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Author Topic: Reader Case Study: Can We Have It All But Still Retire Early?  (Read 117365 times)

Mister Fancypants

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #150 on: March 13, 2014, 09:44:56 AM »
Look, you'll get no argument from me on the value of colleges as a place to meet potential marriage partners, gain admission to certain fields or go to certain graduate schools. I met my husband in college and other men who were there and interested in me are all high achieving and well earning 5 years out from graduation. (All engineers, though. I seem to have a type. =D) But you're paying a hell of a lot for a few extra percentage points of "weeding." How much more bonus additional networking are you kids going to get from an elite school that they aren't going to get from living in Rye, having two parents in finance, having two parents with Ivy League networks and being members of a selective country club? For kids as well connected as yours, they're going to gain a lot less from the elite education, in terms of those intangibles, than someone from a less rareified background. How much money are a couple of percentage points in additional networking value worth? Your kids aren't brilliant children from rural Iowa or the South Bronx who have no connections in the professions. They're already incredibly well enmeshed in your world, and that isn't going to change if, god forbid, they go to SUNY.

I love my SUNY education :) Actually for undergrad I think it is far more practical to save the cash and go to a SUNY school, then pony up for grad school, Harvard Law or an MBA from Wharton or MIT give you the same networking and bragging rights and opportunities without the $300 to $450k undergrad price tag, might even get an employer to pay for it. Not to mention UMich or SUNY or UMass UConn etc. all have a much better party reputation and let’s face it college is not all just about the education in the classroom, I'm a huge advocate of real world experience and that is what I dislike private schools personally I think the mix of people you interact with in the public school system and on the subway for that matter is important for a proper upbringing. Ex-mayor Bloomberg richest man in NY travels via subway, that says something now doesn't it.

Cromacster

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #151 on: March 13, 2014, 09:46:31 AM »
Of course happiness isn't the only purpose in life - and in reality everyone seems to have a slightly different interpretation and opinion of what the meaning of life is.

Additionally everyone has her own core competencies and strengths which allow her to contribute to society.  It would be a shame if Einstein or Steve Jobs had taken the same route just sailing around the world instead of changing it for the better.  Of course not everyone is at that level, but perhaps finding what one's purpose in this world is and fulfilling it is actually more meaningful than having 'freedom' and 'not having to answer to the man'.

The goal or purpose FIRE isn't to earn your money then sit on your porch drinking sweet tea.  The whole idea is that when you are not reliant upon your wage income you can do whatever the hell you want, maybe even sail around the world, or think about quantum physics...whatever blows your skirt up.

You're right, you probably won't invent the next iphone by sailing around the world, but neither of your examples went to an ivy league school.....or even completed school in regards to Jobs.  But do you believe people who are driven and passionate about what they do are just going to up and stop if they become FI?  Why is your path any better than the person who chose to sail around the world with their family?
« Last Edit: March 13, 2014, 09:48:30 AM by Cromacster »

bacchi

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #152 on: March 13, 2014, 09:57:47 AM »
but perhaps finding what one's purpose in this world is and fulfilling it is actually more meaningful than having 'freedom' and 'not having to answer to the man'.

Eh? Are you 'sure' you've read the MMM articles? If so, there appears to be a 'reading comprehension' problem.

My troll-meter is pegging pretty hard.

expatartist

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #153 on: March 13, 2014, 10:30:13 AM »
It would be a shame if Einstein or Steve Jobs had taken the same route just sailing around the world instead of changing it for the better...finding what one's purpose in this world is and fulfilling it is actually more meaningful than having 'freedom' and 'not having to answer to the man'.

By sailing around the world - with goals and plenty of curiosity - kids can see and experience first-hand changes which need to be made. Their discipline and studies and routine will be different but no less important than if they stayed at home (regardless of 'WWGS' - what would Gladwell say). They will encounter people and ideas and materials and ingenuity and inspirations they would never encounter in the US. Reading the NYT/Nat'l Geographic/travel or volunteering during holidays doesn't come close.

bacchi

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #154 on: March 13, 2014, 10:35:15 AM »
[3][4] or with the deliberate intent of provoking readers into an emotional response[5] or of otherwise disrupting normal on-topic discussion.

