I do know what I'm saving for - early retirement. I want to be done before I'm 50 at the very latest. In order for that to happen I need to maintain aggressive savings rates from now until the end. When you say you can't take it with you, you're right about that and there's always the risk that something will happen and I'll have a vast amount of unspent money. But there's also the reverse worst case scenario. I loosen my spending habits and spend in a way that means I will only be financially independent at 60. Along the way my health puts me in a position where I'm forced to retire before that happens and I'm forced to endure a financially uncertain retirement. Or I stay healthy and have to watch a bunch of extra years go by knowing that I could have been retired and enjoying every minute of them.
With money there's always an opportunity cost. Obviously I'm not suggesting that spending $2000 on clothes this one time is going to destroy my retirement plans, but it's still worth considering because my budget exists for a reason. It's a slippery slope once we start making exceptions and 'one time' purchases. Weighing the pros and cons, I agree that I should go ahead and spend in this instance (and I am). Especially since nearly half of the planned spending is for business attire that I need to refresh for my job. But I don't think an instinct to second-guess spending is unhealthy when all spending does (even in small, immeasurable ways) impact what I'm saving for.
Last edited by motl; 2017-03-20 at 04:48 PM.
They say you should dress for the job you want, not the one you have. If well tailored business attire gives you confidence, it may make a difference in the opportunities you get at work. I would call it an investment in your career. That doesn't mean you have to splurge on expensive jewellery, manicures, etc. No need to go overboard.
When I'm faced with an expensive discretionary purchase decision, I often calculate how many hours' work it would take to pay for it (in after tax dollars). That's often helpful in clarifying the value of the purchase to me.
As for your logic on the early retirement side. Sure there is a chance you can get sick and be unable to work. But I don't know if that is the biggest risk. (That could happen just as easily now as at 60, if that is a major concern critical illness insurance would be an easy way to cover that off.)
Your theory is that if you retire at 50 and you happen to get sick at 60, than you've enjoyed 10 years. My theory is that it's better to make sure you enjoy that whole time until 60, whether retired or not because retirement alone isn't going to magically make you happier.
A large amount of people who retire, end up going back to work within a few years, because they didn't realize what a void not working would leave in their lives.
My father was right in that once he had secured his future through sound investing, he allowed himself to spend on what brought him pleasure. He believed that the surplus beyond having needs covered for life was to spend and enjoy. And that he did. He indulged himself and my mother with a home that some would call extravagant, with nice cars, trips, rare single malt scotch and fine British double shotguns. He liked as well to be able to share with his family. Five of brothers and sisters who still lived in his country of origin in northern Europe. He helped several of them to buy homes of their own. Built a barn for one. Perhaps he should have kept that money and invested it, to permit him to die was more money in his jeans. Well, come to think of it, I don't think he ever owned a pair of jeans, in all of his nearly 100 years.
What I saw in my dad I have tried to emulate. To strike a balance between investing and saving for the future and enjoying some of the fruits today. I am reinforced in that view by a few personal experiences. One such experience was dropping by to visit a man I knew well while growing up. A successful businessman and investor. He always lived well, but I know also that he had set things up so that he could continue to do so throughout a long retirement. I went to see him as I was about to move from Toronto to Vancouver.
As we sat on his flagstone terrace overlooking his spacious gardener-tended backyard in Lawrence Park, he told me to make sure I enjoyed some of what I earned as I went along and not try to save and invest it all. He was then about 60. He said that he had directed most of what he made to ensure a retirement of wealth. He said: "Right now I have enough money to buy or do just about anything I could ever want. But the one thing I can't do is to get out of this chair." He had Parkinson's disease. He took his own life a year later.
Next story is also from that time. I moved myself to Vancouver in a rented 5-ton truck. No, I did not need all the space in a 5-ton, but I knew someone else who wanted to move so I carried their stuff as well. They got the move for less than the Tippett Richardson price and I got my move pretty much paid for. Anyway, I digress.
My first night on the road I stayed with a woman I knew in northern Ontario, in a comfortable lakeside home. She related to me that she and her husband had grown up around there and he came to do well in roadbuilding and such activities. She became a school teacher. In those days, big city teachers made more money than country teachers. His business was not portable to Toronto. She took a teaching job in TO and boarded with a friend. He continued his business up north. They got together when they could. The plan was to maximize their earnings and to save, save, save so they could retire early to their lake and live happily ever after. About 15 years into the plan, he died. No benefit received from their sacrifice. But he went out with money!
Here's one more, if you can stand it. I knew a couple who both grew up on farms not far from Toronto. Farming was in their blood. But not easy to make much money, particularly when you had no farmland of your own to begin. They both became school teachers. They did so in the days when one could complete grade 12, go to teachers' college for a year and then teach. So they were both working as teachers by age 20. They took jobs where they could, often teaching in different locales.
The couple saved and bought a farm. They worked the farm when not teaching, so they were able to work the farm full-time in summers. To me, it looked like they were slaves to it. They would get up before dawn, do farm chores. They had lots of livestock, grew their own feed, a big garden to feed the family of 4, etc. Endless work. After morning chores, they would head off in different directions to teach at different schools some distance away and return after the school day, jump on their tractors and set to work again until dark. You would have to love it to go at it as they did.
