughs in medicine. Aging is closer to becoming classified as a "disease" which would enable big pharmaceutical companies to develop drugs that keep us alive longer. Personally if I have to live until 150 but not be capable of working until 120, I wouldn't want that kind of life.

US FDA gives OK for human trial of metformin as anti-ageing drug to prolong life until 120 years

http://www.ibtimes.com.au/us-fda-giv...-years-1488127

They observed that the worms aged slower, became healthier and did not develop wrinkles. When the same drug, the most prescribed diabetes medication, was tested on mice, the lifespan of the rodent extended by almost 40 percent and developed stronger bones. And diabetics who took metformin regularly lived longer than non-diabetics by about an average of eight years.

[CroFlames]

I don't like all this talk of end of life scenarios.

It's the Christmas season for Pete's sake. Let's talk about something cheerier.

[polak]

Originally Posted by Muta

My retirement dream is to move back to New Zealand and live modestly on the coast while traveling, camping, surfing and enjoying the outdoors as much as possible. I don't give two craps about having a Lamborghini or a massive house or anything like that.

Someone said it earlier in this thread, and the advice is great - 'To have more, want less'.

I'm going to be pretty bummed about my life if at no point do I own a supercar.

Couldn't care less about a massive house but a nicely appointed garage is a goal.

[sketchyt]

Don't buy things you can't afford. Enjoy the things you can afford.

[gladaki]

Originally Posted by Slava

Over the last few years I have gotten a lot less frugal. Much of this has to do with my work and helping clients retire. Its not that I don't save or invest for myself and my future, because I absolutely do and much like Croflames noted I just feel a sense of satisfaction knowing that I have money set aside and working for me.

At the same time I have had a number of clients work like dogs, save and invest and then right after, or just as they retire they die. I deal with their widows still, and we have some heartfelt conversations and I've realised that this has made a huge impact on me personally (which isn't surprising really). One told me point blank that "they could've saved more, but those memories of travel and enjoying life are all she has with her late husband" and that really struck me. When I read these blogs and advice columns of people who don't buy lattés or won't allow whatever entertainment or travel purely to save a few bucks I actually feel genuinely sorry for them. I know that I would look back at myself and think "what a complete idiot!" to miss out doing things or enjoying things just to increase my bank account.

I'm not for a second suggesting that people should throw caution to the wind, save zero dollars and run up debt. But saving every nickel just to build a bank roll when you could do some stuff in your life without endangering your financial situation is just as stupid, only you don't reseal that yet.

I love vacations, Save some percent of your income that's enough.
Life is unpredictable so why not live it. I like wealthy barber approach of paying yourself first.

[gladaki]

Originally Posted by troutman

US FDA gives OK for human trial of metformin as anti-ageing drug to prolong life until 120 years

http://www.ibtimes.com.au/us-fda-giv...-years-1488127

They observed that the worms aged slower, became healthier and did not develop wrinkles. When the same drug, the most prescribed diabetes medication, was tested on mice, the lifespan of the rodent extended by almost 40 percent and developed stronger bones. And diabetics who took metformin regularly lived longer than non-diabetics by about an average of eight years.

And those worms don't need to spend time in Gym..

[troutman]

Originally Posted by sketchyt

Don't buy things you can't afford. Enjoy the things you can afford.

http://snltranscripts.jt.org/05/05lbuy.phtml

Wife: We've tried debt consolidation companies.

Husband: We've even taken out loans to help make payments.

Spokesman: Well, you're not the only ones. Did you know that millions of Americans live with debt they cannot control? That's why I developed this unique new program for managing your debt. It's called [presents book] "Don't Buy Stuff You Cannot Afford."

Wife: Let me see that... [grabs book, reads] "If you don't have any money, you should not buy anything." Hmm, sounds interesting

Husband: Sounds confusing.

[Muta]

Originally Posted by troutman

Husband: Let me see that... [grabs book, reads] "If you don't have any money, you should not buy anything." Hmm, sounds interesting

Wife: Sounds confusing.

Fixed that for you

[MoneyGuy]

To have more, want less. I love that; I'll be using that.

I don't understand the mentality: it's old so get rid of it. When my wife uses that on me, I say, "Youre old. Are you suggesting I trade up?" She hasn't killed me yet.

[Slava]

Originally Posted by gladaki

I love vacations, Save some percent of your income that's enough.
Life is unpredictable so why not live it. I like wealthy barber approach of paying yourself first.

I agree with the saving for vacations point. It's been years since I read the wealthy barber, but I'm pretty sure that the pay yourself first line refers to putting away some money for your retirement and future before you do anything else, and not saving for vacations though?

[DownhillGoat]

Originally Posted by Slava

I'm pretty sure that the pay yourself first line refers to putting away some money for your retirement and future before you do anything else, and not saving for vacations though?

That's absolutely what it refers to.

Side note, I really enjoyed that book as a young lad but wow did I lose a ton of respect for Chilton after seeing him on Dragons Den.