Author Topic: Wher to pick up the extra %  (Read 3410 times)

torbisen

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Wher to pick up the extra %
« on: October 19, 2016, 03:00:40 PM »
Hi. I am from Norway, and just started Mustachian for real 3 months ago. I have put out my numbers here before, but in short i have used 13800dollars and saved 18700 the last three months, hovering just shy of the 60% mark savings rate (57%). Its a very good start, and the period has had a few costs which does noe come every day, so i think the period represents a fair average of the year. But i feel i miss around 10-20% in beeing as good as MMM. For example next month we are invited to a party for one of my best friends turning 40. Its arranged out in the City and a "pay it yourself" party. The restaurant is not the cheapest and everybody is typically going for the 150$ menu with wine, which i also could do before when i did not care.§
Now i dont see the meaning to arrange things expensively, but my friends ofcource think as they always have. I so look forward till the day i can quit my work an tell them all i was right.
Also i bought some "necesseties" in our life today as we live it now. Fluor pills for my childrens teeth. Do we really need them after a good brush with fluor on the teeth brush? They cost 2$ a week. Every week. And food for the cats.................100$ today.......It will last maybe three months, but still i need 12000$ in funds just to cover my cat food....................
Also i have someone coming to takeaway the snow when it comes down during winter because i work away from home, and i cannot burden my wife to get up an hour early to take it away with her bare hands with two children to care for and work herselv. Costs 800$ a season. Please help me out to get the last 10-20% sorted out. Give me some ideas and clues :-).

Cwadda

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Re: Wher to pick up the extra %
« Reply #1 on: October 19, 2016, 03:07:06 PM »
You could post your full budget if you're like but I'd say you're doing great! 57% is nothing to scoff at. What is your projected FIRE date?

GuitarStv

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Re: Wher to pick up the extra %
« Reply #2 on: October 19, 2016, 03:10:54 PM »
Twelve grand for cat food seems really high.  It's possible for a family to eat on twelve grand a year.

torbisen

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Re: Wher to pick up the extra %
« Reply #3 on: October 20, 2016, 12:30:43 AM »
I dont mean twelve grand for cat food, but you need to SAVE twelve grand putting them into funds to get 4% out of them for cat food every year ;-).

former player

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Re: Wher to pick up the extra %
« Reply #4 on: October 20, 2016, 02:14:40 AM »
Congratulations on what you have managed so far, particularly as you are doing so while bringing your family along with you and taking their needs into consideration.

I see MMM as optimising Life, Environment and Money rather than just being about optimising Money.  Some things are worth spending money on.   For instance, your obligations to animals in your care mean that you can't stop feeding your cats proper food in the proper amounts.  Whether you need to save up to cover the cost of pets in retirement is a life question: will you want to have pets in your retirement?  Cats typically live for less than 20 years, so if feeding cats is a problem for you just calculate what you will need to save to feed your current cats for the rest of their likely lives while you are retired, which will be a lot lower than the full 25 times their current annual cost.  If having pets is important to you or family members, then save the full amount because you have decided it is worth it.  Mustachianism gives you a framework to make those objective decisions in a way which might not otherwise be possible. 

In other words, it's not all about the money.

I don't know what the answer is about the fluoride pills.  I seem to recall reading that too much fluoride can be a problem, as can too little, but you would need to research for yourself whether your children are getting the right amount.

The snow clearance, in Norway, sounds like a bit of a bargain to me and being a good thing to do for your family while you are away working.  But if this is something which is only a cost because you are away working, then it is a cost for which the benefit is your well-paid job and your happy wife, and it is also a cost which would go away if you changed jobs so that you were not working away from home.  It is also a cost which would go away during retirement, so again it is something you do not need to save the "25 times annual cost" amount for.

It sounds to me as though you have things pretty well sorted.  Don't overthink it.



