Would you spend more if highly paid?

[mm1970]

When I hit FI and started considering RE, I was making enough $ I knew a year or two or three more of working now could make a huge difference versus what I could make if I decided to return to work later.  The only thing I could think of that would really cost that much would be a house, so I asked my wife to find the best one in the area for sale (knowing we would never want to move far) to see if I had a reason to plan to work longer than I was already planning.  We walked thru a $800k home and compared it to the $300k paid off home we live in in our MCOL area.  We just weren't that impressed, and not knowing if you'll actually like your neighbors as much as your current ones kinda made it a non-starter.

Unlike other mustachians we seem to have no problem finding things to spend money on and do let our spending increase annually to whatever 25x our investments are worth, but I can't think of anything we don't have that would make us any happier.

Neighbors.  Neighbors are key.  My best friend bought at a better time than us.  So for $88k less than we paid for our house, she has a 4 BR, 3BA house (city next door) with a garage.  Fantastic kitchen.

Her neighbors are TERRIBLE and mine are awesome.

[Cranky]

Probably?  Some? 

I mean, we certainly spent more money when we stopped being broke all the time. And we’re looking to move and more money makes that a lot easier.

But I actually don’t care for eating out or travel or fancy purses and I don’t drive. I couldn’t even think of anything I wanted for my birthday this summer. LOL

[Cassie]

We would spend more on vacations, eating out and entertainment. I would have someone clean twice a month.  Since we are older and retired this won’t be happening:))

[honeybbq]

I have, and I do.

The deeper answer is for me it's more about NW than salary. When my retirement accounts go up and down by thousands (or tens or hundreds! of thousands) a day, buying a $75 pair of shoes is not is really not a very big question any more.

I try not to be an over-consumer, but when I decide I want something, I just buy it.

[401Killer]

  As much as I'd love to go order a yellow Porsche 718 Cayman GT4 with a proper manual transmission, it would hurt and I would not be happy paying out a hundred grand to do it.

Sorry bud, but just posted on R&T!!

https://www.roadandtrack.com/new-cars/road-tests/a32718027/2020-porsche-cayman-gt4-review/

DOOOEEEET!!! /evil

[ender]

I'm jealous of everyone who can make more without spending more on taxes.

;-)

[FLAFI]

After investing the increased fire hose of cash for a few years, we might upgrade to a nicer home - provided the home is priced right (preferably in a real estate downturn).     

[Metalcat]

I'm jealous of everyone who can make more without spending more on taxes.

;-)

I could if I incorporated, if you want to be a pain in the ass about it ;)

[slappy]

After investing the increased fire hose of cash for a few years, we might upgrade to a nicer home - provided the home is priced right (preferably in a real estate downturn).   

Haha, this is me exactly. I keep looking at the nicer houses in my area and thinking about which one we would be willing to buy if the price was right. If we see a real estate downturn similar to 2008, we will certainly have decisions to make. Prices have come up quite a bit in my area since I bought my house, so my anchor is pretty low.

[Engineer93]

This.  I think our vacation budget would probably double from 5k to 10k a year, plus we would probably hire someone to clean our house and maintain our yard.  This is if our incomes went from 200k to 500k like the original post stated.  Eventually we would buy a bigger house, when we had kids, but not right now.  Obviously we'd be spending more but our savings % and total would greatly increase. 

We would spend more on vacations, eating out and entertainment. I would have someone clean twice a month.  Since we are older and retired this won’t be happening:))

[MayDay]

Yep. Not sure how much as I haven't found the sweet spot yet 😉

Examples of things we have spent more on recently (as we recently went from one person working to two, and increased incomes):

More travel, prioritization of flight times rather than cheapest option

Bought new car when old one died, didn't have intereat in trying to keep the old one running

Meal delivery service (kit that you cook at home).

Things on my list for someday:

Cleaner

Sunroom addition

Even more travel (someday....)

[ol1970]

Yes, you absolutely spend more when you earn more...and you should!  It drives me crazy when people arbitrarily set a budget for life before they've really experienced life and what their real earning potential is.  (i.e. MMM)

I've always saved over 70% of my income, but I went from making $70k/year out of college and living with a bunch of roommates in an apartment to save money, to making well over $1,000,000 a year in a with fat financial independence long in the rearview mirror.  Yes, I routinely by the $18 bottle of wine vs. the $8 bottle.  Yes, I now live in an amazing waterfront home with a sunset across the water between two 100 year old oak trees that looks like a postcard. Yes, I spend money traveling to exotic destinations and living an amazing life, yes this is all done on at the same time as continuing to live way below my means.

Money is meant to be spent, it is only units, you only live so long.  Once you've saved 50X your annual burn, spending a little more money to enjoy the time you have left on this planet to make you and your loved ones life enjoyable is smart.  Hell if MMM would have followed the same path maybe he would still be married and not have a broken family.

