Author Topic: When even having a plan is looked down upon...  (Read 6430 times)

mathlete

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When even having a plan is looked down upon...
« on: January 15, 2018, 10:29:10 AM »
I'm going to sound like a total nerd in the telling of this story below. I can admit that. And even though the story might sound combative, trust me in that everyone was having a good time. Me included.

Quote
I was lucky enough to get to spend some time with my family over the holidays. While hanging out with the "adults" (people my age and older), the subject of retirement was brought up. Not by me. One of my relatives lamented about when they would be able to retire. And then, my mom made a comment that I was unique in that I could probably be pretty happy being poor.

I figured now was as good of a time as ever. I told everyone that I'd actually started planning and saving for an early retirement.

"How early?", a family member asked, and I told them that according to a model that I had built, retiring at 45 years old seemed reasonable. This is where the serious questions started. People asked about my model, and tried to poke holes in it. This was enjoyable enough. Then my mom brought up the fact that we (gf and I) don't have kids yet. I responded by saying that my model has a contingency for the cost of raising children.

"How much are you budgeting?", someone asked.

"About $1,000 per month, plus the anticipation that my salary still has room to grow and cover anything extra."

"That's not enough.", pretty much everyone said, laughing.

"Okay, how much does it cost to raise kids?" I asked, eager to get more data and update my model.

"I don't know, but more than that." seemed to be the consensus answer.

"What if you have a special needs kid that costs a lot of money?"

"Then I won't retire."

"What if the markets tank?"

"Then I won't retire."

"What if they tank WHILE you're retired?"

"Then I'll go back to work if I need to."

Things continued like that for a bit, with the general conclusion of everyone being. "Lol, look at this silly kid who thinks he knows how much life costs." and so on. I invited it on myself, so no big deal.

It does kind of trouble me in the smallest of ways though, because there is an underlying problem here. The point of modeling or of making plans in general, is not to predict the future. It's to gather data and construct a reasonable framework from which you can make informed decisions. If an assumption doesn't turn out to be correct, you update the model. You change the plan.

When I, or the folks around here, see uncertainty, I feel like we digest it and accept it. But it seems like others look at uncertainty, and then decide that the whole idea of making a plan is a waste of time. Why make a plan if you're not certain of the outcome?



desk_jockey

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Re: When even having a plan is looked down upon...
« Reply #1 on: January 15, 2018, 12:56:00 PM »
"What if you have a special needs kid that costs a lot of money?"

"Then I won't retire."

"What if the markets tank?"

"Then I won't retire."

"What if they tank WHILE you're retired?"

"Then I'll go back to work if I need to."

After a reasonable exchange of answering concerns with potential solutions, if I still get the this-silly kid-doesn’t-know-what-they’re-talking-about response then I tend to make my point with exaggerations…

“It’s too risky” - “Yeah, I’m concerned about risk.  For example, I would never visit Kansas because they have tornados there.  That is just too risky.”

“But what about xxxxx” – “I’m still haven’t worked-out how I’d handle a meteor strike or a zombie apocalypse, but I’ve factored xxxxx into my plan through yyyyy.”

swashbucklinstache

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Re: When even having a plan is looked down upon...
« Reply #2 on: January 15, 2018, 02:12:05 PM »
I like these kinds of things as motivation if they're just friendly devil's advocate exchanges coming from a good place. If someone has serious doubts and it's someone I actually care enough about or am annoyed enough by though I like to turn the tables to them. Maybe start with something like "you're 1) aware of super rich people who never work even when they're young, and 2) you're planning to retire at some point, right? So there must be a combination of number and age where it isn't obnoxiously risky to not have a job. What is that number for you at age 65? At age 55? 45? Give me those numbers and then let's talk about them." This is similar to what @desk_jockey said and can be fun if you do want to get combative e.g. "so what you're saying is that if I hit the lotto and have 200 million dollars at age 30 it is too risky to retire and I need to keep my accounting job making $57,000 a year. k, thanks."

