The Money Mustache Community
General Discussion => Welcome and General Discussion => Topic started by: jlcnuke on March 12, 2018, 06:12:44 AM
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I was interested to see how many people are living the Mustachian life, vs just trying to be fiscally responsible. For my purposes here, fiscally responsible means spending less than you earn while having at least a 10% savings rate (the minimum recommend to be financially secure at "normal" retirement age for "normal" people).
Personally, I've been fiscally responsible for a long time, and I have "some" Mustachian habits, but no one would mistake my lifestyle for Mustachian overall (though very "LBYM FIRE-style"). A good amount of my spending would be considered "face punch worthy" by most "true Mustachians" I'd wager. If I wanted a "textbook" Mustachian lifestyle I'd be FIRE already. I'm okay waiting until my late 40's (6-8 years from now) instead to finance the lifestyle I think I'd rather have however.
What about you?
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"Living below your means"? I thought I'd save others the Google time.
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"Living below your means"? I thought I'd save others the Google time.
Yeah, I assumed it was a well known acronym here. I should know better than to make assumptions though (as I'd never think of not spelling it out first in my professional writing), so thanks for pointing it out. :)
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I selected “kind of” Mustachian even though we spend less than $30k per year in our HCOL city and don’t have a car. We do spend more on clean food, annual international flights, private preschool, and an ayi, so I can’t say we are 100% Mustachian.
Edited to add: An ayi is a housekeeper/nanny/maid. Basically a household helper.
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Where's the option for those of us who think that Mustachianism doesn't go far enough? :P
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There's also an option missing for those of us who are FIRE and so don't have a savings rate.
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I selected “kind of” Mustachian even though we spend less than $30k per year in our HCOL city and don’t have a car. We do spend more on clean food, annual international flights, private preschool, and an ayi, so I can’t say we are 100% Mustachian.
I had to look up "ayi" since I wasn't familiar with that term. For anyone else who is unaware, that's apparently a housekeeper in China.
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Where's the option for those of us who think that Mustachianism doesn't go far enough? :P
Just stuck with the first option, gotta use the comments/posting section to explain extra :)
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There's also an option missing for those of us who are FIRE and so don't have a savings rate.
Just go with what you were before you retired I'd say... that's where you'd "fit" in this type of poll imo.
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I selected "kinda mustachian " too because my pre-mmm decisions, mainly a big house in the country that my husband loves, are keeping our spending between 40-45k. I like the house but I would gladly trade it in for a smaller one to get more time with my kids, and I absolutely hate the high utility bills. I have always been frugal without really trying, but didn't know much about investing and had never heard of the concept of FIRE before discovering the blog/forum, which led to me amassing 70k in a checking account and thinking "might as well buy a bigger house ". I think if I had discovered the blog pre-kids I probably would have ignored it.
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I went with kinda mustachian, we've got a couple of cars(working toward being a single vehicle family, but, o boy, is a second vehicle convenient when one of us has to run errands during the day and the other has to be to work at 6 am, 2 hours before the kid would normally be awake). I've got a bit of a clown car habit, driving in the winter instead of biking even though its very much a bike-able distance. My excuse right now is pregnancy, but even last year when I wasn't I still drove the car to work. The SO has a soda habit, and is a big fan of convenience food instead of cooking at home. But we do save a good chunk of the paycheck, which once we finally get the last of our debt(the house) paid off will be even more, and are always looking at where else to optimize without sacrificing the things we enjoy.
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I think if it was just me, I'd be in the "kinda-Mustachian" option. I'm totally cool biking places, I'm never planning on buying a new car, and I get most of my clothes at thrift shops, etc. My husband likes to buy new furniture and shop equipment. Mostly because they're supposed to last longer, which is fair, and also because we still save a LOT of our money so he's comfortable spending the rest. He also hates cleaning our kitchen, so he'd happily buy most of our meals out, or hire a maid, but I talk him down every few months :)
He does an excellent job of saving money, and looks for sales/lower prices because he knows it makes me happy. He's also the one with the side hustle and ideas for more ways to make more money. I'm just super cheap, lol. Without him I'd probably save a higher percentage of my income, but a MUCH lower dollar value.
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"Living below your means"? I thought I'd save others the Google time.
Thank you! I clicked just to figure out what the heck that was.
Also- I don't recall Pete living in the cheapest house he could find, nor biking everywhere (though he bikes MOST places). So when did these things become defining of Mustachianism.
My thing with Mustachianism is I don't want to retire early. But I am financially independent.
I lived below my means my whole life, even before getting into any sort of investments, or specific frugal habits. I learned "don't spend what you don't have" when I was like 6.
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I am definitely LBYM today, Mustachian for some things, not for others, but I also expect to be more Mustachian post FIRE.
Today I make decisions to spend more money on some things in return for time. For example, I only shop at a spendy grocery store because it is on the route home from work. I try to minimize car trips by maximizing what I do on my daily commute instead of making special trips out on the weekend. When I am FIRE, a grocery store run will likely be a dedicated car trip, so I will therefore choose to go in the other direction to the discount store, I will also have more free time in which to spend time on watching sales. Being a household of 1, my grocery bill is not a major problem, but definitely something I will want to optimize when FIRE.
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We’re in a weird position as neither of us are consciously mustachian. We just happen to like biking to work, don’t buy a lot of stuff and save more than we spend. But, we live in a HCOL and could live cheaper but won’t. We have cut back on some things but some things we won’t and we eat out/ order in far more than we should. We vacation how we like and spoil ourselves. We’re also fortunate to have great salaries. I’m definitely on the FIRE path, SO doesn’t believe it’s possible.
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Wow, I see why people have been saying the forum's gone soft. Honestly surprised. Right now, I'm apparently in the 5% who actually live this thing, and I'm pretty shocked it's not the 50%+.
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"Living below your means"? I thought I'd save others the Google time.
Thank you. Initially guessed "live beyond your means", but that didn't make much sense.
"below" isn't intuitive to me when talking about money, as I don't live underneath my cash. I'd prefer "within" instead.
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Heh I'm not sure how to answer. I spend < 30k a year but that's because I don't take HOME much more than that. I don't "spend a lot" because there isn't a lot to spend.
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I picked kind of mustachian. I'm pretty new to the forum and still learning. I think my personality naturally fits the mustachian strategy, but my house and student loans push me over the 30k annual family spending range. Our family grocery spending could be lower too, I'm not mustachian there yet.
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Where's the option for those of us who think that Mustachianism doesn't go far enough? :P
I'm writing in "Couchsurfer who thinks houses are embarrassing luxuries."
(I appreciate when said luxuries have spare couches, though.)
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Wow, I see why people have been saying the forum's gone soft. Honestly surprised. Right now, I'm apparently in the 5% who actually live this thing, and I'm pretty shocked it's not the 50%+.
Just out of curiosity, do you include your housing costs in that 30k? Is it for just you or more than one person?
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Baby steps. That's what we are doing. We worked past low income, finished our educations, upgraded our careers, worked past DW's discomfort with finance planning and discussion, and our self-education in frugality courtesy of you good folks is mostly complete.
So currently we are LBYM but almost saving one of our incomes per year. Just ran the math. Didn't realize that until now.
We won't FIRE in our 30s or 40s b/c we started later than most on this board. We'll comfortably retire early by a few years. We have jobs that we can live with easily enough.
There is more financial efficiency to be had at our house and we're working on it. Baby steps.
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In general I'm frugal day to day and do save 20%+ of income. OTOH expensive house (maybe not for the area, haha!) and a few toys that I'm sure some here would frown on.
Don't really need to define myself by someone else's term or feel good or bad about being in an imaginary club, but for sure there is a lot of common ground with folks here on the forum.
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Canadian, so living on under $40k/year comes to $30k USD -- this with wife and baby
I'm cheating on the income side (massive stock option windfall that vests over next few years) but you can't cheat on the spending side :)
We still have a car and it gets driven more often than I'd like, but my commute is by bike.
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I was interested...
What about you?
I added to the poll, but I'm not really interested.
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Also not sure. I definitely splurge some places, but I'm also under $30k spending. I only made $30k for years, so I got used to it. Spending $20k feels like luxury now!
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I bike or transit, don't have a car and don't spend too much, but that's also cause I have a relatively low income, especially compared to people here. Saving about 25% but I still do splurge on a stuff that matters to me like travel, although I do it as cheaply as possible.
For me, it's about living within my means, according to my values, and prioritizing the environment and my future over consumerist culture.
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Wow, I see why people have been saying the forum's gone soft. Honestly surprised. Right now, I'm apparently in the 5% who actually live this thing, and I'm pretty shocked it's not the 50%+.
Just out of curiosity, do you include your housing costs in that 30k? Is it for just you or more than one person?
We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
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I'm here for the entertainment value and to learn from others.
I probably would be "mustachian" if I were single. However, we fit in the save a ton of money and spend a ton of money category since our high incomes allow this. We are saving around double what we spend, but we spend quite a bit.
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I'm definitely in the LBYM camp, but not "Mustachian," especially not after the past couple of years of some lifestyle creep (buying an expensive townhouse and a modest car) plus the fact that I really cannot get on board with some of the views around here re appropriate spending on child costs (re music lessons and things of that nature, which I do view as "necessary" future expenditures for my newborn as long as my cash flow (or potential cash flow) supports it).
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I guess my wife and I are somewhere between "Kinda Mustachian" and LBYM-FIRE style, as they've been defined.
We save about 32% of total income. I'm still confused how to do the savings rate calculation, but the savings rate percentage is higher when you just factor in take-home pay.
The biggest thing we focus on is maximizing tax-advantaged accounts as much as we are able. This year we are maxing my wife's 401k, her Roth IRA, my traditional IRA, and our HSA.
In terms of spending, we try to make frugal, rational decisions on the big things. We live in a relatively small house in a middle class neighborhood, we drive a 2014 Honda CR-V and 2013 Toyota Rav-4, and we don't have any crazy subscriptions.
That said, we still enjoy spending money on things we enjoy. We've spent quite a bit on fitness equipment the last three years, we have some nice TVs throughout the house, we like doing home renovation projects, and we enjoy eating out about once a week.
Ultimately, our goal is balance, and I think we're on a decent path for that.
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As far as Non-full on Mustachians being "soft" goes, I think that's a little excessive. I see so many conversations on here about living your best life while being frugal and aiming toward FI. Can you really make the most out of life if you are hardcore Mustachian?
Maybe more younger people are finding out about this movement and are on their way to a more Mustachian lifestyle, but are currently just living below their means. Maybe that's why it might seem that there is less of a 100% Mustachian attitude around the site.
But as a 26 year old, I think reading about people's experiences as actual Mustachians does a lot to motivate me and others like me to start creating better habits.
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Heh I'm not sure how to answer. I spend < 30k a year but that's because I don't take HOME much more than that. I don't "spend a lot" because there isn't a lot to spend.
Ha, ditto!
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Can you really make the most out of life if you are hardcore Mustachian?
Um. Yes. Pretty sure that's the core message of the blog: frugality doesn't mean making yourself unhappy, but rather the opposite.
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Can you really make the most out of life if you are hardcore Mustachian?
Isn't the whole point of being mustachian to make the most out of life? It's about using your money on the things you value and not on consumerist crap.
I certainly don't recall Pete ever saying anything different.
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As far as Non-full on Mustachians being "soft" goes, I think that's a little excessive. I see so many conversations on here about living your best life while being frugal and aiming toward FI. Can you really make the most out of life if you are hardcore Mustachian?
Maybe more younger people are finding out about this movement and are on their way to a more Mustachian lifestyle, but are currently just living below their means. Maybe that's why it might seem that there is less of a 100% Mustachian attitude around the site.
Might not help the GDP if we were all frugal but the world might be a nicer place for it. People more like my grandparents who were frugal b/c they had to be. They liked to putter around in the flower garden, mow the grass, have friends over to play cards or cookout.
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Can you really make the most out of life if you are hardcore Mustachian?
Um. Yes. Pretty sure that's the core message of the blog: frugality doesn't mean making yourself unhappy, but rather the opposite.
Maybe that came out wrong. I just think spending money on opportunities to gain awesome experiences (if budgeted for) can sometimes be mistaken for an unfrugal lifestyle if you get what I'm saying. It's tough to find the right verbiage here sometimes.
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As far as Non-full on Mustachians being "soft" goes, I think that's a little excessive. I see so many conversations on here about living your best life while being frugal and aiming toward FI. Can you really make the most out of life if you are hardcore Mustachian?
Maybe more younger people are finding out about this movement and are on their way to a more Mustachian lifestyle, but are currently just living below their means. Maybe that's why it might seem that there is less of a 100% Mustachian attitude around the site.
Might not help the GDP if we were all frugal but the world might be a nicer place for it. People more like my grandparents who were frugal b/c they had to be. They liked to putter around in the flower garden, mow the grass, have friends over to play cards or cookout.
I agree. It really would be. Spendy lifestyles kill relationships in some instances and create personalities that nobody wants to be associated with. It's really too bad. But it's life and it's a result of consumerism being drilled into everybody's' minds from the age of 3.
Quick example, me and my dad love bass fishing together and he used to be a tournament fisherman because he loved fishing and the competition and fishing with friends. He has spent a fair amount of money on this hobby, but the last club tournament he ever fished he got paired up with a guy that literally talked about himself and his toys (truck/house/boat/fishing gear/etc) for like 5 hours straight. He had been frustrated with similar attitudes before that, but said that was the last straw. He gets a lot more satisfaction and happiness from fishing on his small 16 ft boat with me than he ever did fishing among the guys that had 20 footers that cost $20..30..40k.
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I would put myself in the LBYM category. I recently got a bicycle as a gift from my wife. But it's not practical for me to ride it to work because of distance. That being said, our savings rate is pretty good and neither my wife or I are big spenders naturally. She got a new CRV last year but her old vehicle was going to need some costly repairs. My car is pushing 150K miles and I plan to drive it as long as I can while saving for my next vehicle. One expense we need to work on is eating out. I pack a lunch for work every day and I don't have a designated break (I work in an ER). My wife gets an hour lunch break and tends to go out for lunch with co-workers. I want to start meal prepping to have healthier options for both of us and to save money.
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We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
That's what MMM does in his annual spending posts.
I'm sure it's been debated many times, but if you take MMM's annual spending, add back in imputed rent (2k/month that he estimates), while removing ownership costs (property taxes and maintenance); you end up at ~$45-$50k/year, which is not that different from a median US family's after tax income.
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Can you really make the most out of life if you are hardcore Mustachian?
Um. Yes. Pretty sure that's the core message of the blog: frugality doesn't mean making yourself unhappy, but rather the opposite.
Maybe that came out wrong. I just think spending money on opportunities to gain awesome experiences (if budgeted for) can sometimes be mistaken for an unfrugal lifestyle if you get what I'm saying. It's tough to find the right verbiage here sometimes.
And why would spending money on awesome experiences need to result in an unfrugal, anti-mustache lifestyle? Case in point - of our 27K year spending, 1/3 of it goes to extravagant international travel. We do two major trips a year, usually one to Europe and one to Asia, in addition to a bunch of smaller, more local trips. Just last night I finished booking all our accommodations and most of our transportation for our upcoming European summer trip to Brighton, Prague, Berlin, and Amsterdam.
The whole point of this thing is to figure out how to live an awesome life, do all the cool stuff you love, and at the same time keep your spending low.
