Poll

Is the journey or the destination the most important when FIRING?

The journey is the most important. I don't worry about how long it takes to FIRE
15 (34.9%)
The destination is the most important. The faster I reach FIRE, the better
28 (65.1%)

Total Members Voted: 43

Author Topic: Is the journey or the destination the most important when FIRING?  (Read 2370 times)

helloyou

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The sun is coming back, and the lockdown un-tightening again, and there are now plenty of things to do with my friends.

A lot of them are big spender, recently some wanted to go to nice french restaurants, last week going to some thematic cocktail bars, visiting nice locations and so on. And it's quite tempting for me to join them but I'm not very keen to spend $100/night few times per week.

At the same time, I can't keep refusing activities and staying on my own. It's nice to go out and do something fancy and have fun.

And I remembered some quote from Charlie Munger who said that anyone who save less than he spend and invest in index funds regularly can only become rich after 20-30 years... As well as Warren Buffett who said that the journey to be rich is much more interesting than being rich itself. And for him it's fun doing that....


So I was wondering... is the journey the most important or the destination when looking to be FIRE?


Currently I save about 70-75% of my income... while puts me on track to be (true) FIRE within 5-7 years..... If I wanted, I can easily spend $300-500/week to go out, rent in a more central location, get a car and have a more luxurious life... And I'd still be able to save 40-50% of my income after that, which is still enormous by any standard.

So would that be such a problem if I save much less, let myself do all these expensive anti-mustachian things and FIRE in 8-10 years instead?


It's something in my mind at the moment, I don't dislike my job but I'd much prefer not working of course. But sometimes I feel like I'm going too far trying to save and life is way more than that.


So these days I allow myself to spend more... and not think about how much I wasted. Just getting some small pleasure and not worry about additional cost. What does spending $100 there and there represent in the grand scheme of things?

I only have 1 life... and I won't get any younger. Does it worth depriving myself just to get there faster?
« Last Edit: June 12, 2021, 03:20:54 PM by helloyou »

Sibley

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Re: Is the journey or the destination the most important when FIRING?
« Reply #1 on: June 12, 2021, 03:13:39 PM »
You're missing the obvious. This isn't just post pandemic - this is the same old same old, how do we socialize and enjoy ourselves with our friends who aren't frugal. The same solutions exist. You just need to implement them. Propose a backyard cookout, potluck style. Have a game night in the basement. Family picnic at the park. Whatever.

As for which is more important - both pre and post retirement its your life. Why should you decide to be miserable for years? Just because you're not spending money wildly doesn't mean you can't enjoy yourself.

PDXTabs

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Re: Is the journey or the destination the most important when FIRING?
« Reply #2 on: June 12, 2021, 03:58:03 PM »
I think that there is a happy medium there somewhere.

helloyou

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Re: Is the journey or the destination the most important when FIRING?
« Reply #3 on: June 12, 2021, 04:50:20 PM »
You're missing the obvious. This isn't just post pandemic - this is the same old same old, how do we socialize and enjoy ourselves with our friends who aren't frugal. The same solutions exist. You just need to implement them. Propose a backyard cookout, potluck style. Have a game night in the basement. Family picnic at the park. Whatever.

As for which is more important - both pre and post retirement its your life. Why should you decide to be miserable for years? Just because you're not spending money wildly doesn't mean you can't enjoy yourself.

Because its not that simple. Can't always find a cheaper version of the things. If they want to go to an exotic cocktail bar, I can't just decide to replace that at home lol. Same for restaurants.

I also can't see them suddenly becoming frugal and decide to just do things home...

Its also not just friends but also convenience of things... its ok to pay more for convenience. For example eating more premium food with more expensive brand instead of cheaper ones.

I'm not talking about spending wildly, but just to be way strict with frugality as long as savings still pills up?

Dreamer40

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Re: Is the journey or the destination the most important when FIRING?
« Reply #4 on: June 12, 2021, 05:19:11 PM »
The journey and the destination are often the same thing. The FIRE journey is all about finding the right lifestyle and price point you want for the rest of your life.

If you’re saving up so you can go out with friends later, don’t put it off, but instead add that to your current and long term budget. This is especially true for relationships and activities. Maybe put off buying the car or other pricey items you want, but don’t put off experiences you want.

 I’m glad I spent a ton of money traveling with friends and family in my 30s. I could have gotten to FIRE faster if I hadn’t gone, but the travel experiences I had then can’t be replicated now. Some of my travel companions are now too old and covid changed it all anyway. So do the important stuff, whatever that is for you.

ixtap

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Re: Is the journey or the destination the most important when FIRING?
« Reply #5 on: June 12, 2021, 05:28:30 PM »
The FIRE date is a milestone, not a destination.

nereo

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Re: Is the journey or the destination the most important when FIRING?
« Reply #6 on: June 12, 2021, 06:04:28 PM »
You're missing the obvious. This isn't just post pandemic - this is the same old same old, how do we socialize and enjoy ourselves with our friends who aren't frugal. The same solutions exist. You just need to implement them. Propose a backyard cookout, potluck style. Have a game night in the basement. Family picnic at the park. Whatever.

As for which is more important - both pre and post retirement its your life. Why should you decide to be miserable for years? Just because you're not spending money wildly doesn't mean you can't enjoy yourself.

Because its not that simple. Can't always find a cheaper version of the things. If they want to go to an exotic cocktail bar, I can't just decide to replace that at home lol. Same for restaurants.

I also can't see them suddenly becoming frugal and decide to just do things home...

Its also not just friends but also convenience of things... its ok to pay more for convenience. For example eating more premium food with more expensive brand instead of cheaper ones.