For me most people are coming from a good place and want to make sure you have flexibility and are going into your plan with your eyes open from a risk perspective (and this is true for any path that is out of the ordinary). Judging from how a lot of people talk about their ER plans on here having someone in your life playing that role can be a blessing :)
« Last Edit: January 15, 2018, 02:14:43 PM by swashbucklinstache »

bluebelle

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Re: When even having a plan is looked down upon...
« Reply #3 on: January 15, 2018, 03:25:15 PM »
I'm always impressed by 'kids' (your term) that have their shit together enough to even have a budget, them having a plan that has them retiring at 45 might have me fall down on my knees in praise.........I was saving money in my 20s and 30s, but just 'enough' by conventional standards, not MMM numbers.  It wasn't until I got into my 40s that I really clued in, and even then didn't get as serious as I could have.

People want 'easy', and they don't to realize that they've squandered an opportunity for themselves.  $1000/mth seems like enough to raise a child, working on the assumption that most folks already have the 3 bedroom house (if you have to upgrade your housing - that is alot more)....and if you're not planning on raising an Olympic level athlete.

For people who don't track their spending, and assuming they're not high % savers, they really don't have a clue how much they need in retirement, so they must assume you don't know either.

FWIW, I think you're amazing and not a 'silly kid', but I think everyone is still a 'child' to their parents.  My 96 year old mother still worries about whether I get enough sleep.

The Guru

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Re: When even having a plan is looked down upon...
« Reply #4 on: January 17, 2018, 06:23:39 AM »

"How much are you budgeting?", someone asked.

"About $1,000 per month, plus the anticipation that my salary still has room to grow and cover anything extra."

"That's not enough.", pretty much everyone said, laughing.

"Okay, how much does it cost to raise kids?" I asked, eager to get more data and update my model.

"I don't know, but more than that." seemed to be the consensus answer.


No,  they're right. Just the payments on the full size, 3-row-seating 4WD SUV you're going to neeeeeed when the little ones come along will eat up 3/4 of that all by itself.

Seriously, this exchange is revealing all by itself. They admittedly don't know how much you'll need except to say that whatever you have won't be enough. Even though you, like most Mustachians have actually done the math- and they, like most non-Mustachians- haven't.



londonstache

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Re: When even having a plan is looked down upon...
« Reply #5 on: January 17, 2018, 08:57:21 AM »
When I, or the folks around here, see uncertainty, I feel like we digest it and accept it. But it seems like others look at uncertainty, and then decide that the whole idea of making a plan is a waste of time. Why make a plan if you're not certain of the outcome?

I had a similar, frustrating experience this Christmas where I pointed out that I had a similar plan to retire early, which I was told was impossible. "Life costs more than you think!", I was told. 

Another conversation the following day covered the price of grocery shopping. I explained that on a weekly basis, myself and Mrs londonstache pay around £35-40, although we often spend less than this. "Lol!" said my family in unison. "You are unrealistic - we pay £80 minimum per week (my parents)/£100 per week (my sister and brother-in-law)/£50 per week (retired grandmother)". It was then explained to me that my figures (which I carefully track) are definitely wrong.

I did think of explaining how spending £2,000 less per year on food would have an impact upon saving/RE, but decided to bite my tongue!

I've also been told that life has uncertainty so of course it's important not to make any kind of provision for the future and live life by the seat of your pants. After all, who would want to be in the position where they encountered a negative life event knowing that they had a healthy emergency fund and investment portfolio? I'd much rather have nothing in the bank and chance it! *facepunch*
« Last Edit: January 17, 2018, 08:59:27 AM by londonstache »

DTaggart

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Re: When even having a plan is looked down upon...
« Reply #6 on: January 17, 2018, 09:37:17 AM »
This is why I'm not telling my family that I'll be FIREing in a few weeks. I don't want to try and explain it to them. They seem to enjoy their spendypants lifestyles with big houses, multiple new cars, and expensive meals out and vacations, then turning around and complaining that they just can't save or get ahead, or help pay for their kids college. They react quite negatively to any suggestions that things could be different if they made different choices. So when they are freaking out trying to figure out how they are going to pay for their "unexpected" car repair or whatever (Gee, who could have possibly foreseen that a car might someday need new brakes or tires??), I just smile sympathetically, nod and say "Yes, life is so very difficult."

mathlete

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Re: When even having a plan is looked down upon...
« Reply #7 on: January 17, 2018, 12:48:41 PM »

After a reasonable exchange of answering concerns with potential solutions, if I still get the this-silly kid-doesn’t-know-what-they’re-talking-about response then I tend to make my point with exaggerations…

“It’s too risky” - “Yeah, I’m concerned about risk.  For example, I would never visit Kansas because they have tornados there.  That is just too risky.”