Let's see...

You claim to have read all of the articles yet completely miss the point of them.

You wrote "if something unexpected were to occur we would be in financial danger" but whenever someone suggests substantial changes, you equivocate and rationalize. As someone wrote, bringing lunches to work isn't going to save you. Further, you later deny that anything unexpected could happen and/or you would be well prepared to handle it.

You wrote "I think our problems lie in trying to ‘fit in’ with our peer group" but then deny that you're doing it or again rationalize the expenses as necessary "for the kids."

Etc., etc.

If you're not trolling, then you're easily the most defensive case study poster on this forum. That indicates a lack of willingness to actually change.
« Last Edit: March 13, 2014, 10:40:12 AM by bacchi »

Daleth

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #155 on: March 13, 2014, 10:44:18 AM »
It would be a shame if Einstein or Steve Jobs had taken the same route just sailing around the world instead of changing it for the better...finding what one's purpose in this world is and fulfilling it is actually more meaningful than having 'freedom' and 'not having to answer to the man'.

By sailing around the world - with goals and plenty of curiosity - kids can see and experience first-hand changes which need to be made. Their discipline and studies and routine will be different but no less important than if they stayed at home (regardless of 'WWGS' - what would Gladwell say). They will encounter people and ideas and materials and ingenuity and inspirations they would never encounter in the US. Reading the NYT/Nat'l Geographic/travel or volunteering during holidays doesn't come close.

Exactly. I have little doubt that these kids will do really cool things with their lives. The chances of them making life decisions based on what their peer group expects of them instead of based on what their true nature and purpose in life is, a la "I'm 27 and in a stable relationship, I guess it's time to get married" or "I guess I need to buy a really expensive car, since everybody else has one," are slim to none.

windawake

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #156 on: March 13, 2014, 10:48:26 AM »
WF, it really seems like your interest is in trimming some of the fat but not making any drastic changes. It's hard for many on this forum to understand and I hope that after your extensive reading of the forum and MMM posts, you can understand exactly why that is. We are all about trimming way more than the fat. We're about getting down to the bare bones of what life is and choosing deliberately how we want to be a part of this world.

In regards to your situation: on one hand, you are very happy with the experiences that your family is having in the community where you have chosen to live, while on the other hand you recognize that volunteerism, perspective, and non-material experiences are important parts of the upbringing you want to give to your children. You want them to be well-rounded and not reliant upon a huge income to find happiness. It is very unlikely that you will cultivate the aforementioned attitudes and values in your children whilst living such a decadent lifestyle, as many posters before me have pointed out. But, perhaps, you don't actually value those things as much as you say. I'm not saying that's a bad thing. I'm just saying that the desires and hopes you've stated throughout this thread seem contradictory with your lifestyle choices, which makes me suspect that they're not equally balanced desires. It seems like you value the lifestyle more and the values/experiences/lessons less. And if that's your choice, that's fine.

MrsPete

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #157 on: March 13, 2014, 11:06:40 AM »
The right answer here is BALANCE. 

Every time you say yes to something (like sailing around the world), you're saying no to something else (like being part of an academically challenging school or taking part in team sports). 

Each of us must choose for our children where that line should be drawn -- how many activities are "too many"?  How much relaxed, unstructured family time is appropriate?  How many chores are appropriate for a certain age?  How much stuff should we buy? 

We won't all agree upon the line in the sand -- and, in fact, multiple lines exist.  Y'all are arguing over those lines.  Clearly the OP is unhappy with his current balance; if not,  he wouldn't have posted.
« Last Edit: March 13, 2014, 11:08:57 AM by MrsPete »

bacchi

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #158 on: March 13, 2014, 11:10:13 AM »
Perhaps it would be helpful, for others but particularly for yourself, to provide specific examples, as you seem to exaggerate a lot of the points you are attempting to make.

As I'm not the only one who has mentioned this, perhaps you should look into it since it is, after all, your case study?