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Being a baby boomer I have been frugal most of my life and our friends were too. Now at 63 we are traveling more, eating out more and going to more entertainment then ever before because we have both the time and $.
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We are in the LBYM-FIRE category, where we spend a lot but have a reasonable savings rate (40% last year, up from 27% the previous year, thanks to tips and support found here) and will definitely retire early. My husband is much more Boglehead than Mustachian and we live in a HCOL area. We have plenty of room for improvement, but we've already made a lot of big steps since finding MMM so I'm happy with our progress so far and optimistic that we'll make more.
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Can you really make the most out of life if you are hardcore Mustachian?
Um. Yes. Pretty sure that's the core message of the blog: frugality doesn't mean making yourself unhappy, but rather the opposite.
Maybe that came out wrong. I just think spending money on opportunities to gain awesome experiences (if budgeted for) can sometimes be mistaken for an unfrugal lifestyle if you get what I'm saying. It's tough to find the right verbiage here sometimes.
Blowing money on anything is 'unfrugal'.
It doesn't matter if you blow it on a nice car, a giant house, a pet cow, travel, or hookers/blow. You're certainly free to say 'hey, blowing this giant pile of money on this silly shit is what I want to do' . You're not free to say 'Hey, I'm blowing this giant pile of money on this silly shit, but it's for life experiences, so I don't want anyone to call me on it. #FRUGAL YOLO'.
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I voted Mustachian, even though I don't bike everywhere. Together my fiance and I spend about 30k/yr including housing (rent). Rarely eat out, rarely travel, rarely buy clothes (and always used), <$200/mo for groceries, etc. I was at about a 50% savings rate (including taxes as expenses) last year. This year will be a bit lower due to combining finances with my lower-income fiance, and paying for the wedding. I hope to bring it back up next year, though.
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Can you really make the most out of life if you are hardcore Mustachian?
Um. Yes. Pretty sure that's the core message of the blog: frugality doesn't mean making yourself unhappy, but rather the opposite.
Maybe that came out wrong. I just think spending money on opportunities to gain awesome experiences (if budgeted for) can sometimes be mistaken for an unfrugal lifestyle if you get what I'm saying. It's tough to find the right verbiage here sometimes.
And why would spending money on awesome experiences need to result in an unfrugal, anti-mustache lifestyle? Case in point - of our 27K year spending, 1/3 of it goes to extravagant international travel. We do two major trips a year, usually one to Europe and one to Asia, in addition to a bunch of smaller, more local trips. Just last night I finished booking all our accommodations and most of our transportation for our upcoming European summer trip to Brighton, Prague, Berlin, and Amsterdam.
The whole point of this thing is to figure out how to live an awesome life, do all the cool stuff you love, and at the same time keep your spending low.
I think the "do all the cool stuff you love" thing is where there can be a significant change in costs. Sure, if the stuff you love to do is cheap then it's easy to keep your spending low. However, if you enjoy sailing a modern 40 ft yacht, diving the Caribbean, and eating 4-5 star meals, you can keep your spending "lower" and still spend a lot of money. A luxury car enthusiast, for instance, wouldn't enjoy driving a 20 year old Kia and missing out on driving a luxury car for them might be something they aren't willing to compromise in their life, but they might save some money by getting that used $30k BMW instead of the new $150k Aston Martin. Either way though, they're spending quite a bit of money because that's one of the things that makes their life more enjoyable. To other people it may be "just a car", but to them it may be an enjoyable experience they have every day they drive the vehicle. What people enjoy can be cheap or it can be expensive.
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We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
That's what MMM does in his annual spending posts.
I'm sure it's been debated many times, but if you take MMM's annual spending, add back in imputed rent (2k/month that he estimates), while removing ownership costs (property taxes and maintenance); you end up at ~$45-$50k/year, which is not that different from a median US family's after tax income.
I don't fault anyone for not including money they didn't actually spend in their annual expenses. It seems like a pretty pointless exercise, honestly, to figure out how much imaginary money to add into your calculations.
Zikoris, I've really enjoyed reading about your story over the years. If memory serves, at one point you were in a rent-controlled apartment. Are you still there? Do you think rent-controlled housing costs are something the average American can get in a major city? (I believe there is rent control in NYC, but not sure about the rest of the US) Not rhetorical questions by the way; just interested on your perspective of your own predicament.
We're in a co-op, but in Canada they actually have less rent control than the market - non-existent, really. Co-ops operate under a different set of laws, so while normal rentals are capped at a certain % per year (changes every year, but 3% is common), there is virtually no limit as to how much co-ops can increase. In the recent past, there have been 40%+ increases for some units, for example. This year we're probably looking at 20-25%, which is still manageable, but getting borderline. So I have a pretty good idea how our time here will eventually end - with a massive increase in rent that pushes us to find a cheaper place.
I have no idea what the rental market is like in the US, but it seems to me that it would only make sense to live somewhere like NYC if you had the salary to match the rent. As far as I can tell, there seem to be lots of cities that have reasonable rents.
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While I've been following the forum more the last couple years, I have seen more snobbery and egotism among "Mustachians" which I don't really understand. They learned how to save more and more, reached their goals, and now generalize people that are in similar situations they once were. Very interesting.
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Do you believe the things that you like and enjoy are outside your locus of control? Kind of sounds like you do. I believe that we can be born with inclinations, but that those inclinations can be trained and refined and modified. That the things we like is not an affliction; it's a choice we make every day.
Who cares if it's controllable. If I want to live my life doing the things I enjoy, and they cost money, I'm going to spend money doing them. Sure, I could decide to "not do the things I like and try to find cheaper things to do that I might like" but why? For me, working doesn't suck so bad that I want to give up the things I enjoy simply because they cost money (or more money than some other things).
I can say definitively that I am MORE happy diving in tropical waters than I am playing free poker at the local pool hall. Sure, I'll go play poker still when I'm at home, but I'd much rather be diving in the tropics despite the increased costs associated with that activity.
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We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
That's what MMM does in his annual spending posts.
I'm sure it's been debated many times, but if you take MMM's annual spending, add back in imputed rent (2k/month that he estimates), while removing ownership costs (property taxes and maintenance); you end up at ~$45-$50k/year, which is not that different from a median US family's after tax income.
I don't fault anyone for not including money they didn't actually spend in their annual expenses. It seems like a pretty pointless exercise, honestly, to figure out how much imaginary money to add into your calculations.
Seriously. If he has to add in rent he didn't pay; he might need to add in a calculation for all the labor he did himself instead of hiring someone.
I think MMM attributes a lot of things to his business that greatly increase his and his family's quality of life, so it seems more personal- but imputed rent makes no sense to me as part of his spending.
Also, he built a business where he can travel and play with his family and count it as a business expense. Other people could have done that, we just didn't. (I'm pretty on the "blogosphere is maxed out" so I don't know that you still could; but the opportunity was there. I know I seriously regret not monetizing my youtube channel a decade ago.)
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Wow, I see why people have been saying the forum's gone soft. Honestly surprised. Right now, I'm apparently in the 5% who actually live this thing, and I'm pretty shocked it's not the 50%+.
Just out of curiosity, do you include your housing costs in that 30k? Is it for just you or more than one person?
I'm kind of shocked too, it's at 8% now but still a lot lower than I expected. Just biking and buying a cheap house doesn't even really sound hardcore Mustachian to me.
Our joint income is around 30k and we save about half of it. We don't own a car and we bought the cheapest house we could find, 800 square foot in the inner city. We still live a life of luxury: 2 people, 3 bedrooms and no roommate anymore, a garden, we eat other things than rice and beans, we own several pairs of shoes each. This is the richest we've ever been and I'm sure I could cut at least 3k, probably closer to 5k, in spending every year if I tried.
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We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
That's what MMM does in his annual spending posts.
I'm sure it's been debated many times, but if you take MMM's annual spending, add back in imputed rent (2k/month that he estimates), while removing ownership costs (property taxes and maintenance); you end up at ~$45-$50k/year, which is not that different from a median US family's after tax income.
I don't fault anyone for not including money they didn't actually spend in their annual expenses. It seems like a pretty pointless exercise, honestly, to figure out how much imaginary money to add into your calculations.
It might come in handy if you wanted to compare your spending to someone else's and say, "Look how little I spend. I don't understand why everyone else doesn't just live on 25k/year like me."
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Wow, I see why people have been saying the forum's gone soft. Honestly surprised. Right now, I'm apparently in the 5% who actually live this thing, and I'm pretty shocked it's not the 50%+.
Just out of curiosity, do you include your housing costs in that 30k? Is it for just you or more than one person?
We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
That's awesome, I'd like to be at that level eventually. We'd be close to that I think without my student loan payments. Kudos to everyone spending under 30k. And to the rest of you too for making spending choices consciously.
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Wow, I see why people have been saying the forum's gone soft. Honestly surprised. Right now, I'm apparently in the 5% who actually live this thing, and I'm pretty shocked it's not the 50%+.
Just out of curiosity, do you include your housing costs in that 30k? Is it for just you or more than one person?
I'm kind of shocked too, it's at 8% now but still a lot lower than I expected. Just biking and buying a cheap house doesn't even really sound hardcore Mustachian to me.
Our joint income is around 30k and we save about half of it. We don't own a car and we bought the cheapest house we could find, 800 square foot in the inner city. We still live a life of luxury: 2 people, 3 bedrooms and no roommate anymore, a garden, we eat other things than rice and beans, we own several pairs of shoes each. This is the richest we've ever been and I'm sure I could cut at least 3k, probably closer to 5k, in spending every year if I tried.
I expected that people like myself ("spendypants" that are still saving a lot of money) would be much more in the minority. I'd guess that, like myself, many people ended up coming across these forums based on "living below your means" topics and stuck around, despite not really subscribing to the more "extreme" cutting of expenses. I'm absolutely certain that much of my spending (and especially one of my planned future large purchases) would seem an outrageous waste of money to the more mustachian posters here, but I still enjoy helping with people's questions on investments or discussing how to "DIY" some projects or save money in some areas.
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While I've been following the forum more the last couple years, I have seen more snobbery and egotism among "Mustachians" which I don't really understand. They learned how to save more and more, reached their goals, and now generalize people that are in similar situations they once were. Very interesting.
I've seen that quite a bit, and I think a lot of it is assuming everyone has the same life goals. Being non-mustachian isn't bad (though I can see how you would get that from some of MMM's articles but the "face-punching" is just the theme, not real life, lol). That's not the point. The point is that FIRE is possible and anyone who says is it's impossible is just straight up wrong. Some people want to work until they're 50, 60, 70. And there's nothing wrong with that. It's just that you can also retire at 30 or 40 but requires a different lifestyle.
I value not working over things that cost money. I'm hustling and trying to make as much money as I can while in college. My investments are at about ~16000 across taxable and IRA accounts after about a year and half of saving money from working 25+ hrs/week while on-campus on top of classes and internships while not in school. I've kept and average savings rate at ~40-50%. I sleep in a small apartment, paying somewhere the lower 10% of rent in the area, some of my friends are paying somewhere in the upper 20%. I have plenty of friends that work less than half of what I do and party a lot. I'm not much into that; they are. There's nothing wrong with what they're doing. They have different values than I do.
Sorry if this came off a little rant-y, just needed to let it out. Seen too many people hating on other people's life choices when it doesn't affect them at all.
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We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
That's what MMM does in his annual spending posts.
I'm sure it's been debated many times, but if you take MMM's annual spending, add back in imputed rent (2k/month that he estimates), while removing ownership costs (property taxes and maintenance); you end up at ~$45-$50k/year, which is not that different from a median US family's after tax income.
I don't fault anyone for not including money they didn't actually spend in their annual expenses. It seems like a pretty pointless exercise, honestly, to figure out how much imaginary money to add into your calculations.
It might come in handy if you wanted to compare your spending to someone else's and say, "Look how little I spend. I don't understand why everyone else doesn't just live on 25k/year like me."
I think it's easy enough to just say "I live on X, and my house is also paid off", and let people do what they will with that info, rather than do some weird math with imaginary numbers that somehow doubles your spending. Once you get into weird accounting, there will always be something people can nitpick at - this fake number is too high, that fake number is too low. It seems to be adding a level of complexity that just doesn't need to be there.
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Wow, I see why people have been saying the forum's gone soft. Honestly surprised. Right now, I'm apparently in the 5% who actually live this thing, and I'm pretty shocked it's not the 50%+.
I mean I think MMM has attracted a sorta mid-tier Mustachianism crowd that doesn't really live the full lifestyle but want to be more financially responsible which sorta brings it down, too. Also I think there's a huge gray area between the first option and the second and people may be underestimating themselves to the second option. I chose the second option since I'm still in college and haven't technically borne the full costs of living (healthcare, mostly).
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We've spent around 27K/year for many years, 100% of spending, for two people and one cat. Leaving your biggest expense out of the equation (housing) would be some pretty fishy accounting.
That's what MMM does in his annual spending posts.
I'm sure it's been debated many times, but if you take MMM's annual spending, add back in imputed rent (2k/month that he estimates), while removing ownership costs (property taxes and maintenance); you end up at ~$45-$50k/year, which is not that different from a median US family's after tax income.
I don't fault anyone for not including money they didn't actually spend in their annual expenses. It seems like a pretty pointless exercise, honestly, to figure out how much imaginary money to add into your calculations.
It might come in handy if you wanted to compare your spending to someone else's and say, "Look how little I spend. I don't understand why everyone else doesn't just live on 25k/year like me."
I think it's easy enough to just say "I live on X, and my house is also paid off", and let people do what they will with that info, rather than do some weird math with imaginary numbers that somehow doubles your spending. Once you get into weird accounting, there will always be something people can nitpick at - this fake number is too high, that fake number is too low. It seems to be adding a level of complexity that just doesn't need to be there.
I think it can be helpful to compare against others but to make it a detailed comparison is next to impossible for all of the caveats that can exists in someone's life. I usually just use people's stories across the forum to try to get an idea of where I'm at--not to directly compare.
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Do you believe the things that you like and enjoy are outside your locus of control? Kind of sounds like you do. I believe that we can be born with inclinations, but that those inclinations can be trained and refined and modified. That the things we like is not an affliction; it's a choice we make every day.
Who cares if it's controllable. If I want to live my life doing the things I enjoy, and they cost money, I'm going to spend money doing them. Sure, I could decide to "not do the things I like and try to find cheaper things to do that I might like" but why? For me, working doesn't suck so bad that I want to give up the things I enjoy simply because they cost money (or more money than some other things).
I can say definitively that I am MORE happy diving in tropical waters than I am playing free poker at the local pool hall. Sure, I'll go play poker still when I'm at home, but I'd much rather be diving in the tropics despite the increased costs associated with that activity.
Cool - more power to you. I'm not trying to influence your choices; I'm just suggesting that it still boils down to choice -- not fate.
Almost all spending is choice. A person could choose to live in a tent, forage for wood and water from a river, eating just rice and beans with hikes through forests as entertainment (maybe picking some berries along the way or getting free scraps from dumpsters etc). The costs of such a lifestyle would probably be somewhere less than $2k/year. That's enough to "exist", and there are people in this country that live such a lifestyle. All spending about the absolute bare minimum to meet the needs of survival is choice, not fate. I'd never suggest otherwise.
My point was that "what choices" people make is based on what they find they enjoy, and people who enjoy more expensive things will need more money to accommodate a lifestyle that allows them to do such things than a person who enjoys walking in the woods, camping, and eating rice and beans every day.
