"Don't save too much"

[Runge]

This post over an the YNAB forums is exceedingly dangerous.

http://forum.youneedabudget.com/discussion/35299/dont-save-too-much-ynab-perverts-unite

A snippet:

We've been using YNAB since October 2013 and whilst the strategy may seem perverse, it's worked for us. The 'saving down' has allowed us to live a much more comfortable lifestyle. We have a top of the range Mazda 6 that's safe for our children and we pay £250/month on repayments for a ~6% AER loan. We would NEVER have the self control to save £250/month otherwise. I have been setting up a business over the last 2 years and my wife is a full time mum. We had very little money, perhaps £25k/year. When you're raising a family in London that puts you way below the poverty line. I'm pleased to say that my business is doing well now and I'm able to take about £90k/year out of it. But whilst on paper we were poor, we travelled all around the world, visited New York, Morocco, Portugal. We went on a lavish holiday to a family resort in Mallorca that my 3 year old son still talks about *in detail*. This might seem reckless and to some people immoral but we used YNAB to at least keep track of this roller coaster. We frequently spent way beyond our means but it was managed and we had fun doing it. We have great memories of our overspending and thankfully we're in a position now to start paying some of it back!

Apparently "buying memories" (read: overspending on memories) is more important than becoming FIRE. In a post further down he claims that he's a "big fan of the stoicism philosophy that has an emphasis on delayed gratification," however his actions and mindset prove otherwise.

Thankfully there are some other Mustachian-esque YNABers on the forums to provide some mustaschian feedback. Although I don't suspect this guy to fully comprehend the dangerous waters he's put his family in until after his luck runs out.

[Dodge]

I saw that too, was planning on making an account over there to respond, but not sure if it's worth it.  He complains that his friends got into BIG TIME DEBT over the years, and there were no negative consequences, while he himself was a big saver during these years, and has nothing to show for it.  Then justifies getting an expensive car loan, by saying "We would NEVER have the self control to save £250/month otherwise"?

[austin]

The human mind is amazing at rationalization. :/

[eyePod]

Yikes. I always wonder if it's better if someone says "I understand the risk and don't mind spending this extra money now." It just seems like this guy is very cash flow dependent. One little hiccup and he'd be screwed.

[vivophoenix]

I saw that too, was planning on making an account over there to respond, but not sure if it's worth it.  He complains that his friends got into BIG TIME DEBT over the years, and there were no negative consequences, while he himself was a big saver during these years, and has nothing to show for it.  Then justifies getting an expensive car loan, by saying "We would NEVER have the self control to save £250/month otherwise"?

it was hard to follow, cause it seemed kinda rambly, but from what i understand. if he was such an awesome saver, where is the cash?

or is his argument he didnt save but he didnt spend into debt; he literally lived from paycheck to paycheck but no more than that?

so it seems like what he should have done was actually saved money at that time and with that ~250 a month he could later buy that car?

[Runge]

Yikes. I always wonder if it's better if someone says "I understand the risk and don't mind spending this extra money now." It just seems like this guy is very cash flow dependent. One little hiccup and he'd be screwed.

He's extremely cash flow dependent. He's relying so much on debt and leverage, that if there's any set back in his self-employed business, huge problems can arise. It's the exact opposite of being FI, Financial Slavery. Yeah, maybe it worked out for his buddy, but that's one anecdotal piece of evidence and should not apply under most circumstances.

[odput]

Yikes. I always wonder if it's better if someone says "I understand the risk and don't mind spending this extra money now." It just seems like this guy is very cash flow dependent. One little hiccup and he'd be screwed.

He's extremely cash flow dependent. He's relying so much on debt and leverage, that if there's any set back in his self-employed business, huge problems can arise. It's the exact opposite of being FI, Financial Slavery. Yeah, maybe it worked out for his buddy, but that's one anecdotal piece of evidence and should not apply under most circumstances.

Yeah...the whole concept of "saving down" is by definition being dependent on future cash flow.  I read most of the thread, and the guy seems to think because he's an entrepreneur, that he won't ever have cash flow problems, nor ever worry about retiring because he plans to work himself to death (paraphrased, but not by much).

Hope he has some serious insurance...

[nereo]

I kinda want to track this fellow and see how it all works out for him.  FWIW, being a "saver" instead of a "spender" during my college years didn't generate feelings of having 'missed out. on anything. 

[mydogismyheart]

I was a really good saver when I was younger.  Then I became a really good spender and got greedy.  I had to start completely over and pay off all debts and start re-saving.  And I do regret it.  I'm just lucky I figured it out while I was still young and while I may be starting over with just a few thousand in savings at 31, at least I am on the right track.  I can't imagine being in this guy's shoes.  I have friends like him, and just can't imagine it.  What will they do when they get older and have no money?  Or are trying to live off of the virtually non existent social security?  I actually know someone who lives on SS and gets about $1K (plus some food stamps, but no subsidized housing) per month, and actually lives on it!  Good luck to him when that time comes!  Yikes!

[marty998]

Paying a car loan is considered saving?

Also he seems to be saying "It's not my fault, YNAB made me do it".