[joe189man]

ol1970 - can i ask what you do for work?

we have spent more as we made more - i see no reason not to enjoy life and spend more as you make more as long as you are planning for the future properly.

[LetItGrow]

When I hit FI and started considering RE, I was making enough $ I knew a year or two or three more of working now could make a huge difference versus what I could make if I decided to return to work later.  The only thing I could think of that would really cost that much would be a house, so I asked my wife to find the best one in the area for sale (knowing we would never want to move far) to see if I had a reason to plan to work longer than I was already planning.  We walked thru a $800k home and compared it to the $300k paid off home we live in in our MCOL area.  We just weren't that impressed, and not knowing if you'll actually like your neighbors as much as your current ones kinda made it a non-starter.

Unlike other mustachians we seem to have no problem finding things to spend money on and do let our spending increase annually to whatever 25x our investments are worth, but I can't think of anything we don't have that would make us any happier.

Neighbors.  Neighbors are key.  My best friend bought at a better time than us.  So for $88k less than we paid for our house, she has a 4 BR, 3BA house (city next door) with a garage.  Fantastic kitchen.

Her neighbors are TERRIBLE and mine are awesome.

This is not mentioned enough. This is likely a good reason to keep housing costs under control so it is not devastating to the 'stache if you just need to move for sanity sake.

We recently moved, and chatted with the old neighbor as the moving truck departed. He was a perfect neighbor, we talked maybe three times in four years. After some storm damage in the area, after some construction work, and as the movers left. He was very concerned with who may be moving in, since neither of us had kids, and our house is perfect for a huge family.

[slappy]

When I hit FI and started considering RE, I was making enough $ I knew a year or two or three more of working now could make a huge difference versus what I could make if I decided to return to work later.  The only thing I could think of that would really cost that much would be a house, so I asked my wife to find the best one in the area for sale (knowing we would never want to move far) to see if I had a reason to plan to work longer than I was already planning.  We walked thru a $800k home and compared it to the $300k paid off home we live in in our MCOL area.  We just weren't that impressed, and not knowing if you'll actually like your neighbors as much as your current ones kinda made it a non-starter.

Unlike other mustachians we seem to have no problem finding things to spend money on and do let our spending increase annually to whatever 25x our investments are worth, but I can't think of anything we don't have that would make us any happier.

Neighbors.  Neighbors are key.  My best friend bought at a better time than us.  So for $88k less than we paid for our house, she has a 4 BR, 3BA house (city next door) with a garage.  Fantastic kitchen.

Her neighbors are TERRIBLE and mine are awesome.

This is not mentioned enough. This is likely a good reason to keep housing costs under control so it is not devastating to the 'stache if you just need to move for sanity sake.

We recently moved, and chatted with the old neighbor as the moving truck departed. He was a perfect neighbor, we talked maybe three times in four years. After some storm damage in the area, after some construction work, and as the movers left. He was very concerned with who may be moving in, since neither of us had kids, and our house is perfect for a huge family.

Your neighbor doesn't want a family to be his new neighbor?

[Chris@TTL]

For all your detailed questions, looks like you've got plenty of good, informative responses.

Re:
"IRA contributions: 6000/year which I haven't made this year. Can I contribute this $6000 over the last 4 months of the year and reduce my  MAGI by $1500/month?"

Don't forget, not unlike other tax shelters (eg HSA), you can contribute into next year for this. For example, for 2019 IRAs (because of the tax date pushback due to COIVD), you could contribute funds up until July 15, 2020 towards your 2019 IRA deduction.

So far as your bigger question:
"Would you spend more if highly paid?"

Not really. Jenni and I have spent about $40-45K US (as a pair) per year for several years. Our income has varied widely in that period, enough that our savings rate has cracked 75% for years at a time. We built a life we wanted, then started saving for it. We've been fortunate to be happy with that, and fortunate to have increased incomes along with that -- and never feeling like we needed more.

In fact, at one point, I turned down a $175K salary at just 28 years old.

The thing I value is time.

These days, we're long past FI and transitioning into RE with both of us switching to part-time work.

Our spending really hasn't changed through any of this.

[ol1970]

ol1970 - can i ask what you do for work?

we have spent more as we made more - i see no reason not to enjoy life and spend more as you make more as long as you are planning for the future properly.