Be frugal and industrious, and you will be free (Ben Franklin)

havregryn

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Re: Wher to pick up the extra %
« Reply #5 on: October 20, 2016, 03:41:15 AM »
I think with this high income and living in Norway your savings rate is more than good enough.
It's probably not possible to cut costs of groceries and services in Norway as it is in some other places are the spectrum of the prices is just too narrow (assuming based on one short visit but we are from Sweden so it's let's say similar to some degree).
And I'm pretty sure that these countries with free healthcare, education, child allowances, decent state pensions etc should have their own math behind a safe FIRE amount. It's a different financial context compared to places where you're expected to pay for all this stuff yourself.


torbisen

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Re: Wher to pick up the extra %
« Reply #6 on: October 20, 2016, 04:33:10 AM »
Thanx for worthfully answers. I am not gonna kill the cats to make my FIRE come closer for sure, but the way i am thinking is what the hell did they eat thirty years ago?? Probably what the family threw away and some mice.
Yes i also know the snow thing is not gonna apply when i retire, and of course my wifes comfort when i am away is most important. I just wonder if any of you have some "super" advices, because i know cutting costs is the fastest way. I count double to adding income, and extra income also seem to come with extra costs as transportation and extra comfort stuff fore the ones at home. Just wish i was FIRE right now when my kids are 7 and 9, but it is at least 4-8years out with my "extravagant livingstyle".
I am 41 by the way.

torbisen

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Re: Wher to pick up the extra %
« Reply #7 on: October 20, 2016, 12:30:43 PM »
I know for sure 65% will get me a lot closer than 57%, so i try to go there.

Cwadda

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Re: Wher to pick up the extra %
« Reply #8 on: October 20, 2016, 02:02:29 PM »
Thanx for worthfully answers. I am not gonna kill the cats to make my FIRE come closer for sure, but the way i am thinking is what the hell did they eat thirty years ago?? Probably what the family threw away and some mice.
Yes i also know the snow thing is not gonna apply when i retire, and of course my wifes comfort when i am away is most important. I just wonder if any of you have some "super" advices, because i know cutting costs is the fastest way. I count double to adding income, and extra income also seem to come with extra costs as transportation and extra comfort stuff fore the ones at home. Just wish i was FIRE right now when my kids are 7 and 9, but it is at least 4-8years out with my "extravagant livingstyle".
I am 41 by the way.

A very small percentage of folks are able to retire by 50. So you'll be way ahead of the curve.

torbisen

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Re: Wher to pick up the extra %
« Reply #9 on: October 20, 2016, 03:18:22 PM »
Yeah, i have been a kind of semi Mustachian or at least carefull with money before although i did not REALLY understand the whole picture that you could retire on it FOR REAL before, or that it was an option. I started save in stockfunds in 2008, but just around 700$ a month. If i THEN had understood and done 5500$ like now, or lets say realisticly 2500$-3000$ back then i would have been a LOT closer today. Cant change it though. HAppily i bought an apartment in 2001 and a house in 2007 having both still. With the savings rate and only 4% after inflation it would still strictly take 9 years.......I work on an alternate plan for some of the money, which contains buying stocks after a monthly tips from a magazine i have read for over ten years. They started out with the tips in 1987 and have done 23% yearly in average since then, so i plan to do some of the money there to speed up a little bit.

arebelspy

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Re: Wher to pick up the extra %
« Reply #10 on: October 23, 2016, 06:26:13 AM »
Twelve grand for cat food seems really high.  It's possible for a family to eat on twelve grand a year.

When someone told him "You can't early retire, you'll end up living on cat food!" he took it literally and upped his cat's food budget to make sure he'd be okay with that outcome.



