Author Topic: From Saver to Spender  (Read 2566 times)

foghorn

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From Saver to Spender
« on: October 19, 2017, 02:52:42 PM »
MMM Readers;

I recently posted on the Case Studies Forum entitled "At A Crossroads" about my current situation and what I should do next.  Most of the great responses encouraged me to FIRE, as everyone felt I was financially ready.

My question here is for those that have already FIRE'd:  How did you go from being a Saver to being a Spender?

In order to FIRE, you were certainly a great Saver, but once there was no more job and no more paycheck, did spending some of what you saved bother you?  While working was never a lot of fun, I sure enjoyed watching those balances go up every month.  The idea of spending some of that money is really hard for me. 

I am hoping that some of you have advice on how you overcame this issue.

Thank you.


Cassie

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Re: From Saver to Spender
« Reply #1 on: October 19, 2017, 02:58:59 PM »
We were 53 and 58 and ready to enjoy ourselves. The first year we did not really do anything because we were somewhat worried. After that we started to plan vacations, experiences, eating out, festivals, etc.   Also we had 3 friends die between 59-67 so that certainly puts things into perspective.  I don;t know how old you are so that may make a difference too.  WE aren't going crazy but we are having fun.

foghorn

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Re: From Saver to Spender
« Reply #2 on: October 19, 2017, 03:04:13 PM »
Thank you for the reply.

I am sorry - I should have stated that I am 50 years old.


Here is the link to my Case Study - in case anyone is interested.


https://forum.mrmoneymustache.com/case-studies/at-a-crossroads/

Cassie

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Re: From Saver to Spender
« Reply #3 on: October 19, 2017, 03:15:41 PM »
So I went and looked at this.  Are there any places you have always wanted to vacation?  what type of things did you as a child want to be when you grew up?   There may be some hobbies in there you have not thought of. Any hobbies that you gave up along the way?  Any home projects you want to do?

bacchi

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Re: From Saver to Spender
« Reply #4 on: October 20, 2017, 11:09:36 AM »
Oh, yeah, this is the hardest part for me. I have plenty to do and enjoy my new freedom but selling and spending down investments is difficult. It's been made easier because the market has increased my liquid net worth despite my withdrawals but, damn, it was satisfying seeing thousands go into retirement accounts each month.

Cassie's experience ^^ might be the best. Take it easy, relax, and ease into ER before dropping $35k on a new Harley. Like many things, withdrawing gets easier with practice.

Good luck.

BTDretire

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Re: From Saver to Spender
« Reply #5 on: October 22, 2017, 10:50:46 AM »
I sure enjoyed watching those balances go up every month.  The idea of spending some of that money is really hard for me. 


 Hopefully you are spending 'less then' the gains you earn each year.
So your balance should still grow and at the least, stay even.
 Obviously if the market makes a turn to the downside, your balance could be less for a few years.

Melf

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Re: From Saver to Spender
« Reply #6 on: October 23, 2017, 07:42:12 AM »
I'm 50 and nearing the end of my first year or FIRE.  If you were prepared and the numbers looked good then all you can do is stick with the plan.  You probably know what your yearly spending looks like by now after all the prep and planning for FIRE.  We just have to rely on the game following the rules that we've been counting on.  We know that our investments should be able to handle the withdrawals that we need to make and hopefully can handle any bumps that come along the way.  Just ease into that first year or so and get comfortable with it. 

Edited to add:  I just read through your case study.  I'm sure that you know by now that you have absolutely nothing to worry about financially other than maybe cutting down on the management fees that you pay to Fidelity.  Your stash is roughly 3 times that of mine and yearly expenses are comparable.  I think you are set now matter how you go about it from here.  I think you'll find out that you have little to worry about.  Enjoy FIRE!
« Last Edit: October 23, 2017, 08:29:15 AM by Melf »

elaine amj

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Re: From Saver to Spender
« Reply #7 on: October 23, 2017, 10:09:30 AM »
I'm worried about this too. Posting to follow and learn some wisdom :)
My journal: http://forum.mrmoneymustache.com/journals/realigning-spending-to-match-our-future-goals-a-canadian-journey/

Camp Mustache Canada 2017 was everything I dreamed of and more. Super excited that Camp Mustache Canada 2018 is now a thing!

jim555

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Re: From Saver to Spender
« Reply #8 on: October 23, 2017, 10:57:35 AM »
I am grappling with the change to spender, and it isn't easy.  I don't mind spending if it makes sense and I am getting a good value.  I feel like just blowing money would be wasteful and it will not make me feel happy.