I started life as an engineer.  Saved my butt off, instead of leanfiring at 28 years old to sit around and play video games I invested it all in a small business in plastics.  Turns out I bit off nearly more than I could chew, and really had to work hard to save it.  (like average 100 hour a week hard for 4-5 years).  Only then did I turn the corner and start to make real money.  When I was able to take big bonuses and distributions I plowed them back into investments (commercial real estate, residential, index funds, other small businesses).  After $3M liquid I started to relax a bit spending wise.  Sold it all to take a break 6 years ago at 43, but because I'm sort of an expert in my field, I can now do part time consulting for fun between traveling that earns into the mid six figures even in retirement.  Still only spend maybe $200k/year in a big year even though being worth into the 8 figures.

Point is people who've never experienced hiking the Napali coast trail in Hawaii, but then say it is stupid and unnecessary to spend more than what you thought was the perfect amount when you were 30 years old are just plain silly.  I suppose ignorance is bliss, but money is a tool, you don't get to keep it when you are gone.  I suppose I look at it this way, me taking my wife to French Polynesia every year is the financial equivalent of a leanfire person taking their wife to Appleby's for their anniversary.  There are a lot of people who rationalize that experiences they cannot have are not worth doing or just wasteful spending...don't listen to them.

[mm1970]

ol1970 - can i ask what you do for work?

we have spent more as we made more - i see no reason not to enjoy life and spend more as you make more as long as you are planning for the future properly.

I started life as an engineer.  Saved my butt off, instead of leanfiring at 28 years old to sit around and play video games I invested it all in a small business in plastics.  Turns out I bit off nearly more than I could chew, and really had to work hard to save it.  (like average 100 hour a week hard for 4-5 years).  Only then did I turn the corner and start to make real money.  When I was able to take big bonuses and distributions I plowed them back into investments (commercial real estate, residential, index funds, other small businesses).  After $3M liquid I started to relax a bit spending wise.  Sold it all to take a break 6 years ago at 43, but because I'm sort of an expert in my field, I can now do part time consulting for fun between traveling that earns into the mid six figures even in retirement.  Still only spend maybe $200k/year in a big year even though being worth into the 8 figures.

Point is people who've never experienced hiking the Napali coast trail in Hawaii, but then say it is stupid and unnecessary to spend more than what you thought was the perfect amount when you were 30 years old are just plain silly.  I suppose ignorance is bliss, but money is a tool, you don't get to keep it when you are gone.  I suppose I look at it this way, me taking my wife to French Polynesia every year is the financial equivalent of a leanfire person taking their wife to Appleby's for their anniversary.  There are a lot of people who rationalize that experiences they cannot have are not worth doing or just wasteful spending...don't listen to them.

Impressive.

Also, when you have "enough", I consider it to be helpful to spread the wealth around.  Like employing someone to clean my house.  Why hoard my money?  (Actually, she's still getting paid and we told her we'd let her know when it's safe to come back.  Hasn't been here since mid March.)

[slappy]

ol1970 - can i ask what you do for work?

we have spent more as we made more - i see no reason not to enjoy life and spend more as you make more as long as you are planning for the future properly.

I started life as an engineer.  Saved my butt off, instead of leanfiring at 28 years old to sit around and play video games I invested it all in a small business in plastics.  Turns out I bit off nearly more than I could chew, and really had to work hard to save it.  (like average 100 hour a week hard for 4-5 years).  Only then did I turn the corner and start to make real money.  When I was able to take big bonuses and distributions I plowed them back into investments (commercial real estate, residential, index funds, other small businesses).  After $3M liquid I started to relax a bit spending wise.  Sold it all to take a break 6 years ago at 43, but because I'm sort of an expert in my field, I can now do part time consulting for fun between traveling that earns into the mid six figures even in retirement.  Still only spend maybe $200k/year in a big year even though being worth into the 8 figures.

Point is people who've never experienced hiking the Napali coast trail in Hawaii, but then say it is stupid and unnecessary to spend more than what you thought was the perfect amount when you were 30 years old are just plain silly.  I suppose ignorance is bliss, but money is a tool, you don't get to keep it when you are gone.  I suppose I look at it this way, me taking my wife to French Polynesia every year is the financial equivalent of a leanfire person taking their wife to Appleby's for their anniversary.  There are a lot of people who rationalize that experiences they cannot have are not worth doing or just wasteful spending...don't listen to them.

Does any real person actually decide a budget for life at 30 and then FIRE based on that? I think that argument is very strange. (I heard it recently on a podcast as well.)

[MudPuppy]

Kind of? My FIRE number is based on my expenses when I was 29/30.

[Metalcat]

ol1970 - can i ask what you do for work?

we have spent more as we made more - i see no reason not to enjoy life and spend more as you make more as long as you are planning for the future properly.

