Author Topic: MMM 2016 Budget  (Read 51720 times)

EscapeVelocity2020

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Re: MMM 2016 Budget
« Reply #100 on: May 24, 2017, 06:25:01 AM »
I still think people are missing the point.  Maybe a more succinct way to frame my point is simply this - I wonder what the blog would be like if there had been no extra income and MMM actually did only spend 25k/yr since 2008.  What if the trips to Ecuador, Portland, etc. came out of his own pocket (not going to bike to those places).  What if there had been no incentive to push PeerStreet and all those other bum financial products.  Maybe he actually would have leveraged his 'will work for food' ethos like when he took his family to Hawaii.  Maybe he would have reported back that the radiant heat experiment was a failure (capital costs outweighed the savings).  Maybe he'd express his lust for an e-bike occasionally but, alas, human power is still optimal.  Obviously we'll never know, since it is a hypothetical now, but it is probably a better case for many aspiring ER's that still read his blog.  Those initial years were really when he was doing something magical, and I'm just a little disappointed that he lost his way. 
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Re: MMM 2016 Budget
« Reply #101 on: May 24, 2017, 06:31:49 AM »
I still think people are missing the point.  Maybe a more succinct way to frame my point is simply this - I wonder what the blog would be like if there had been no extra income and MMM actually did only spend 25k/yr since 2008.  What if the trips to Ecuador, Portland, etc. came out of his own pocket (not going to bike to those places).  What if there had been no incentive to push PeerStreet and all those other bum financial products.  Maybe he actually would have leveraged his 'will work for food' ethos like when he took his family to Hawaii.  Maybe he would have reported back that the radiant heat experiment was a failure (capital costs outweighed the savings).  Maybe he'd express his lust for an e-bike occasionally but, alas, human power is still optimal.  Obviously we'll never know, since it is a hypothetical now, but it is probably a better case for many aspiring ER's that still read his blog.  Those initial years were really when he was doing something magical, and I'm just a little disappointed that he lost his way.
But couldn't it be seen in a different way?  Not that everyone who achieves FIRE will reach MMM's heights of post-FIRE entrepreneurship.  But that the freedom of FIRE creates the opportunity for new ventures, whether money earning or not? 

And the maths that MMM sets out shows that even without earning additional money in FIRE, after a few years of FIRE at 4% the likelihood is that investment returns will start to create excess income which will enable the financial reins to be loosened at about the same stage that MMM is loosening his.
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Scandium

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Re: MMM 2016 Budget
« Reply #102 on: May 24, 2017, 06:57:58 AM »
I understand the objections here, and I empathize with the idea of "hidden spending" turning off some readers, but lets stop for a sec and think about this. 

To me the whole idea of Mustachianism isn't just being frugal, clipping coupons, credit card bonuses, etc.  It's about designing an efficient lifestyle, one that make you happy. We are so quick to use spending as a way to measure, we forget, that's not even the point. Our goal is to fulfill our needs without "throw a bunch of cash at the problem" as our first option.  MMM designed his life so that his need for travel, buying electric cars, etc are fulfilled.  At the same time he is writing articles and promoting an agenda/lifestyle important to him, earning income he gets to divert to large scale donations to other causes important to him, meet friends with similar values, ect.  IOW, one action works towards several goals at once, all without directly costing him money. He has parlayed his financial independence into a more efficient lifestyle.

We are comparing apples to oranges in that we are trying to compare the accounting of a 50hr a week salaryman to someone who is financially independent.  None of MMM's endeavors would have been possible if his baseline needs weren't covered (aka financial independence).  No blog, no trips, no electric car, no six figure donations to charity.


Well, I think that's the point many are making. His "advice" and writing these days isn't really applicable to 99% of people. I certainly find nothing actionable there lately. What he thinks of the Leaf, or donating $100k may be interesting reading for some, but I can read that elsewhere. And frankly don't care.

99% out blogs never make a dime, and 9/10 people who start a business go bust. So reading about one of the few who has a half million dollar blog and actually make money from his business may be fascinating on some level, but provide virtually nothing to apply to my life. I can only work my desk job and try to save, starting a blog would not make me anything. It's a necessity caused by his success, but I don't feel a need to read it anymore, and I haven't.

Blackeagle

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Re: MMM 2016 Budget
« Reply #103 on: May 24, 2017, 07:10:32 AM »
One thing to remember about the shed is that the expense really a part of MMM's sale of his old house and moving into a new, smaller one.  He sold the old house for about $400k, bought the new one for $240k and spent about $60k renovating it with the express intention to make up some of the space he lost in the downsizing by constructing an outbuilding.  From the articles it sounds like he's gotten a house that's more energy efficient, has spaces that work better for he and his family, and freed up about $70,000 ($400k from the old house, vs $330 to buy the new house, renovate it, and build the shed).  Sounds pretty mustachian to me.

nereo

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Re: MMM 2016 Budget
« Reply #104 on: May 24, 2017, 07:39:45 AM »
One thing to remember about the shed is that the expense really a part of MMM's sale of his old house and moving into a new, smaller one.  He sold the old house for about $400k, bought the new one for $240k and spent about $60k renovating it with the express intention to make up some of the space he lost in the downsizing by constructing an outbuilding.  From the articles it sounds like he's gotten a house that's more energy efficient, has spaces that work better for he and his family, and freed up about $70,000 ($400k from the old house, vs $330 to buy the new house, renovate it, and build the shed).  Sounds pretty mustachian to me.
Yeah, one thing that's routinely impressed me about Pete is how he continually optimizes, particularly the largest expenses while maintaining a high QOL. Each new (to him) home is slightly smaller and more efficient. I, too, have dreams of having a stand-alone shed for carpentry projects. 
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Classical_Liberal

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Re: MMM 2016 Budget
« Reply #105 on: May 24, 2017, 07:44:48 AM »
I still think people are missing the point.  Maybe a more succinct way to frame my point is simply this - I wonder what the blog would be like if there had been no extra income and MMM actually did only spend 25k/yr since 2008.  What if the trips to Ecuador, Portland, etc. came out of his own pocket (not going to bike to those places).  What if there had been no incentive to push PeerStreet and all those other bum financial products.  Maybe he actually would have leveraged his 'will work for food' ethos like when he took his family to Hawaii.  Maybe he would have reported back that the radiant heat experiment was a failure (capital costs outweighed the savings).  Maybe he'd express his lust for an e-bike occasionally but, alas, human power is still optimal.  Obviously we'll never know, since it is a hypothetical now, but it is probably a better case for many aspiring ER's that still read his blog.  Those initial years were really when he was doing something magical, and I'm just a little disappointed that he lost his way.

I agree the early years posts are the magic makers.  However, I think that is partially because I have not yet reached his level in thought processes.  Meaning to say I haven't been FI for a decade plus & had the opportunity (financial safety) to do the things he has had the opportunity to do.  Maybe in 10 years I will come to see the world more as he sees it today?


Well, I think that's the point many are making. His "advice" and writing these days isn't really applicable to 99% of people. I certainly find nothing actionable there lately. What he thinks of the Leaf, or donating $100k may be interesting reading for some, but I can read that elsewhere. And frankly don't care.