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We're in a co-op, but in Canada they actually have less rent control than the market - non-existent, really. Co-ops operate under a different set of laws, so while normal rentals are capped at a certain % per year (changes every year, but 3% is common), there is virtually no limit as to how much co-ops can increase. In the recent past, there have been 40%+ increases for some units, for example. This year we're probably looking at 20-25%, which is still manageable, but getting borderline. So I have a pretty good idea how our time here will eventually end - with a massive increase in rent that pushes us to find a cheaper place.
Does your Co-op have a min and max income requirement? They did where I grew up in the Maritimes, so I am wondering how feasible they are for professionals with six figure salaries during their career. It could be awesome for someone like me post FIRE, and may make my dream of moving to Victoria more acheivable now that real estate is insane there.
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My house has a spare bedroom which we use, but don't need, and we keep the whole thing a pretty comfortable temperatures. I also drive more than I really need to but my car (and fuel) is provided by my work. We eat brand name biscuits. I selected item 2.
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Related to the low number reporting being a true Mustachian, I think the set-up of the answers may've led people to select the "less extreme" options, either because they didn't hit all the requirements listed for true Mustachianism (including biking everywhere) or just because they don't view themselves as the most extreme people on the board. The responses are drawing a normal distribution curve. I bet if we set the answers to have Mustachianism as the third option with ERE-level and aesthetic (or something) below it, we would still see a normal distribution curve and a lot more people would be reporting that they're Mustachians.
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I was interested to see how many people are living the Mustachian life, vs just trying to be fiscally responsible. For my purposes here, fiscally responsible means spending less than you earn while having at least a 10% savings rate (the minimum recommend to be financially secure at "normal" retirement age for "normal" people).
Personally, I've been fiscally responsible for a long time, and I have "some" Mustachian habits, but no one would mistake my lifestyle for Mustachian overall (though very "LBYM FIRE-style"). A good amount of my spending would be considered "face punch worthy" by most "true Mustachians" I'd wager. If I wanted a "textbook" Mustachian lifestyle I'd be FIRE already. I'm okay waiting until my late 40's (6-8 years from now) instead to finance the lifestyle I think I'd rather have however.
What about you?
I don't think a savings rate of 10% really qualifies as living below your means. Unless you assume that you are going to die early or pretty significantly decrease your spending later on, can you really save 10% and keep your spending roughly stable in retirement? Maybe for some low earners, that plus social security will allow you to avoid a drop in spending. How many years would you have to save 10% to replace your income? Would 40 years do it?
As for me, I'm somewhere between LBYM-FIRE style and just plain old LBYM.
My current rate is more LBYM-FIRE Style, but I started late enough and have an expensive enough lifestyle that I will be close to 60 before I can replace my income (although I guess I could cheat that earlier if I counted social security). Hoping that current $24k of childcare costs will drop significantly as the kids get older, which could maybe put me firmly in the LYBM-FIRE style.
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Being a baby boomer I have been frugal most of my life and our friends were too. Now at 63 we are traveling more, eating out more and going to more entertainment then ever before because we have both the time and $.
This is where we are - we’ve always been careful with money, because we haven’t had too much of it. Now the kids are out of the house, and for the first time we’re able to do some things just because we want to.
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Related to the low number reporting being a true Mustachian, I think the set-up of the answers may've led people to select the "less extreme" options, either because they didn't hit all the requirements listed for true Mustachianism (including biking everywhere) or just because they don't view themselves as the most extreme people on the board. The responses are drawing a normal distribution curve. I bet if we set the answers to have Mustachianism as the third option with ERE-level and aesthetic (or something) below it, we would still see a normal distribution curve and a lot more people would be reporting that they're Mustachians.
This is my issue with the question. If you spend 25k per year (and outright own your home) that looks "Mustachian," while if you spend 50k/year and are renting I think most people would say that is "normal."
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With the choices provided, I have to pass on voting as I can disqualify each one as not applicable to me.
I'll take my 70 to 80% savings rate, which I had long before I ever heard of MMM.
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$25k/yr is awesome. That's half a regular mortgage in my area, so needless to say it's useful to list the area you live or just go by percentage of income you live off of if you want to flex your frugal muscles for the forum.
In terms of the forum 'going soft' I think you should instead think about how awesome it is that more and more people are jumping on board and making progress.
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We're in a co-op, but in Canada they actually have less rent control than the market - non-existent, really. Co-ops operate under a different set of laws, so while normal rentals are capped at a certain % per year (changes every year, but 3% is common), there is virtually no limit as to how much co-ops can increase. In the recent past, there have been 40%+ increases for some units, for example. This year we're probably looking at 20-25%, which is still manageable, but getting borderline. So I have a pretty good idea how our time here will eventually end - with a massive increase in rent that pushes us to find a cheaper place.
Does your Co-op have a min and max income requirement? They did where I grew up in the Maritimes, so I am wondering how feasible they are for professionals with six figure salaries during their career. It could be awesome for someone like me post FIRE, and may make my dream of moving to Victoria more acheivable now that real estate is insane there.
There's a range when you first apply (about 33K-90K-ish right now I think), but nobody cares after that, unless you're applying for subsidy (in which case there's annual income verification). The purpose of co-ops is to build stable long-term communities, so we don't kick people out for eventually making too much money - we encourage them to stay and volunteer their skills and knowledge to benefit the community.
Every co-op has different income requirements - some are really low, some really high, and some non-existent. And other requirements. Some are language-specific (here in Vancouver we have a few Francophones ones and at least one Chinese one), or specific to other groups (like artists). And each one operates independently, and has its own way of doing things. I'd say you would really need to contact the individual ones you want to move into to see if they're the right fit for you.
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We're in a co-op, but in Canada they actually have less rent control than the market - non-existent, really. Co-ops operate under a different set of laws, so while normal rentals are capped at a certain % per year (changes every year, but 3% is common), there is virtually no limit as to how much co-ops can increase. In the recent past, there have been 40%+ increases for some units, for example. This year we're probably looking at 20-25%, which is still manageable, but getting borderline. So I have a pretty good idea how our time here will eventually end - with a massive increase in rent that pushes us to find a cheaper place.
Does your Co-op have a min and max income requirement? They did where I grew up in the Maritimes, so I am wondering how feasible they are for professionals with six figure salaries during their career. It could be awesome for someone like me post FIRE, and may make my dream of moving to Victoria more acheivable now that real estate is insane there.
There's a range when you first apply (about 33K-90K-ish right now I think), but nobody cares after that, unless you're applying for subsidy (in which case there's annual income verification). The purpose of co-ops is to build stable long-term communities, so we don't kick people out for eventually making too much money - we encourage them to stay and volunteer their skills and knowledge to benefit the community.
Every co-op has different income requirements - some are really low, some really high, and some non-existent. And other requirements. Some are language-specific (here in Vancouver we have a few Francophones ones and at least one Chinese one), or specific to other groups (like artists). And each one operates independently, and has its own way of doing things. I'd say you would really need to contact the individual ones you want to move into to see if they're the right fit for you.
Thanks, this is really good to know and eye opening. It might be an option for me in retirement, it sounds like not now due to income level. It also sounds like if you have a professional job, you should get into one as a fresh out, when salaries are lower, or have to wait until you retire. Either way, it is something people should know more about.
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$25k/yr is awesome. That's half a regular mortgage in my area,
$25K would be a bad year for me. My bare bones is $15K. I'm in a LCOL area - home has been paid off for about 13 years, but it certainly wasn't the cheapest one I could find, or my bare bones would be even less.
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Thanks, this is really good to know and eye opening. It might be an option for me in retirement, it sounds like not now due to income level. It also sounds like if you have a professional job, you should get into one as a fresh out, when salaries are lower, or have to wait until you retire. Either way, it is something people should know more about.
If you're actually an artist and not just on MMM, I would definitely recommend an artist-focused one - they tend to be super nice (and very well decorated) and have great communal workshops and stuff. If FIRE Artist is just your handle, and you're as artistically-challenged as me, ignore this.
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$25k/yr is awesome. That's half a regular mortgage in my area, so needless to say it's useful to list the area you live or just go by percentage of income you live off of if you want to flex your frugal muscles for the forum.
In terms of the forum 'going soft' I think you should instead think about how awesome it is that more and more people are jumping on board and making progress.
I think that this is true, and I find the 30k hang up to be puzzling and not useful. I aspire to have a similar level of middle class lifestyle as MMM, but have to get there on a single income in a different country, and different COL, in different market conditions. Straight off there are differences that make it not valuable to compare on a dollar for dollar, or even savings rate level.
Excluding my mortgage payments, I live off of the equivalent of 34k USD/yr. not bad for where I live. I could absolutely pay off my house tomorrow, and cut back a bit more, all to say, yes, I live on 30k/yr, but who gives a fuck?
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I drive a new SUV with a 3 year loan, live in a 4 year old 3,000 sq foot house in one of the best neighborhods of Columbus, Ohio, vacation multiple times per year and my savings rate (in terms of student loan principle(paid off this year) plus home principle plus 401k plus savings account) is almost 60%. Central Ohio is cheap. Sometimes I don’t realize how cheap it is until I come here. I guess I’m lbym with a Mustachian savings rate. I would give that stuff up or red wine or “clean” food or about 50 other wants to FIRE in 5 years instead of 8. My advice to mustacheans is leave the coasts for 10 years and go back there when you can afford it. I’d venture I could hit 75-80% savings rate in Ohio if I gave up 95% of my wants.
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Thanks, this is really good to know and eye opening. It might be an option for me in retirement, it sounds like not now due to income level. It also sounds like if you have a professional job, you should get into one as a fresh out, when salaries are lower, or have to wait until you retire. Either way, it is something people should know more about.
If you're actually an artist and not just on MMM, I would definitely recommend an artist-focused one - they tend to be super nice (and very well decorated) and have great communal workshops and stuff. If FIRE Artist is just your handle, and you're as artistically-challenged as me, ignore this.
Full time artist is my FIRE plan, I am going to night school to get a fine art certificate and working on my artist resume and portfolio until I FIRE in 3 to 5 years. I think I would qualify then. Now, I am Jane average engineer slogging away to financial freedom.
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Not a true mustachian, but somewhere in the middle. We try to live as frugally as possible while enjoying things in life that bring us joy. Things like fancy cars, clothes, and gadgets doesn't bring us joy. My wife and I travel as often as we can while I like to play a casual round of golf once or twice a month. We don't eat at fine dining restaurants and prefer hole-in-the-wall type of establishments while we share our meals. As long as we set a fixed amount of savings per month, we are okay with spending the rest should we choose to do so (we don't). We just like the flexibility of it all should we have the impulse to spend/buy something. Granted, our savings rate isn't what you would call average (we save at least 50% of our monthly net income) so take this with a grain of salt.
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Living below our means. Saving a ton but not pinching every penny.
We would probably be more Mustachian if we hated our jobs. But we actually like our jobs just fine.
Our goal is to stash away as much as we can so that we can be financially independent before before the overlords figure out a way to proletarianize our work and grind us down, as they have with so many others... and/or society becomes so oligarchical and stratified that there is no market to support what we do anymore.
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I think some people are "drowning in the details". Maybe I should have been more clear in the polling choices instead of posting examples of attributes...
1. I follow every piece of advice given by MMM religiously and live as cheaply as I can possibly do so.
2. I do a lot of the stuff discussed by MMM, but I'm still doing some stuff on purpose that is obviously not in lock-step with the "MMM teachings".
3. I save a lot of money so I'll be FI nice and early, but I also spend a lot of money, not really subscribing to a number of the suggestions/advice from MMM.
4. I save a decent amount of money but don't really follow MMM, nor am I shooting to be able to retire super early. Comfortably retiring when i start taking SS should be just fine.
5. In debt, learning to one day be in a decent place financially.
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I put myself in the kinda category. I should retire a good ten years before my peers, which isn't bad considering when I got serious about investing.
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For me it's all about making deliberate spending decisions. Recognizing what you value and prioritizing where your money goes. The particulars are irrelevant.
No matter how Mustachian you might be, there's always someone who spends less than you and earns more. If you're paying attention to what you spend and what you truly value, you're doing it right.
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I'm Mustachian, but only for the money.
Take away all the money stuff, I don't know how mustachian I would be. I don't like biking. It hurts my butt. I don't like meet-ups. I am an introvert, and I hate small talk. I don't like fixing things or getting my hands dirty. I like to talk about ideas. I don't like to implement anything. I like to eat red meat. I like to watch sports. I have 3 pairs of New Balance just because I like the way they look. I own a treadmill, which I walk on as I watch Black Mirror. I do sometimes go on news diets. About every 10 years, I'll donate about a hundred bucks to my local radio station.
I hate working, and I hate having to have a job, and I hate being told what to do. I'm here because Pete's financial cookbook seems to work sufficiently well, and there are a ton of people on this forum who are more knowledgeable and more entertaining than Pete. When i get tired of the forum again, I'll nuke all my posts and leave for 6 months.
My kids are young and and my DW is minutes from her dream job so we're not moving for the next 10-15 years. If I didn't have the kids or the DW, I'd probably just try to get to like 400K and then move to Thailand, and see what happens. Since I have the DW and kiddies, I'm instead going to aim for 5 more years of high-paying work; that would take me to 43 and 700/800K. At that point, I'll try to get a job at the local library because that was my favorite job that I had in college. I'm not really cut out for actual work.
This is the best, most honest thing I have seen on this forum in a while.
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I should have read the thread before answering I think!
Spending is about $80k but that includes:
* an 80% ltv mortgage we just started at $25k/yr piti which allows us to extract former home equity to cash which is great when our mortgage is a fixed 30yr 3.625%.
* An $15k/year Pre-K bill for our son. Gulp.
Take those out and we're at $40k other spend. We mostly bus and bike but own two cars (2000 and 2009's) which collectively get 7000 miles for year and on hich I do most of the work. Too much dining out (3meals per week) for sure but no lunches out. Healthcare spend is pretty significant at maybe $7k. A bit too much personal allowance for each of us but then again, I hardly spend mine and have been helping family out.
Anyway, we save 50%+ and could almost fire especially if aca kicked in subsidies.
Picked kinda mustachian. I think we could reach there without much trouble if we weren't full time working. And we're working towards better.
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Is it more important to keep this community "hardcore" and eschew all others who fail to follow the "religion"?
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Maybe, it is good to have others who modify their lives in small ways that don't make them hardcore, but is still an improvement for the environment and their personal finances.
...is the worry that the "softies" will infect the "hardcore" with their spendy ways???
If our household were earning $30K, $40K or even $50K -> we'd be very thrifty, hardcore mustachians by necessity.
Since our household income is north of $250K -> we spend roughly $50K/yr and save roughly $100K/yr for a married couple with several pets (not including child support which will be ending soon). So, we fall into the third category. On Bogleheads, we are considered hardcore and failing to live a full life because we don't spend more...good thing I like to participate by providing my answers without getting wrapped up in living up to the expectations at bogleheads or mmm.
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I think some people are "drowning in the details". Maybe I should have been more clear in the polling choices instead of posting examples of attributes...
1. I follow every piece of advice given by MMM religiously and live as cheaply as I can possibly do so.
2. I do a lot of the stuff discussed by MMM, but I'm still doing some stuff on purpose that is obviously not in lock-step with the "MMM teachings".
3. I save a lot of money so I'll be FI nice and early, but I also spend a lot of money, not really subscribing to a number of the suggestions/advice from MMM.