You have a talent for sarcasm. That would also be part of the "defensive" attitude that I mentioned.

Daleth

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #159 on: March 13, 2014, 11:17:06 AM »
By sailing around the world - with goals and plenty of curiosity - kids can see and experience first-hand changes which need to be made. Their discipline and studies and routine will be different but no less important than if they stayed at home (regardless of 'WWGS' - what would Gladwell say). They will encounter people and ideas and materials and ingenuity and inspirations they would never encounter in the US. Reading the NYT/Nat'l Geographic/travel or volunteering during holidays doesn't come close.

Exactly. I have little doubt that these kids will do really cool things with their lives. The chances of them making life decisions based on what their peer group expects of them instead of based on what their true nature and purpose in life is, a la "I'm 27 and in a stable relationship, I guess it's time to get married" or "I guess I need to buy a really expensive car, since everybody else has one," are slim to none.
Daleth, your points are quite valid and well taken, if in reality doing cool things with their lives and not following conventional norms is what would help them realize and fulfill what their purpose in life is (which is really what makes people happy)

My guess is you do assume that to be the case

This is a subtle distinction, but it looks like you're missing it, perhaps because I haven't explained it in so many words until now. But here goes: I'm not saying or assuming that there is anything intrinsically wrong with going to an Ivy League, getting married at 27 or whatever the average is, and working a conventional job. It wouldn't work for me, but I'm sure there are people for whom that's truly fulfilling and meaningful.

What I'm saying is that far too many people follow the conventional path NOT because it's what's truly fulfilling and meaningful to them, but because it is "just what people do," it's "what all my friends are doing," it's what they're told all their lives (if they had a conventional or aspiring-conventional upbringing) will make them happy, and it's the easiest path to follow in this society.

And by easiest I mean not only that most people support and approve of conventional choices like going to the best/most expensive college you can get into, so the kid feels very socially supported in making that choice, but literally, 18-year-olds wanting to follow that path can get student loans for $100k+ to help them do it--whereas they can't, for instance, get a loan to buy a sailboat, film a movie, or start an organic farm or a weird little company like Apple Computer was in the 70s.

People who make life decisions because it's what their peers and family expect of them, rather than because it's what they really want and are "designed for" (i.e. it fits their character, goals, etc.), are not going to be happy. That is just as true for people raised by hippies or adventurers who make hippie-ish or adventurous life choices that are not actually in tune with their own natures, as it is for people with conventional upbringings who make conventional choices.

That being said, in my experience it is more unusual for people raised by hippies or adventurers to blindly/semi-helplessly follow the path set by their parents and peers than it is for people raised conventionally, for one big reason: because following your own path rather than conforming is a huge value for most hippie or adventurer parents (and thus they encourage it in their kids, whatever that kid's right path may be), whereas it's typically not a huge value for conventional parents (thus they are less likely to encourage their kids to make unconventional choices even when the kid deeply believes such choices are best for him or her).

crazyworld

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #160 on: March 13, 2014, 11:30:33 AM »
Also, can't help myself here =)  taxes: how can america be the great place it is w/o all of us higher earners chipping in?  Since I grew up in a third world country, I know what happens when a nation can't pay its bills.  Barely any law and order, dirty air, potholed roads, denuded mountains, polluted rivers and beaches, corruption, no reliable emergency services - medical/fire/coast guard - I could go on and on.  Really, all that stuff takes money.  Yes it hurts to pay so much, yes there is waste.  There were a few fabulous rich around when I grew up, and they lived in their giant mansions in a bubble as much as they could.  They could buy the best education, security for themselves, even medical care, but air & water and natural beauty can't really be bought with private money.

Well I would say I pay at least my fair share of taxes considering the benefits I receive.  People say it's about fairness and I completely agree: it seems unfair that a small % of people pay such a high % of taxes with about half of people paying no federal income tax.