99% out blogs never make a dime, and 9/10 people who start a business go bust. So reading about one of the few who has a half million dollar blog and actually make money from his business may be fascinating on some level, but provide virtually nothing to apply to my life. I can only work my desk job and try to save, starting a blog would not make me anything. It's a necessity caused by his success, but I don't feel a need to read it anymore, and I haven't.

I guess I look at his "advice" as more conceptual vs practical.  The concept of becoming FI, or the concept of saving 3/4's of my income being possible, as opposed to exactly how to do it.  I don't want to mimic the guys decisions.  I don't even like biking (I walk) and I've never set foot inside a Costco.  While I have gotten a few practical tips, it's more realizing I can make life optimal in a similar way. I have just done it my way, which outside of a ridiculously high savings rate, does not mirror his accumulation years at all.  This may just personality related as I'm an ENTJ big picture type of person.

boarder42

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Re: MMM 2016 Budget
« Reply #106 on: May 24, 2017, 07:57:03 AM »
One thing to remember about the shed is that the expense really a part of MMM's sale of his old house and moving into a new, smaller one.  He sold the old house for about $400k, bought the new one for $240k and spent about $60k renovating it with the express intention to make up some of the space he lost in the downsizing by constructing an outbuilding.  From the articles it sounds like he's gotten a house that's more energy efficient, has spaces that work better for he and his family, and freed up about $70,000 ($400k from the old house, vs $330 to buy the new house, renovate it, and build the shed).  Sounds pretty mustachian to me.

good way to present it and something he should have done in his blog post.
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Spitfire

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Re: MMM 2016 Budget
« Reply #107 on: May 24, 2017, 08:11:48 AM »
I don't have a problem with the way he split his budget out with core expenses vs blog/business expenses. I really don't think a couple business trips, a nissan leaf, and a shed would make or break his happiness.   

Maybe people are just objecting that he rationalizes it as a business expense rather than enjoyment, which is a fair point.

Chris22

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Re: MMM 2016 Budget
« Reply #108 on: May 24, 2017, 08:19:20 AM »
I don't have a problem with the way he split his budget out with core expenses vs blog/business expenses. I really don't think a couple business trips, a nissan leaf, and a shed would make or break his happiness.   

Maybe people are just objecting that he rationalizes it as a business expense rather than enjoyment, which is a fair point.

None of it matters if he doesn't crow about spending $25k-$30k a year.  But if he wants to brag about that number, the other stuff does affect his credibility. 
"If I could get all the money back I ever spent on cars, I'd spend it on cars." - Nick Mason

edgema

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Re: MMM 2016 Budget
« Reply #109 on: May 24, 2017, 08:19:57 AM »
Very interesting to see everyone’s comments – and this is my first.

I have been following this and other FI blogs for the past 3 years and have made some of the major adjustments (downsized house, cheap cars) to accelerate FI and am super excited (I am 2 years away). That said, I think the numbers are simply bigger on both the assets required and the spending needed.

We (family of four) are quite big spenders (certainly compared to $30k) and my concern about when to retire have always hinged on;

1)   Realistic expectation of spend while still enjoying life (there is not a designer shoe, handbag, watch or the like to be seen in our house)
2)   Realistic return expectation on the investment portfolio

On both sides I have always found MMM substantially lower than I can see as realistic, at least for our family.

On 1) I have always had my suspicions of how achievable / joyful this lifestyle would be for us as there are so many things not included which would seriously test my relationship with wife and children if I cut out, noting of course that these would be considered great luxuries to 95% of the world but if we are all reading this that is perhaps not the relevant measure;

•   We live in the UK and I grew up skiing so want my 2 kids to experience this and you are going to drop $4k to get to France and ski for a week. The pass alone is $800 for the family for the week.
•   Housing is simply very expensive in the UK and I want to live near my family so kiss goodbye to at a very minimum $500k for the house (even after the 50% downsize – value wise).
•   Our kids friends live all over the place so we are racking up miles
•   My Dad lives in Florida and if we are to visit him during children's school holidays, say hello to a $3,000 air fare for the four of us.
•   We want to help out our two kids for college fees (average UK student debt at graduation $50k) or helping with first apartments for the kids. That is $10k additional ‘spend’ each year for the next 10.   

Be gentle as I can see true Moustacians sharpening their knives (but I could go on) and what is the option – tell my kids to only make local friends, tell them that I know I grew up going skiing but daddy wants to retire at 40 so tough luck, tell my dad sorry but we aren’t going to visit, saddle my kids with massive debt and thus impact their career choices (as it did me)? This has led me to some sort of Moustache ‘lite’ version which looks, perhaps ironically, much more like MMM spending this past year and something like a baseline something like $80,000 a year if you are free of mortgage and debt. I believe many of the ‘one off’ items in this 2016 budget are simply not (like many corporate accounts!) and would be replaced by other ‘one off’ items each year. For example, I seem to remember a blog entry where the beauty of FI was described by MMM as the ability to go to Florida for a month to escape the harsh winters in Colorado. A quick owners direct on that would tell you that is not a cheap endeavour.

On 2) I have always found the ‘how much do I need’ incredibly optimistic. I work in investments and I think it is quite risky that people have almost taken as gospel that the most impressive recent economy (US) and most impressive run in equity markets (US equities), leading to the highest P/E multiples in decades, is the model to base the next 30-years off of. So, you take a relatively generous 2.5% dividend yield, my $80,000 requirement and end up needing $2.8m unless you assume markets carry on getting more expensive. Admittedly, my calculation is probably too harsh but I would say to endlessly expect equities to compound at 7% is just fantasy.

Let me be clear, the overall the message is great and has led me to major changes in life, but to pick up what some others have said, I think MMM has somewhat retro-fitted the ‘Message’ to his life as though everything was planned when it was not (e.g. the fact he actually didn’t retire but instead set up a construction business). I am 40 and have c$2.0m in invested assets and very lucky to be a high earner. But I am in a job that I would not be able to pick up again once I walk away. If I get this wrong there is no turning back to my current level of earnings.

Throw all that in the mix and the calculation I get to is that the (hopefully) 40 years I have left would be better sticking to work for at least another 2 years, saving hard, be well above what FIRE devotees think is the right amount (and still be very young compared to most retirees). BUT not risk being 50 and not in the comfortable financial position I could be.

Blackeagle

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Re: MMM 2016 Budget
« Reply #110 on: May 24, 2017, 08:44:38 AM »
Why do you say that Pete sold the old house with the "express intention to make up some of the space he lost in the downsizing by constructing an outbuilding"?  Based on the article, the evidence for that assertion seems dubious.  And by dubious, I mean that there is no actual evidence for it.

"So, moving to this new house came with one condition: I could survive the compression if I could at least build something about the size of a garage – to function as a place to work, think, create loud music of questionable quality,  and spread out my big messy projects."

http://www.mrmoneymustache.com/2017/01/24/diy-studio-building/

nereo

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Re: MMM 2016 Budget
« Reply #111 on: May 24, 2017, 08:47:34 AM »
@ edgema: one thing that's routinely missed about MMM's $25k/year spending is that it includes a paid off home (he paid something like $330k for his current abode). He counts property taxes but not rent/mortgage (because he has none).