I'm not talking about spending wildly, but just to be way strict with frugality as long as savings still pills up?

This forum isn’t about maximizing frugality at the expense of your happiness - it’s about maximizing your happiness through more thoughtful consumption. Or to put it another way, if your choices are leading you to be unhappy, you’ve made a wrong turn somewhere.

Sibley is right - this is a question as old as the forum (“how do I interact with people who are more speedy than I...?”). And it is certainly possible - many of us manage it to one degree or another. Sometimes we go out to their fancy restaurants or tiki-bars (hey, that’s fun too!), but other times be the leader and find activities you want to do.  IME most groups default to the easy choices of restaurants and bars whenever someone doesn’t step up and suggest something different - but are easily swayed when someone does take initiative.  Most of the time my spendy-friends wind up thanking me for organizing a cookout in the park, or finding some low/no cost exhibit to check out.

Ultimately, you need to chose what makes you happy.  It’s your money, and more specifically its your time you are spending to go to these places. Is an extra day (or week?) worth the happiness you get from a particular night out?  Sometimes the answer will be “most definitely”.  Other times it’s just mindless consumption, and you wind up back at work on Monday asking yourself “why did I bother?”.  It’s all what you value.  It doesn’t even have to be an either/or proposition; it’s rather easy to cut your expenses in half in most bar/restaurant situations - just order less. 

Sibley

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Re: Is the journey or the destination the most important when FIRING?
« Reply #7 on: June 12, 2021, 06:27:12 PM »
You're missing the obvious. This isn't just post pandemic - this is the same old same old, how do we socialize and enjoy ourselves with our friends who aren't frugal. The same solutions exist. You just need to implement them. Propose a backyard cookout, potluck style. Have a game night in the basement. Family picnic at the park. Whatever.

As for which is more important - both pre and post retirement its your life. Why should you decide to be miserable for years? Just because you're not spending money wildly doesn't mean you can't enjoy yourself.

Because its not that simple. Can't always find a cheaper version of the things. If they want to go to an exotic cocktail bar, I can't just decide to replace that at home lol. Same for restaurants.

I also can't see them suddenly becoming frugal and decide to just do things home...

Its also not just friends but also convenience of things... its ok to pay more for convenience. For example eating more premium food with more expensive brand instead of cheaper ones.

I'm not talking about spending wildly, but just to be way strict with frugality as long as savings still pills up?

It is that simple. You will be bowing out of some of those events. And attending a few, and proposing others. Really, pretty much what would happen anyway because you just can't attend everything.

As for the premium foods that cost more, are you sure that they're really better? I find that many things I get at Aldi are same or better quality than the brand names. Get better at meal planning and working around store sales. There's plenty of examples on this forum of people eating really well for quite reasonable cost. It takes practice and planning.

Convenience items also tend to be lower quality. And with meal planning and freezing foods, that takes care of the times when you're out of time or energy for cooking.

Villanelle

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Re: Is the journey or the destination the most important when FIRING?
« Reply #8 on: June 12, 2021, 06:41:21 PM »
You're missing the obvious. This isn't just post pandemic - this is the same old same old, how do we socialize and enjoy ourselves with our friends who aren't frugal. The same solutions exist. You just need to implement them. Propose a backyard cookout, potluck style. Have a game night in the basement. Family picnic at the park. Whatever.

As for which is more important - both pre and post retirement its your life. Why should you decide to be miserable for years? Just because you're not spending money wildly doesn't mean you can't enjoy yourself.

Because its not that simple. Can't always find a cheaper version of the things. If they want to go to an exotic cocktail bar, I can't just decide to replace that at home lol. Same for restaurants.

I also can't see them suddenly becoming frugal and decide to just do things home...

Its also not just friends but also convenience of things... its ok to pay more for convenience. For example eating more premium food with more expensive brand instead of cheaper ones.  You can only go to every third expensive invite.  You can order an appetizer and water at that fancy restaurant. 

I'm not talking about spending wildly, but just to be way strict with frugality as long as savings still pills up?

You can take the initiative and invite them to cheaper activities.

You can go to fancy cocktail hour and only order one drink, or perhaps get a soda. 

In the end, you have to decide your priorities.  There's almost always a way to be cheaper, and I don't think anyone here selects that every single time, so we all draw our lines.  You can work forever.  You can dumpster dive and live in your car and never do anything for entertainment or stimulation unless it is free.  Or you can decide where, in the middle of that spectrum, you want to fall.   As you said, you only get one lif,e but that goes both ways.  Total deprivation seems like a waste, but so does spending an extra decade or so of that one life working because you spent money on things that didn't truly enhance your life. 

 In order to help you not stress about it, it might make sense to set a budget for friends activities each month.  If you have $200 to spend on it, you can decide which ones to pick and choose within that budget.  That gives you some freedom not to fret about spending on some frivolous things, but also keeps you from doing it too much. 

boarder42

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Re: Is the journey or the destination the most important when FIRING?
« Reply #9 on: June 12, 2021, 07:07:22 PM »
Having reached fi both are important. You need to be mindful and efficient with spending in areas you enjoy. My path is always about making what I enjoy more efficient than average. So travel hacking. Knowing the market for life toys that I buy. Hitting happy hours for date nights.

More importantly I think everyone on the path should focus on what they're doing to earn a living on the way to fi and not just chasing another dollar, enjoying the journey to me is more about reevaluating your job or career choice and making sure it brings value to your life along the way. Spending and saving is simple. Finding enjoyment in life either pre or post fi is an existential question we all should ponder more frequently.