Redistribution can cut both ways, here's an interesting mental exercise: What if the energy that is saved by turning down the thermostat by MMM is simply spent by his wasteful neighbor who wants to keep the temperature 74 during the winter, and to make things more 'fair' an arbitrary amount is transferred by the utility company so that MMM pays more than his actual usage and his neighbor pays less?  Isn't that what our extremely progressive income tax system is doing as well but in reverse?

And why is income taxed - why not wealth?  Well that is of course a completely different topic.
[/quote]

I agree that wealth should be taxed, with corresponding decrease in income tax - no argument from me there.  Regarding the oft-repeated "fairness" issue and "1/2 the country does not pay taxes" - this includes the demographic of low income people - who work full time and make too little to live on.  How can we realistically expect them to chip in much, if anything?  Of course this also includes rich people who pay zero federal taxes because of tax code loopholes (this is not second-hand info - I see their tax return). But this is not the demographic being usually discussed, because they are "job-creators". And it is true, they are.  BTW, I am not saying you are not paying your fair share.  But please think about your luxurious life and the equally great life your children are going to have.  Now think about a single mom, working full time, making maybe 30K and her life and the life of her child(ren).  Even if she pays no taxes and you pay a lot, she will not come to within a mile of your life in 7 generations.  We are completely off-topic now, sorry! And clearly I am a bleeding heart liberal...

Daleth

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #161 on: March 13, 2014, 11:37:31 AM »
There was obviously some misunderstanding, but even so I'm not sure exactly how many posts on the blog you listed that I needed to read, in addition to the newspaper article, in order to get all of the information that you clearly already have knowing them personally. 

I'm not at all saying you should've known, for instance, that the mom was a private-school blue blood and not a hippie. (Although honestly, you're in finance and this is a financial forum--I think anyone here would have realized that a family capable of taking off around the world in their own sailboat for 6 years, with 3 kids and no jobs, must be at least reasonably well off. And frankly, most hippies--and I know plenty--are not.)

What I was critiquing wasn't the fact you didn't know what kind of people these were or what their goals were, but the fact you posted statements that indicated that you were ASSUMING what kind of people they were and what their goals were. Did you ask or speculate about what their goals might have been in an open minded way? No, you made that knee-jerk comment about (air-quotes) "freedom" and getting away from "the Man."

By way of contrast, I hope you noticed in my previous post that I'm NOT assuming that anyone whose life path is conventional is following that path because they want to conform with their peers. Some people, including at least one very independent-minded person I am related to, have made choices totally consistent with the conventional path because that was actually right for them personally, it was what they really wanted, etc.

But in your posts on this thread, you sound like you made a lot of lifestyle choices (country club, $85k car, massively expensive lawn care, etc.) because it's what your peers expect of you; it's what one does in your social group, IF one does not want to stand out. I don't care what your specific choices are (except to the extent they're financially foolish), I care whether you made them genuinely or merely out of a desire to fit in, to not look different, to fulfill other people's expectations... If the latter, you are not going to be happy. That's just how it works. It's the reasons for the choices that determines whether you're happy or not.

I wasn't referring to them specifically with my 'freedom' and 'not having to answer to the man' comment.

How else could I have interpreted your statement, in response to my post about this family sailing around the world, that "it would be a shame if Einstein or Steve Jobs had taken the same route just sailing around the world instead of changing it for the better.  Of course not everyone is at that level, but perhaps finding what one's purpose in this world is and fulfilling it is actually more meaningful than having 'freedom' and 'not having to answer to the man'"?

You're contrasting Einstein, Jobs and others who "find what [their] purpose in this world is and fulfill it" with people who "just sail around the world instead of changing it for the better," and you conclude that Einstein, Jobs et al. are likely superior because "perhaps" what they did is more meaningful than having freedom and not having to answer to the Man. From a point of view of logic, reading comprehension etc., I'm not sure there is any coherent argument that you were NOT referring to the sailing family, or at least to them and hypothetical others like them--who else could you have been referring to, in your Einstein/Jobs vs. those who sail around the world comparison?