It's not really hidden, but many start out thinking "but I pay $1250/mo for my reasonable home in a HCOL area - that's $15,000/year!  I can't live on just $833/mo!"  No.   To follow his spending example it's $2,100/mo AFTER/EXCLUDING your rent or mortgage. 

But as you said, it's about expectations, values and regions.  Ultimately it's about paying for what you value and enriches your life, and cutting out all the other crap that creeps into our modern lives.
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jim555

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Re: MMM 2016 Budget
« Reply #112 on: May 24, 2017, 08:55:59 AM »
MMM is way under spending considering his income.  Frugality is hard to change once you have it.

BeanCounter

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Re: MMM 2016 Budget
« Reply #113 on: May 24, 2017, 08:57:05 AM »
While I believe in the overall MMM message, I have been one of his outspoken critics in the past year regarding the disclosure of his expenses and the sustainability of his lifestyle. I do think this years post is better written than the previous year.

ditkanate

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Re: MMM 2016 Budget
« Reply #114 on: May 24, 2017, 09:03:38 AM »
I'm a bit confused why some people upset. Because MMM is completely FI, he shouldn't spend beyond $25k per year for the rest of his life til death do us part, because he explained years ago in his blog how to become FI?  Because he espouses these principles he is forever bound by them?  Maybe he should quit writing entirely and just leave up the old posts about his life before he was making boatloads of cash through the blog?  Seems like he is in a no win situation.  He acknowledges in his post that he is spending money beyond what he used to preach.  He is only ABLE to spend that additional money because he DID live the life he used to preach.  And because he lived the frugal FIRE life he had the free time to create his blog, which has given him even MORE financial freedom.  Which he is choosing to use in various ways. 

edgema

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Re: MMM 2016 Budget
« Reply #115 on: May 24, 2017, 09:27:03 AM »
Nerio.

I understand that property point, but only included as the higher the number the harder to pay off and start building the FI pot.

I totally agree with your ‘expectations, values and regions’ point. I liked a view presented on, I think, another blog which promoted being more mindful of what you are spending money on. Is this purchase adding a positive or taking away a negative in my life. Garden man cave for $30k, fabulous fun for decades, lets’ do it. $15k rolex, ridiculous consumerism, let’s not.

The problem is I think MMM can be a little preachy that $25k is ‘the’ number where the family live the life they ‘exactly’ want. Where people have taking issue is that is clearly not the case has they have spent $90k plus this year.

My concern is that if people take the $25k and the 4% figures too literally and too early in life, they may make the jump too early and give up well paid careers and then may have to struggle into less well paid ones later in life if they get the numbers wrong.

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Re: MMM 2016 Budget
« Reply #116 on: May 24, 2017, 09:39:30 AM »
Quote
Because he espouses these principles he is forever bound by them? Seems like he is in a no win situation.

No, he's not bound by them and yes, he's in a no-win situation. All that's really at stake here is whether or not Pete wants to be the "lifestyle guru" that he has previously stated is his goal. If he wants to just kick back and enjoy FI, he can spend whatever he likes. If he really wants to bring in new people to his environmentalist, anti-consumerism movement, he kinda needs to stay the original course.

I'm not mad. I understand all the nuance. All I'm saying if that I was a new site visitor and the 2016 budget post was the first thing I saw (aka "I'm retired but make >300k a year and spend only 25k12345!!), my first reaction would be to think that MMM was just another Internet charlatan financing his life by preying on the dreams of others. I would immediately close the browser.



1Not including business expenses
2Not including 'investment' home renovations
3Not including property taxes
4Not including buying cars for 'advocacy' purposes
5Not including whatever else I bought
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EscapeVelocity2020

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Re: MMM 2016 Budget
« Reply #117 on: May 24, 2017, 09:41:19 AM »
I'm a bit confused why some people upset. Because MMM is completely FI, he shouldn't spend beyond $25k per year for the rest of his life til death do us part, because he explained years ago in his blog how to become FI?  Because he espouses these principles he is forever bound by them?  Maybe he should quit writing entirely and just leave up the old posts about his life before he was making boatloads of cash through the blog?  Seems like he is in a no win situation.  He acknowledges in his post that he is spending money beyond what he used to preach.  He is only ABLE to spend that additional money because he DID live the life he used to preach.  And because he lived the frugal FIRE life he had the free time to create his blog, which has given him even MORE financial freedom.  Which he is choosing to use in various ways.

If his life was an exploding volcano of luxury at 25k, then spending more should be an unpleasant, bedpan and catheter issue.  Hardship was a virtue.  This was the foundation of Mustachianism, so basically Pete is living as though his assumption was wrong and as income rises then spending more makes for a better life.

Maybe he should've quit while he was ahead, he won't be the first to have made that mistake (George Lucas).
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Chris22

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Re: MMM 2016 Budget
« Reply #118 on: May 24, 2017, 09:44:40 AM »
Quote
Because he espouses these principles he is forever bound by them? Seems like he is in a no win situation.

No, he's not bound by them and yes, he's in a no-win situation. All that's really at stake here is whether or not Pete wants to be the "lifestyle guru" that he has previously stated is his goal. If he wants to just kick back and enjoy FI, he can spend whatever he likes. 

I'm not mad. I understand all the nuance. All I'm saying if that I was a new site visitor and the 2016 budget post was the first thing I saw (aka "I'm retired but make >300k a year and spend only 25k12345!!), my first reaction would be to think that MMM was just another Internet charlatan financing his life by preying on the dreams of others. I would immediately close the browser.



1Not including business expenses
2Not including 'investment' home renovations
3Not including property taxes
4Not including buying cars for 'advocacy' purposes
5Not including whatever else I bought

This.  All of this.  Well stated.

Quote
If he really wants to bring in new people to his environmentalist, anti-consumerism movement, he kinda needs to stay the original course.

I wouldn't even necessarily argue this, I would just say he can't be crowing about "I spend $25k a year and live a super-luxurious life!"  A lot of what makes his life super-luxurious is not counted when calculating that $25k.  If you're the kind of person who can say "eh, I get his jist, it doesn't matter" then that's fine.  I'm not that kind of person.  I'm an accountant.  If you tell me you spent $25k and your spending doesn't add up to $25k I'm going to throw the bullshit flag, because you're lying. 
"If I could get all the money back I ever spent on cars, I'd spend it on cars." - Nick Mason

BeanCounter

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Re: MMM 2016 Budget
« Reply #119 on: May 24, 2017, 09:46:02 AM »
The problem is I think MMM can be a little preachy that $25k is ‘the’ number where the family live the life they ‘exactly’ want. Where people have taking issue is that is clearly not the case has they have spent $90k plus this year.