I started life as an engineer.  Saved my butt off, instead of leanfiring at 28 years old to sit around and play video games I invested it all in a small business in plastics.  Turns out I bit off nearly more than I could chew, and really had to work hard to save it.  (like average 100 hour a week hard for 4-5 years).  Only then did I turn the corner and start to make real money.  When I was able to take big bonuses and distributions I plowed them back into investments (commercial real estate, residential, index funds, other small businesses).  After $3M liquid I started to relax a bit spending wise.  Sold it all to take a break 6 years ago at 43, but because I'm sort of an expert in my field, I can now do part time consulting for fun between traveling that earns into the mid six figures even in retirement.  Still only spend maybe $200k/year in a big year even though being worth into the 8 figures.

Point is people who've never experienced hiking the Napali coast trail in Hawaii, but then say it is stupid and unnecessary to spend more than what you thought was the perfect amount when you were 30 years old are just plain silly.  I suppose ignorance is bliss, but money is a tool, you don't get to keep it when you are gone.  I suppose I look at it this way, me taking my wife to French Polynesia every year is the financial equivalent of a leanfire person taking their wife to Appleby's for their anniversary.  There are a lot of people who rationalize that experiences they cannot have are not worth doing or just wasteful spending...don't listen to them.

Does any real person actually decide a budget for life at 30 and then FIRE based on that? I think that argument is very strange. (I heard it recently on a podcast as well.)

That's my thinking, based on my years here, it's really a false concern.

Most people here are highly focused on maximizing earning and having enough. It's a rare person here who actually lives like Pete, and even fewer who live on less than Pete and don't continue to earn extra income the way he does.

There are a few low spenders here who totally quit working and plan on living on that low spend indefinitely.

Also, as the person who first started ragging on luxury in this thread, I did so from the experience of having lived it, not from some imaginary excuse to avoid trying to make more money. That's my personal taste. Others are entitled to their personal taste.

Some people love living in a post card. I've done it and didn't really like it, to each their own. I spend a fair amount of time with the 7 figure net worth crowd, and know very well what I'm missing. I'm very okay with it.

I think in a world aggressively driven to earn and spend.as much as possible, worrying about the vanishingly few who actually think and live like MMM is a concern that no one really needs.

[MonkeyJenga]

ol1970 - can i ask what you do for work?

we have spent more as we made more - i see no reason not to enjoy life and spend more as you make more as long as you are planning for the future properly.

I started life as an engineer.  Saved my butt off, instead of leanfiring at 28 years old to sit around and play video games I invested it all in a small business in plastics.  Turns out I bit off nearly more than I could chew, and really had to work hard to save it.  (like average 100 hour a week hard for 4-5 years).  Only then did I turn the corner and start to make real money.  When I was able to take big bonuses and distributions I plowed them back into investments (commercial real estate, residential, index funds, other small businesses).  After $3M liquid I started to relax a bit spending wise.  Sold it all to take a break 6 years ago at 43, but because I'm sort of an expert in my field, I can now do part time consulting for fun between traveling that earns into the mid six figures even in retirement.  Still only spend maybe $200k/year in a big year even though being worth into the 8 figures.

Point is people who've never experienced hiking the Napali coast trail in Hawaii, but then say it is stupid and unnecessary to spend more than what you thought was the perfect amount when you were 30 years old are just plain silly.  I suppose ignorance is bliss, but money is a tool, you don't get to keep it when you are gone.  I suppose I look at it this way, me taking my wife to French Polynesia every year is the financial equivalent of a leanfire person taking their wife to Appleby's for their anniversary.  There are a lot of people who rationalize that experiences they cannot have are not worth doing or just wasteful spending...don't listen to them.

Does any real person actually decide a budget for life at 30 and then FIRE based on that? I think that argument is very strange. (I heard it recently on a podcast as well.)

Well, I fired at 31, not 30, but yeah. :P I didn't assume that I would spend the same amount of money forever, but I'm lean fire and did assume I could keep my voluntary expenses in that range long-term.

I budgeted extra for long term healthcare and possible rent increases. I never budgeted for a car or fancy international vacations or $200 tasting menus, because I didn't care about those things. Even when I traveled full time, I stayed with friends and took trains and buses over planes when possible.

I grew up with conspicuous consumption, and I know it's not for me.

[LetItGrow]

When I hit FI and started considering RE, I was making enough $ I knew a year or two or three more of working now could make a huge difference versus what I could make if I decided to return to work later.  The only thing I could think of that would really cost that much would be a house, so I asked my wife to find the best one in the area for sale (knowing we would never want to move far) to see if I had a reason to plan to work longer than I was already planning.  We walked thru a $800k home and compared it to the $300k paid off home we live in in our MCOL area.  We just weren't that impressed, and not knowing if you'll actually like your neighbors as much as your current ones kinda made it a non-starter.

Unlike other mustachians we seem to have no problem finding things to spend money on and do let our spending increase annually to whatever 25x our investments are worth, but I can't think of anything we don't have that would make us any happier.

