Comments on: Lifestyle Changes by Design

By: kitty

kitty — Fri, 27 Nov 2009 23:50:00 +0000

TML – when you put it this way it does make sense. I was not really talking about the specific decision as much as the whole “scaling back” decision. This surprised me, that’s all.

I routinely scale my plans when needed to accomodate somebody who cannot afford something too – this is part of having cousins and friends who are less fortunate. I am also not a huge spender. It’s just that it’s always an issue of balance to me – saving so that I can afford to retire yet spend enough so that I don’t regret not having done something.

By: Mr. ToughMoneyLove

Mr. ToughMoneyLove — Fri, 27 Nov 2009 14:32:52 +0000

Kitty: You may be missing the point of my post. The decision to drive vs. fly was not driven by current necessity but by a choice not to spend when suitable options were available. The three other family members in the car (two of whom were our sons) could not afford to fly so we decided to drive with them. The money we did not spend on airfare can probably be put to better use in the future (taxes, medical care?) when we will not have as much discretionary income available to us. To me, it’s part of making a mental transition from working for the money to retirement, which is getting a lot closer.

By: MasterPo

MasterPo — Fri, 27 Nov 2009 04:16:11 +0000

I’m not going to second guess Mr. TML’s decision beyond what I already stated. IMO his income and/or net worth have no bearing on the discussion. As I often tell my wife, the rich didn’t get that way spending and don’t stay that way by spending.

Having the money to spend and being “affordable” are waaaaaay two seperate things.

By: kitty

kitty — Thu, 26 Nov 2009 23:03:37 +0000

MasterPo – I didn’t say you should spend all your money today. But as with investing, it’s best to hedge your bets – find some good balance. Which is what I said. Odds are, by the way, that most of us die sometime between 60 and 80. Lucky ones will live a little longer. Odds are also that when we are over 70 we will not have enough energy to do some of the things we enjoy. BTW – a friend of mine died at 38 from lymphoma. We really don’t know how much time we have.

As to me, I am 50, have over a million net worth and a paid off home. If I exclude primary residence, I’ll have about 750K divided pretty equally between retirement and non-retirement savings/investments. I also have vested rights in a pension, but it’s too small to count ($1880 a month if I take it at 55; $2880 a month – at 65). I save a significant portion of my 110K salary without trying, but of course they can fire me. What I have isn’t enough for retirement this second, but I think this is more than enough to not having to scale anything back. If I lose my job, I’ll scale back. I was under the impression that TML had more money and higher salary than I do, so I was really surprised he needs to scale back.

By: MasterPo

MasterPo — Thu, 26 Nov 2009 03:44:26 +0000

Kitty,

I hear that argument all the time (sometimes from my wife!).

But if had to place a bet, IMO odds are darn good you *will* live to see tomorrow. And when life comes at you (fast!) won’t be any good to say “I didn’t expect to be hear for that”.

By: kitty

kitty — Thu, 26 Nov 2009 02:45:46 +0000

Have a good holiday!
Don’t know much about your financial situation – I actually thought you had enough so you don’t need to have these “small sacrifices”.

One thing to keep in mind – this is always a trade off. Sure, you need to save enough to keep the lifestyle you want in retirement, but you also cannot take your money with you after you are gone. We don’t know how much time we have, we certainly don’t know how much time we have while we still have enough health and energy to enjoy our vacation or have time with your extended family.

So it’s good to plan for the future, but to be careful about overdoing it. Of course I don’t know your financial situation or whatever financial battle might be in your future. Yes, there is strong possibility of higher taxes (why not just put money in munis to avoid the problem?), and higher healthcare expenses. There is also high likelyhood of less energy to enjoy some of the things you enjoy now.

By: MasterPo

MasterPo — Wed, 25 Nov 2009 04:42:42 +0000

Enjoy your holiday.

But as to your decisiont to drive instead of fly, can you post the financial analysis of that decision? The cost of car fuel, tolls, food, wear&tear verses air fare?

And dont’ forget the intangables like higher risk of an accident, a ticket (not that you would ever speed or anything like that ) and just not being wiped out all need to be considered.

I recently took a trip to Texas. I’ll post the details later. But I had the choice of cheaper air fare and a longer drive or more $$$ air and short drive. I took the former but if I go back some day I’m definately going for the latter.