My concern is that if people take the $25k and the 4% figures too literally and too early in life, they may make the jump too early and give up well paid careers and then may have to struggle into less well paid ones later in life if they get the numbers wrong.
+1
I think we're pretty frugal. But $25k with kids would require a pretty extreme lifestyle. And saying no a lot. MMM has no extra sports or extra curricular activities for his kid in the budget. Is that really realistic? There are zero school expenses. I feel like I'm always throwing in some money for something my kids need at school. Or outings to museums or other family entertainment that costs money?
What about things like braces when the boy gets older. Are you going to say no to that? What about the kid getting his drivers license? Are you going to say no to that because the insurance is expensive and he should just ride his bike?
I could go on and on.

mm1970

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Re: MMM 2016 Budget
« Reply #120 on: May 24, 2017, 09:51:25 AM »
I understand the objections here, and I empathize with the idea of "hidden spending" turning off some readers, but lets stop for a sec and think about this. 

To me the whole idea of Mustachianism isn't just being frugal, clipping coupons, credit card bonuses, etc.  It's about designing an efficient lifestyle, one that make you happy. We are so quick to use spending as a way to measure, we forget, that's not even the point. Our goal is to fulfill our needs without "throw a bunch of cash at the problem" as our first option.  MMM designed his life so that his need for travel, buying electric cars, etc are fulfilled.  At the same time he is writing articles and promoting an agenda/lifestyle important to him, earning income he gets to divert to large scale donations to other causes important to him, meet friends with similar values, ect.  IOW, one action works towards several goals at once, all without directly costing him money. He has parlayed his financial independence into a more efficient lifestyle.

We are comparing apples to oranges in that we are trying to compare the accounting of a 50hr a week salaryman to someone who is financially independent.  None of MMM's endeavors would have been possible if his baseline needs weren't covered (aka financial independence).  No blog, no trips, no electric car, no six figure donations to charity.


Well, I think that's the point many are making. His "advice" and writing these days isn't really applicable to 99% of people. I certainly find nothing actionable there lately. What he thinks of the Leaf, or donating $100k may be interesting reading for some, but I can read that elsewhere. And frankly don't care.

99% out blogs never make a dime, and 9/10 people who start a business go bust. So reading about one of the few who has a half million dollar blog and actually make money from his business may be fascinating on some level, but provide virtually nothing to apply to my life. I can only work my desk job and try to save, starting a blog would not make me anything. It's a necessity caused by his success, but I don't feel a need to read it anymore, and I haven't.

I think some of that is just because he's awesome.

I mean, think about it...most people aren't as successful as he is.  Whether in software or anything.

He and his wife both had really good jobs...higher than most people. 
Then they saved a lot of money ... a lot more than most people.

Retiring early gave him the freedom to work on other ventures.  And it turns out, he's really good at a lot of things...better than most people.  And, by retiring early, he had the time to work on them.

- His writing is engaging, and his blog was really good at the beginning. I'm betting it's not just that he's a good writer - he had to work at it.  I've had a blog for 10 years, and I can identify the <10 good posts that I wrote, and they were definitely ones that I wrote and re-wrote and researched.

- He's really good at real estate and fixing up houses.  But you know, he had some early fails.  Sure he's mechanically inclined, but a lot of his success has come from...practice.  My husband is mechanically inclined too, but you can tell which parts of the house he did earlier rather than later.

- Then there is Mrs MMM.  First, there was getting her real estate license, which helped save money on the transactions (I mean, aside from her prior day job!)
- Then there's her hobbies. I  love crafting too.  I've tried just about everything.  The two things I've stuck to most are quilting and crocheting, though I've dabbled in jewelry making.  I don't wear jewelry though, so it's not my interest.   Well, it turns out her Etsy shop is successful.  Now, how?  First, she was retired, so she had the time to try and few things.  And pick the ones that she liked.  And see what sold.  Then, she did RESEARCH.  It's not just "putting stuff on Etsy".  I wouldn't have the faintest clue on how to do the research MMM described in his blog post - but that's a key to her success.  Doing the research to figure out what sells, and how to get more business.

So in both cases - the two individuals are both more talented than most (which will make others jealous at times), AND they've designed their lives so that they can follow these passions and work on them.  And now they are lucrative. 

I mean, isn't that part of the point?  Designing your own life?  Not needing the money?  I just think that a lot of the disappointment in how MMM's life is going is just sour grapes because it all came up roses.  Is it really his "fault" that he's good at things?

Most blogs don't make money, but most of them suck.
I'd gather that most Etsy shops aren't big money makers either.

It's like a blog I used to read where it was a mom packing vegan lunchboxes for her kid.  She went on to write two vegan cookbooks.  Then a few years later, stopped being vegan.  The vitriol!  "How dare you make money on these cookbooks when you are a faker!"  Um, she wasn't a faker when she wrote the books?  And they are good books with good recipes?  And she still is mostly vegan?

Chris22

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Re: MMM 2016 Budget
« Reply #121 on: May 24, 2017, 09:55:32 AM »
It's like a blog I used to read where it was a mom packing vegan lunchboxes for her kid.  She went on to write two vegan cookbooks.  Then a few years later, stopped being vegan.  The vitriol!  "How dare you make money on these cookbooks when you are a faker!"  Um, she wasn't a faker when she wrote the books?  And they are good books with good recipes?  And she still is mostly vegan?

But there's a difference between:

"I'm mostly vegan, here are some great vegan recipes, but occasionally I'll have meat"

and

"I'm a vegan, everyone should be vegan, look how awesome my vegan lifestyle is and we're all vegan all the time*



*except sometimes we eat meat when we want a really good meal"
"If I could get all the money back I ever spent on cars, I'd spend it on cars." - Nick Mason

Dabnasty

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Re: MMM 2016 Budget
« Reply #122 on: May 24, 2017, 09:56:02 AM »
Nerio.

I understand that property point, but only included as the higher the number the harder to pay off and start building the FI pot.

I totally agree with your ‘expectations, values and regions’ point. I liked a view presented on, I think, another blog which promoted being more mindful of what you are spending money on. Is this purchase adding a positive or taking away a negative in my life. Garden man cave for $30k, fabulous fun for decades, lets’ do it. $15k rolex, ridiculous consumerism, let’s not.

The problem is I think MMM can be a little preachy that $25k is ‘the’ number where the family live the life they ‘exactly’ want. Where people have taking issue is that is clearly not the case has they have spent $90k plus this year.

My concern is that if people take the $25k and the 4% figures too literally and too early in life, they may make the jump too early and give up well paid careers and then may have to struggle into less well paid ones later in life if they get the numbers wrong.
I think you're right that this is why some are critical, he claimed life couldn't possibly get better with more spending but I always took that as part of his optimistic/exaggerative writing style and what he really meant was he was high enough on the diminishing returns scale to not care much. On the other hand I can actually agree with some of his creative accounting and I think his costs to meet maximum happiness haven't changed much. I suppose the up front shed cost should factor in opportunity cost :) Then again he may get his 30 back +7%/per year in appreciation, the world may never know...

That being said I am impressed that certain costs like restaurants and automobile are still so low. I think this is interesting because it shows which expenses they truly aren't interested in spending more on and these are the types of consumerist spending he is most critical of. I find this useful information because I do wonder, If I were not working full time would I eat out more due to boredom or would I eat out less because I can take as much time as I want to cook. I assume the latter but I know I can't always trust my future self.