“But what about xxxxx” – “I’m still haven’t worked-out how I’d handle a meteor strike or a zombie apocalypse, but I’ve factored xxxxx into my plan through yyyyy.”

These got a chuckle out of me.

mathlete

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Re: When even having a plan is looked down upon...
« Reply #8 on: January 17, 2018, 12:57:02 PM »
Seriously, this exchange is revealing all by itself. They admittedly don't know how much you'll need except to say that whatever you have won't be enough. Even though you, like most Mustachians have actually done the math- and they, like most non-Mustachians- haven't.

Exactly!! My estimate may end up being completely off, but I at least have an estimate. And I can walk through the steps I took to arrive at the estimate. I can't wrap my head around how an imperfect estimate made from incomplete data is worse than no estimate at all.

Thanks everyone for allowing me to commiserate a bit.

Linea_Norway

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Re: When even having a plan is looked down upon...
« Reply #9 on: January 17, 2018, 01:21:57 PM »
Love this thread. Checking your spending is indeed an eyeopener. Other people have no idea how much they actually spend.

MonkeyJenga

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Re: When even having a plan is looked down upon...
« Reply #10 on: January 17, 2018, 06:49:47 PM »
I don't know how I've gotten so lucky with responses to my plans. Most of friends think it's cool, even if not what they want. Even when I told my spendy dad that I wanted to retire on $15k/yr in my thirties, his response was a shocked, "That's below the poverty line!"

I chirped back, "Yep! I don't need a lot to be happy."

He went, "Okay..."

But no arguing over it, no trying to convince me I was crazy.

There's a chance I'll get written out of the will in favor of relatives who need the money more, but it's not worth it to me to lie.

Maybe I did get these kinds of responses at the beginning, but I've talked about it for so long that I've beat people into submission.

kaypinkHH

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Re: When even having a plan is looked down upon...
« Reply #11 on: January 18, 2018, 06:46:15 AM »
Lol I very much enjoyed this.

I haven't mentioned possible FIRE plans to my parents or many IRL people.

Here is a good small example of how risk adverse my own mom is (not financial example, but it fit in well with OPs risk adverse family):

Over the holidays I planned to meet up with 1 friend for breakfast in my hometown, and a 2nd friend for lunch in a city between my hometown and my current city (I see these friends ~1x per year). Friend 1 had to change plans, and this all ended up being the same day. I planned to meet up for breakfast at 9:30. I assumed breakfast would take 1 hour (due to the location we chose/serving time etc.). Drive to 2nd location is ~2.5 hours, so I planned lunch with 2nd friend at 1:00pm. My contingency plan: If we were running late I would call my 2nd friend and delay lunch by 30 minutes (it was the holidays, she knew we were travelling, this was NBD.)

I told my mom this plan, and her response was "Well that is impossible! You should cancel lunch plans with 2nd friend." To avoid the stress/risk of being late for 2nd friend, she would have rather cancelled the whole thing than try to make it work.

In the end I was 10 minutes late meeting my 2nd friend, who was also 10 minutes late!

So yah trying to explain ERE to someone with that mindset doesn't go anywhere :P

Cowardly Toaster

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Re: When even having a plan is looked down upon...
« Reply #12 on: January 18, 2018, 01:18:13 PM »
I don't know how I've gotten so lucky with responses to my plans. Most of friends think it's cool, even if not what they want. Even when I told my spendy dad that I wanted to retire on $15k/yr in my thirties, his response was a shocked, "That's below the poverty line!"

I chirped back, "Yep! I don't need a lot to be happy."

He went, "Okay..."

But no arguing over it, no trying to convince me I was crazy.

There's a chance I'll get written out of the will in favor of relatives who need the money more, but it's not worth it to me to lie.

Maybe I did get these kinds of responses at the beginning, but I've talked about it for so long that I've beat people into submission.

$15K a year? I'm intrigued. Do you have a journal that describes your plan?