Their great plan was for both to teach to age 55, to max out their pensions, then devote themselves fully to the farm and having some fun. Things were nicely on track when they severed an acre of the farmland for one of their kids and kid's spouse. They all then busied themselves building a house on that acre. At the stage when the house was partly framed and the second floor was no more than joists with some boards to walk on, mum was on the second floor carrying bricks for the chimney. She made a footing misstep and fell between the joists to the floor below. Severed spinal cord. instant paraplegic. No longer able to participate to much extent in the full-time farm life so long awaited. She was about age 53 then. He left teaching early, not so much to farm as to take care of her.
The several unfortunate episodes mentioned above all occurred when I was in my mid-20s and they have served to remind me ever since to take some time to smell the roses. That includes spending some cash along the way, while putting some (but not all) to work for the future. I thought I had struck a reasonable balance. But gardner speaks with a pretty blunt, self assured "you are wrong". I hope gardner will return to this thread and point out to me, and with some didactic benefit to fellow CMFers, just how I have erred.
Good stories about living "real" life.
We had a trailer in cottage country, and every time I visited I could hear hammering and sawing going on. It went on all year.
One day I got curious and went to visit the property. An older gentleman and his wife were building a beautiful home on the lakefront.
I got to know them and visited them a few times. He was always hammering and sawing away or cutting down trees and splitting wood.
Their home was built on rock, and he had scraped out a basement using hand tools. I forget how many chisels he had gone through.
Just when their retirement home was almost finished, he gets heart problems.
A few trips to Toronto specialists.......and then a few more and pretty soon he was going back forth all the time.
That was it for their dream. Sold the place and moved to Oshawa, Ontario.
I think about him..........and all that work, when he could have been fishing, sipping on a rum and coke, or riding around on his ATV.
That is what me and my buddies were doing for the years he was pounding that cottage together.
Last edited by sags; 2017-03-21 at 03:38 PM.
Someone planted a tree a long time ago so I can sit in the shade.
The fact that one agnoizes over spending when they don't need to may indicate something deeper, that perhaps they do not know how to have some enjoyment and balance in their life. It's one thing to not spend when you don't have the money or any saving, I am all for those who are in debt or with no savings to reign in all discretionary spending. It's another thing when you are only looking for the future but not the present. The problem is the future doesn't often come for these people as they have missed the moments.
To me life is about balancing living and enjoying the moment vs saving for the future. That takes a lot of practice learning about what is important to you, what makes you happy, what is worth it what is not. One doesn't just figure it out at 50. I know my measure of success for me is if I can't get through without regrets. No regretting that I spent on something (wasting money) and not regretting that I didn't spend (missed moments).
On a 'smart' device, please excuse autocorrect/when letters are missing.
Let me point out that in my OP I expressed frustration with guilt over spending a considerable amount of money on what I consider to be frivolous items. The point here is that I could continue shopping at places like JCrew Factory and spend half of what my OP wishlist has grown too. The goods would be inferior, but I would look fine and spend less money. My guilt came not from spending money but from an attempt to convince myself that spending (more/a lot of) money on things that I don't need isn't a big deal. Adopting that mentality too often = lifestyle creep.
Moreover, the idea that because I struggled with this purchase I must not enjoy life or spend money on anything fun is a giant mental leap. My budget is designed to be frugal in areas that are either necessities or aren't important to me while allocating funds to hobbies/interests that do (ie. travel). It's about prioritizing money to go furthest on what matters while reducing expenses on everything else. Dressing well matters, but I can dress well for cheap - hence the OP struggle. So let's not get carried away here. I know how to enjoy life and spend money on what matters to me. I have a very clear idea of what I'll do with my time and money once I am partially and/or fully retired. My OP represented a struggle with spending more money than usual on items that I don't absolutely need, and I ended up deciding to be OK with it. No regrets.
That is great to hear.
For me personally I would never spend that much on a handful of clothing items, because I don't value high value brand name clothing that much. But for you it does sound like something you do desire, even though you struggle to spend on it.
I think part of my issue is that I mixed in necessary business spending with personal spending RE: clothes.
In the summer my role is changing and I'll be in suits 3-4 days per week. Right now I'm able to dress casual or business casual. I have few suits and the fit/materials aren't great. My dress shoes are very worn down. So I knew going into the summer that I'd need to buy 1-2 pairs of dress shoes and at least 2 new suits. I'd already decided to not cheap out on these items due to how much wear I'll put on them and because I'll be in client-facing situations often.
But once I also decided to start adding a few personal/casual items to the list (ie. new spring/fall jacket, boots, etc.) the list and price started to make me nervous. But in reality I need the business attire - can't really not buy them - and they are more an investment in myself and career. The personal spending is less than half of the wish list. Still a decent amount versus what I normally spend on clothes, but I think it was easier to get on board mentally when I just excluded the business attire from my calculations. I can't not buy that stuff so including it was unfairly ballooning my spending, which caused the guilt. I'd already somewhat budgeted for the business attire, so it was more about separating the two mentally.