Chris22

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Re: MMM 2016 Budget
« Reply #123 on: May 24, 2017, 09:58:22 AM »
That being said I am impressed that certain costs like restaurants and automobile are still so low. I think this is interesting because it shows which expenses they truly aren't interested in spending more on and these are the types of consumerist spending he is most critical of. I find this useful information because I do wonder, If I were not working full time would I eat out more due to boredom or would I eat out less because I can take as much time as I want to cook. I assume the latter but I know I can't always trust my future self.

Except his automobile costs are NOT so low, because he didn't count the fact that he bought, you know, an automobile.  He just said they're low because he wrote a small number for "automobile".

 
"If I could get all the money back I ever spent on cars, I'd spend it on cars." - Nick Mason

mm1970

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Re: MMM 2016 Budget
« Reply #124 on: May 24, 2017, 09:58:43 AM »
Quote
Be gentle as I can see true Moustacians sharpening their knives (but I could go on) and what is the option – tell my kids to only make local friends, tell them that I know I grew up going skiing but daddy wants to retire at 40 so tough luck, tell my dad sorry but we aren’t going to visit, saddle my kids with massive debt and thus impact their career choices (as it did me)? This has led me to some sort of Moustache ‘lite’ version which looks, perhaps ironically, much more like MMM spending this past year and something like a baseline something like $80,000 a year if you are free of mortgage and debt. I believe many of the ‘one off’ items in this 2016 budget are simply not (like many corporate accounts!) and would be replaced by other ‘one off’ items each year. For example, I seem to remember a blog entry where the beauty of FI was described by MMM as the ability to go to Florida for a month to escape the harsh winters in Colorado.

- Have dad come visit you, or visit less often, or figure out how to use miles (I used to fly my mother over to visit us because it's 1 plane ticket instead of 4)
- MMM hasn't said he will saddle his kid with debt.  I'm imagining he won't pay outright for college but also won't let him get into debt either.  Kind of nice when your parents know their way around.
- I assume there are ways to ski for less, but I don't ski.  My husband did ski growing up.  And...right now my kids have been skiing exactly once (well, one of them anyway), and they don't seem to be damaged by lack of skiing.

mm1970

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Re: MMM 2016 Budget
« Reply #125 on: May 24, 2017, 10:00:11 AM »
It's like a blog I used to read where it was a mom packing vegan lunchboxes for her kid.  She went on to write two vegan cookbooks.  Then a few years later, stopped being vegan.  The vitriol!  "How dare you make money on these cookbooks when you are a faker!"  Um, she wasn't a faker when she wrote the books?  And they are good books with good recipes?  And she still is mostly vegan?

But there's a difference between:

"I'm mostly vegan, here are some great vegan recipes, but occasionally I'll have meat"

and

"I'm a vegan, everyone should be vegan, look how awesome my vegan lifestyle is and we're all vegan all the time*



*except sometimes we eat meat when we want a really good meal"

Thing is, she *was* a vegan for a very very long time.  And when she wrote the cookbooks, she was a vegan.  So I really don't understand the attitude of "how dare you make money on it!"  Like she has to turn in her vegan card (well, if there was one)...but she still wrote the books.  And by then, she was shutting down the blog. 

Chippewa

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Re: MMM 2016 Budget
« Reply #126 on: May 24, 2017, 10:04:24 AM »
I ended up reading his post due to this thread. I understand the angst some have. But the lesson or bit I took from it is to create multiple business incomes. That's an advantage. If neither of them had businesses then they would be fine on their bare bones budget fo $25K ish. At some point, they both had to expand their lives. Instead of doing it from personal or dividend income, they are doing it with business income. With no fear of failure because they have set up a great safety net. That can take a person quite far if the want.
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mm1970

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Re: MMM 2016 Budget
« Reply #127 on: May 24, 2017, 10:06:38 AM »
Quote
MMM has no extra sports or extra curricular activities for his kid in the budget. Is that really realistic? There are zero school expenses. I feel like I'm always throwing in some money for something my kids need at school. Or outings to museums or other family entertainment that costs money?
What about things like braces when the boy gets older. Are you going to say no to that? What about the kid getting his drivers license? Are you going to say no to that because the insurance is expensive and he should just ride his bike?
I could go on and on.

Why would it be in the budget if he doesn't need it yet?

My older kid is his kid's age.  He didn't really need a budget for sports or extra-curriculars for a very long time.  Eventually, he joined baseball. So yeah, now we pay for baseball.  But he's got quite a few friends who aren't into sports, and don't play sports.

We have free music lessons at school, and even extra music district-wide.  Also free.  And they bus your kids there.
We also have free sports at school. Soccer, basketball, and track.

I never had braces.  Many kids never need braces.  Even if they do, eventually, why would he have braces in his budget if his kid doesn't need them (yet)?

His kid is 5 years from driving, why on earth would he have a driver's license in his budget?

There are plenty of family entertainment things that you can do that are free.  The library.  Free days at museums.  Around here, kids go on field trips to museums, and then the museums often give them a ticket for a free family entry for a day.  Free concerts in the park.  Hikes.  Parks.  And, of course, if you are retired - you then have more time to figure out all these free days and things.

You can get by at school spending very little money.  Like $0.

Chris22

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Re: MMM 2016 Budget
« Reply #128 on: May 24, 2017, 10:07:15 AM »
It's like a blog I used to read where it was a mom packing vegan lunchboxes for her kid.  She went on to write two vegan cookbooks.  Then a few years later, stopped being vegan.  The vitriol!  "How dare you make money on these cookbooks when you are a faker!"  Um, she wasn't a faker when she wrote the books?  And they are good books with good recipes?  And she still is mostly vegan?

But there's a difference between:

"I'm mostly vegan, here are some great vegan recipes, but occasionally I'll have meat"

and

"I'm a vegan, everyone should be vegan, look how awesome my vegan lifestyle is and we're all vegan all the time*



*except sometimes we eat meat when we want a really good meal"

Thing is, she *was* a vegan for a very very long time.  And when she wrote the cookbooks, she was a vegan.  So I really don't understand the attitude of "how dare you make money on it!"  Like she has to turn in her vegan card (well, if there was one)...but she still wrote the books.  And by then, she was shutting down the blog.

I have zero problem with the money MMM makes from his blog.  None at all.  I'm just asking for some intellectual honesty, if there's lifestyle creep (and there is) A) admit to it, and B) either defend it or reject it and desire to do better.  But don't pretend it isn't there because you make up numbers that omit it. 