Neighbors.  Neighbors are key.  My best friend bought at a better time than us.  So for $88k less than we paid for our house, she has a 4 BR, 3BA house (city next door) with a garage.  Fantastic kitchen.

Her neighbors are TERRIBLE and mine are awesome.

This is not mentioned enough. This is likely a good reason to keep housing costs under control so it is not devastating to the 'stache if you just need to move for sanity sake.

We recently moved, and chatted with the old neighbor as the moving truck departed. He was a perfect neighbor, we talked maybe three times in four years. After some storm damage in the area, after some construction work, and as the movers left. He was very concerned with who may be moving in, since neither of us had kids, and our house is perfect for a huge family.

Your neighbor doesn't want a family to be his new neighbor?

Correct. sticky, loud children all over? No thanks is his view, and ours for that matter.

[Zikoris]

Does any real person actually decide a budget for life at 30 and then FIRE based on that? I think that argument is very strange. (I heard it recently on a podcast as well.)

We're basically doing that. For the last eight years we've been living as close to our ideal lifestyle as possible while still working, so we have a very good idea what price tag is attached to said lifestyle. I think it's extremely logical to base retirement spending on your own real numbers from 10-15 years of tracking. Particularly if you're fairly "consistent" in terms on consumption/lifestyle, like you're not going to all of a sudden decide you have a buy a bunch of shit you never had before, or suddenly have a bunch of kids you never wanted before, and so on.

[Cassie]

One thing is that as you age you often want more comfort. So tent camping was fun until age 54.  Then we got a used motor home. 12 years later it’s gone and we stay in motels.  So some costs go up as you age such as healthcare.

[Metalcat]

One thing is that as you age you often want more comfort. So tent camping was fun until age 54.  Then we got a used motor home. 12 years later it’s gone and we stay in motels.  So some costs go up as you age such as healthcare.

I see more posts here about owning luxury cars than I do about tent camping. I think the lifestyles of the majority of our members, who are typically pretty high earning, are already soft enough to be sustainable well into senior years.

I know my lifestyle is softer and cushier than that of my senior citizen parents who spend A LOT more than I do.

[Zikoris]

One thing is that as you age you often want more comfort. So tent camping was fun until age 54.  Then we got a used motor home. 12 years later it’s gone and we stay in motels.  So some costs go up as you age such as healthcare.

I feel like you can predict that to a degree from looking at your own family. I don't sleep in a tent very often (maybe 3-4 nights a year), but my 66 year old dad seems to do fine, so as long as I prioritize my health at least to the extent he does, I should be fine in that regard. We already rent nice apartments when we travel, so I don't see much that would change there. Things that aren't going to work for me tend to become apparent pretty quickly - last summer I slept on the floor in a traditional Japanese apartment to see what it was like, and I was clearly already too old for that at 32, lol. Though it was actually softer than the mattress I slept on in Hong Kong. I don't know how the hell people in HK sleep on those things. Every morning I woke up and my heels hurt.

[mm1970]

One thing is that as you age you often want more comfort. So tent camping was fun until age 54.  Then we got a used motor home. 12 years later it’s gone and we stay in motels.  So some costs go up as you age such as healthcare.

We are in our early 50s.  A few years ago, we bought camping cots.  It really made a difference in comfort, so much better than being on the ground, better than an air mattress.

But still, we are soft enough that:
- we probably only camp once a year
- most of our trips we stay in hotels or AirBNBs.   ANd we are leaning more towards AirBNBs so we can have kitchens and bedrooms.

Now that we have the dog...we'll see.  We haven't taken any kind of vacation since we adopted her right after Thanksgiving.  I expect fewer camping trips (maybe every other year), more AirBNBs.

[Bloop Bloop]

Does any real person actually decide a budget for life at 30 and then FIRE based on that? I think that argument is very strange. (I heard it recently on a podcast as well.)

We're basically doing that. For the last eight years we've been living as close to our ideal lifestyle as possible while still working, so we have a very good idea what price tag is attached to said lifestyle. I think it's extremely logical to base retirement spending on your own real numbers from 10-15 years of tracking. Particularly if you're fairly "consistent" in terms on consumption/lifestyle, like you're not going to all of a sudden decide you have a buy a bunch of shit you never had before, or suddenly have a bunch of kids you never wanted before, and so on.

I'm in my early 30s and I think I have a great lifestyle. I can't imagine much that I want to spend on that I don't already spend on. I already live a very cushy life. And I don't even spend that much. I have no idea how (non-super-rich) families can spend $100k a year or $150k a year. It astounds me. I mean, to each her own I guess, but some of those families will retire and then demand a government pension....

[Cranky]

I didn’t like sleeping on the floor when I was 30, so my life goals really did aspire to a future budget where I didn’t need to do that. LOL I like my life a million times better now than I was 30yo, so stuff does change.