I've never felt deprived of anything on my journey.  If you're feeling deprived you're missing something.
« Last Edit: June 12, 2021, 07:16:09 PM by boarder42 »

Metalcat

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Re: Is the journey or the destination the most important when FIRING?
« Reply #10 on: June 12, 2021, 07:12:25 PM »
It's entirely up to you what financial priorities you decide for yourself.


ixtap

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Re: Is the journey or the destination the most important when FIRING?
« Reply #11 on: June 12, 2021, 07:15:51 PM »


I only have 1 life... and I won't get any younger. Does it worth depriving myself just to get there faster?

Now is as good a time as any to try some of these things out and see if you actually enjoy them. After all, what is the point of FIRE if you are going to feel deprived because you still can't do things that you didn't do while planning for FIRE?

This is what concerns me most about people who talk about how deprived they feel when working towards FIRE. What do you expect to change once you leave work that means you will no longer feel deprived, even though you aren't spending any more money?

helloyou

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Re: Is the journey or the destination the most important when FIRING?
« Reply #12 on: June 12, 2021, 07:32:37 PM »
Looks like we all agree that mindless spending is not something we want to do. And that we should avoid. And it's also about compromise. Not living in a dumpster but not spending too much.

The way you speak sounds like I'm just going to splash my money. But that's not my point at all. I don't splash my money and definitely don't live like a Jet-set person.

I do feel trying to save few ££ there and there quite exhausting and time-consuming. Sometime I wonder if it worth going a bit further to the Lidl shop (15min each way) instead of the next door Asda to save few £££ worth it. Or looking for the more affordable drink/meal on the menu. Trying to convince my friends to go to the cheap Wetherspoons instead of some fancy restaurant... Or as @Sibley mentioned working around store sales. Sometimes I just want to enjoy and avoid all these calculations and planning to save money.


It's not like I'm on minimum wage, even if I were to increase my spending by $1.5k/month I'd still be able to save 40-50% of my income, and that would still be higher than most of my friends. BTW I'm not planning to increase by that much, it's just that I have A LOT of room to spend until it would hurt my ability to save.


Sometimes I feel like the penny pinching is not worth it, and it cost me more trying to save than the well being of not having to worry about it at all. Because fundamentally it doesn't make that much difference.

As @Dreamer40 mentioned, travel and experience can't be replicated when I get old. When I'll be FIRED on my 50s, I wouldn't be able to do what I'm doing now!


@ixtap I don't really have an idea about anything specific I want to change once I reach FIRE. It's more about security and freedom than anything else. No worry about running out of money, no worry about having to go to work, just do as I please. As simple as that!
« Last Edit: June 12, 2021, 07:44:11 PM by helloyou »

Metalcat

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Re: Is the journey or the destination the most important when FIRING?
« Reply #13 on: June 12, 2021, 08:48:11 PM »
Are you looking for permission to spend more?

Because you don't need it.

ender

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Re: Is the journey or the destination the most important when FIRING?
« Reply #14 on: June 13, 2021, 07:22:23 AM »
I've increased spending in the last year or two because I've realized some things I find immensely fulfilling cost more money than I "could" save instead.

Does it negatively impact my FIRE date? You better believe it does.

Does it negatively impact my overall life, where money/FIRE are just one facet? That's a lot less clear and something I've actively been thinking through.

Personally, I think when I was younger I focused far too much on the destination and became miserly to a degree it negatively impacted my life. Some folks find it easy to find an objective and obsess over it to the exclusion of a healthy life. That was me. It might be you too.

Villanelle

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Re: Is the journey or the destination the most important when FIRING?
« Reply #15 on: June 13, 2021, 03:17:44 PM »
Looks like we all agree that mindless spending is not something we want to do. And that we should avoid. And it's also about compromise. Not living in a dumpster but not spending too much.

The way you speak sounds like I'm just going to splash my money. But that's not my point at all. I don't splash my money and definitely don't live like a Jet-set person.

I do feel trying to save few ££ there and there quite exhausting and time-consuming. Sometime I wonder if it worth going a bit further to the Lidl shop (15min each way) instead of the next door Asda to save few £££ worth it. Or looking for the more affordable drink/meal on the menu. Trying to convince my friends to go to the cheap Wetherspoons instead of some fancy restaurant... Or as @Sibley mentioned working around store sales. Sometimes I just want to enjoy and avoid all these calculations and planning to save money.


It's not like I'm on minimum wage, even if I were to increase my spending by $1.5k/month I'd still be able to save 40-50% of my income, and that would still be higher than most of my friends. BTW I'm not planning to increase by that much, it's just that I have A LOT of room to spend until it would hurt my ability to save.


Sometimes I feel like the penny pinching is not worth it, and it cost me more trying to save than the well being of not having to worry about it at all. Because fundamentally it doesn't make that much difference.

As @Dreamer40 mentioned, travel and experience can't be replicated when I get old. When I'll be FIRED on my 50s, I wouldn't be able to do what I'm doing now!


@ixtap I don't really have an idea about anything specific I want to change once I reach FIRE. It's more about security and freedom than anything else. No worry about running out of money, no worry about having to go to work, just do as I please. As simple as that!

My parents are in their lat 70s.  They still play tennis several times a week.  Until he was 70, my dad still went scuba diving.  I tend to think that "I won't be able to do so many things when I'm old" is overplayed and often an excuse to spend wastefully now.

The thing is, you don't need an excuse.  If you want to spend $200,000 USD now, go ahead and do it.  But I'd hope that if you are doing it, you are clear about the tradeoffs.  $1.5k/mo is a LOT of money, especially when it is an increase to whatever you are already spending that wasn't a bare-bones, dumpster-diving lifestyle. 