It would be like if your vegan author was telling everyone they should be vegan because it's so great but not being vegan herself.  She doesn't need to be vegan for her vegan recipes to have merit.  But her overall message of "you should be a vegan" (assuming she's pushing veganism" falls apart if she's, uh, not being vegan.  If you're going to tell me I should be a vegan then you should be a vegan.  If you are going to tell me be mostly vegan but some meat sometimes is okay, then that's fine too.  But a non-vegan telling me I should be a vegan is different.
"If I could get all the money back I ever spent on cars, I'd spend it on cars." - Nick Mason

Dabnasty

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Re: MMM 2016 Budget
« Reply #129 on: May 24, 2017, 10:17:18 AM »
If his life was an exploding volcano of luxury at 25k, then spending more should be an unpleasant, bedpan and catheter issue.  Hardship was a virtue.  This was the foundation of Mustachianism, so basically Pete is living as though his assumption was wrong and as income rises then spending more makes for a better life.

Maybe he should've quit while he was ahead, he won't be the first to have made that mistake (George Lucas).

I have to disagree with this angle because he never said additional spending is a step toward bedpan/catheter, that's only the case if you're spending on convenience and luxury. People spend thousands of dollars to climb Mount Everest.

And he built a shed. Sure, he spent $30,000 on it but he could have spent more and had it built without lifting a finger. He drives for Uber to try out the leaf. He continues to help friends with construction projects for beer. Are these not voluntary hardships?

As for Star Wars, well. I mean. ya

tyort1

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Re: MMM 2016 Budget
« Reply #130 on: May 24, 2017, 10:19:14 AM »
Pete is in a tough place - he's got expenses that can be accounted for as personal expenses or business expenses.

If he labels them as personal expenses, then he is criticized - LIFESTYLE CREEP!!

If he labels them as business expenses, then he is criticized - NOT RETIRED!!!

Kind of the definition of a no win situation.
Frugalite in training.

Gondolin

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Re: MMM 2016 Budget
« Reply #131 on: May 24, 2017, 10:24:05 AM »
Quote
If he really wants to bring in new people to his environmentalist, anti-consumerism movement, he kinda needs to stay the original course.

I wouldn't even necessarily argue this

Yeah, I agree (Hence the 'kinda' qualifier). There's got to be a way to package his current situation in a way that doesn't dull the original message.

Quote
But don't pretend it isn't there because you make up numbers that omit it. 

Ah, this! I think you and I are on the same page Chris22. Vagueness, accounting tricks, "all the secrets are in my $19.99 e-book" BS is what internet charlatans love. Part of what drew me to the MMM website was how clear and transparent it all was. Now MMM is starting to lose that and I think it muddles the clarity of his original message for new readers.

The shockingly simple math is shocking because it is simple. Once you start adding caveats, business expense categories, and complex accounting, it completely loses it's potency.


Quote
If he labels them as personal expenses, then he is criticized - LIFESTYLE CREEP!!
If he labels them as business expenses, then he is criticized - NOT RETIRED!!!

Also, true. Welcome to the Internet I guess.
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Chris22

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Re: MMM 2016 Budget
« Reply #132 on: May 24, 2017, 10:27:19 AM »
Pete is in a tough place - he's got expenses that can be accounted for as personal expenses or business expenses.

If he labels them as personal expenses, then he is criticized - LIFESTYLE CREEP!!

If he labels them as business expenses, then he is criticized - NOT RETIRED!!!

Kind of the definition of a no win situation.

The two I'm most critical of, the car and the shed, can't reasonably be claimed as business expenses in my opinion, and the shed he excluded purely on the basis that it will appreciate so it isn't spending (Jennifer Lawrence yeah ok gif).  The car replaced his other personal car, and yeah he wants to "use it as an experiment for the blog" but it's pretty clearly replacing his last personal car, so.....


I don't even think either is excessive lifestyle creep.  "Hey we downsized houses, and I used some proceeds to build a shed, it all happened to hit this year."  "I wanted to get an electric car to replace a gas car because it's the right thing to do, that cost me $XXXX in car payments this year."  No big deal.  The problem, as they say, is in the coverup.
"If I could get all the money back I ever spent on cars, I'd spend it on cars." - Nick Mason

BeanCounter

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Re: MMM 2016 Budget
« Reply #133 on: May 24, 2017, 10:29:56 AM »
Quote
MMM has no extra sports or extra curricular activities for his kid in the budget. Is that really realistic? There are zero school expenses. I feel like I'm always throwing in some money for something my kids need at school. Or outings to museums or other family entertainment that costs money?
What about things like braces when the boy gets older. Are you going to say no to that? What about the kid getting his drivers license? Are you going to say no to that because the insurance is expensive and he should just ride his bike?
I could go on and on.

Why would it be in the budget if he doesn't need it yet?

My older kid is his kid's age.  He didn't really need a budget for sports or extra-curriculars for a very long time.  Eventually, he joined baseball. So yeah, now we pay for baseball.  But he's got quite a few friends who aren't into sports, and don't play sports.

We have free music lessons at school, and even extra music district-wide.  Also free.  And they bus your kids there.
We also have free sports at school. Soccer, basketball, and track.

I never had braces.  Many kids never need braces.  Even if they do, eventually, why would he have braces in his budget if his kid doesn't need them (yet)?

His kid is 5 years from driving, why on earth would he have a driver's license in his budget?

There are plenty of family entertainment things that you can do that are free.  The library.  Free days at museums.  Around here, kids go on field trips to museums, and then the museums often give them a ticket for a free family entry for a day.  Free concerts in the park.  Hikes.  Parks.  And, of course, if you are retired - you then have more time to figure out all these free days and things.

You can get by at school spending very little money.  Like $0.

He wouldn't necessarily have those particular things in his budget. I'm just using them as an example of how kids cause lifestyle creep that you have very little control over. If you FIRE with kids on a $700k stache, how do you pay for those things over time. Or maybe you don't, you just say no to everything.

PopMegaphone

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Re: MMM 2016 Budget
« Reply #134 on: May 24, 2017, 10:34:08 AM »

The two I'm most critical of, the car and the shed, can't reasonably be claimed as business expenses in my opinion, and the shed he excluded purely on the basis that it will appreciate so it isn't spending (Jennifer Lawrence yeah ok gif).  The car replaced his other personal car, and yeah he wants to "use it as an experiment for the blog" but it's pretty clearly replacing his last personal car, so.....

For me MMM has a minor amount of hypocrisy judging others lifestyle creep while glossing over his own.   Basically, there's a bit of arrogance being the judge, jury and executioner on what constitutes "good" life style creep spending.

I like MMM and I think he makes some good points, but the way he presents this budget is pretty ridiculous.
« Last Edit: May 24, 2017, 10:35:53 AM by PopMegaphone »

bacchi

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Re: MMM 2016 Budget
« Reply #135 on: May 24, 2017, 10:45:10 AM »
At least it's better than Dave Ramsey's $4.9M modern castle

That is one tacky monstrosity.

nereo

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Re: MMM 2016 Budget
« Reply #136 on: May 24, 2017, 10:53:08 AM »
At least it's better than Dave Ramsey's $4.9M modern castle

That is one tacky monstrosity.
"God" provided it for him.
13,000 sqft + a 1,500 sqft garage.
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Blackeagle

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Re: MMM 2016 Budget
« Reply #137 on: May 24, 2017, 11:21:19 AM »
I do have a bit of a problem with the blog income.  He said that being FI means he no longer needs to make decisions with regard to how much income his actions will generate... and then goes ahead and relentlessly monetizes his website. 