Torb: You're off to a great start!  Sounds like you have the major stuff down, now it's a matter of tweaking a bit.  Get things on autopilot, then enjoy yourself.  FIRE will come soon enough, with a 57% savings rate (13.6 years if you're at $0 right now... more if you're in debt, less if you already have some savings).
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with a kid.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (occasionally) blog at AdventuringAlong.com.
You can also read my forum "Journal."

human

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Re: Wher to pick up the extra %
« Reply #11 on: October 23, 2016, 06:50:39 AM »
Maybe I missed it but do you include mortgage or rent in your expenses? Peolple like MMM don't have those expenses.

Some also just remove mortgage payments entirely as an investment (as an aside that never made sense to me as a mortgage is a liability and you would need to track all associated expenses such as interest on mortgage, maintenance and taxes to determine true roi).
« Last Edit: October 23, 2016, 06:52:12 AM by human »

arebelspy

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Re: Wher to pick up the extra %
« Reply #12 on: October 23, 2016, 07:02:13 AM »
Maybe I missed it but do you include mortgage or rent in your expenses? Peolple like MMM don't have those expenses.

MMM doesn't have that expense now.  But the OP isn't comparing, for example, absolute spending to MMM's right now, which doesn't include a mortgage.

He's comparing savings rate, and MMM, I believe, did have a mortgage during his earnings years where he had the savings rate the OP is comparing to.

Comparing to someone else though is rarely a good idea.  Do the best you can do, regardless of what some dude on the Internet did.  :)
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with a kid.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (occasionally) blog at AdventuringAlong.com.
You can also read my forum "Journal."

human

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Re: Wher to pick up the extra %
« Reply #13 on: October 23, 2016, 07:06:37 AM »
Maybe I missed it but do you include mortgage or rent in your expenses? Peolple like MMM don't have those expenses.

MMM doesn't have that expense now.  But the OP isn't comparing, for example, absolute spending to MMM's right now, which doesn't include a mortgage.

He's comparing savings rate, and MMM, I believe, did have a mortgage during his earnings years where he had the savings rate the OP is comparing to.

Comparing to someone else though is rarely a good idea.  Do the best you can do, regardless of what some dude on the Internet did.  :)


I raised MMM simply because OP did and I totally get your point.

I'm not going to go back and read MMM's blog posts on it but I suspect he may have been one of these people that turn something on the basic accounting liability side to an an asset or just left it off.

EDIT: I know that's falling into the comparative trap but there it is.

Jschange

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Re: Wher to pick up the extra %
« Reply #14 on: October 23, 2016, 04:47:44 PM »
everything looks like it's on a good path. And I'd love to learn more about how you're doing it (posting to follow)

Metric Mouse

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Re: Wher to pick up the extra %
« Reply #15 on: October 23, 2016, 11:25:28 PM »
I dont mean twelve grand for cat food, but you need to SAVE twelve grand putting them into funds to get 4% out of them for cat food every year ;-).

Ha! I was trying to imagine what $12,000 worth of catfood would look like!
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torbisen

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Re: Wher to pick up the extra %
« Reply #16 on: November 09, 2016, 04:28:35 PM »
Somebody here asked where i was at. I have aprox 60000$ left of loan, or mortgage is that how you say it? But that includes when i am finished with is ( in ten months) I own a 500000$ Villa to live in or rent out if at long travels, a 375000$ Rental apartment in Oslo the capital and a 2,5 year old Tesla S 85 worth about 56000$ in Norway, so yes i would be mortgage free without the tesla thats right, but its our only car, electrisity is real cheap in norway, gasoline extremely expensive, and also there is free parking, payment on highways and ferry`s here for electric cars, and also no tax, so its as cheap as a Volkswagen Passat with some equipment over here :-).  Problem is, id like to be finished and ready to stop work in four years time. My kids are growing big fast......