4. I save a decent amount of money but don't really follow MMM, nor am I shooting to be able to retire super early. Comfortably retiring when i start taking SS should be just fine.
5. In debt, learning to one day be in a decent place financially.
Well unless MMM is living in a cardboard box down by the river and eating government cheese I highly.doubt he (or anyone else here) is living as cheaply as they can ;-). I live a regular middle class Millionaire Next Door kind of life on much less than MMM. However I don't have dependants and I have had many options in life that allowed me to live on less than the average person - such as the ability to use the VA for medical care for free. A bunch more too. So while living a very low cost mustachian life style allowed me to LBYM and save and tetire early, even on a low salary, I could live cheaper.
Yes, please read everything as literal as you possibly can, because that's clearly how it was meant given the context....oh wait, no, that's not right at all...
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LBOM. We're not young, and we're going to keep working until our second kid is finished with college, in about 8 years (we might not exactly last that long, but it's currently the plan). If he gets partial scholarships, or decides to go someplace that's not crazy expensive, we'll stop sooner. That puts us squarely in "used-to-be-retirement age" age, but not what people currently tend to do. It also lets us retire while we're still in good enough shape to have some serious adventures.
(I know the whole "pay for college" thing is a subject of much debate, and I'm not going to discuss it here. That alone probably says where we are.)
We're still paying for a mortgage in an insanely expensive housing market, and raising two teenagers -- our food bills alone make us un-mustachian. And paying for things like soccer and music lessons put us well out of mustachian-territory.
Really, we're in it for the environmentalism. And the importance of choosing "what has value to you?" and spending on that, but not things that don't. And teaching our kids that consumerism is a big never-ending scam. We ride our bikes most places, hardly ever eat out, fix things ourselves, volunteer a bunch, build our community, and try to find work that's meaningful.
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I think some people are "drowning in the details". Maybe I should have been more clear in the polling choices instead of posting examples of attributes...
1. I follow every piece of advice given by MMM religiously and live as cheaply as I can possibly do so.
2. I do a lot of the stuff discussed by MMM, but I'm still doing some stuff on purpose that is obviously not in lock-step with the "MMM teachings".
3. I save a lot of money so I'll be FI nice and early, but I also spend a lot of money, not really subscribing to a number of the suggestions/advice from MMM.
4. I save a decent amount of money but don't really follow MMM, nor am I shooting to be able to retire super early. Comfortably retiring when i start taking SS should be just fine.
5. In debt, learning to one day be in a decent place financially.
Well unless MMM is living in a cardboard box down by the river and eating government cheese I highly.doubt he (or anyone else here) is living as cheaply as they can ;-). I live a regular middle class Millionaire Next Door kind of life on much less than MMM. However I don't have dependants and I have had many options in life that allowed me to live on less than the average person - such as the ability to use the VA for medical care for free. A bunch more too. So while living a very low cost mustachian life style allowed me to LBYM and save and tetire early, even on a low salary, I could live cheaper.
Yes, please read everything as literal as you possibly can, because that's clearly how it was meant given the context....oh wait, no, that's not right at all...
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Joking dude! See little smiley winky face. My point was that we all can probably live cheaper than we do. Most of us, even us lower expenses MMM/ERE type people, chose not too.
I apologize. I miss stuff like that in Tapatalk too often, so I should know to look for it by now. Sorry :(
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My husband and I FIRE'd. He was never super Mustachian, but we've gone full-Mustache during certain periods of our lives.
After FIRE, I randomly became self employed for no good reason other than I like it. Our assets kept escalating - in part due to over-saving and in part due to my income.
We have no kids. When we die, all of our money goes to charities involving animals and the environment. We started to wonder why we were being to frugal - so the cats could inherit more?
So we started spending more. Husband has an easier time with increased day-to-day spending, which doesn't really excite me. I'm more a big-ticket person (a screened porch, a big donation to a local nature camp for kids, converting acreage to native prairie, etc), plus services to reduce chores.
It's not a mustachian lifestyle. We track our spending and make sure our assets are still growing, but otherwise, we just do what we want.
I'm not a great influence, so I try not to post too much. But I like the community, so I hang around.
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Regarding the discussion on accounting for "normal expenses" that you don't have, I don't think such things should be included in a person's spending number (as they're not spending money on it). However, I think anytime the number's being used for something that isn't "just personal" (i.e. your case study, your information, etc), a "caveat" should be included. "I spend $2,000/year, however I live with my rich parents who provide free housing, food, utilities, cars, boats, and a private jet as well as access to their 12 houses around the world" is a far cry from "I spend $2,000/year and live wonderfully" which doesn't mention the parents supporting them in an extravagant lifestyle.
For instance, my plan is to allot ~$60k/year for spending in retirement, with a paid off house in an average cost of living area, and with the VA covering my medical expenses. Someone spending that including a mortgage ($12k/year for me currently) and covering their own health insurance and medical bills (upwards of $10-15k for an individual in my situation without subsidies) would have a significantly different "personal spending" allowance ($60k for me vs $35-40k available for them after the bills I won't have).
As of this morning, almost 40% of respondents either identify as Mustachian or kinda-Mustachian. I think that's pretty good honestly. I think if I had a lower income I'd probably shoot for being kinda-Mustachian myself. At my income, as a single guy with no kids, however, I'm content to just save enough to retire in my 40's and maintain my current lifestyle (well, likely make my lifestyle a little better as I won't be going to work so I'll definitely enjoy myself more lol). I think it would be interesting to see how income plays a role in people's choices to "fit" into each category, though I'm sure a poll or something could be set up to determine that I'm not sure how it would be done and don't have the interest in setting it up. I'd hypothesis that many people with lower incomes would be more likely to adopt more of the advice of MMM than those with higher incomes, though I'm sure there are some in every income category that would defy that.
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I answered #3 Live Below Your Means but still spend a lot only because our mortgage is astronomical (in my opinion). We live in a very HCOL area and chose a townhome near mass transit and in a really good school system because A) we value shorter, car free commutes, and B) we value high quality education for our three kids. That pushed us into a high monthly mortgage. And this is lower cost housing compared to the single family homes in our area. But seeing $3700 come out every month is rough.
Aside from that, I feel like our spending is well optimized. We have one six year old vehicle for our family of 5, I meal plan every week, and am very conscious of what purchases we make. We save around 38% of our income, which goes toward 529's, 401K's, and our mutual fund.
My DH's government salary is nice but after housing and other basic living expenses we only have the above percentage left to save. I am in the process of working on bringing in more income though so that we can increase our savings. That's the only way I can see us saving more until the little guys are done with pre-school and begin public elementary school.
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This is my issue with the question. If you spend 25k per year (and outright own your home) that looks "Mustachian," while if you spend 50k/year and are renting I think most people would say that is "normal."
This is where I'm at. My home is paid in full and I spend around $20K/year (some years a little more depending on what needs to be done to the house, some less, so it averages out to that).
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We've reached a level of NW that could easily support our not so Mustacian lifestyle. Still working for healthcare benefits and addicted to the firehose of savings were racking up.
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Most of my professional colleagues think I’m a lunatic for this lifestyle. Meanwhile I think they’re nuts for owning $200K cars, especially in this climate. One guy is buying a helicopter. WTF? Sure, I’m the one making crazy choices...
This really made me laugh out loud.
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I'm Mustachian, but only for the money.
Take away all the money stuff, I don't know how mustachian I would be. I don't like biking. It hurts my butt. I don't like meet-ups. I am an introvert, and I hate small talk. I don't like fixing things or getting my hands dirty. I like to talk about ideas. I don't like to implement anything. I like to eat red meat. I like to watch sports. I have 3 pairs of New Balance just because I like the way they look. I own a treadmill, which I walk on as I watch Black Mirror. I do sometimes go on news diets. About every 10 years, I'll donate about a hundred bucks to my local radio station.
I hate working, and I hate having to have a job, and I hate being told what to do. I'm here because Pete's financial cookbook seems to work sufficiently well, and there are a ton of people on this forum who are more knowledgeable and more entertaining than Pete. When i get tired of the forum again, I'll nuke all my posts and leave for 6 months.
My kids are young and and my DW is minutes from her dream job so we're not moving for the next 10-15 years. If I didn't have the kids or the DW, I'd probably just try to get to like 400K and then move to Thailand, and see what happens. Since I have the DW and kiddies, I'm instead going to aim for 5 more years of high-paying work; that would take me to 43 and 700/800K. At that point, I'll try to get a job at the local library because that was my favorite job that I had in college. I'm not really cut out for actual work.
A lot of this is me. A couple things not so much. But good on you for stating things that many feel, but refuse to admit.
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I love sailing and would really enjoy owning a cottage - I also don't own either a boat or cottage because of the cost. Rather, I considered what it is about both experiences that I enjoy (being around water, nature, and the joy of tinkering) and have found ways to get that same joy from less expensive activities. I find that making those choices takes some introspection about my priorities and motivations. These days, I'm more interested in doing that deliberate thought work than I have been in the past when I was known to spend a fair bit on stress-relieving distractions. It wasn't that I needed spa days / fancy clothes / dinner out, they were all distractions from a life that made me unhappy. Even now that I've restructured things I still have the odd day when I'm tired and want an easy solution now, I spend to get it, even though it often results in sub-optimal happiness (for instance, delivery food, short car rides, online shopping driven by emotions or boredom).
Personally, I see a great value in scrutinizing my own spending and in using the forum to see how others have learned to give zero fucks about pretenses and appearances so that I can be inspired to do the same. Basically, if you can't enjoy life without a $200k car (or whatever it is that you're defensive about), then you should probably give some thought as to what you get from having it, and why that's important to you.
It's not about being unable to enjoy life without spending more, it's about enjoying life more with things that cost more. I enjoy my life now. I enjoyed my life when I lived on a submarine with 150 other people and spent practically nothing for months at a time (well, I still paid my rent and nominal utility costs for a vacant apartment). I enjoyed my life when I shared a small 2 bedroom apartment with a friend and my girlfriend at the time. I've enjoyed the overwhelming majority of my life, whether I was earning next to nothing or I was earning six-figures a year.
I can say unequivocally that I, personally, find my life MORE enjoyable now that I can afford more luxurious activities/things/experiences that I find enjoyable. When my vacations cost a couple tanks of gas so I could go stay with family for a week and sleep in, maybe playing some video games or swimming in my parent's pool, that was enjoyable. It wasn't nearly as enjoyable to me as my week in the Bahamas diving 3-4 times a day on an all-inclusive live-aboard dive trip however. The former cost less than $200 for the week and the latter was thousands for the same time period, but my enjoyment of the latter made it "worth it" to me. I can also afford to do those things and still save enough to retire in my 40's, so I don't see a good reason to not spend the money on those things I enjoy just to retire a year or two earlier in my 40's. It's all about balancing desires - the desire to be financially independent vs the desire to have the things/experiences/activities that more money can afford. Others may dislike working enough that they would rather forego such experiences and that's fine. I'm not going to tell anyone they have to spend $XYZ in order to have an enjoyable life. Conversely, however, I'm not going to tell anyone that they are screwing up by, in my opinion, responsibly spending their money to have the things that bring them joy in life.
I'm not spending money to impress other people, I'm spending money on the things that bring me joy and comfort. Doing that while still saving and investing responsibly seems like a pretty good balance between the extremes of saving and spending to me. I'm not going to look down on people for choosing a different balance between savings and spending though (well, I'll look down on those that don't save at all and I probably think negatively about the far extreme savers as well, but I don't think such people are represented here in general).
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Not Mustachian. Our savings rate is 33% but we make around 400K so we also spend a lot. But we are at $1.3M so far at 40 and should save a lot more before we retire.
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Our overhead is about $8000/month. So that's just not Mustachian, I guess. Depends on how you define it, maybe.
We have two kids and both of us work, so right there that's $2k out the door per month.
Mortage and HOA fees in a HCOL come to $2200 for a 3 bedroom, 2 bath, 850 square foot condo in an unimpressive neighborhood.
Mustachian things:
1. Scratch cooking (but Hawaii has notoriously expensive groceries, so we still have a $700/month grocery spend)
2. Very old cars and short commutes (however, can't bike; need to do kid dropoffs/pickups and there are highways involved in our commutes)
3. $500/year on clothes for a family of four
4. Travel hacking
5. No cable, almost no entertainment that isn't free
6. Almost all furniture is from Craigslist
But the big thing we do that is not Mustachian is give away a fairly substantial amount of money despite the fact that we're not FI yet. And we don't really want to retire because we love what we do. We would like to work in a way that was more flexible and took less time. But our savings rate is only around 20%. Giving is at around 15%.
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It seems like there's never an option for: "Spends less than $30k/yr while living in a moderately priced home in a nice neighbourhood and driving cars like clowns and still having a decent savings rate while being 'low income' (<$50k for the purposes of this forum)."
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Well put. It sounds like your vacation spending is deliberate and does bring you the value in terms of joy for the investment.
What I had hoped to convey was that spending on things that make you truly happy isn't the problem, as much as spending on the things that you think will make you happy or keep up with the Jones's. That's the sort of spending that I used to do FAR too much of, and now try to work on. Personally, I struggle a lot with "what-will-people-think-itis" and so when I see spending choices that seem extravagant, I default to assuming that they're made to maintain appearances. These assumptions and not expressing myself well when I'm feeling philosophical are ongoing challenges.
Yeah, spending money just to impress others is wasteful imo. Perhaps there are people who derive happiness from impressing others though... if so I guess it wouldn't be a complete waste? I've never been of that opinion myself. I definitely agree with the sentiment that spending money to "keep up with the Jones's" is usually a really really ridiculous idea, however prevalent it may be.
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Well put. It sounds like your vacation spending is deliberate and does bring you the value in terms of joy for the investment.
What I had hoped to convey was that spending on things that make you truly happy isn't the problem, as much as spending on the things that you think will make you happy or keep up with the Jones's. That's the sort of spending that I used to do FAR too much of, and now try to work on. Personally, I struggle a lot with "what-will-people-think-itis" and so when I see spending choices that seem extravagant, I default to assuming that they're made to maintain appearances. These assumptions and not expressing myself well when I'm feeling philosophical are ongoing challenges.
Yeah, spending money just to impress others is wasteful imo. Perhaps there are people who derive happiness from impressing others though... if so I guess it wouldn't be a complete waste? I've never been of that opinion myself. I definitely agree with the sentiment that spending money to "keep up with the Jones's" is usually a really really ridiculous idea, however prevalent it may be.
I'm not sure why, but I can't fathom how spending money to impress others could create any kind of real happiness. Such a person has to be compensating for something... Low self esteem? Overall loneliness? Massive amounts of debt? I just don't know. I honestly would like to hear from someone that is actually happy as a result of "keeping up." Maybe it would open my mind up a bit. How can one be happy if they prioritize maintaining a good image in others' eyes before maintaining a good image in their own eyes?
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Well put. It sounds like your vacation spending is deliberate and does bring you the value in terms of joy for the investment.
What I had hoped to convey was that spending on things that make you truly happy isn't the problem, as much as spending on the things that you think will make you happy or keep up with the Jones's. That's the sort of spending that I used to do FAR too much of, and now try to work on. Personally, I struggle a lot with "what-will-people-think-itis" and so when I see spending choices that seem extravagant, I default to assuming that they're made to maintain appearances. These assumptions and not expressing myself well when I'm feeling philosophical are ongoing challenges.