[ender]

One thing is that as you age you often want more comfort. So tent camping was fun until age 54.  Then we got a used motor home. 12 years later it’s gone and we stay in motels.  So some costs go up as you age such as healthcare.

I see more posts here about owning luxury cars than I do about tent camping. I think the lifestyles of the majority of our members, who are typically pretty high earning, are already soft enough to be sustainable well into senior years.

I know my lifestyle is softer and cushier than that of my senior citizen parents who spend A LOT more than I do.

+1

Not to mention, if you retire at 40, by the time you are in your 60s your FIRE likely dramatically succeeded or you pretty much failed it.

[Fomerly known as something]

I’d likely add some additional spending.  Going on a few more tours that look interesting during a vacation, staying at slightly higher end small hotels, not thinking for 2 years if I really want to buy a kayak or waiting another few years to build the screened in porch.

But I also have a pretty strong contentment that I have enough in general so from the outside most people wouldn’t see much of a change in my lifestyle if I made the small changes, but I’d know (and likely agonized over them)

[Zikoris]

One thing I've found really interesting is how consistent our spending has been over the years, despite how many things have changed. Like, we've taken up new hobbies, dropped old ones, changed our food systems a lot, and gradually shifted from normal trips to some pretty wild ones. Some years we have a bunch of dental expenses, some years very little. Yet like clockwork, every year we end up spending right around 27-28K.

[2Birds1Stone]

Our spending in 2010-2014 on a ~$60k/yr household income was almost the same as 2015-2019 where we had a $180k/yr income......but I guess that's why we were able to leanFIRE @33/29 years old......YMMV

[lutorm]

Our income has been creeping up the past couple of years (probably not sustainable) and the biggest change in spending has been an increased willingness to pay people to do stuff for us. Not because I'm too cushy to do things myself, but because making all that money also means my spare time is very precious these days and while I'm totally willing to mow the lawn, spray ant bait around the yard, etc, in a world where I have plenty of spare time, the extra cost is worth being able to put in the time on things I really want even if it delays the FIRE date a bit.

[undercover]

I think the better question is “would I be willing to work at a job that paid that much” and the answer is probably not. I would much rather work a lower paying job with low stress than the opposite. Nothing I can buy is that important to me. I have learned to live a very fulfilling life on very little so adding complexity to that for no reason makes zero sense.

I often look around me and think how much happier I would probably be with less stuff even when I already require very little, so the thought of more does absolutely nothing for me.

So, obviously I can’t say for sure, but if someone wants to give me that amount of money per year for whatever reason then I’m sure I’d spend more in certain areas because like you said, “why not”, but I am absolutely certain it would have zero effect on my overall happiness and in fact it may hurt it.

[kanga1622]

DH would absolutely say yes - he is the spender. He'd probably be happy with XM radio and some sort of live sports subscriptions. Beyond that, he isn't really "wanting" for much. In a perfect world he'd have us traveling the country in an RV because he loves to travel. Unfortunately, I get motion sickness from a rocking chair so that dream isn't happening with me as the co-pilot.

I would spend some more but not a huge amount - I'm the saver. We have a pretty decent savings rate on a relatively low income for a family of 4. I'd love to have a flusher savings account and more socked away for the kids' college and our retirement. We've had to loosen up the grocery budget due to COVID and that was the area most in need of fattening anyway. But as our medical costs continue to rise, I'd love to have more budgeted to that category every month.

Although I don't know if RE will ever really be possible for me. I'm a worrier by nature so always wanting more in savings to help me deal with the earlier/pricier/un- expected things that pop up in life.

[Arbitrage]

Money is meant to be spent, it is only units, you only live so long.  Once you've saved 50X your annual burn, spending a little more money to enjoy the time you have left on this planet to make you and your loved ones life enjoyable is smart.  Hell if MMM would have followed the same path maybe he would still be married and not have a broken family.

Harsh (about MMM) - and in all likelihood untrue.  There is no evidence that I'm aware of that the MMs were divorced over money, or lack of spending.  I'd also posit that, once you have financial security, those who spend large amounts aren't less likely to get divorced, either. 

The point of this site is not to reach FIRE as quickly as possible.  It's also not just about money - it's also about living responsibly and sustainably.  Naturally, not everyone here is going to agree with that, and it's of course possible to live sustainably while spending gobs of cash, but part of the point is to decouple spending from happiness to the greatest extent possible.  Maybe your experience is telling you that more spending continues to equal more happiness all the way up the spectrum, but there are plenty who would disagree. 

I can't speak from personal experience, but our close friends with 7-figure incomes (and now spending to match after slowly working their way up the spending ladder) aren't really any happier now than when there were living a mere upper-middle-class life.