havregryn

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Re: Wher to pick up the extra %
« Reply #17 on: November 10, 2016, 12:53:40 AM »
Torbisen I will tell you what I tell myself, even though I am anxious and crazy about it, but it's always easier to preach to others.
You live in Norway and you are even by Norwegian standards wealthy. If you want to be home with your kids, be home with your kids and work later if you feel you need more money than your current assets give you.  It will probably not be any problem for you to find a perfectly decent job in Norway even after a 10 year sabbatical and deep down you probably know it. One salary can also probably support you without a problem (if your wife keeps working).
It's almost a cynical problem compared to what a lot of people on this forum are doing.
I take the liberty to say it as I have the same issue (and we're poorer than you, but still more than wealthy enough to not work for a few years in Sweden and still live happily ever after). A part of me wants to be home with kids and a part of me wants to have a stash that would hold the tenets of FIRE even though I have no real need to never work again (just while the kids are small, and let's face it, there is almost the opposite of ageism in Scandinavia) and it's more than enough for only one of us parents to work to be able to live just fine. Meaning that I really don't need to be financially independent to the degree necessary for a person who wants to permanently retire and is living in an economy where it will get increasingly difficult to get a satisfying job the longer he/she is away from the workforce and where heath insurance and future pension are closely tied to employment (I would imagine you guys have an even better garantipension system than we do with all the oil money).
You, it seems to me, like me and my husband, have more of a money anxiety issue than money non-existence issue when it comes to deciding whether it's worth to not work and be with kids. But I totally get you, as I am too driven insane by this.

torbisen

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Re: Wher to pick up the extra %
« Reply #18 on: November 10, 2016, 01:21:50 AM »
Good answer Havregryn. Thank you. My biggest problem as such is that i really like what i do for a living, but it keeps me away from home around 120 days a year, and i am completely at home for around two weeks a month, then some daywork in between. I fly rescue helicopters in the Airforce, but the thing is that if i quit this job, i would never get it back. Then i mean this particular job. I could get a job somewhere else randomly in the airforce, but this is the only flying job i want, the rest is warfare stuff...... I also have the diagnosis Bechtrevs. I tried (because i had to for two years due to my contract) work a desk job, but my body just cant do it. It freezes and after 4 months of it i was almost paralysed and off work for 6 months before arguing to come back to my flying job because it suits my diagnosis perfrctly. My job today is perfect because of consentrated time at work, then free time to exercise and recreate at home to reset my body. Also since we work 24h watch i can exercise and recreate at work. Yes i know in Norway you could just say you are to sick to work and still get more than enough, but that is not satisfying at all. At the moment my assets does not give me any income, because the rent from the rental after taxes and so only covers the rest of my mortgage with downpayments. So after payed down, maybe it will give me a "free" house for my self and 800$ for the rental after tax and stuff. If i continue working i will be pensioned at 57, if i stop now i will be at 67 like all others, and almost get a minimum pension (have not calculated it at all).  I so do want to be able to manage this all by myself (and my wife also offcourse). We picture to travel a lot after retirement. Then i can live to tell afterwards to encourage others afterwards :-). Are you from Sweden Havregryn?

havregryn

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Re: Wher to pick up the extra %
« Reply #19 on: November 10, 2016, 01:56:42 AM »
I am not ethnically from Sweden but it is defined in my tax file as the "center of my economic interest" :D. I was born in Croatia, but my husband (and both kids) are Swedish and we lived in Sweden, we have an apartment there, family, friends, we always thought we'd live there. Then I got a great job in Luxembourg so we moved but I generally assume we would retire in Sweden. Husband is getting more skeptical so maybe not but oh well, still I know the system fairly well and I always imagined Norway to be a richer and less leftist crazy version of Sweden (i.e. I often think that if Sweden manages to self-destruct with their communist mantras we'd go live in Norway instead, if Norway will still be letting in Swedish citizens).

What I meant is also that if you look at it, if you're ok with frugality in old age, it doesn't really matter how much money you have saved, as even if you live until 100, state pension will make it possible for you to live, and you can burn all of your savings on travel and fun long before that.
Of course I'm not advocating sponging off, I just mean it is a sense that it is simply far more secure to live in Scandinavia than in Trump's America or retiring early in Thailand etc. So no way would you need the same amount of savings to be able to play around a bit.