But, hopefully that fulfills my quota for exactitude (aka pedantry) for the day. I was just struck by all the assumptions you had--that sailing around the world was not finding one's purpose and fulfilling it, that people who did that instead of being more like Einstein/Jobs were just seeking "freedom" (which you put in air quotes, as if it is a false or inferior value) and trying to escape the Man, etc.
« Last Edit: March 13, 2014, 11:41:54 AM by Daleth »

minimalist

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #162 on: March 13, 2014, 11:47:02 AM »
WestchesterFrugal, it is obvious that you and your spouse are very smart and successful. You simply have a lot of money leaks. I would suggest that you start scaling down your lifestyle in the immediate future, rather than 10 years from now. Some ways to do that:
-Downsize to ~$1 million house without acreage
-Replace one Leaf and "showoff machine" with a Tesla (best of both worlds)
-Leave country club and host more parties/dine out more

I'm going to exclude taxes since they cannot be controlled and rental expenses because they net out to zero, but what do you think of these proposed expenses?

PITI    $5,137    (Assumes 20% down, 4.5% APR, 1.5% property tax, $1k a year insurance)
Charity    $2,500    
Property Maintenance    $833    (assumes 1% per year)
Gardner    $200    
Live-In Help    $1,800    
Country Club    $0      
Groceries    $1,800    (additional expenses for hosting parties)
Vacations    $833    (vacations 2x a year or go on more frugal vacations 3x a year)
Utilities    $500    (lower due to smaller house, less acreage, etc)
Kids' Activities    $685    
Shopping    $500    (this can probably be cut, but I don't know the details)
Auto Insurance/Maintenance    $320    (2 cars instead of 3)
Public Transportation    $330    
Gasoline    $0      
Restaurants/Eating Out    $400    (some of this is currently done at the country club)
Entertainment    $80    
Total    $15,918

MrsPete

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #163 on: March 13, 2014, 12:14:06 PM »
What is your definition of 'substantial changes'?  Moving across the country?  Pulling kids out of school without regard to circumstance and values/priorities?  Downsizing a house and kicking a grandparent out to live in a crowded apartment in Manhattan? 
How much change are you seeking? 

You began by asking if you can "have it all" and retire early, which would seem to indicate you're looking to retain your current lifestyle yet also retire early.  That probably isn't possible.  Yet some posts indicate that you're willing to embrace change, while others seem just the opposite.  You're a bit contradictory, and I think it's because the ideas are still new to you.  You haven't yet settled your mind on what you'll accept and what you'll reject. 

As for "doing a 180", I don't know how much change that means to you.  You mention not being willing to move away from the Northeast.  I don't understand why anyone would want to live there, but you probably wouldn't care for the South where I live.  I'd point out that you could leave your immediate area, which seems to have a negative effect on you, without leaving the Northeast. 


Mister Fancypants

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #164 on: March 13, 2014, 12:17:34 PM »

I agree that wealth should be taxed, with corresponding decrease in income tax - no argument from me there.  Regarding the oft-repeated "fairness" issue and "1/2 the country does not pay taxes" - this includes the demographic of low income people - who work full time and make too little to live on.  How can we realistically expect them to chip in much, if anything?  Of course this also includes rich people who pay zero federal taxes because of tax code loopholes (this is not second-hand info - I see their tax return). But this is not the demographic being usually discussed, because they are "job-creators". And it is true, they are.  BTW, I am not saying you are not paying your fair share.  But please think about your luxurious life and the equally great life your children are going to have.  Now think about a single mom, working full time, making maybe 30K and her life and the life of her child(ren).  Even if she pays no taxes and you pay a lot, she will not come to within a mile of your life in 7 generations.  We are completely off-topic now, sorry! And clearly I am a bleeding heart liberal...
Everyone needs skin in the game, even if it's 1%.

Additionally the goal should be to optimize and make equal opportunities to succeed, not equalize outcomes.

The US tax system is one of the most progressive in the world, due to lack of VAT (consumption) tax.  I actually would welcome a consumption tax - it is certainly Mustachian in forcing those who overspend to foot the bill for those who don't.  But taxing income at higher and higher marginal rates makes no sense.