[Metalcat]

I think the better question is “would I be willing to work at a job that paid that much” and the answer is probably not. I would much rather work a lower paying job with low stress than the opposite. Nothing I can buy is that important to me. I have learned to live a very fulfilling life on very little so adding complexity to that for no reason makes zero sense.

I often look around me and think how much happier I would probably be with less stuff even when I already require very little, so the thought of more does absolutely nothing for me.

So, obviously I can’t say for sure, but if someone wants to give me that amount of money per year for whatever reason then I’m sure I’d spend more in certain areas because like you said, “why not”, but I am absolutely certain it would have zero effect on my overall happiness and in fact it may hurt it.

What I've come to understand from the very high net worth folks I talk to is that the work at the very high level of income isn't particularly stressful. It's getting there that sucks.

That said, I'm talking more 1M+/yr comp, not mid 6 figures like a lot of brutally hard working Bay Area folks and doctors make.

The 200-600K range does seem to be a slog range though. I don't know a lot of people with those comps who don't suffer for it. I'm sure there are some out there, but I think those people are the exception.

Meanwhile the 1M+ folks I know are generally going home at 4 and have a bunch of 200-600K staff to handle the long hours and stresses for them.

[Cassie]

I have to admit that I also wondered if money contributed to the divorce of MM. However, it’s nobody’s business.

[Metalcat]

Money is meant to be spent, it is only units, you only live so long.  Once you've saved 50X your annual burn, spending a little more money to enjoy the time you have left on this planet to make you and your loved ones life enjoyable is smart.  Hell if MMM would have followed the same path maybe he would still be married and not have a broken family.

Harsh (about MMM) - and in all likelihood untrue.  There is no evidence that I'm aware of that the MMs were divorced over money, or lack of spending.  I'd also posit that, once you have financial security, those who spend large amounts aren't less likely to get divorced, either. 

The point of this site is not to reach FIRE as quickly as possible.  It's also not just about money - it's also about living responsibly and sustainably.  Naturally, not everyone here is going to agree with that, and it's of course possible to live sustainably while spending gobs of cash, but part of the point is to decouple spending from happiness to the greatest extent possible.  Maybe your experience is telling you that more spending continues to equal more happiness all the way up the spectrum, but there are plenty who would disagree. 

I can't speak from personal experience, but our close friends with 7-figure incomes (and now spending to match after slowly working their way up the spending ladder) aren't really any happier now than when there were living a mere upper-middle-class life.

Harsh, and also untrue according to what he himself says. Whether you believe what he says about his own divorce or not, it's pretty rude to come to his own site and basically call the guy a liar about his own divorce.

[Just Joe]

Answering OP's question: I don't think DW and I would change much. Our approach to things and life remain mostly the same as when we were in college. Not impressed by mansions or fancy people or their things.

We did buy a larger house with a much larger patch of ground last year. Made for a much nicer pandemic WFH situation just b/c all four of us could spread out a little.

We'd probably pay someone to refresh the house and landscaping but then go right on maintaining it ourselves. Perhaps pay someone to clean it bi-weekly or monthly while continuing our regular cleaning routines.

I could imagine a toy or two like a waterski boat. Slow travel a couple times per year. Month long trips perhaps. Replace our ordinary things with nicer quality things as stuff wears out. 

We've arrived at the income level we wanted and needed to save money and still have a comfortable family life here. We could happily have a smaller home like before and may still have that someday when we are older and less interested in mowing acres of grass or cleaning the one we have now. Depends on how many grandkids and how often everyone comes to our house.

A higher income might help us help others by donating more resources. We would definitely retire sooner.

[Fomerly known as something]

A lot too depends on where you live.  I currently live in a home that I paid $280k for, a comparable home in SFO would be $2 million at least.  I don’t need to move up in home if I make more in my current city because my home is great.  But if I were in SFO, yeah I’d likely buy a home but that would be the biggest difference if I went from $150k to 500k in a HCOL.

[Firehazard]

If I hadn't already FIRED, and I still had my old $100k/yr job, I would splurge on some professionally done landscaping upgrades, such as a french drain, adding some new planting beds, a hedge to screen my view of my neighbor's weedy, unkempt yard.  Maybe an insulated garage door, too. 

I wouldn't spend more on our day to day lifestyle, though. 

[Luz]

When I hit FI and started considering RE, I was making enough $ I knew a year or two or three more of working now could make a huge difference versus what I could make if I decided to return to work later.  The only thing I could think of that would really cost that much would be a house, so I asked my wife to find the best one in the area for sale (knowing we would never want to move far) to see if I had a reason to plan to work longer than I was already planning.  We walked thru a $800k home and compared it to the $300k paid off home we live in in our MCOL area.  We just weren't that impressed, and not knowing if you'll actually like your neighbors as much as your current ones kinda made it a non-starter.