How old are you? Yes, your job is very specific, that complicates things.
Would you be able to move into a cheaper primary residence? I.e. sell the house and get something cheaper, thus liberating some funds?
Or maybe take out a loan against it and buy some rental properties abroad, we were thinking of doing that and buying some stuff in Croatia. The math seems quite profitable but we are a bit lazy to do it right now (facepunch).

havregryn

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Re: Wher to pick up the extra %
« Reply #20 on: November 10, 2016, 02:19:32 AM »
Btw also just some questions to compare to Sweden in my mind to get a better picture..would your tax on the earnings from the rental reduce if you had no work income?
Is interest paid on the loan tax deductible and what is your current rate (I saw in some old post 1.8%, that seems very high for your situation, can you negotiate that down (if it matters, since your loan is low).
Is it an interest-only mortgage like we have in Sweden, i.e. all the principal payments you do are purely voluntary? You probably have no reason to do them while at home with kids if you choose to go that way and interest can be made low. My father in law pays less than 1% on his, we pay 1,3% and that is just because the bank hates us now that we moved abroad.
How much do you currently have invested in stocks etc?
Can you take a year off work and return without a problem just to test drive the whole thing?

torbisen

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Re: Wher to pick up the extra %
« Reply #21 on: November 10, 2016, 12:25:19 PM »
The tax would not reduce, no, and the interest rate is as low as it gets :-(. What i should be able to do something with is the food cost. Around 1000$ a month, but i have already shaved off 30% ;-). Norway is expensive, specially when ecologic is twice the price...

Linda_Norway

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Re: Wher to pick up the extra %
« Reply #22 on: November 17, 2016, 01:17:40 AM »
Hei Torbisen.

Do you regularly do what they preached on TV in "ForbrukerinspektÝrene" yesterday?

Look online where you can get cheaper:
- phone
- mortgage
- electricity
- insurances

Check those thing regularly and then negotiate a better deal with your current bank/insurance company or swap to another.

I became aware yesterday that I have a very good phone deal, but I have not checked my insurances for too many years, even though we were good at swapping earlier. Need to sit down and do this sometime very soon.

Hilsen

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« Last Edit: November 17, 2016, 01:19:34 AM by Linda_Norway »

Dicey

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Re: Wher to pick up the extra %
« Reply #23 on: November 17, 2016, 03:50:53 AM »
I think you're getting bogged down in the details. To live a good life, one must always seek balance. The future's not guaranteed, so it's important to celebrate life's milestones. Optimize as much as you reasonably can, then focus on living a good life now, not just in the projected future.
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Linda_Norway

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Re: Wher to pick up the extra %
« Reply #24 on: November 17, 2016, 05:05:44 AM »
I think you're getting bogged down in the details. To live a good life, one must always seek balance. The future's not guaranteed, so it's important to celebrate life's milestones. Optimize as much as you reasonably can, then focus on living a good life now, not just in the projected future.

This is the great question. Use some of your wealth now and work longer or save it and work shorter. But as you say, the future is not guaranteed. If you can afford it, it is good to use some of your wealth already today. But in my opinion, you should choose these things carefully and see if they really are worth it.
I also think joining an expensive party once is not such a bad thing as having an expensive and repetitive hobby, like driving a car that used lots of fuel.

torbisen

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Re: Wher to pick up the extra %
« Reply #25 on: December 17, 2016, 08:54:34 AM »
After 5 months we have now saved 35500 dollars at a rate of 61,4% of our income. We might buy an imac for christmas for the whole family, our computers are 8 years an they dont work very well anymore. Yes its stupid, but i work with logic doing music and the kids learn to make music as well. It will though take us down to 57,3% savings rate........I know its too expensive. But anyhow the 57,3% for 5 months is worth celebrating  little bit :-).