Author Topic: The Fulfillment Curve  (Read 6100 times)

totoro

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The Fulfillment Curve
« on: March 08, 2013, 02:26:17 PM »
There have been a few posts about this recently, including the MMM spending experiment and some on hedonic adaptation.

It got me thinking about bang for the buck.  Some people are focussed on cutting back absolutely everything to amass enough money to be FI.  The bang for the buck is long-term high return for each dollar saved.

I find that I'm not in this camp anymore.  I like my job.  I earn a good wage.  I own enough stuff.  I have investments.  For me, there are some things I really enjoy that I have no guilt spending money on because, while I'm not retired, I have enough financial security that amassing capital is no longer as motivating the way it once was.

I was away on business yesterday.  My connecting flight was missed and I had a long delay.  I paid the thirty bucks for the private lounge that includes free wifii, peace and quiet, drinks and food.  Totally worth it for me.

Got me thinking that my paradigm has shifted.  I don't buy a lot of consumer stuff, but things that improve the quality of my time I am willing to pay for. 

Jamesqf

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Re: The Fulfillment Curve
« Reply #1 on: March 08, 2013, 03:25:01 PM »
Got me thinking that my paradigm has shifted.  I don't buy a lot of consumer stuff, but things that improve the quality of my time I am willing to pay for.

Yes, that's my thinking exactly.  I don't spend on e.g. smartphones, new cars (especially fancy SUV-like new cars), or dining out much, because those things would do nothing to improve my quality of life, or would even, by my admittedly idiosyncratic standards, lower it.  OTOH I spend what some people might consider ridiculous amounts on supporting a horse & a couple of dogs, don't have problems buying a new pair of skis or a couple hundred bucks worth of plants...  But I still have a good bit left over to add to the 'stash.

Cecil

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Re: The Fulfillment Curve
« Reply #2 on: March 09, 2013, 08:06:25 AM »
The whole and only point of money is for enjoyment. Extreme people like Jacob of ERE get the most enjoyment out of not working. Spending as little as possible allows them to use their money for FI. Extreme people on the other side spend wildly.

I like my job. I don't want to be there past about 40 or 45 but I like what I do enough to be able to justify having a smartphone, buying skis or going to an all-inclusive in Mexico.

No Name Guy

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Re: The Fulfillment Curve
« Reply #3 on: March 09, 2013, 10:30:27 AM »
Totoro:  It sounds to me like purposeful spending, not wanton spending with no consideration to the cost / benefit ratio.

Jamesqf

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Re: The Fulfillment Curve
« Reply #4 on: March 09, 2013, 11:12:08 AM »
The whole and only point of money is for enjoyment. Extreme people like Jacob of ERE get the most enjoyment out of not working. Spending as little as possible allows them to use their money for FI.

But you get to a point, or at least I did, where the money is pretty much irrelevant to enjoyment.  I sort of got into the FI thing backwards: I didn't start out being frugal & saving in order to become FI, I just got to a point in life where I was making a good bit of money, but all the stuff I really enjoyed - hiking, biking, cross-country skiing, gardening - was pretty cheap.  I had the experience of previous poverty which had disinclined me to spending money unnecessarily, so the excess just kept piling up, got invested, and one day I realized that I could survive on the income from it.

Quote
Extreme people on the other side spend wildly.

But for them, it seems that it's the act of spending that is the reward, not what they happen to buy, which often sits unused in garage or closet.

totoro

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Re: The Fulfillment Curve
« Reply #5 on: March 10, 2013, 12:07:41 PM »
Yes, good comments re. purposeful vs. consumer-driven spending.  I'm not a spend for prestige person but I do spend more than necessary on some things that give enough enjoyment.

Ozstache

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Re: The Fulfillment Curve
« Reply #6 on: March 10, 2013, 02:40:43 PM »
But you get to a point, or at least I did, where the money is pretty much irrelevant to enjoyment.  I sort of got into the FI thing backwards: I didn't start out being frugal & saving in order to become FI, I just got to a point in life where I was making a good bit of money, but all the stuff I really enjoyed - hiking, biking, cross-country skiing, gardening - was pretty cheap.  I had the experience of previous poverty which had disinclined me to spending money unnecessarily, so the excess just kept piling up, got invested, and one day I realized that I could survive on the income from it.

Ditto for me on becoming "Accidentally FI", however my disinclination to spend money unnecessarily stems mainly from my lifelong hate of waste and excess. Friends and family are still amazed that I can be considering ER 20 years before most of them, derived just about entirely from a single (albeit healthy) income, whereas most of them are dual high income and struggling to make ends meet. It's amazing that such people would rather be skeptical of my achievement rather than try to learn from it. Most think I won the lottery or came into millions through inheritance!

mustachecat

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Re: The Fulfillment Curve
« Reply #7 on: March 10, 2013, 03:03:34 PM »
totoro, do you think that your previous mindset was helpful in clarifying or refining your priorities? I'm in the cutting-back camp for now, although I don't aspire to anything close to a minimalist life either now or in retirement. But cutting back is really helping me assess what's really important. In many cases, the stuff I cut has a temporary sting, and then I forget that I ever had a gym membership/drank fancy coffee every day/had SO MANY TV CHANNELS/etc. In other cases, I find that I really miss making nice (but wildly extravagant by MMM standards) meals, so I reinstate the expenses. But I'm still glad that I'm going through this process--it's a good filter.

totoro

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Re: The Fulfillment Curve
« Reply #8 on: March 10, 2013, 04:52:30 PM »
I had the advantage of growing up below the poverty line so my cost/benefit was built in early on.  This was helpful for saving long-term, but I it can go too far that way too when you don't allow yourself to be okay with stuff that you can afford and would enjoy more than the long-term benefit of the invested savings. 

I feel guilty buying fancy coffees for myself and I can just never do it, although I could afford it easily.  I know that I am just not going to enjoy it enough and I will feel wasteful/guilty.  Most of my friends have absolutely no problem with it.  I'm okay with this built-in filter to this degree.

I like your approach of cutting back and finding out what you miss.  I agree that good food at home is something I'm willing to pay more for most of the time.  I think I appreciate it more because of experiencing what it is like not to be able to do this.

Jamesqf

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Re: The Fulfillment Curve
« Reply #9 on: March 10, 2013, 09:46:06 PM »
...my disinclination to spend money unnecessarily stems mainly from my lifelong hate of waste and excess.

That's certainly true for me, in a lot of ways.  I've always preferred small cars, for instance.  (Though generally true sports cars, so there is a certain excess of performance involved.)  I also make a good part of my living from this, as much of what I do involves re-engineering software to run much faster & use less resources.

mpbaker22

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Re: The Fulfillment Curve
« Reply #10 on: March 11, 2013, 07:00:08 AM »
I think totoro is right in that some things are worth paying for.  It does depend on the person, right?
Like MMM has a relatively large house, I believe.  If we all wanted immediate FI, we could probably go out to an empty (of humans) forest and live the paleo way.  I don't see anyone doing that.

SilverSoul

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Re: The Fulfillment Curve
« Reply #11 on: March 11, 2013, 08:14:59 AM »
I like this thread - it's nice to see a lot of people with similar views on purposeful spending.  I've still got a lot of work to do in order to remove the wasteful spending in my life, but it's also nice to see that there are many people who don't view spending in and of itself as a bad thing.  There are some things in life worth spending money on :)