Unlike other mustachians we seem to have no problem finding things to spend money on and do let our spending increase annually to whatever 25x our investments are worth, but I can't think of anything we don't have that would make us any happier.

Neighbors.  Neighbors are key.  My best friend bought at a better time than us.  So for $88k less than we paid for our house, she has a 4 BR, 3BA house (city next door) with a garage.  Fantastic kitchen.

Her neighbors are TERRIBLE and mine are awesome.

This is not mentioned enough. This is likely a good reason to keep housing costs under control so it is not devastating to the 'stache if you just need to move for sanity sake.

We recently moved, and chatted with the old neighbor as the moving truck departed. He was a perfect neighbor, we talked maybe three times in four years. After some storm damage in the area, after some construction work, and as the movers left. He was very concerned with who may be moving in, since neither of us had kids, and our house is perfect for a huge family.

Your neighbor doesn't want a family to be his new neighbor?

Correct. sticky, loud children all over? No thanks is his view, and ours for that matter.

Sticky, loud, and all over, haha! Perfect description!

[CrabbitDutchie]

Coming at this from a slightly different angle.

I can't imagine a scenario in which a job paying me 500k would be enjoyable enough to stick at. Even if the job itself was ok, the imposter syndrome, guilt and my perceived need to put in the effort to justify that amount of income means that I'd probably need to get a very good therapist just to hold it down. However I'd hazard a guess that no amount of lifestyle inflation would make up for the job itself.

If this job/income magically fell out of the sky starting tomorrow and I kept all my current expenses the exact same (or increased slightly to my pre COVID level) I'd only need to do that job for 1 year in order to be lean FI. At that point I could quit. If I was to increase my spending then I'd be sabotaging all of the security and freedom I'm striving for. My life right now is pretty optimised and sustainable, why spend more?

I've basically doubled my salary in the past 4 years and am not spending more than I was 4 years ago. I currently have trouble visualising how it would be possible to spend my entire salary and for that to bring out an increase in day to day happiness. Let alone one 10x as much.

[MudPuppy]

I answered the question as if my current job magically gave me a tenfold raise.

[Travis]

If overnight for no particular reason my income went up $50k I'd buy a few more lunches and take a vacation without worrying about doing credit card miles calculus.  Right now I'm mentally going back and forth whether or not to spend $200 upgrading a component of my 10 year old computer or spending $1400 on building a completely new one (with 2 year old parts).  If my income was higher I wouldn't hesitate. I'd still own the same car and desire the same sized house.  After a couple luxuries like the vacation, the computer, and taxes, I'd invest the rest since I don't actually need it which would make up for this new FIRE number.

[KBecks]

I would no doubt have better stuff in my house.  Original art.  I was just browsing on Etsy at some very nice handmade home accessories that are little luxuries.  I would have more of the very nice stuff if we had more fluff money.

[ol1970]

Money is meant to be spent, it is only units, you only live so long.  Once you've saved 50X your annual burn, spending a little more money to enjoy the time you have left on this planet to make you and your loved ones life enjoyable is smart.  Hell if MMM would have followed the same path maybe he would still be married and not have a broken family.

Harsh (about MMM) - and in all likelihood untrue.  There is no evidence that I'm aware of that the MMs were divorced over money, or lack of spending.  I'd also posit that, once you have financial security, those who spend large amounts aren't less likely to get divorced, either. 

The point of this site is not to reach FIRE as quickly as possible.  It's also not just about money - it's also about living responsibly and sustainably.  Naturally, not everyone here is going to agree with that, and it's of course possible to live sustainably while spending gobs of cash, but part of the point is to decouple spending from happiness to the greatest extent possible.  Maybe your experience is telling you that more spending continues to equal more happiness all the way up the spectrum, but there are plenty who would disagree. 

I can't speak from personal experience, but our close friends with 7-figure incomes (and now spending to match after slowly working their way up the spending ladder) aren't really any happier now than when there were living a mere upper-middle-class life.

Hey I totally agree more money doesn’t equal more happiness.  But MMM decided with $800k in the bank at essentially 30 years old, with zero blog income that all he ever needed in the next 80 years of his life was $25k a year of today’s dollars.  He subsequently built something great that I admire in this website that dramatically changed his financial situation.  He created a persona though that didn’t allow flexibility or growth.  I’m just saying I disagree with that.  At 30 I was making $70k a year at 40 I was making $1M.  I actually didn’t change my spending much at all. 

I have no idea if living a $25k a year lifestyle while bringing in $500k a year contributed to MMMs marital issues but I could see how it could.  I’m just saying have a freaking cookie once in a while he’s  earned it.