So I go back to your "only 1 life" rationalization.  You only have one life and if you spend an extra decade**** working, you've squandered much of that decade of your one life.   (****no idea if that's less or maybe more than you will need to do if you spend an extra $18,000 per year both now and presumably in retirement as well)  A couple hundred dollars a month?  Eeh.  But at $18,000/yr, you need to invest an additional ~~$450,000, and to do so with $1.5k per month to put away, so that is a MUCH longer time working.  Is that how you want to spend your 1 life?  Maybe it is, but again, just make sure you are aware of the tradeoff and willing to make it. 

helloyou

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Re: Is the journey or the destination the most important when FIRING?
« Reply #16 on: June 13, 2021, 03:58:04 PM »
@Villanelle I've actually done the calculation.

My current net worth around £700k. (I'm changing to GBP because it's my currency)

Scenario 1 - Save the max
Save £5k/month with an expected yearly gain of 5%. So each year I add £60k+5% capital gain.
Year   Net worth
2021   £700,000
2022   £795,000
2023   £894,750
2024   £999,488
2025   £1,109,462
2026   £1,224,935
2027   £1,346,182
2028   £1,473,491 => Achieve FIRE targed in 2028.

Scenario 2 - Go out and don't worry about spending more (£2k/month more on spending)
Save £3k/month (£36K/year) and same yearly gain.
Year    Net worth
2021   £700,000
2022   £771,000
2023   £845,550
2024   £923,828
2025   £1,006,019
2026   £1,092,320
2027   £1,182,936
2028   £1,278,083
2029   £1,377,987
2030   £1,482,886 => Achieve FIRE targed 2 years later.


I took 5% gain instead of 7% to avoid biases (because the gain compound more and more as the portfolio gets bigger). You can see it's not a 10 years difference (even though I save almost half as much) but only 2 years.

It's a long road to FIRE, so why not enjoy as much as I can on the way there?
« Last Edit: June 13, 2021, 04:06:07 PM by helloyou »

boarder42

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Re: Is the journey or the destination the most important when FIRING?
« Reply #17 on: June 13, 2021, 04:50:24 PM »
@Villanelle I've actually done the calculation.

My current net worth around £700k. (I'm changing to GBP because it's my currency)

Scenario 1 - Save the max
Save £5k/month with an expected yearly gain of 5%. So each year I add £60k+5% capital gain.
Year   Net worth
2021   £700,000
2022   £795,000
2023   £894,750
2024   £999,488
2025   £1,109,462
2026   £1,224,935
2027   £1,346,182
2028   £1,473,491 => Achieve FIRE targed in 2028.

Scenario 2 - Go out and don't worry about spending more (£2k/month more on spending)
Save £3k/month (£36K/year) and same yearly gain.
Year    Net worth
2021   £700,000
2022   £771,000
2023   £845,550
2024   £923,828
2025   £1,006,019
2026   £1,092,320
2027   £1,182,936
2028   £1,278,083
2029   £1,377,987
2030   £1,482,886 => Achieve FIRE targed 2 years later.


I took 5% gain instead of 7% to avoid biases (because the gain compound more and more as the portfolio gets bigger). You can see it's not a 10 years difference (even though I save almost half as much) but only 2 years.

It's a long road to FIRE, so why not enjoy as much as I can on the way there?

This is the same calc I run for any major life change. We chose to upgrade our house. On paper with conservative returns it pushed our FI date 2 years. We determined that was worth it. I went down to a 90% schedule. It added a year to the timeline in theory. But netted me less overall working days.

Reality has been good returns and cash out refis reinvested in the market actually accelerated the FI date. Buying a mcmansion cut time off our fi timeline due to cashing in appreciation. And there is nothing better than 3 day weekends.

As long as you understand the impacts of any monetary change then you have the information to make a choice that's beat for you and you don't need our approval.

helloyou

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Re: Is the journey or the destination the most important when FIRING?
« Reply #18 on: June 13, 2021, 05:11:12 PM »
I'm not asking for approval lol. I just want to exchange ideas and explore different point of view! And make sure that I'm not missing anything in the way I'm changing my approach to FIRE!

nereo

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Re: Is the journey or the destination the most important when FIRING?
« Reply #19 on: June 13, 2021, 05:28:18 PM »
To me, there’s still a mindset problem here.  In the two scenarios listed, it seems like OP is viewing one as spartan and miserly, and the other as “having fun”.  To quote MMM: If you think this is about extreme frugality, you’ve missed the point.

Do whatever brings you the greatest amount of happiness, now and in the future. Based on countless case-studies I’ve seen, I’d wager there’s an ‘Option 3’ - which is just moderately less saved per year as Scenario 1, but with a lot more fun.  Heck, I’d wager that Scenario 2 isn’t even the most fun (this is backed up by all sorts of studies that highlight how mindless consumption and “not worrying about it” actually leads to less happiness, not more).

To reiterate - if you are looking for permission to spend, you don’t need it, and no one can give it to you regardless. But if you aren’t able to judge whether a particular activity is “worth it” from a financial perspective, then you need to take a few hours (or days, or even weeks) and work out what you value most, and what you are working towards.  FIRE is never an end-goal, and those who try to make it the finish line frequently drift around afterwards annoyed at their missed opportunities while being hyper-frugal and uncertain where to go from here. Those who are seeing FIRE as just one step of a life purposefully designed towards something fare far better. Those people seldom even have to think about whether a particular expense is “worth it” because they can see how it fits into their broader life (or how it doesn’t).

Tl;dr - in the short term ask of every potential purpose: “is this worth it”? It all boils down to exchanging your time.
In the long term, work out what you are doing and why. 