Yeah, spending money just to impress others is wasteful imo. Perhaps there are people who derive happiness from impressing others though... if so I guess it wouldn't be a complete waste? I've never been of that opinion myself. I definitely agree with the sentiment that spending money to "keep up with the Jones's" is usually a really really ridiculous idea, however prevalent it may be.
I'm not sure why, but I can't fathom how spending money to impress others could create any kind of real happiness. Such a person has to be compensating for something... Low self esteem? Overall loneliness? Massive amounts of debt? I just don't know. I honestly would like to hear from someone that is actually happy as a result of "keeping up." Maybe it would open my mind up a bit. How can one be happy if they prioritize maintaining a good image in others' eyes before maintaining a good image in their own eyes?
I gave up trying to understand what makes other people happy when I first learned that I had friends who enjoyed running. They'll run for hours, have to put on bandaids or some crap because the running would otherwise cause their bodies to actually blister and/or bleed. Not to mention the cramps and panting and sore muscles for days and ... well, suffice it to say that I consider running to be an activity you engage in because failure to run will cause your death, not something enjoyable. However, there are people who do it for fun... weirdos though they may be... lol
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Well put. It sounds like your vacation spending is deliberate and does bring you the value in terms of joy for the investment.
What I had hoped to convey was that spending on things that make you truly happy isn't the problem, as much as spending on the things that you think will make you happy or keep up with the Jones's. That's the sort of spending that I used to do FAR too much of, and now try to work on. Personally, I struggle a lot with "what-will-people-think-itis" and so when I see spending choices that seem extravagant, I default to assuming that they're made to maintain appearances. These assumptions and not expressing myself well when I'm feeling philosophical are ongoing challenges.
Yeah, spending money just to impress others is wasteful imo. Perhaps there are people who derive happiness from impressing others though... if so I guess it wouldn't be a complete waste? I've never been of that opinion myself. I definitely agree with the sentiment that spending money to "keep up with the Jones's" is usually a really really ridiculous idea, however prevalent it may be.
I'm not sure why, but I can't fathom how spending money to impress others could create any kind of real happiness. Such a person has to be compensating for something... Low self esteem? Overall loneliness? Massive amounts of debt? I just don't know. I honestly would like to hear from someone that is actually happy as a result of "keeping up." Maybe it would open my mind up a bit. How can one be happy if they prioritize maintaining a good image in others' eyes before maintaining a good image in their own eyes?
I gave up trying to understand what makes other people happy when I first learned that I had friends who enjoyed running. They'll run for hours, have to put on bandaids or some crap because the running would otherwise cause their bodies to actually blister and/or bleed. Not to mention the cramps and panting and sore muscles for days and ... well, suffice it to say that I consider running to be an activity you engage in because failure to run will cause your death, not something enjoyable. However, there are people who do it for fun... weirdos though they may be... lol
I am no runner by any means, but I have felt the "runner's high" that you hear people talk about. It's a real thing. Endorphins start flowing and the running becomes effortless. It is hard on your joints, which is why I don't do it often (I already have a form of arthritis at 26...sucks, but whatever). But I do it often enough to maintain decent cardiovascular shape (paired with the rowing machine). There was one time I was "feeling it" so much that I started to get scared because it felt like I was no longer controlling my own body.
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It seems like there's never an option for: "Spends less than $30k/yr while living in a moderately priced home in a nice neighborhood rural area and driving cars like clowns and still having a decent savings rate while being 'low income' (<$50k for the purposes of this forum) with 5 kids."
Tweaked as above, I agree!
FWIW, I chose option 1. We can't really bike here (distances too great, and tubas and upright basses are hard to transport), and big old farmhouses are cheap to buy but wasteful to heat, so those specifics are off. However, I feel like we are living the spirit of Mustachianism - cook from scratch, DIY as much as possible, save 50%+, live an intentionally happy intentionally less wasteful life.
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It seems like there's never an option for: "Spends less than $30k/yr while living in a moderately priced home in a nice neighborhood rural area and driving cars like clowns and still having a decent savings rate while being 'low income' (<$50k for the purposes of this forum) with 5 kids."
Tweaked as above, I agree!
FWIW, I chose option 1. We can't really bike here (distances too great, and tubas and upright basses are hard to transport), and big old farmhouses are cheap to buy but wasteful to heat, so those specifics are off. However, I feel like we are living the spirit of Mustachianism - cook from scratch, DIY as much as possible, save 50%+, live an intentionally happy intentionally less wasteful life.
Impressive! :)
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LBYM.
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Well put. It sounds like your vacation spending is deliberate and does bring you the value in terms of joy for the investment.
What I had hoped to convey was that spending on things that make you truly happy isn't the problem, as much as spending on the things that you think will make you happy or keep up with the Jones's. That's the sort of spending that I used to do FAR too much of, and now try to work on. Personally, I struggle a lot with "what-will-people-think-itis" and so when I see spending choices that seem extravagant, I default to assuming that they're made to maintain appearances. These assumptions and not expressing myself well when I'm feeling philosophical are ongoing challenges.
Yeah, spending money just to impress others is wasteful imo. Perhaps there are people who derive happiness from impressing others though... if so I guess it wouldn't be a complete waste? I've never been of that opinion myself. I definitely agree with the sentiment that spending money to "keep up with the Jones's" is usually a really really ridiculous idea, however prevalent it may be.
I'm not sure why, but I can't fathom how spending money to impress others could create any kind of real happiness. Such a person has to be compensating for something... Low self esteem? Overall loneliness? Massive amounts of debt? I just don't know. I honestly would like to hear from someone that is actually happy as a result of "keeping up." Maybe it would open my mind up a bit. How can one be happy if they prioritize maintaining a good image in others' eyes before maintaining a good image in their own eyes?
I've met a few - they consider keeping up with the Joneses as the price of doing business. They want a big peer group that delivers invitations to social gatherings. To participate they need certain kinds of things (car, clothes, house in the right neighborhood) and only certain discussion topics are valid. The right politics and religion play into this as well. Some of these people participate for for so long that their "choices" are second nature and they can't imagine living any other way. Some stereotypes have been born out these groups of people.
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Well put. It sounds like your vacation spending is deliberate and does bring you the value in terms of joy for the investment.
What I had hoped to convey was that spending on things that make you truly happy isn't the problem, as much as spending on the things that you think will make you happy or keep up with the Jones's. That's the sort of spending that I used to do FAR too much of, and now try to work on. Personally, I struggle a lot with "what-will-people-think-itis" and so when I see spending choices that seem extravagant, I default to assuming that they're made to maintain appearances. These assumptions and not expressing myself well when I'm feeling philosophical are ongoing challenges.
Yeah, spending money just to impress others is wasteful imo. Perhaps there are people who derive happiness from impressing others though... if so I guess it wouldn't be a complete waste? I've never been of that opinion myself. I definitely agree with the sentiment that spending money to "keep up with the Jones's" is usually a really really ridiculous idea, however prevalent it may be.
I'm not sure why, but I can't fathom how spending money to impress others could create any kind of real happiness. Such a person has to be compensating for something... Low self esteem? Overall loneliness? Massive amounts of debt? I just don't know. I honestly would like to hear from someone that is actually happy as a result of "keeping up." Maybe it would open my mind up a bit. How can one be happy if they prioritize maintaining a good image in others' eyes before maintaining a good image in their own eyes?
Well, you could define "real happiness" to basically answer your question with a no true scotsman argument applied to happiness, but generally:
(1) it's validation. Whatever insecurities they have, it sort of validates that they are at least as "successful" as their peer group (or aspirational peer group).
(2) it may satisfy a human, social desire to reciprocate: If there is a peer group where it is routine for members of the group to invite the rest of the group to (a) go on boat outings, (b) visit their vacation property, (c) come to nice dinners at their nice home, (d) come to social events/parties/fundraiser that they sponsor or support, (e) use their tickets to sporting events, etc., and one person of the group cannot reciprocate, they are naturally going to feel left out.
(3) It lubricates social interactions: Sort of related to number 2, but People have a tendency to feel comfortable in groups of people who are like them, and keeping up with the jones provides some superficial indications that you are alike and maybe makes it easier to maintain social cohesion within a group. If you show up to gatherings in clothes that are noticeably not as nice, it's a natural human tendency to feel insecure or out of place about it. Similarly, if your social group has much nicer houses than yours, it would be a natural human tendency to be a little insecure about inviting people to come to say dinner.
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We are a solid LBYM - FIRE style family that enjoys some wants.
- Cook at home 90% of the time and mostly from scratch.
- DIY haircuts for the kids.
- Max out 401ks, Roth IRAs, 529s (up to tax deduction max)
- Inexpensive clothing worn until it is worn out (I'm wearing clothes from high school today and my 20 year reunion is in 2 years)
- Habitual library users
and so on....
But... we have two cars and one is a clown SUV, we have a face-punchable phone plan (we keep our phones for years and years and years), we ski every weekend in the winter (on season passes with used equipment and we bring our own lunch), our kids play sports (with used equipment when possible) and we have a dog. Oh and we give quite a bit because we feel it is important and aligns with our values.
Basically, we hit our saving goals first and use the remainder responsibly and we are on track to retire in our 40s. We could have been hard core and retired in our 30s, but we did not enjoy the hard core lifestyle and have found a happy middle-ground for us.
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I have a car note and a condo fee, sometimes get my condo cleaned by professionals, and get my toenails maintained by professionals. BUT I don’t have expensive taste and I live in a modest place and drive a modest chariot in a HCOL area. Working on making my luxurious expenses less frequent.
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I think MMM himself has made it pretty clear that his family was not denying themselves...they just took a hard look at what their spending was really doing for them and then eliminated spending that wasn't adding value to their lives. So, as many others have commented, I think the descriptions in the poll are too restrictive or maybe missing the point :)
That said, I think my husband and I are mostly in the first category....although we spend more than $30k/yr. This is because 1) we rent in a HCOL area, and 2) we choose to put our child in FT daycare (we have no family nearby and we both earn enough that the opportunity cost of a SAHP is quite high at this time). Our non-childcare non-housing spending is less than the most recently reported MMM numbers.
I think what really makes us "mustachian" is that we think pretty critically about our spending and lifestyle. We've figured out that a lot of things that people spend money on (e.g. eating out, gym memberships, retail therapy, driving anywhere within 5 miles of home) don't really make us happier or healthier or give us more free time. So we don't spend money on those things anymore and boom...savings. For things we do enjoy that cost money, we're willing to spend a little effort first figuring out if there are ways of doing those things for free/less cost than you might initially expect. Usually this comes down to being willing to plan more in advance or do things at off-peak times. I think MMM has a blog post on this topic, A Peak Life is Lived Off Peak (https://www.mrmoneymustache.com/2013/04/07/a-peak-life-is-lived-off-peak/). e.g. we love to visit beautiful national parks, and are willing to commit to going on certain dates months in advance to secure good (and cheap) camping spots, rather than planning at the last minute and getting stuck in some crummy overpriced hotel near the park. Our toddler is now at an age where he really enjoys going to kid-oriented museums, I plan our trips in advance so we can use a library discount program and go for free or 50% off. We like to be able to visit family members out of town/country, so we decide on the trips we want to do 1-2 years in advance and then my husband figures out the credit card churning we need to do to accumulate points/miles for a free or very cheap trip. I guess some people would say oh, I like to be able to act spontaneously, but really...our system means we have a fun activity/outing/vacation planned at least once a month, which seems pretty sweet to me. And because our planning in advance keeps the cost very low (or nonexistent), we still feel pretty free to cancel stuff if something better comes up at the last minute (rare!).
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Since some face-worthy comments about expensive cars and vacations costing thousands of dollars have been mentioned, I suppose I'll add my own here. 12 years ago, I bought a brand new car, my first and only. I admit it. It was in the low 20's for cost, and I paid ca$h, but that was tough to spend the dough at the time. Well, all these years later, it has low miles and is still in great condition inside and out. On the plus side, I haven't traveled for expensive vacations or blown much money on anything else since I bought that car. Like Spartana, I'm able to have a great time without spending a lot of dough, although maybe not as much fun as her. I've found that spending a lot of money doesn't necessarily mean it's going to be more fun or fulfilling. Ironically, my projected FIRE budget for next year includes a nice cushion for fun/travel of nearly $30K/yr based on a 4% WR. That doesn't mean I'll actually spend that much, but the growth of my stash has made it possible. If history is any indication, my frugal tendencies will result in me spending well south of that requiring less than a 3% WR while still enjoying retirement. But at least I have more options open to me by having the cash available. I didn't want finances to be an impediment during FIRE. I certainly wouldn't want to retire on bare bones.
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What I had hoped to convey was that spending on things that make you truly happy isn't the problem, as much as spending on the things that you think will make you happy or keep up with the Jones's.
This is a really good point. While DH and I live well below our means (~65% savings rate) we're still nowhere near Mustachian by most measures. However, the members of this group that are Mustachian in ways that I am not are a great resource for helping me think about what spending truly makes me happy versus what I've been programmed to think will make me happy (or worse yet, spending I haven't really thought about at all!).
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Mr. R. is Mustachian to the core - he's a natural:)
I bounce between being a creampuff Mustachian-LBYM and extreme frugality, but that's just me and depends entirely on my/our goals and focus at any given time.
What resonates with me the most is:
1. constant optimization - now that is something that comes natural to me:)
2. mindful examination of our values, lifestyle and ultimate goals - turned out to be a good thing for our relationship too:)
3. finding that there are plenty of people who care about the earth and our stewardship - especially young people are awesome in that regard.
Finances are missing from my list, because they are rolled up into point one and two - when you put your money where your values reside, your path becomes clear.
MMM is so much more than a blog about FIRE. I think all of us who are fully engaged in this forum find challenges, ideas, motivation and satisfaction in taking the next step - past money - the step to living our best life.
Thanks to this forum we have a solid plan for Mr. R's future RE and we have already reached basic FI.
Copying Pete? Ha, that would be a laugh - we are in an entirely different situation-age group, but the lifestyle-philosophy and the math apply and rather magically produce the desired results.
Once I am done with one last goal you may firmly count me in the just LBYM category forever. Mr. R. will remain Mustachian forever, but will occasionally let himself be corrupted by me:) - that works for us.
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I think I said LBYM-FIRE-style, because we hit FI around 50 and are currently at a 40-50% savings rate -- but damn we spend a lot of money. I have zero desire to be MMM -- grew up poor and so had to DIY everything/live on a strict budget by necessity, and even all these years later it brings me pleasure to have someone else clean my house for me (seriously, sometimes I feel like doing a little happy dance because I do not need to scrub the toilet). OTOH, I also have no desire to keep up with the Joneses and get much more happiness from knowing I have a big 'stache than I do from spending money.
I am in it largely for the badassery -- I succumbed to lifestyle inflation and the ease of outsourcing everything, and I like the reminder that I am capable of handling whatever needs to get done, that I do not need all of the luxury to be happy, and that it is not healthy to have everything you want when you want it. Except housecleaners, of course. :-) One of my coworkers just gave me one of those name things you put on your desk, like you see at the bank. It says "unfuckwithable." Highest praise I can possibly imagine, and I am ridiculously thrilled and feel like a total success.