He is no where close to "relentlessly" monetizing the blog.  Sure, he's doing some affiliate marketing, but there's no straight up ads (even here on the forum), no sponsored content, he's not hawking books or seminars, there's no membership where you can pay more each month to get extra content, and the posting rate is pretty clearly driven by his level of interest in writing rather than what would generate the most money.  Frankly, when it comes to monetizing MMM he's being pretty lazy about it. 

ditkanate

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Re: MMM 2016 Budget
« Reply #138 on: May 24, 2017, 11:45:32 AM »
Pete is in a tough place - he's got expenses that can be accounted for as personal expenses or business expenses.

If he labels them as personal expenses, then he is criticized - LIFESTYLE CREEP!!

If he labels them as business expenses, then he is criticized - NOT RETIRED!!!

Kind of the definition of a no win situation.

The two I'm most critical of, the car and the shed, can't reasonably be claimed as business expenses in my opinion, and the shed he excluded purely on the basis that it will appreciate so it isn't spending (Jennifer Lawrence yeah ok gif).  The car replaced his other personal car, and yeah he wants to "use it as an experiment for the blog" but it's pretty clearly replacing his last personal car, so.....


I don't even think either is excessive lifestyle creep.  "Hey we downsized houses, and I used some proceeds to build a shed, it all happened to hit this year."  "I wanted to get an electric car to replace a gas car because it's the right thing to do, that cost me $XXXX in car payments this year."  No big deal.  The problem, as they say, is in the coverup.

But, he wrote about both of those things in the blog.  How is that a coverup?  Because he didn't categorize them how you'd prefer? 

Perhaps he should write his spending blog posts with just two categories:

1. Spending that would've happened no matter what even if I wasn't retired yet.
2. Other spending due to being super rich and retired.

It sounds like the main problem many have is looking at this post through the eyes of a complete MMM newbie and seeing them get turned off by a perceived slight of hand with the accounting. 

Kathryn K.

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Re: MMM 2016 Budget
« Reply #139 on: May 24, 2017, 11:53:30 AM »
The two I'm most critical of, the car and the shed, can't reasonably be claimed as business expenses in my opinion, and the shed he excluded purely on the basis that it will appreciate so it isn't spending (Jennifer Lawrence yeah ok gif).  The car replaced his other personal car, and yeah he wants to "use it as an experiment for the blog" but it's pretty clearly replacing his last personal car, so.....


I don't even think either is excessive lifestyle creep.  "Hey we downsized houses, and I used some proceeds to build a shed, it all happened to hit this year."  "I wanted to get an electric car to replace a gas car because it's the right thing to do, that cost me $XXXX in car payments this year."  No big deal.  The problem, as they say, is in the coverup.

Yeah, I haven't read the blog lately so when I went back and read the post about the shed I rolled my eyes hard.  MMM goes from "downsizing is so great!" to "whoops, guess that getting rid of a lot of housing space isn't all it's all cracked up to be!" And then justifies the shed because he's a "Maker" and it will appreciate (uh, not so sure random structures on a property are always a plus).

I scanned through the original post about the house and didn't see anything about the plans for the shed mentioned then (as he now claims was the case from the beginning), so I think it is disingenous to be all "Downsizing is so great!!!" and then come back a few years later saying you were planning to build extra space the whole time.

Edit: In a subsequent post about the house http://www.mrmoneymustache.com/2013/09/23/rebuilding-our-new-old-house-want-to-help/ I do see the shed is mentioned although it is was described as an office/workspace/cross-fit studio (presumably for both MMM and Mrs. MMM) while in its final incarnation it seems to have become solely an office/workshop for MMM. I still consider it disingenous that this wasn't mentioned when all the benefits of downsizing were being discussed.
« Last Edit: May 24, 2017, 12:06:29 PM by Kathryn K. »

Raenia

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Re: MMM 2016 Budget
« Reply #140 on: May 24, 2017, 11:54:17 AM »
I don't have much too add to the conversation here, but just wanted to say that posts like this were what made me roll my eyes and close the browser the first time someone directed me to MMM.  Yeah, sure, it looks so easy when you have two high-earning adults with no kids during the accumulation phase, and you can count all your expensive hobbies as business expenses instead of actual spending.  It took years for me to come back and give the blog another read to get past that and see the truth of the math.  I wouldn't be surprised if others see the creativity of MMM's budgeting and are convinced there's nothing real behind it and give up without trying.

I have not interest in face-punching for the spending, they're successful and retired and can do what they like.  But still, it is definitely off-putting to newbies.

obstinate

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Re: MMM 2016 Budget
« Reply #141 on: May 24, 2017, 12:00:43 PM »
Pete is in a tough place - he's got expenses that can be accounted for as personal expenses or business expenses.
Well, he'd be in a tough place if he gave a shit about the carping that gets done on these fora, which he doesn't read.

threefive

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Re: MMM 2016 Budget
« Reply #142 on: May 24, 2017, 12:04:27 PM »
If MMM truly monetized the blog to its potential based on traffic, then it would look completely different. With his level of traffic, the blog income is relatively small. Very rarely do I feel like he's trying to sell me something other than whatever is going on in his head (the exception being stuff like PeerStreet, Betterment, etc.)

Business expenses: why would he include these in his personal spending? I travel all over the world for my job. Trust me, I get a LOT of personal enjoyment out of doing so. I would never think to add the costs of those trips into my personal spending. I'm about to take a job that includes free public transportation on the area's public transit. My personal spending will go down quite a bit because of this. I never thought to continue calculating the imputed cost of that into my personal budget. Sure, maybe I need to think about the potential future transportation costs when I leave the job, but right now it's a benefit. Should I also include my employers considerable contribution to my health insurance when calculating personal expenses? Would it matter if a company I owned paid these costs?

The Nissan Leaf stuff is a bit hand-wavy BS. He has/had a car. He spent that money. Sure he can write about the car, but if he isn't deducting it from his taxes, then I wouldn't consider it a business expense. I think he'd have a tough time in an audit if he did deduct it from his taxes as a business expense. The outbuilding is just him spending money and outright pretending he didn't. He will not get $30k added value to the house. I spent $15k this year renovating our kitchen. I won't get $15k back out. I spent $15k because I wanted a new kitchen. He spent $30k because he wanted a man cave. I have no beef with that, but he did still spend the money.

Still ... if we add in the the car and the outbuilding, we're looking at:

(1) Car: Say $14k (not sure how he swung that!), worth about $7k in 5 years, so about $1,400 spread over that time. I'm even ignoring the sale of the Scion.
(2) Outbuilding: I'll spread this cost over 10 years, because how many outbuildings are you going to build in that time? Forget opportunity cost. That's $3000 in spending.

So ... $35,000. If I take that number and add to it my housing costs, then he's at a typical middle class level of spending. He'd need roughly a $70k a year job to support that level of spending with the inclusion of "traditional" retirement saving. What that means is he is not some frugal living god, but a relatively normal middle class spender, which I don't think he disagrees with.