Villanelle

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Re: Is the journey or the destination the most important when FIRING?
« Reply #20 on: June 13, 2021, 06:15:30 PM »
@Villanelle I've actually done the calculation.

My current net worth around £700k. (I'm changing to GBP because it's my currency)

Scenario 1 - Save the max
Save £5k/month with an expected yearly gain of 5%. So each year I add £60k+5% capital gain.
Year   Net worth
2021   £700,000
2022   £795,000
2023   £894,750
2024   £999,488
2025   £1,109,462
2026   £1,224,935
2027   £1,346,182
2028   £1,473,491 => Achieve FIRE targed in 2028.

Scenario 2 - Go out and don't worry about spending more (£2k/month more on spending)
Save £3k/month (£36K/year) and same yearly gain.
Year    Net worth
2021   £700,000
2022   £771,000
2023   £845,550
2024   £923,828
2025   £1,006,019
2026   £1,092,320
2027   £1,182,936
2028   £1,278,083
2029   £1,377,987
2030   £1,482,886 => Achieve FIRE targed 2 years later.


I took 5% gain instead of 7% to avoid biases (because the gain compound more and more as the portfolio gets bigger). You can see it's not a 10 years difference (even though I save almost half as much) but only 2 years.

It's a long road to FIRE, so why not enjoy as much as I can on the way there?

If you are spending an extra £2k/mo or £24k/yr then your FIRE number will be £600,000 more than it would be if you were spending the lesser amount.  So your calculations are wrong since they end in basically the same number.  So it's not just the lower amount invested; it's also the higher amount needed, which you've failed to account for.  If you can't live on 24k/yr less now because you feel too deprived, then you can't live on 24k less in retirement, either, right? 

Metalcat

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Re: Is the journey or the destination the most important when FIRING?
« Reply #21 on: June 13, 2021, 07:38:08 PM »
I'm not asking for approval lol. I just want to exchange ideas and explore different point of view! And make sure that I'm not missing anything in the way I'm changing my approach to FIRE!

But what are you looking for? That's what I keep trying to figure out.

I'm really confused as to what kind of input you are looking for.

lutorm

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Re: Is the journey or the destination the most important when FIRING?
« Reply #22 on: June 13, 2021, 07:55:32 PM »
So it's not just the lower amount invested; it's also the higher amount needed, which you've failed to account for.  If you can't live on 24k/yr less now because you feel too deprived, then you can't live on 24k less in retirement, either, right?
Yeah this is what I was going to say. Extra spending hits you two ways.

(If you are currently "depriving" yourself so that you can get to FIRE and start spending more to enjoy life, I don't think anyone's suggesting that. You should out find how much money you want to live on before you FIRE, because otherwise how do you know that's the right amount?)

wageslave23

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Re: Is the journey or the destination the most important when FIRING?
« Reply #23 on: June 14, 2021, 06:55:10 AM »
I think it all depends on how much that two extra years of working will bother you.  I would have a hard time justifying working an extra year let alone two for anything that extra spending money now could buy.  But I despise having 8 hours of my day, 5 days a week wasted in front of a computer.  And the things I like to do are all free: hike, bike, fish, play cards, read, etc.  So I might not be the best person to ask.  As others have said only you can determine if the trade off is worth it. 

The bigger question is will you be happy in FIRE if you cut your budget down?  I think other people are blindly saying that your budget needs to be the same pre and post FIRE.  But I could see where it could be a lot less because having fun while working can be more expensive than once FIRED.  I.e. you go to a fancy restaurant because you don't feel like entertaining at home.  You go on a expensive vacation as a way of escape.  Etc.

helloyou

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Re: Is the journey or the destination the most important when FIRING?
« Reply #24 on: June 14, 2021, 08:59:27 AM »
@lutorm and @Villanelle, you have it wrong in the FIRE calculation. My FIRE amount is the amount I need to live including these £2k extra.

So at £1.5M at 4% I should have enough to spend these £2k extra + my current normal life. Of course, it should still work if an unexpected crash happens and long bear market, for which I'd obviously spend less like everyone.

So no I won't feel more deprived once I FIRE and I can either spend a bit more now and take longer to be there or not.

@Malcat I'm also interested on people position toward that. It seems that most people want to be FIRE asap. But I'm now thinking maybe it's not the best approach? Although it depends on case by case. You can see on the survey 1/3 are happy to take the long road instead!


@wageslave23 it does bother me quite a lot actually. Sometimes I just want to quit and forget about it. Recently I was even considering doing VERY LEAN fire and quit on £650k.... but then some reasons came back to mind and I'm back to work. Need to have at least a bit more. Maybe I'm looking for reason to be happy while getting a better stash... because it's a VERY LONG road!

Villanelle

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Re: Is the journey or the destination the most important when FIRING?
« Reply #25 on: June 14, 2021, 09:17:17 AM »
@lutorm and @Villanelle, you have it wrong in the FIRE calculation. My FIRE amount is the amount I need to live including these £2k extra.

So at £1.5M at 4% I should have enough to spend these £2k extra + my current normal life. Of course, it should still work if an unexpected crash happens and long bear market, for which I'd obviously spend less like everyone.

So no I won't feel more deprived once I FIRE and I can either spend a bit more now and take longer to be there or not.

@Malcat I'm also interested on people position toward that. It seems that most people want to be FIRE asap. But I'm now thinking maybe it's not the best approach? Although it depends on case by case. You can see on the survey 1/3 are happy to take the long road instead!


@wageslave23 it does bother me quite a lot actually. Sometimes I just want to quit and forget about it. Recently I was even considering doing VERY LEAN fire and quit on £650k.... but then some reasons came back to mind and I'm back to work. Need to have at least a bit more. Maybe I'm looking for reason to be happy while getting a better stash... because it's a VERY LONG road!