FWIW, hedonic adaptation is really, truly, a thing. I have two happy places in my head: hanging off the West Caicos Wall at about 90' down; and on the chair lift at Taos with the ridiculously blue sky and white snow. But you know what? I am not overall "happier" than I was before I could afford all of that.* I am 100% confident that had DH never introduced me to skiing and scuba diving that I would have found other places and things that brought me that same feeling of inner peace -- because that comes from within me. Heck, I can almost get there sitting on my back deck on a perfect early fall evening with the fire pit going and blue time overhead.
So, yeah, I am all about spending money on "experiences" that bring me happiness. But I could have achieved the same level of happiness for a metric shit-ton less money if I had never taken up skiing or scuba diving and spent that time exploring cheap/free fun stuff closer to home.
Now, I am in no way an anti-consumer purist, and I do believe some "things" can bring extra happiness. I truly cannot imagine being quite as happy on a daily basis without my StupidCar. I love driving with the top down, I love the feel of downshifting into the corner, I love the sound of SportPlus mode (especially when the engine does that little blip when the revs drop), and I lovelovelove the security of knowing that my own "oh shit" level is maybe 10% of the car's. But, (a), I wouldn't have enjoyed it nearly as much if I hadn't waited until FI to get it, because I would have been conscious that this "thing" was interfering with higher-priority needs and wants (e.g., kids' education). And more to the point, (b), the list of "things that actually bring you happiness" is way, way shorter than the list of "things that you think will bring you happiness." I can tell you from personal experience that the thing that brings the most happiness and contentedness in life, beyond a happy and healthy family, is knowing that you don't need this shit and can walk any time you want to. All the other stuff is just the cherry on top of the sundae.
*Well, I am, but it's not because of the fancy stuff I can afford to do. It's because I no longer have sufficient fucks to spare about a lot of the stupid stuff I used to get so worried about.
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I'm shocked by these results - only 7% true mustaches. The way people jump on people on this forum I would have thought this would be way higher.
I am somewhere between categories 2-3 but picked 3 because I take some pretty expensive trips.
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I don't know. What defines Mustachian? DH and I spend less than $30k/year, though we can afford to spend more. We are only in our 30s and already FIRE. Bikes? No. My town isn't bikeable unless you live close to downtown, where houses cost more. But we only own 1 fuel-sipping car and only drive it an average of once per week. In some ways, I splurge on fancy things. But in other ways, I'm more frugal than even MMM himself.
MMM is trying to teach being frugal and that you don't need as much as you think you do to retire. As long as you can apply that to your life, I don't think it matters if you bike a couple of miles through the snow to buy groceries or not.
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I suppose just LBYM. I went in for a laser hair removal consultation recently, and decided to just go ahead and start the sessions instead of shopping around. So I guess I wasn’t mustachian about my own facial hair.
FYI, this is necessary for my mental health and not just me being too lazy to continue shaving the lasered areas.
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I was really excited about MMM when I started reading. It was a good fit for me because I already live at a lower standard than my peers, would *never* car commute and I believe intentionally designing my life. Plus I think he makes the important point that choosing to have kids or pets is a consumption choice like any other. You do not need multiple dogs or kids, or any dogs or kids, just because other people are doing it.
BUT I've gotten turned off by some of the extreme stuff on the forum. Going to six grocery stores to save on food. People who keep their houses at less than 70 degrees in the winter and make everyone suffer to save a few dollars! And you can pry my gym membership out of my cold, dead hands. Frugality is about intentionally spending on things that matter to you--not cutting every luxury out of your life. My gym spending is less than $100 a month (for two gyms!) and in exchange, I get health, fitness, self-confidence, and energy. How is that not worth it? Yeah, yeah, I know I could just do ten million pushups at home, but you can't get the motivation and inspiration of a gym, or the same level of fitness, at home.
I know I could save more if I cut all the wine out of my life and replaced it with water (which I mean both literally and metaphorically). But I like work, and the idea of giving up every luxury in order to quit sooner has no appeal. After all, the purpose of life is to enjoy life.
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I was really excited about MMM when I started reading. It was a good fit for me because I already live at a lower standard than my peers, would *never* car commute and I believe intentionally designing my life. Plus I think he makes the important point that choosing to have kids or pets is a consumption choice like any other. You do not need multiple dogs or kids, or any dogs or kids, just because other people are doing it.
BUT I've gotten turned off by some of the extreme stuff on the forum.
There are people of all degrees of Mustashianism here. Don't let a few extremist comments turn you off.
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We live below our means.... we spend a lot and we save a lot. I'm already retired but I have other businesses now. The lil woman will never retire she says. Most of the people that work at the museum are in their 50-60-70-80's and have made high 6 figures for many years.
It's been so long for me since I had a job I'm not sure how it would feel but I can tell you this, even when you own a business, if all you have to pay for is electric/food/water/cable/etc, your work day feels so different. I still start work like an employee but I know that if I want to take off a day or a week or a year.... I can. Even if I had a job..... I could take off ever how long I wanted.
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Funny, when people mention Mustachian, it is totally a fabricated online thing. I've met a few Mustachians through the site, but nobody really knows what it means or how to quantify how Mustachian Mustachians are.
On the other hand, LBYM is a well known path to riches. You have your income, you save some or most of it, and you are good to go once your savings start to cover your need for income. It becomes a judgement call, on how much passive income you want and how much you are wanting to part ways with the active income requirement. It's more what I will teach my children than 'Mustachianism'.
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I'm very good with my income, which is the reason I survived the last 10 years well below the poverty line. Finally making middle class wages, but it'll be a few years before I have capital. (Student debt.)
Clean CC, car's paid off, bike everywhere in the summer months. I'm on track to rent a cheap 1bdrm within walking distance of work by next winter. Currently renting a room in a shitbox apartment with a roommate. Really tired of not having my own space.
There's been some lifestyle expansion since I got my current job - I own a TV now! Netflix! - but every once in a while I'll have the "so where did you go on vacation this year?" conversation at work and realize I'm nowhere near what my coworkers consider "normal".
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I think I said LBYM-FIRE-style, because we hit FI around 50 and are currently at a 40-50% savings rate -- but damn we spend a lot of money. I have zero desire to be MMM -- grew up poor and so had to DIY everything/live on a strict budget by necessity, and even all these years later it brings me pleasure to have someone else clean my house for me (seriously, sometimes I feel like doing a little happy dance because I do not need to scrub the toilet).
Complete opposite here, growing up we had hired help clean our home and iron our shirts. It's always struck me as completely undesirable, irrespective of cost.
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I'm in my late 20's and said LBYM FIRE. I actually sat down for the first time and estimated my spending and savings rate (which I've avoided doing since that risks putting me in a downward spiral of budgeting to strictly then saying fuck it and not budgeting at all). I didn't go too detailed, but my spending is $25-$30k for a HCOL area, which leaves me at a 50-60% savings rate. Maxed out my 401k and my IRA last year with plans to do so again this year, have all my insurance payments planned out already, as well as a slush/shit-hit-the-fan fund. I drive my paid off 2011 car and my only debt is my mortgage. I've figured out a good balance of eating out and going out with friends and staying in.
Honestly, real plans of FIRE are pretty far from my mind right now. Other than making sure I save a lot, I'm not giving it much thought right now.
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~50% pre-tax savings rate but I buy race parts for a sports car, so, whatever
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I voted LBYM - FIRE, but I think a huge part of it comes down to who you are comparing yourself too. Peers with a similar income would consider me as tight as a duck's arse with my 2/3rds savings rate. When I read the blogs of young people on here with 1/3 the income we have and I see how much effort they are putting in to save money I feel like a bloated plutocrat and wouldn't feel comfortable calling myself mustachian in their company.
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I'd rather be retired younger to do all the stuff I want to do every single day then work years longer in order to have a week or 2 of luxury travel or a few expensive things. Finding ways once retired to spend weeks, months or even years living and diving (or skiing or climbing or hiking or travelling or whatever) in cool places as often as you want in much less expensive ways is better for some of us then being stuck in a job everyday for years longer to have some short lived luxuries. I was joking with another forum member @dude that while my ER life might not be about heliskiing off a live aboard sailboat in Iceland for my week off work vacation, I'm able to live and ski cheaply in a ski town every single day of the week all season long. Can't do that when you're stuck at your job for many extra years so you can get to FIRE much later so you can quit to go ski every single day all season long ;-).
Amen, spartana! As you know, my FIRE date is a function of my LEO retirement date (i.e., 20 years of LEO service), so I've always known I had to grind it out until then. But the payoff is enormous in terms of a pension, benefits, and high salary during working years. And though I'll be retiring at the relatively old age of 54, fourteen of the years between H.S. and now were spent in the Navy, college, and law school, such that I'll have only really worked in my career for @ 21.5 years. I think I've gamed the system pretty well! Now I get to go be a ski/climbing/surfing bum in my 50's with a firehose of passive income for the rest of my life.
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It's not about being unable to enjoy life without spending more, it's about enjoying life more with things that cost more. I enjoy my life now. I enjoyed my life when I lived on a submarine with 150 other people and spent practically nothing for months at a time (well, I still paid my rent and nominal utility costs for a vacant apartment). I enjoyed my life when I shared a small 2 bedroom apartment with a friend and my girlfriend at the time. I've enjoyed the overwhelming majority of my life, whether I was earning next to nothing or I was earning six-figures a year.
I can say unequivocally that I, personally, find my life MORE enjoyable now that I can afford more luxurious activities/things/experiences that I find enjoyable. When my vacations cost a couple tanks of gas so I could go stay with family for a week and sleep in, maybe playing some video games or swimming in my parent's pool, that was enjoyable. It wasn't nearly as enjoyable to me as my week in the Bahamas diving 3-4 times a day on an all-inclusive live-aboard dive trip however. The former cost less than $200 for the week and the latter was thousands for the same time period, but my enjoyment of the latter made it "worth it" to me. I can also afford to do those things and still save enough to retire in my 40's, so I don't see a good reason to not spend the money on those things I enjoy just to retire a year or two earlier in my 40's. It's all about balancing desires - the desire to be financially independent vs the desire to have the things/experiences/activities that more money can afford. Others may dislike working enough that they would rather forego such experiences and that's fine. I'm not going to tell anyone they have to spend $XYZ in order to have an enjoyable life. Conversely, however, I'm not going to tell anyone that they are screwing up by, in my opinion, responsibly spending their money to have the things that bring them joy in life.
I'm not spending money to impress other people, I'm spending money on the things that bring me joy and comfort. Doing that while still saving and investing responsibly seems like a pretty good balance between the extremes of saving and spending to me. I'm not going to look down on people for choosing a different balance between savings and spending though (well, I'll look down on those that don't save at all and I probably think negatively about the far extreme savers as well, but I don't think such people are represented here in general).
My brother from another mother! This is me to a T. My favorite things in life to do are rock/ice climb, snowboard (esp. in the backcountry), surf, dive, hike, camp. Some of these things I can do within a 2-3 hour drive of where I live. But there are vastly superior opportunities to do these things in other locations, like the intermountain west, Costa Rica, Mexico, etc., etc. So I spend money (some would say a lot, but relative to my income, it's not) traveling to these places to pursue these passions. THAT'S what I want to do more of in retirement - a LOT more of. So I've leveraged a high-income career and some reasonably frugal measures into a shitload of savings (that will be in addition to a pension and SS), such that I'll have a lot of money to do these things with in retirement. Though even there, I choose the cheapest flight/rental car/hotel options. I'm not a 4-star accommodations kind of guy ; just need a clean bed and a shower in a decent location. I personally just couldn't ever see myself living (alone, even!) on $25k, but for those who do, I'm impressed and psyched for them. So for sure I'm LBYM-FIRE, and not "Mustachian" (as it applies to MMM himself).
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wait a second... I live in one of the best neighborhoods of Columbus, Ohio... and i also drink red wine and eat "clean food"...
I drive a new SUV with a 3 year loan, live in a 4 year old 3,000 sq foot house in one of the best neighborhods of Columbus, Ohio, vacation multiple times per year and my savings rate (in terms of student loan principle(paid off this year) plus home principle plus 401k plus savings account) is almost 60%. Central Ohio is cheap. Sometimes I don’t realize how cheap it is until I come here. I guess I’m lbym with a Mustachian savings rate. I would give that stuff up or red wine or “clean” food or about 50 other wants to FIRE in 5 years instead of 8. My advice to mustacheans is leave the coasts for 10 years and go back there when you can afford it. I’d venture I could hit 75-80% savings rate in Ohio if I gave up 95% of my wants.
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I voted LBYM - FIRE, but I think a huge part of it comes down to who you are comparing yourself too. Peers with a similar income would consider me as tight as a duck's arse with my 2/3rds savings rate. When I read the blogs of young people on here with 1/3 the income we have and I see how much effort they are putting in to save money I feel like a bloated plutocrat and wouldn't feel comfortable calling myself mustachian in their company.
I chose "kinda mustachian" but "LBYM FIRE style" could've been my answer as well. And I agree that who you are comparing yourself too makes quite a difference.
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I'm LBYM. I think my quality of life is extraordinarily luxurious, but for an attorney it's somewhat modest. In reality it is a form of arbitrage; I pull in an attorney salary while keeping a middle-class lifestyle in a LCOL city.
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I've actually worked longer then you (22 years) even though FIREd younger.
If I was in your position I probably would have worked longer too but I was chaffing at the bit and, not being high income, the extra years wouldn't have made a huge difference in my finances as they would a low spending high earner. Plus I was worried I wouldn't hevable to keep my fitness levels up to a high level to do things later in life. You have managed to do that while working and are super fit so won't be an issue for you. Not sure I could have managed the same working an extra 10 or more years. Glad I quit when I did but my FIRE is probably leaner then most people would like even though its pretty damn luxurious to me.
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Yeah, my no-nonsense 40-hour workweek has allowed me plenty of free time to stay fit, pursue hobbies and stay sane. Though I'm currently on the DL! Wrecked myself pretty good on my snowboard out in Utah a week and a half ago. Out of work last week and this week, hopefully go back next week. 6-8 week recovery time though, so no adventures for me for the next few months (have to bail on an April snowboarding trip to Colorado, hoping to be healthy enough to surf in Mexico in June!). SUUUUUCKS being injured!
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We're high earners, so still able to save a significant amount of money/month, while indulging in plenty of face punch worthy behaviors. (Kids in sports, house in HCOL bay area, own cars, etc). We're saving about $125K/year, plan to retire early (me, husband is happy to keep working) & have evaluated all of the tradeoffs of fundamentally rethinking our lives to spend less. We are as satisfied as we can be with our current prioritization & tradeoffs.
On the biking thing, I actually enjoy biking to work. However, biking adds commuting time, and I pay a nanny for my time, so my mustachian identity is in conflict. :-)
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^^ sorry to hear that but any reason for time off work ;-).
I wreaked myself in Utah a couple of weeks ago too - and then wreaked myself in Vegas in...um...a different way (brain cells RIP). Now also recuperating and binge posting here. Just wanted to show that us ERE-level mustache have fun too. It's not just a bleak life of thin gruel and lukewarm tap water ;-).
HAHAHA! Oh, believe me, I've never thought otherwise about you!
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I'm more "LBYM," especially considering how I want to travel often, and plane tickets and lodgings aren't really cheap, even if you get "deals" it's still spending money. So for this reason I can't be "Mustachian." I can't live life just not traveling and seeing the world. I've read some blogs where people who have a high savings rate say they're content with just watching netflix at home - it's just not for me. I also prefer to eat well and don't focus on solely what is the cheapest food.