My point: Live like you make $60-70k on a salary of $120k and retire early. If you don't make $120k, then ... start making $120k or spend less than MMM. If you make the average household income in the US, then don't expect the MMM lifestyle. It's too fancy.

Kathryn K.

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Re: MMM 2016 Budget
« Reply #143 on: May 24, 2017, 12:09:15 PM »
If MMM truly monetized the blog to its potential based on traffic, then it would look completely different. With his level of traffic, the blog income is relatively small. Very rarely do I feel like he's trying to sell me something other than whatever is going on in his head (the exception being stuff like PeerStreet, Betterment, etc.)


Since you admit that at least in some cases, the blog monetization has compromised his message, why did MMM monetize at all if he would have been truly ok living on $25K with no extras paid for as business expenses?

PoutineLover

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Re: MMM 2016 Budget
« Reply #144 on: May 24, 2017, 12:16:12 PM »
Since you admit that at least in some cases, the blog monetization has compromised his message, why did MMM monetize at all if he would have been truly ok living on $25K with no extras paid for as business expenses?
... he saw an opportunity, he took it. He is pretty transparent about all the things he has recommended and states that he recommends them because he uses them and that if you sign up he (and sometimes you) will get a benefit. It's done in a more tasteful way than just papering the blog in ads. In the end, it adds to his safety cushion, or he donates it. Wouldn't you take that same opportunity, even if you didn't really need the money?

ol1970

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Re: MMM 2016 Budget
« Reply #145 on: May 24, 2017, 12:16:25 PM »
I'm just glad he came clean that his budget for alcohol and craft beer is grossly understated at $350!  Dear lord I'd be embarrassed as hell to tell the world what a single guy who lives on the water, entertains with sunset boat rides, and has been known to throw the occasional party spends on that line item!

In all seriousness though, I get that he is sort of "trapped" in his spending because his fame and identity is as the super frugal dude.  I think 50 years from now though, when he's got a massive pile of money laying on his death bed, he may wish he would have taken his wife and kids on a Safari, or a sailing trip to through the Caribbean, or (fill in with other awesome life experience here).  To each their own and if he's happy that is all that matters...I for one wouldn't be pissed if he took those trips as business expenses and wrote about it, life's way too short to sit ultra-frugally on your pile when there is so much cool stuff out there to experience. 

boarder42

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Re: MMM 2016 Budget
« Reply #146 on: May 24, 2017, 12:20:15 PM »
If MMM truly monetized the blog to its potential based on traffic, then it would look completely different. With his level of traffic, the blog income is relatively small. Very rarely do I feel like he's trying to sell me something other than whatever is going on in his head (the exception being stuff like PeerStreet, Betterment, etc.)


Since you admit that at least in some cases, the blog monetization has compromised his message, why did MMM monetize at all if he would have been truly ok living on $25K with no extras paid for as business expenses?

b/c if you're going to do something why not make some extra cash doing it if its possible.  also MMM didnt FIRE

he left his job to start building houses <-- career change
then the housing market colapsed.  <--- if this doesnt happen we may never know about him.  he may just keep building houses making a killing.
then the markets crashed. <---- butt hole pucker time.

anyone in that situation would likely be looking to bring in extra income if possible so he blogged and monetized it.
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Kathryn K.

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Re: MMM 2016 Budget
« Reply #147 on: May 24, 2017, 12:20:56 PM »
Since you admit that at least in some cases, the blog monetization has compromised his message, why did MMM monetize at all if he would have been truly ok living on $25K with no extras paid for as business expenses?
... he saw an opportunity, he took it. He is pretty transparent about all the things he has recommended and states that he recommends them because he uses them and that if you sign up he (and sometimes you) will get a benefit. It's done in a more tasteful way than just papering the blog in ads. In the end, it adds to his safety cushion, or he donates it. Wouldn't you take that same opportunity, even if you didn't really need the money?

Me personally yes, but I don't go around telling people but that I have the one true way of living and you're a consumer sucka if you don't agree with me.

MMM has been all about how his ideals are more important than money so there seems to be some cognitive dissonance there. Would MMM really have used some of these things if there wasn't the potential payoff down the road? As an earlier poster said, there's now no way to be sure so it does dilute his message.

Kathryn K.

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Re: MMM 2016 Budget
« Reply #148 on: May 24, 2017, 12:28:03 PM »
If MMM truly monetized the blog to its potential based on traffic, then it would look completely different. With his level of traffic, the blog income is relatively small. Very rarely do I feel like he's trying to sell me something other than whatever is going on in his head (the exception being stuff like PeerStreet, Betterment, etc.)


Since you admit that at least in some cases, the blog monetization has compromised his message, why did MMM monetize at all if he would have been truly ok living on $25K with no extras paid for as business expenses?

b/c if you're going to do something why not make some extra cash doing it if its possible.  also MMM didnt FIRE

he left his job to start building houses <-- career change
then the housing market colapsed.  <--- if this doesnt happen we may never know about him.  he may just keep building houses making a killing.
then the markets crashed. <---- butt hole pucker time.

anyone in that situation would likely be looking to bring in extra income if possible so he blogged and monetized it.

I don't disagree with your above sequence of history, but doesn't that also undercut that the message of "the 4% rule will see you through" that is a cornerstone of the MMM philosophy?

When one is basically preaching a philosophical system, not being consistent to it yourself is not the best way to get others to buy into it - especially when the philosophy itself promotes black and white thinking about its key concepts.

boarder42

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Re: MMM 2016 Budget
« Reply #149 on: May 24, 2017, 12:30:33 PM »
If MMM truly monetized the blog to its potential based on traffic, then it would look completely different. With his level of traffic, the blog income is relatively small. Very rarely do I feel like he's trying to sell me something other than whatever is going on in his head (the exception being stuff like PeerStreet, Betterment, etc.)


Since you admit that at least in some cases, the blog monetization has compromised his message, why did MMM monetize at all if he would have been truly ok living on $25K with no extras paid for as business expenses?

b/c if you're going to do something why not make some extra cash doing it if its possible.  also MMM didnt FIRE

he left his job to start building houses <-- career change
then the housing market colapsed.  <--- if this doesnt happen we may never know about him.  he may just keep building houses making a killing.
then the markets crashed. <---- butt hole pucker time.

anyone in that situation would likely be looking to bring in extra income if possible so he blogged and monetized it.

I don't disagree with your above sequence of history, but doesn't that also undercut that the message of "the 4% rule will see you through" that is a cornerstone of the MMM philosophy?

When one is basically preaching a philosophical system, not being consistent to it yourself is not the best way to get others to buy into it - especially when the philosophy itself promotes black and white thinking about its key concepts.

i 100% agree thats the side i'm on with the whole thing.  If he really wants to show this works every dime he makes should be given away.  (but who the hell is gonna do that)  the insurance is worth so much just to have that cash there for the healthcare what ifs the end of life what ifs.

it'd be really cool to see some one FIRE and 100% live on the 4% rule with a roth ladder and blog about it ... but when that happens and then it gets popular then it makes money and that money is now a safety net and you're no longer retired.  you see where this is going. its an infinite cycle.
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