In that case, if you spend 2k less, you need less money to FIRE.  So either way, your time math is wrong because you are working to get to the same FIRE number in both scenarios.  You need less money to spend X-2000 per month than you do to spend X per month.  I'm not sure how else to say that so you understand it, so here's some numbers.

In one scenarios, Bob spends $60k per year.  He needs $1.5m to fund that (at a 4% WR).  In another scenario, Bob spends $2k less per month (before and after retirement), or $24k less per year so he needs only $900,000 per year to FIRE.  But both of your scenarios have ~$1.5m as the bottom line, when in reality, in the first scenario you are not adding to your stache more quickly, but you get to stop at a smaller number.  You haven't accounted for that. 

If you are saying that no matter how much you spend now, you need 60k/yr to spend in FIRE, that doesn't make much sense.  Are you saying that you would be able to not spend that extra 2k now, but once you quit it will become necessary?  Does that make any sense?

In the end, it's your money.  Do what makes you happy.  But as your numbers stand now, you aren't looking at the actual cost in years worked that you will pay for this inflated lifestyle.

it also seems to me like there is a lot of territory between 0 and 2000.  For me, the right answer would probably be found somewhere in that territory.  £2000 a month is a LOOOOOOT of money.  It's more than some people live on.  Buying an extra 200 or 500 of extravagance per month allows you to attend several fancy dinners with friends and a couple cocktail hours as well.  How on earth do you need £2000 every month, in addition to your current budget which I suspect has a fair amount of fat in it, to do that? 

It seems like you are making excuses not to sacrifice much of anything or to ever have to say no to a single invite, or to ever only have 1 cocktail. You've made this a binary thing--no additional money or sooooo much additional money--so that you can tell yourself that no additional money feels too constrained and affects your happiness, so I guess that multiple £200 dinners and £25 cocktails each month is the way to go.  And fine, if that's how you want to live, vaya con dios, friend.  But it's ridiculously wasteful of both your time and your money, and I think you know that on some level or you wouldn't be here asking this. 

nereo

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Re: Is the journey or the destination the most important when FIRING?
« Reply #26 on: June 14, 2021, 09:19:42 AM »
@lutorm and @Villanelle, you have it wrong in the FIRE calculation. My FIRE amount is the amount I need to live including these £2k extra.

So at £1.5M at 4% I should have enough to spend these £2k extra + my current normal life. Of course, it should still work if an unexpected crash happens and long bear market, for which I'd obviously spend less like everyone.

I'm a bit confused - why is your FI number the same when your monthly spending between the two scenarios is so different?

dougules

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Re: Is the journey or the destination the most important when FIRING?
« Reply #27 on: June 14, 2021, 10:18:17 AM »
Is this friend group worth working an extra 10 years to you?  It's an honest question, not rhetorical.  If not, you need a new group of friends.  Of course that's not simple, but it's really the only other option if you can't nudge your current friends towards hanging out in less expensive ways. 

wageslave23

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Re: Is the journey or the destination the most important when FIRING?
« Reply #28 on: June 14, 2021, 10:27:29 AM »
Is this friend group worth working an extra 10 years to you?  It's an honest question, not rhetorical.  If not, you need a new group of friends.  Of course that's not simple, but it's really the only other option if you can't nudge your current friends towards hanging out in less expensive ways.

Figure out what YOU like doing and then find friends that have similar interests.  I have a lot of old friends who I like a lot but have very little in common with anymore so we have drifted apart.  That's the way life goes, spend time doing the things you want to do and find others who you like to do them with. 

shuffler

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Re: Is the journey or the destination the most important when FIRING?
« Reply #29 on: June 14, 2021, 10:39:16 AM »
I'm a bit confused - why is your FI number the same when your monthly spending between the two scenarios is so different?
He's determined that he wants/needs to spend the extra 2k during retirement.  In his mind, that is the fixed goal.  The target amount is set.

The question he's exploring is whether he should apply austerity measures from now until his retirement date (saving an extra 2k/mo), or whether he should go ahead and spend at his predetermined retirment-level of spending (which includes spending that 2k/mo).  He's feeling out whether the potential 2k savings will make him feel better in net (b/c he retires earlier) or worse (b/c his relationships may suffer if he can't hang out at spendy places).

Metalcat

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Re: Is the journey or the destination the most important when FIRING?
« Reply #30 on: June 14, 2021, 10:40:53 AM »
@lutorm and @Villanelle, you have it wrong in the FIRE calculation. My FIRE amount is the amount I need to live including these £2k extra.

So at £1.5M at 4% I should have enough to spend these £2k extra + my current normal life. Of course, it should still work if an unexpected crash happens and long bear market, for which I'd obviously spend less like everyone.

So no I won't feel more deprived once I FIRE and I can either spend a bit more now and take longer to be there or not.

[member=39652]Malcat[/member] I'm also interested on people position toward that. It seems that most people want to be FIRE asap. But I'm now thinking maybe it's not the best approach? Although it depends on case by case. You can see on the survey 1/3 are happy to take the long road instead!


@wageslave23 it does bother me quite a lot actually. Sometimes I just want to quit and forget about it. Recently I was even considering doing VERY LEAN fire and quit on £650k.... but then some reasons came back to mind and I'm back to work. Need to have at least a bit more. Maybe I'm looking for reason to be happy while getting a better stash... because it's a VERY LONG road!

Ah, see here is where I got confused.