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I chose Kinda Mustachian, because we have a relatively low savings rate and are still not quite there on the expenses downward curve.
I know not all polls can reflect all people, but the major option I feel is missing is something like "Early Downshifter. Your savings rate is low and you're not aiming for FIRE, but that's because you use Mustachianism to be able to work fewer hours at a lower-paying job you like right now, rather than frontloading your working life and then retiring completely."
We do follow most of MMM's advice about the expenses side of the equation. No car, buy second hand, cook at home, keep utilities low... But that means my husband can work at his lower-paying job and I can be a part-time feckless artist and take time off to look after children RIGHT NOW. We're certainly on track to retire at 65, and maybe earlier depending on how things go, but we have minimal grind. I look at the friends we graduated with who are working crazy hours in stressful jobs and think about how glad I am that we don't do that.
I also often think about how rich we are. Sure, I'm conscious of our expenses and there are a few things we could do but don't (cleaner...), but whenever we have a real problem we always have the option of just throwing money at it. I was worrying the other day about whether we should take our whole hospital bag while staying a few nights with a friend as I'm 37 weeks pregnant. My husband pointed out that if it comes to it, we'll just give our friend our debit card and a shopping list and spend a few hundred quid on stuff we don't really need. Oh, what a hard and deprived life we lead!
I know that time is your greatest friend and that lots of people don't discover MMM until they're already in debt and drowning in financial commitments, but I really wish early downshifting were talked about more. Once you have an emergency fund and some retirement savings (to compound until conventional retirement age), it's perfectly Mustachian to go part-time or change careers immediately. And it might seem safer and more "reasonable" to some of the 4% rule naysayers who dismiss the whole of Mustachianism because they don't want to work-then-FIRE. Downshifting is a lot more accessible as an idea.
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I feel like I'm between the 2nd and 3rd options, so I rounded 'up' to LBYM FIRE-style. We are frugal in the traditional ways (cooking at home, small place, 11 year old car + biking, etc.) but we spend a bit on things that we consider quality-of-life entries (hobbies, travel, charity).
I agree with shelivesthedream about downshifting. Being frugal means that 1. I can take time to go to grad school to get my education license, 2. SO and I spend less than a teacher's salary, so 2 incomes makes us feel crazy rich, and 3. I have the option of going half-time if I want more time to myself. It doesn't mean I have to give up my favorite things just because they're expensive; it DOES mean I can afford the time to make the most of my favorite things. It's pretty great.
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Why do so many people, think that those who buy nice things, ONLY do it to impress others? It’s like -
No one “actually” enjoys sports cars as a hobby, they “only” buy them to impress their friends. Or no one ever enjoyed a track day, or zooming through a quarter mile at 11 seconds? But about just an appreciation for the high quality?
I’ve ALWAYS loved cars and the sorts. I haven’t been able to have a sports car due to my traveling lifestyle and this no permanent home. I’d love to have a sports car some day and it would have nothing to do with impressing anyone. In fact, since I’m more frugal than I used to be, I’d almost be slightly embarrassed by it for that reason. The sports car I really want right now would cost me exactly 10 weeks in savings to buy at my current rate. I still don’t have it.
There are many other “nice” things I buy and appreciate that virtually no one I even know has ever heard of or would even know it costs a lot. Some of my clothing items for example are $$, yet most people would never know. I appreciate the quality, details, texture, etc.
Nothing nice that I buy has any intention of impressing anyone.
As for my spending, right now I could live comfortable off about $5k a month which is so so to me. I do contract work and wouldn’t accept a job under $12k/mo take home (currently at about 18-19k/mo take home) so I have a decent savings rate.
Since I work a ton, I’m fine splurging on some things. We go out to a nice date night every weekend (dinner.) we have steak usually 2 meals a week. Eat insanely healthy otherwise (count all our calories and macros).
I’m not mustachian but do live below our means. My wife is way more frugal than me (though she doesn’t work.)
One of the good things about the traveling for my work is we live in a 5th wheel typically. So no standard garage, super small living space. Keeps us from buying too much stuff knowing we live in about 350 sq ft between my wife and our dog.
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If we were fully frugalized we could retire likely earlier.
We save a lot right now either way so if it comes to a point where I end up hating my job in the future accelerating to "full Mustachian" would not be too hard.
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I chose Kinda Mustachian, because we have a relatively low savings rate and are still not quite there on the expenses downward curve.
I know not all polls can reflect all people, but the major option I feel is missing is something like "Early Downshifter. Your savings rate is low and you're not aiming for FIRE, but that's because you use Mustachianism to be able to work fewer hours at a lower-paying job you like right now, rather than frontloading your working life and then retiring completely."
We do follow most of MMM's advice about the expenses side of the equation. No car, buy second hand, cook at home, keep utilities low... But that means my husband can work at his lower-paying job and I can be a part-time feckless artist and take time off to look after children RIGHT NOW. We're certainly on track to retire at 65, and maybe earlier depending on how things go, but we have minimal grind. I look at the friends we graduated with who are working crazy hours in stressful jobs and think about how glad I am that we don't do that.
You describe our situation perfectly, but I still chose Mustachian because the description is 100% accurate for us. We don't own a car, we have a super cheap house and we make 30k , so we spend a lot less.
Our savings rate is of course "relatively" low (about 50% in the best months, but often more like 30-40%) but it's massive compared to most people on our income level and we live an extremely frugal live compared to almost everyone. We're not going to retire anytime soon because we're low income, but I guess you could say we're already parttime retired. I don't think you need to have a very high income / high savings rate to be considered mustachian.
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I don't think a savings rate of 10% really qualifies as living below your means. Unless you assume that you are going to die early or pretty significantly decrease your spending later on, can you really save 10% and keep your spending roughly stable in retirement? Maybe for some low earners, that plus social security will allow you to avoid a drop in spending. How many years would you have to save 10% to replace your income? Would 40 years do it?
Assuming a 6% real return on investments 10% savings rate for 40 years might be enough.
If you start out living on 90% of income, assume no real wage growth and 6% real investment returns, you end up with savings about 17x spending after 40 years. Social Security should be enough to cover the other 31% of spending in this case (you'd have to have income well beyond the second SS bend point for it to not be enough - somewhere around $11,000/mo in today's dollars)
The problem with a 10% savings rate is with lifestyle inflation. If wages and spending both grow 1% more than inflation, you only end up with savings about 13x spending. Social Security might not be able to cover the other 47% of your spending (SS fails with starting wage > $2300/mo, final wage > $3400/mo, retirement spending > $3000/mo - not too bad in a LCOL area). If real wage growth and lifestyle inflation are just 2% above inflation, savings would only be about 10x spending and SS would be very unlikely to cover the gap. Of course if real investment returns turn out better than 6% the lifestyle inflation might still work out with a 10% savings rate.
Someone who starts with 10% savings rate, experiences modest 1% real wage growth but does not increase real spending can easily retire in 35 years without relying on SS.
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I do bike everwhere. And my share of rent is $25/week. And I spend less than $30k.... but I don't think I'm very Mustachian. Despite my cheap rent, my savings rate isnonly about 65%. I have high hopes of kicking it up a notch!
I picked the 2nd option.
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LBYM, save a ton, but based on what I've read here we're no where near "true mustachian" and we're pretty good with that.
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I chose Kinda Mustachian, because we have a relatively low savings rate and are still not quite there on the expenses downward curve.
I know not all polls can reflect all people, but the major option I feel is missing is something like "Early Downshifter. Your savings rate is low and you're not aiming for FIRE, but that's because you use Mustachianism to be able to work fewer hours at a lower-paying job you like right now, rather than frontloading your working life and then retiring completely."
We do follow most of MMM's advice about the expenses side of the equation. No car, buy second hand, cook at home, keep utilities low... But that means my husband can work at his lower-paying job and I can be a part-time feckless artist and take time off to look after children RIGHT NOW. We're certainly on track to retire at 65, and maybe earlier depending on how things go, but we have minimal grind. I look at the friends we graduated with who are working crazy hours in stressful jobs and think about how glad I am that we don't do that.
You describe our situation perfectly, but I still chose Mustachian because the description is 100% accurate for us. We don't own a car, we have a super cheap house and we make 30k , so we spend a lot less.
Our savings rate is of course "relatively" low (about 50% in the best months, but often more like 30-40%) but it's massive compared to most people on our income level and we live an extremely frugal live compared to almost everyone. We're not going to retire anytime soon because we're low income, but I guess you could say we're already parttime retired. I don't think you need to have a very high income / high savings rate to be considered mustachian.
I'll be honest: I don't actually know what our savings rate is! Our income situation is a bit complicated - Mr SLTD has a regular salary but also gets free accommodation as part of his compensation, and my freelance income varies wildly. So I would calculate savings rate differently depending on whether I was looking at how much we put into investments or whether I was trying to ballpark years to FIRE (because of the house thing) - but then it's also different every year depending on my earnings, and we've had a bumpy few years with being given some money by relatives but also buying a house full of furniture at once in 2017 (which even if you do it all on the cheap has a big impact on a lower income) so our apparent savings situation keeps changing. Depending on how you look at it, it could be between 10% and 40% as a guess.
But I do think we have a little way to go on the expenses front, which was the main reason for only kinda Mustachian.
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I don't think a savings rate of 10% really qualifies as living below your means. Unless you assume that you are going to die early or pretty significantly decrease your spending later on, can you really save 10% and keep your spending roughly stable in retirement? Maybe for some low earners, that plus social security will allow you to avoid a drop in spending. How many years would you have to save 10% to replace your income? Would 40 years do it?
If you start out living on 90% of income, assume no real wage growth and 6% real investment returns, you end up with savings about 17x spending after 40 years. Social Security should be enough to cover the other 31% of spending in this case (you'd have to have income well beyond the second SS bend point for it to not be enough - somewhere around $11,000/mo in today's dollars)
The problem with a 10% savings rate is with lifestyle inflation. If wages and spending both grow 1% more than inflation, you only end up with savings about 13x spending. Social Security might not be able to cover the other 47% of your spending (SS fails with starting wage > $2300/mo, final wage > $3400/mo, retirement spending > $3000/mo - not too bad in a LCOL area). If real wage growth and lifestyle inflation are just 2% above inflation, savings would only be about 10x spending and SS would be very unlikely to cover the gap. Of course if real investment returns turn out better than 6% the lifestyle inflation might still work out with a 10% savings rate.
Someone who starts with 10% savings rate, experiences modest 1% real wage growth but does not increase real spending can easily retire in 35 years without relying on SS.
You are describing somebody with a much higher than 10% savings rate. At the end of thirty-five years, you're talking about a savings rate of over 35%. If somebody experiences real wage growth and keeps their savings rate at 10%, then their ability to retire actually gets pushed out. Obviously what actually happens is somewhere between the two, but much closer to the second approach than the first.
I guess my point is that if you are saving 10%, you are basically living exactly within your means, as it will take around 40 years to be able to replace your spending. But that's probably not right because I think I did the calculation using 4%, and a better comparison would be how long it takes to buy an annuity that replaces your spending.
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I don't think a savings rate of 10% really qualifies as living below your means. Unless you assume that you are going to die early or pretty significantly decrease your spending later on, can you really save 10% and keep your spending roughly stable in retirement? Maybe for some low earners, that plus social security will allow you to avoid a drop in spending. How many years would you have to save 10% to replace your income? Would 40 years do it?
If you start out living on 90% of income, assume no real wage growth and 6% real investment returns, you end up with savings about 17x spending after 40 years. Social Security should be enough to cover the other 31% of spending in this case (you'd have to have income well beyond the second SS bend point for it to not be enough - somewhere around $11,000/mo in today's dollars)
The problem with a 10% savings rate is with lifestyle inflation. If wages and spending both grow 1% more than inflation, you only end up with savings about 13x spending. Social Security might not be able to cover the other 47% of your spending (SS fails with starting wage > $2300/mo, final wage > $3400/mo, retirement spending > $3000/mo - not too bad in a LCOL area). If real wage growth and lifestyle inflation are just 2% above inflation, savings would only be about 10x spending and SS would be very unlikely to cover the gap. Of course if real investment returns turn out better than 6% the lifestyle inflation might still work out with a 10% savings rate.
Someone who starts with 10% savings rate, experiences modest 1% real wage growth but does not increase real spending can easily retire in 35 years without relying on SS.
You are describing somebody with a much higher than 10% savings rate. At the end of thirty-five years, you're talking about a savings rate of over 35%. If somebody experiences real wage growth and keeps their savings rate at 10%, then their ability to retire actually gets pushed out. Obviously what actually happens is somewhere between the two, but much closer to the second approach than the first.
I guess my point is that if you are saving 10%, you are basically living exactly within your means, as it will take around 40 years to be able to replace your spending. But that's probably not right because I think I did the calculation using 4%, and a better comparison would be how long it takes to buy an annuity that replaces your spending.
People with a savings rate of ~0% retire every year. A savings rate of 10% will allow someone to retire with minimal (if any) change in their lifestyle when "normal" assumptions about changes in life situation are considered (such as paying off a home about the same time as retiring, getting SS, medicare, etc etc, non-linear salary changes, etc). Here's an article on the 10% savings rule from a pretty well-respected financial expert of the research into it that he and Kitces did https://www.marketwatch.com/story/is-saving-10-for-retirement-enough-maybe-2018-01-04.
I'll post a summary quote from in the article:
Once these dynamics are accounted for, saving rates of 10% or less were “safe” for all but the highest earners over 40-year savings periods based on historical market returns and income provided by Social Security. Further, for the lowest-earning Americans, Social Security alone was sufficient for retirement, while earners at the 90th percentile had a safe savings rate of 13.1%.
For most of those retiring at "normal" retirement age, 10% is just fine generally. That doesn't mean it isn't helpful to save more or that it isn't necessary to save more if you want to retire early, but for the "average" person out there, a 10% savings rate is likely to work out just fine.
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I chose Kinda Mustachian, because we have a relatively low savings rate and are still not quite there on the expenses downward curve.
I know not all polls can reflect all people, but the major option I feel is missing is something like "Early Downshifter. Your savings rate is low and you're not aiming for FIRE, but that's because you use Mustachianism to be able to work fewer hours at a lower-paying job you like right now, rather than frontloading your working life and then retiring completely."
We do follow most of MMM's advice about the expenses side of the equation. No car, buy second hand, cook at home, keep utilities low... But that means my husband can work at his lower-paying job and I can be a part-time feckless artist and take time off to look after children RIGHT NOW. We're certainly on track to retire at 65, and maybe earlier depending on how things go, but we have minimal grind. I look at the friends we graduated with who are working crazy hours in stressful jobs and think about how glad I am that we don't do that.
I also often think about how rich we are. Sure, I'm conscious of our expenses and there are a few things we could do but don't (cleaner...), but whenever we have a real problem we always have the option of just throwing money at it. I was worrying the other day about whether we should take our whole hospital bag while staying a few nights with a friend as I'm 37 weeks pregnant. My husband pointed out that if it comes to it, we'll just give our friend our debit card and a shopping list and spend a few hundred quid on stuff we don't really need. Oh, what a hard and deprived life we lead!
I know that time is your greatest friend and that lots of people don't discover MMM until they're already in debt and drowning in financial commitments, but I really wish early downshifting were talked about more. Once you have an emergency fund and some retirement savings (to compound until conventional retirement age), it's perfectly Mustachian to go part-time or change careers immediately. And it might seem safer and more "reasonable" to some of the 4% rule naysayers who dismiss the whole of Mustachianism because they don't want to work-then-FIRE. Downshifting is a lot more accessible as an idea.