Woodshark

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Re: From Saver to Spender
« Reply #9 on: October 27, 2017, 04:25:30 PM »
It's a tough mindset (saver to spender) to get over. We retired 2.5 years ago and it takes some time to get used to taking money out instead of putting money in. You just have to tell yourself "this is why we saved liked crazy for so many years".  Once you run the Firecalc and i-orp programs (a zillion times) you eventually have to come around to the truth that you can really do this. Then you convince yourself to believe in the math and your original goal of retirement. I was hard withdrawing funds the first year but you eventually get used to it.

onewayfamily

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Re: From Saver to Spender
« Reply #10 on: October 27, 2017, 10:55:02 PM »
There's a related thread over on Bogleheads with some good perspectives:

https://www.bogleheads.org/forum/viewtopic.php?f=10&t=230731
We FIRE'd at age 28 (me) and 29 (Mrs. OneWayFamily) and are now trying to travel to every country on Earth - it takes longer with 2 toddlers!

If you'd like to keep track of where we're at - check out our photos @ Instagram or our lame attempt at a blog at onewayfamily.com

freeat57

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Re: From Saver to Spender
« Reply #11 on: November 01, 2017, 05:24:45 PM »
Hello foghorn! (Where's leghorn?) Your situation sounds very much like mine, except that I am a few years ahead of you.  I read your case study post and perhaps you can gain something from my experience.  You should be in fine shape to pursue your dreams, considering the fact that you already seem to have fairly frugal habits.

I was hit by a mass layoff from my megacorp job in 2010 after 19 years there.  I had previously worked a few years at a different, smaller company. The way the layoff worked, I no longer had to report to work after March, but was paid regular salary through June.  Then I received severance pay of almost 1.8x my annual salary. Most of that went into my already decent after tax Vanguard account, because my 401k contribution was already maxed.  Then, because of the crazy way our bonus system worked, I got a $46K bonus that paid out in 2011.  (Insert long rant about how idiotic megacorps are!) So, I had 1.75 years of not working while still being paid.  I spent that time adjusting to the idea of not going into the office, being a "nobody" and filling my time with other interests. 

In the summer of 2011, an old friend contacted me about an open teaching position at his university that he thought I would be a good candidate for.  In spite of the fact that I was in reality FI at that time, I think I was uneasy about having no salary income in 2012, my first year with no check from an employer.  I took the bait, applied, and got the job.  That meant moving a long distance to a place I really was not thrilled about.  The salary they paid was a joke, but the benefits were decent.  Basically, I was earning less than I had earned in my very first year in corporate employment 25 years before.  It paid the bills, but I didn't accumulate much from that job.  After 3.5 years, I quit that job, mainly because I was very frustrated with the administration and the huge gap between their stated values and goals and their actions.  Teaching college students was a lot of fun!  However, it was actually more than a full time job if done right.  The fun did not outweigh the frustrations with the admin and the fact that I felt taken advantage of.  So, here's the lesson; it is hard to work at a less than ideal job when you know that your investments are earning more that you are being paid in salary!

Now I have moved to a city I chose based on a long list of criteria and am starting to explore life in a number of ways, like many others on this forum.  I am living off investments and still spend below what my returns have been.  I do have a bit of a financial buffer on the horizon.  The aforementioned megacorp will begin paying me a pension at the age of 65 that will be enough to cover my essential living expenses.  Oh! Since I was laid off in March 2010, my net worth has almost doubled. 

So foghorn, breathe deeply, lean back, and dream up a new life as a "nobody".  (But have a plan, of course!)