Yes, this is an impression people get, but it's not true. I would say it's actually not at all the norm here that people are trying to retire asap. I would say that many people here have a FIRE target, but are perfectly happy spending on their preferred lifestyle in the meantime. 

CodingHare

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Re: Is the journey or the destination the most important when FIRING?
« Reply #31 on: June 14, 2021, 11:18:32 AM »
Ah, see here is where I got confused.

Yes, this is an impression people get, but it's not true. I would say it's actually not at all the norm here that people are trying to retire asap. I would say that many people here have a FIRE target, but are perfectly happy spending on their preferred lifestyle in the meantime.
Yeah, this is me.  I have my planned FIRE date, and I could definitely reach it sooner if I was more austere.  But then I wouldn't be popping out to breweries with my SO, or spoiling my dog.  I've also landed at a company that I'm happy with, so the immediate pressure to FIRE because of a bad boss is gone.  (Although I learned my lesson to always have enough savings to say FU to abusive working conditions.)

jrhampt

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Re: Is the journey or the destination the most important when FIRING?
« Reply #32 on: June 14, 2021, 11:30:15 AM »
I think there's a pandemic effect at work here perhaps.  I'm FI, but I'm going on a travel/brunch/happy hour absolute orgy this spring/summer (and maybe into the fall...TBD) to see all my vaccinated friends and family and do all the things I couldn't do last year ALL AT ONCE ALL THE TIME.  Because I have pent up demand, I'm letting it go.  I've given myself permission.

Villanelle

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Re: Is the journey or the destination the most important when FIRING?
« Reply #33 on: June 14, 2021, 11:42:24 AM »
@lutorm and @Villanelle, you have it wrong in the FIRE calculation. My FIRE amount is the amount I need to live including these £2k extra.

So at £1.5M at 4% I should have enough to spend these £2k extra + my current normal life. Of course, it should still work if an unexpected crash happens and long bear market, for which I'd obviously spend less like everyone.

So no I won't feel more deprived once I FIRE and I can either spend a bit more now and take longer to be there or not.

[member=39652]Malcat[/member] I'm also interested on people position toward that. It seems that most people want to be FIRE asap. But I'm now thinking maybe it's not the best approach? Although it depends on case by case. You can see on the survey 1/3 are happy to take the long road instead!


@wageslave23 it does bother me quite a lot actually. Sometimes I just want to quit and forget about it. Recently I was even considering doing VERY LEAN fire and quit on £650k.... but then some reasons came back to mind and I'm back to work. Need to have at least a bit more. Maybe I'm looking for reason to be happy while getting a better stash... because it's a VERY LONG road!

Ah, see here is where I got confused.

Yes, this is an impression people get, but it's not true. I would say it's actually not at all the norm here that people are trying to retire asap. I would say that many people here have a FIRE target, but are perfectly happy spending on their preferred lifestyle in the meantime.

I'll agree with Malcat on this.  In fact, that's why I've mentioned several times that allowing an extra 200 or 500 a month might be a viable option for you.  That's definitely NOT just racing to FIRE as fast as possible by any plausible means. 

My spouse and I travel, eat good food, have cocktails (occasionally even fancy ones), live in a nice house, sometimes eat our or order in, etc.  We are by NO means wanting to FIRE ASAP.  Frankly, if we were, we'd already be FIRE as my spouse has a pension which would start the day he quits and would be more than many people's entire FIRE budget, before we even touched our savings.   But he continues to work because we do want to be able to travel a lot (and only moderately budget-consciously) in retirement (and before retirement, too!), because we do want to continue to do all the things I just mentioned (again, both before and after retirement) and frankly because he also gets satisfaction from his job.  So for us, and I think probably 99% of posters here, it's not a sprint with "stop working for pay" as the only goal.  It's a balance of allowing for some luxuries now and later, but also being very mindful of what those luxuries cost (in terms of both time and money) and making careful, considered decisions.  Maybe a fancy cocktail twice a month is worth it, but doing it 6x/mo costs is three times as much yet gets only 0.5 times as much enjoyment. So we consider those things and draw thoughtful lines that balance our desire to be FIRE, or at least have the money to FIRE whenever we want, with making the most of our "one life" now, too. 

I can't think of a single poster here  who doesn't have some balance like that.  They "allow" themselves to buy an annual ski pass because they love skiing.  They buy some fancy woodworking tools because that's their passion.  They buy expensive cheese or wine, or both, because those experiences, in moderation, enrich their lives.  They eat out on Thursdays because that's an incredibly hectic day for their family and maybe a favorite restaurant has 50% of kids' meals that day.  The go to dinner once or twice a month with friends because those social connections make them feel alive and connected and happy.  They have  housekeeper come in once a month because with 3 kids under age 5, they feel too stressed trying to DIY that task until the kids are a bit older.  They have a dog.   You can any of those things, or even a few of them, on far, far less than what you are currently proposing.  Most of us do.

So it also seems you have a fundamental misunderstanding about how most people view FIRE.  But just looking at how few people dumpster dive and live in a van down by the river and only shower once a week and eat only foraged food and... will make it very clear that for almost no one is it just about "get me there as fast as possible and nothing but speed to the finish line matters".

Metalcat

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Re: Is the journey or the destination the most important when FIRING?
« Reply #34 on: June 14, 2021, 11:50:40 AM »
^Exactly, even some of our most frugal members spend on things like annual international travel, etc.

We all prioritize what we need to in order to be happy. The ones who spend very little tend to be very happy spending very little.

helloyou

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Re: Is the journey or the destination the most important when FIRING?
« Reply #35 on: June 14, 2021, 12:27:32 PM »
@Villanelle and @nereo, the calculation is actually pretty simple.