I wholeheartedly agree with this. My SO earns decent money, but deliberately chose a job that was less hours, shorter commute and less pay than either his previous job or the alternatives in Central London (although travel costs to the City start to outweigh additional salary anyway) He’d been through a period of lots of overtime, higher salary long hours and he was exhausted.
I am self employed and work quite a relaxed schedule. I bring in good money for the hours I do but I believe my mental health would suffer if I was doing a different job or more hours. I have choices because of financial decisions we made in the past (and, admittedly, some windfalls due to close family deaths)
We too are having a baby and came to MMM about 5 years ago. I see whatever mustachian principles we’ve manage to absorb as a way to make our lives have more ROOM in them. Retiring very early might not be an option for us, as our savings rate is not high enough. But MMM gave us direction and purpose to the LBYM ways we already had (we started investing shortly after we found him)
I like MMM’s uncompromising attitude, it gives the movement shape and character. But everyone is free to take what they need from the philosophy. And while we are not fully mustachian in many senses of the word, we don’t spend anywhere near the money that our peers do. And we have the benefit of knowing what can be achieved, if we were to choose to do some things differently in future.
Having the time and space *now* to raise a child or children, at 35 and 44, is much more valuable to us then working our arses off and spending much less to achieve a greater savings rate. Had we’d been given the kick up the bum 5 years earlier, before I went self employed and dropped income, things might be different. But we are still in a gloriously comfortable financial/working position compared to 99% of people we know and I’m very pleased with that.
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I don't think a savings rate of 10% really qualifies as living below your means. Unless you assume that you are going to die early or pretty significantly decrease your spending later on, can you really save 10% and keep your spending roughly stable in retirement? Maybe for some low earners, that plus social security will allow you to avoid a drop in spending. How many years would you have to save 10% to replace your income? Would 40 years do it?
If you start out living on 90% of income, assume no real wage growth and 6% real investment returns, you end up with savings about 17x spending after 40 years. Social Security should be enough to cover the other 31% of spending in this case (you'd have to have income well beyond the second SS bend point for it to not be enough - somewhere around $11,000/mo in today's dollars)
The problem with a 10% savings rate is with lifestyle inflation. If wages and spending both grow 1% more than inflation, you only end up with savings about 13x spending. Social Security might not be able to cover the other 47% of your spending (SS fails with starting wage > $2300/mo, final wage > $3400/mo, retirement spending > $3000/mo - not too bad in a LCOL area). If real wage growth and lifestyle inflation are just 2% above inflation, savings would only be about 10x spending and SS would be very unlikely to cover the gap. Of course if real investment returns turn out better than 6% the lifestyle inflation might still work out with a 10% savings rate.
Someone who starts with 10% savings rate, experiences modest 1% real wage growth but does not increase real spending can easily retire in 35 years without relying on SS.
You are describing somebody with a much higher than 10% savings rate. At the end of thirty-five years, you're talking about a savings rate of over 35%. If somebody experiences real wage growth and keeps their savings rate at 10%, then their ability to retire actually gets pushed out. Obviously what actually happens is somewhere between the two, but much closer to the second approach than the first.
I guess my point is that if you are saving 10%, you are basically living exactly within your means, as it will take around 40 years to be able to replace your spending. But that's probably not right because I think I did the calculation using 4%, and a better comparison would be how long it takes to buy an annuity that replaces your spending.
People with a savings rate of ~0% retire every year. A savings rate of 10% will allow someone to retire with minimal (if any) change in their lifestyle when "normal" assumptions about changes in life situation are considered (such as paying off a home about the same time as retiring, getting SS, medicare, etc etc, non-linear salary changes, etc). Here's an article on the 10% savings rule from a pretty well-respected financial expert of the research into it that he and Kitces did https://www.marketwatch.com/story/is-saving-10-for-retirement-enough-maybe-2018-01-04.
I'll post a summary quote from in the article:
Once these dynamics are accounted for, saving rates of 10% or less were “safe” for all but the highest earners over 40-year savings periods based on historical market returns and income provided by Social Security. Further, for the lowest-earning Americans, Social Security alone was sufficient for retirement, while earners at the 90th percentile had a safe savings rate of 13.1%.
For most of those retiring at "normal" retirement age, 10% is just fine generally. That doesn't mean it isn't helpful to save more or that it isn't necessary to save more if you want to retire early, but for the "average" person out there, a 10% savings rate is likely to work out just fine.
Well, those "normal" assumptions mean you aren't really saving 10% of your income, but more than 10%. Also that article jumps back and forth between talking about being able to retire and being able to retire without a significant adjustment to your lifestyle/spending, and I can't tell when it's talking about one and when it's talking about the other.
Also, this is somewhat of a quibble, but when you talk about living within your means, I'm not sure income from SS and Medicare should be included. While counting on them is a pretty safe assumption, I'm not sure future payments from a welfare program is living within your means. Obviously the medicare side of that is a lot harder to figure out as you can't just ignore the income, but if I can't at the very least replace my spending without social security income that is being provided by workers who will (hopefully) be by and large less well off than I am, then I will not feel like I have successfully lived within my means.
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Well, those "normal" assumptions mean you aren't really saving 10% of your income, but more than 10%. Also that article jumps back and forth between talking about being able to retire and being able to retire without a significant adjustment to your lifestyle/spending, and I can't tell when it's talking about one and when it's talking about the other.
Also, this is somewhat of a quibble, but when you talk about living within your means, I'm not sure income from SS and Medicare should be included. While counting on them is a pretty safe assumption, I'm not sure future payments from a welfare program is living within your means. Obviously the medicare side of that is a lot harder to figure out as you can't just ignore the income, but if I can't at the very least replace my spending without social security income that is being provided by workers who will (hopefully) be by and large less well off than I am, then I will not feel like I have successfully lived within my means.
You could read the entire study they did if you feel like it, and income streams that are "virtually guaranteed" should (imo) absolutely be included. So a retiree would include them and any reasonable plan would include them if anywhere near the age to utilize them. There's no good reason I can see for not including them beyond the "SS won't be around!" hype that's been going on for 50 years now, without SS going anywhere. You can decide what is "within" your means by any measure you'd like. I'm going to define it as "spending no more money than comes in", and that would include all sources of income, whether from a job, investments, interest, rental properties, pensions, annuities, SS, medicare benefits, etc. Most people don't tend to discount sources of income arbitrarily, but you're welcome to.
Alternatively, we could just use the common sense approach to determining if a 10% savings rate is enough for people to retire. Common sense tells me that the overwhelming majority of people save much less than 10% (~3-5% or so I think is historically about average). The overwhelming majority of people retire. Therefore, logic tells us that most people retire despite having not had a lifetime savings rate of 10%. Therefore, saving 10% of income for life would obviously be sufficient for people to retire.
That doesn't even get into the studies that show that spending, regardless of available resources, tends to decrease in retirement, making it even more affordable overall.
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Why do so many people, think that those who buy nice things, ONLY do it to impress others? It’s like -
No one “actually” enjoys sports cars as a hobby, they “only” buy them to impress their friends. Or no one ever enjoyed a track day, or zooming through a quarter mile at 11 seconds? But about just an appreciation for the high quality?
I’ve ALWAYS loved cars and the sorts. I haven’t been able to have a sports car due to my traveling lifestyle and this no permanent home. I’d love to have a sports car some day and it would have nothing to do with impressing anyone. In fact, since I’m more frugal than I used to be, I’d almost be slightly embarrassed by it for that reason. The sports car I really want right now would cost me exactly 10 weeks in savings to buy at my current rate. I still don’t have it.
There are many other “nice” things I buy and appreciate that virtually no one I even know has ever heard of or would even know it costs a lot. Some of my clothing items for example are $$, yet most people would never know. I appreciate the quality, details, texture, etc.
Nothing nice that I buy has any intention of impressing anyone.
As for my spending, right now I could live comfortable off about $5k a month which is so so to me. I do contract work and wouldn’t accept a job under $12k/mo take home (currently at about 18-19k/mo take home) so I have a decent savings rate.
Since I work a ton, I’m fine splurging on some things. We go out to a nice date night every weekend (dinner.) we have steak usually 2 meals a week. Eat insanely healthy otherwise (count all our calories and macros).
I’m not mustachian but do live below our means. My wife is way more frugal than me (though she doesn’t work.)
One of the good things about the traveling for my work is we live in a 5th wheel typically. So no standard garage, super small living space. Keeps us from buying too much stuff knowing we live in about 350 sq ft between my wife and our dog.
Do you actually spend $5k/month AND live in a 5th wheel? Without a sports car? If so, dammnnnn. Where's all the money going?
We question "nice things" because the vast majority of people don't question them. Most people buy new SUVs and pickups now. Do people haul more lumber or pull more cattle now compared to 20 years ago? Or is there a cultural trend of buying larger vehicles and larger houses and storing excess crap at Public Storage? (Yes, yes, and yes.)
People get very defensive about their motives (SUV drivers are hitting "Reply" right now). And maybe they've intently thought about their purchase and decided it does make sense for them. However, when everyone is doing it, it's worth some introspection. Is it you or is it marketing? Once purchased, do you still appreciate it 5 years down the road or does it lose its appeal after a few weeks? Do you flip through the Ikea catalog a la Fight Club looking for the latest fashion in home decor because, well, Ikea decided it's "in" this season and you've got to keep up?
(For the record, I have a sports car.)
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People get very defensive about their motives (SUV drivers are hitting "Reply" right now). And maybe they've intently thought about their purchase and decided it does make sense for them. However, when everyone is doing it, it's worth some introspection. Is it you or is it marketing? Once purchased, do you still appreciate it 5 years down the road or does it lose its appeal after a few weeks?
I think for many, the appreciation of a new SUV wears off somewhere between 2 and 5 years of ownership (faster if gas prices spike).
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LBYM, save a ton, but based on what I've read here we're no where near "true mustachian" and we're pretty good with that.
I think this is me as well.....
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I chose Kinda Mustachian, because we have a relatively low savings rate and are still not quite there on the expenses downward curve.
I know not all polls can reflect all people, but the major option I feel is missing is something like "Early Downshifter. Your savings rate is low and you're not aiming for FIRE, but that's because you use Mustachianism to be able to work fewer hours at a lower-paying job you like right now, rather than frontloading your working life and then retiring completely."
We do follow most of MMM's advice about the expenses side of the equation. No car, buy second hand, cook at home, keep utilities low... But that means my husband can work at his lower-paying job and I can be a part-time feckless artist and take time off to look after children RIGHT NOW. We're certainly on track to retire at 65, and maybe earlier depending on how things go, but we have minimal grind. I look at the friends we graduated with who are working crazy hours in stressful jobs and think about how glad I am that we don't do that.
I also often think about how rich we are. Sure, I'm conscious of our expenses and there are a few things we could do but don't (cleaner...), but whenever we have a real problem we always have the option of just throwing money at it. I was worrying the other day about whether we should take our whole hospital bag while staying a few nights with a friend as I'm 37 weeks pregnant. My husband pointed out that if it comes to it, we'll just give our friend our debit card and a shopping list and spend a few hundred quid on stuff we don't really need. Oh, what a hard and deprived life we lead!
I know that time is your greatest friend and that lots of people don't discover MMM until they're already in debt and drowning in financial commitments, but I really wish early downshifting were talked about more. Once you have an emergency fund and some retirement savings (to compound until conventional retirement age), it's perfectly Mustachian to go part-time or change careers immediately. And it might seem safer and more "reasonable" to some of the 4% rule naysayers who dismiss the whole of Mustachianism because they don't want to work-then-FIRE. Downshifting is a lot more accessible as an idea.
I'm with her.
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LBYM. Goal is Financial Integrity and I am building a big FU and Shit Happens stash but I don't have RE as a goal.
I prioritize my wellbeing and enjoying life in the now over my savings rate so I am definitely not MMM when it comes to stoicism. That said I have had 80% savings rate in the past and I am currently at 50% savings rate after taking more than a year off from work to enjoy some fun personal projects. So for me its just challenging how I live my life and spending on what matters to me.
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I chose Kinda Mustachian, because we have a relatively low savings rate and are still not quite there on the expenses downward curve.
I know not all polls can reflect all people, but the major option I feel is missing is something like "Early Downshifter. Your savings rate is low and you're not aiming for FIRE, but that's because you use Mustachianism to be able to work fewer hours at a lower-paying job you like right now, rather than frontloading your working life and then retiring completely."
We do follow most of MMM's advice about the expenses side of the equation. No car, buy second hand, cook at home, keep utilities low... But that means my husband can work at his lower-paying job and I can be a part-time feckless artist and take time off to look after children RIGHT NOW. We're certainly on track to retire at 65, and maybe earlier depending on how things go, but we have minimal grind. I look at the friends we graduated with who are working crazy hours in stressful jobs and think about how glad I am that we don't do that.
I also often think about how rich we are. Sure, I'm conscious of our expenses and there are a few things we could do but don't (cleaner...), but whenever we have a real problem we always have the option of just throwing money at it. I was worrying the other day about whether we should take our whole hospital bag while staying a few nights with a friend as I'm 37 weeks pregnant. My husband pointed out that if it comes to it, we'll just give our friend our debit card and a shopping list and spend a few hundred quid on stuff we don't really need. Oh, what a hard and deprived life we lead!
I know that time is your greatest friend and that lots of people don't discover MMM until they're already in debt and drowning in financial commitments, but I really wish early downshifting were talked about more. Once you have an emergency fund and some retirement savings (to compound until conventional retirement age), it's perfectly Mustachian to go part-time or change careers immediately. And it might seem safer and more "reasonable" to some of the 4% rule naysayers who dismiss the whole of Mustachianism because they don't want to work-then-FIRE. Downshifting is a lot more accessible as an idea.
This was a very useful lens. I keep going back & forth on whether I want to suck it up for a few more years & go full steam FIRE, or slow down now & keep working part time. I like your framing, @shelivesthedream
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You could read the entire study they did if you feel like it, and income streams that are "virtually guaranteed" should (imo) absolutely be included. So a retiree would include them and any reasonable plan would include them if anywhere near the age to utilize them. There's no good reason I can see for not including them beyond the "SS won't be around!" hype that's been going on for 50 years now, without SS going anywhere. You can decide what is "within" your means by any measure you'd like. I'm going to define it as "spending no more money than comes in", and that would include all sources of income, whether from a job, investments, interest, rental properties, pensions, annuities, SS, medicare benefits, etc. Most people don't tend to discount sources of income arbitrarily, but you're welcome to.
Agreed. My SS dollars will be just as useful as my cash and investments when the time comes. I've paid into SS all through my entire career including to this day, so it's not welfare as the previous poster mistakenly stated anymore than a government pension is welfare.
I decided to vote myself as mustachian because my barebones budget is about $1250/mo., despite a six figure income, which results in a savings rate over 80% and $15,000/yr for spending. I don't think I've spent over $20,000 in a year since 2009. I don't bike everywhere in this climate, but I do bike quite a bit in the warmer months, and I have a short commute to work and very low mileage on my 11 1/2 year old car. And while my house isn't the cheapest I could find, it's lower cost than most mentioned here due to the low cost of living area I live in, and it's been paid-for going on 14 years. And I had been living the same frugal lifestyle for decades, well before I ever heard of MMM or ever went to other early retirement websites.