Abe

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Re: When even having a plan is looked down upon...
« Reply #13 on: January 18, 2018, 11:26:41 PM »
I tried to show my model (in Excel) to my parents (whose finances I manage, so I know they are set for life). Even though they themselves have followed the essentially the same plan (because I set up their retirement accounts & pensions in the same way), they refuse to believe that they could have retired at age 60, or I will be able to retire by age 45-50. A lot of it centered on unlikely scenarios, and assume that once retired I will be permanently unemployable. <shrug>


Fi365

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Re: When even having a plan is looked down upon...
« Reply #14 on: January 18, 2018, 11:35:11 PM »
These sorts of exchanges are one of the primary reasons that we started journaling/blogging about our FI adventure last year.

When we retire around ~40-45, and everyone thinks we’re crazy, then I’ll send them the url as proof that FIRE was a decade in the making!

Not that anyone will actually care.

They’ll think we’re poor and cheap no matter what we do.

londonstache

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Re: When even having a plan is looked down upon...
« Reply #15 on: January 19, 2018, 06:22:16 AM »
I tried to show my model (in Excel) to my parents (whose finances I manage, so I know they are set for life).

I'll not show my model to my parents unfortunately (who incidentally are about to retire, but not early). They will only pay attention to one side of the FIRE equation - "earn more", as myself and Mrs londonstache have decent salaries, although live in a HCOL city, without seeing the other side - we spend way less than they do.

gerardc

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Re: When even having a plan is looked down upon...
« Reply #16 on: January 19, 2018, 07:01:23 AM »
Maybe I did get these kinds of responses at the beginning, but I've talked about it for so long that I've beat people into submission.

I'm like you. I'm pretty confident about this whole thing in discussions, while they often have no clue/knowledge (e.g. about finance) and it ends up showing. But then again my salary is super high so they chalk it up to that.

ixtap

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Re: When even having a plan is looked down upon...
« Reply #17 on: January 19, 2018, 09:49:08 AM »
I tried to show my model (in Excel) to my parents (whose finances I manage, so I know they are set for life).

I'll not show my model to my parents unfortunately (who incidentally are about to retire, but not early). They will only pay attention to one side of the FIRE equation - "earn more", as myself and Mrs londonstache have decent salaries, although live in a HCOL city, without seeing the other side - we spend way less than they do.

FIL has made his own retirement spreadsheet based on salary. We let him run our numbers, but with spending. He had a very hard time believing that a couple could live on the number we gave him.

MonkeyJenga

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Re: When even having a plan is looked down upon...
« Reply #18 on: January 19, 2018, 08:51:11 PM »
I don't know how I've gotten so lucky with responses to my plans. Most of friends think it's cool, even if not what they want. Even when I told my spendy dad that I wanted to retire on $15k/yr in my thirties, his response was a shocked, "That's below the poverty line!"

I chirped back, "Yep! I don't need a lot to be happy."

He went, "Okay..."

But no arguing over it, no trying to convince me I was crazy.

There's a chance I'll get written out of the will in favor of relatives who need the money more, but it's not worth it to me to lie.

Maybe I did get these kinds of responses at the beginning, but I've talked about it for so long that I've beat people into submission.

$15K a year? I'm intrigued. Do you have a journal that describes your plan?

Oh, I have had many journals, but I rarely talk about money. Basic breakdown for my last year in NYC:

$500-ish for rent and utilities
$100 MetroCard
$60 health insurance
$150-200 food
$20 cell phone

Then some medical and travel expenses, not much else.

Now I'm spending under $200/mo since I'm not paying rent or almost anything else. Can't last forever, but it's fun couchsurfing for now.

AlexK

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Re: When even having a plan is looked down upon...
« Reply #19 on: January 19, 2018, 09:46:29 PM »
I retired at age 41 three years ago and my mom still thinks I'm going to run out of money at any time. Ex-coworkers that are at new companies now call me sometimes with job offers, assuming I need a job again when they know I'm retired. Even when the math is explained it's hard for the average person to believe it.

The reality is I probably saved too much and could have retired earlier. When I look at a graph of net worth versus time I cannot tell when I quit my job from the shape of it, just a constant upward slope (thanks to stock and real estate markets).