I'm 38 and expecting at least 50 more years runway once I fire (although I know I'll get older but no one wants to point to their death).

According to Vanguard Monte Carlo simulator, a 4% withdrawal rates gives me a survival rate of 80%:

https://retirementplans.vanguard.com/VGApp/pe/pubeducation/calculators/RetirementNestEggCalc.jsf

Now, if I want a 95% survival rate, my withdrawal rate should be at 2.4%:


So my portfolio is planned to have the maximum likelihood to stay fire, including decade(s) long recession. So if time stays good, yes I'd have extra and can spend at 4% (60k) withdrawal rate. But if time goes bad, I only have 5% chance of failure by only consuming 2.4% (2k/month less so 36k/year) of my portfolio when that happens!
« Last Edit: June 14, 2021, 12:36:17 PM by helloyou »

Villanelle

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Re: Is the journey or the destination the most important when FIRING?
« Reply #36 on: June 14, 2021, 01:10:10 PM »
Clearly either I'm not articulating myself well, or you just have your mind set and aren't interested, because what you are saying doesn't make numerical sense. Spending less money in retirement means you need less money from which to withdraw, no matter what withdraw rate you use or what margin of safety you want.

Either way, good luck, and enjoy those £25 cocktails and £200 dinners. 

ericrugiero

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Re: Is the journey or the destination the most important when FIRING?
« Reply #37 on: June 14, 2021, 01:43:05 PM »
@Villanelle and @nereo, the calculation is actually pretty simple.

I'm 38 and expecting at least 50 more years runway once I fire (although I know I'll get older but no one wants to point to their death).

According to Vanguard Monte Carlo simulator, a 4% withdrawal rates gives me a survival rate of 80%:

https://retirementplans.vanguard.com/VGApp/pe/pubeducation/calculators/RetirementNestEggCalc.jsf

Now, if I want a 95% survival rate, my withdrawal rate should be at 2.4%:


So my portfolio is planned to have the maximum likelihood to stay fire, including decade(s) long recession. So if time stays good, yes I'd have extra and can spend at 4% (60k) withdrawal rate. But if time goes bad, I only have 5% chance of failure by only consuming 2.4% (2k/month less so 36k/year) of my portfolio when that happens!

I don't think that's correct.  To have the 5% chance of failure (over 50 years), you need to spend 2.4% ALL the time, not just when the market is down.  If you cut spending when the market is down, that does help your chances a lot, it just doesn't get you all the way to 5%.   

Also, I'm with the other posters, the "right" answer is probably somewhere in the middle.  An extra 2k/month is A LOT.  If you are smart about it, you should be able to have fun with friends for a lot less.  At the end of the day, it's all about your priorities.  Do you want freedom from work or do you want to spend the extra money?  Those two things work against each other so you have to decide your own balance.  Most regular people err too far towards consumption.  Some mustachians probably err too far towards frugality.  Find your own balance and tweak it as you go. 

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Re: Is the journey or the destination the most important when FIRING?
« Reply #38 on: June 14, 2021, 02:26:43 PM »
It's an individual decision.

By establishing £5,000 as your desired FIRE spend, and explaining that you would enjoy spending £5,000 much more than £3,000 right now each month, you've clearly shown your own preference. Go for it.

You're really asking if you should spend less during accumulation than during FIRE. In early accumulation, people just learning how to save often experience the feeling of scrimping. But once you've become a steady saver, as you have, and you're clear about what makes you happy, few people scrimp to the point of unhappiness during accumulation.

If you hate your job, maybe you should scrimp. If you're content working, enjoy your 10 years of instead of feeling glum for 8 years.

PS. A lot of the things that make you happy are ones that others in this forum, like me, don't value so much. They're classic things that ordinary consumers want and ordinary Mustachians often reduce. Arguably you could learn to be happy with less of them. But you have worked on those areas and clearly tested your preferences already, so go enjoy!

helloyou

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Re: Is the journey or the destination the most important when FIRING?
« Reply #39 on: June 14, 2021, 03:15:39 PM »
Yes it's a difficult balance to find. Between wanting to reach it fast and wanting to enjoy life! I'm still pondering in many way where should be my balance!

@ericrugiero yes if the market goes down and my portfolio crash, the goal is to be able to survive on 2.4-3% withdrawal rate for long time to maximise the chance of success! So yes as the portfolio shrink, the withdrawal amount will shrink as well to keep this 5% success rate.

I took £2k/month as example. I can definitely live for less. Although if I want to be able to live on my own in HCOL cities in AIRBNB it wouldn't be too much! One of my envy is to live permanently in Airbnb and travel around like this. Not sure if that's something I really want tbh, but it would be good if I'm able to do that.
« Last Edit: June 14, 2021, 03:24:05 PM by helloyou »

Metalcat

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Re: Is the journey or the destination the most important when FIRING?
« Reply #40 on: June 14, 2021, 03:31:57 PM »
Yes it's a difficult balance to find. Between wanting to reach it fast and wanting to enjoy life! I'm still pondering in many way where should be my balance!

@ericrugiero yes if the market goes down and my portfolio crash, the goal is to be able to survive on 2.4-3% withdrawal rate for long time to maximise the chance of success! So yes as the portfolio shrink, the withdrawal amount will shrink as well to keep this 5% success rate.

I took £2k/month as example. I can definitely live for less. Although if I want to be able to live on my own in HCOL cities in AIRBNB it wouldn't be too much! One of my envy is to live permanently in Airbnb and travel around like this. Not sure if that's something I really want tbh, but it would be good if I'm able to do that.

This is why it's an entirely personal decision.

Only you can decide for yourself what trade offs contribute to a more optimal life.