That’s an argument that is always taken in perspective, people with high income always say higher marginal tax rates make no sense and a consumption tax makes more sense. And those who make very low incomes feel very justified in paying no income tax as they can barely survive.

The truth is somewhere in the middle, there is no system that will make everyone happy, it is unfair to tax the impoverished and at the same time no one should get a completely free ride. On the other side of that coin is the fact that the wealthy can afford to pay more so make them for the benefit of those who are less fortunate. Neither side is truly right, somewhere in the middle you get a good solution but it has yet to be presented in a workable form, especially since it needs to come from Washington so we know it will never happen. So in the end someone will get screwed and it is generally the poor but not quite poor enough to be completely state supported and the wealthy but the not quite wealthy enough to really not give a damn.

There is a sweat spot in the middle and people following Mustachian tenets tend to fall into it as they have enough accrued substantial enough assets to cover their low level of spending so they can avoid taxes almost entirely or at least pay a minimal amount while having a much more enjoyable lifestyle then the average 9-5 in debt working middle class family.

-Mister FancyPants

Daleth

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #165 on: March 13, 2014, 01:22:17 PM »
Unfortunately $1mm is going to be tough for this area with enough square footage and distinct living spaces (separate bedrooms) for 6 people.  We don't need a mansion (we don't currently live in one anyway) - our current house is roughly 3000 sqft above ground and 1000 sqft below (play area, workout room, laundry, small home office).  We need at least 5 bedrooms (granny, live-in, master, each child boy/girl), not to mention we sometimes work from home (office space).  I am guessing that is still at least 3000 sqft in this area.  Also, if you want us to entertain more we would need some decent common areas + dining space.  $1.5 might be possible (although it would probably be older and need work and probably wouldn't have much curb appeal - the former are more concerns in terms of cost of repair and maintenance, we aren't terribly concerned about the latter, as our current house is from the 1930s traditional colonial anyway).

But have you actually looked? I just ran a search at this realtor: http://www.houlihanlawrence.com
...and found 7 homes currently for sale in Rye, NY that have at least 5 bedrooms and cost between $500k and $1 million.
Here's the most expensive one ($965k, 5BR, 2.1ba--I'm sure for the savings in house payment you'll have, you can afford to add another bathroom or two if you want):
http://www.houlihanlawrence.com/property-detail/3401303/56-Clinton-AV-Ryecity-NY-10580

There are also 4 currently for sale between $1m and $1.5m, of which the most expensive--asking $1.475m--has 5BR and 4.1 baths, more than 3200sq ft above ground (no idea what if anything is below ground) and sits on just under 2 acres:
http://www.houlihanlawrence.com/property-detail/3400015/20-Hillandale-RD-Ryetown-NY-10573
Here's how the realtor describes it: "a spectacular country property in the Hillandale estate area. The private 300' driveway leads to the secluded two acre retreat that has it all; pool, pond, stream , gazebo, playhouse and beautiful foliage." If you get a 30-yr fixed loan with 20% down at, say, 4.5%--the rates are always a smidge higher for jumbo loans like this--you're looking at a monthly mortgage payment of $5979... but the taxes there are almost $3000/mo.

But personally I think the best deal may be this 7BR/7ba on just under 1 acre in Rye Town for $1.115M--that would get you a mortgage payment of $4520/mo plus taxes (which are a little over $2000/mo) and insurance. It's huge, but it has solar panels with a 3-day battery, and that apparently is but one of the ways in which the current owners have done work to make it energy efficient.
http://www.houlihanlawrence.com/property-detail/3403794/94-Betsy-Brown-CR-Ryetown-NY-10573
So there ya go: a big enough home for all 6 of you, in your area, with nice grounds but not ridiculous acreage to keep up, Miele, SubZero, Viking and Bosch appliances--for just a smidge over $1 million.

I have no clue what school districts are like there, but I doubt there are bad ones and in any case you don't care since you're planning to put your kids through private school.
« Last Edit: March 13, 2014, 01:34:42 PM by Daleth »

DoubleDown

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #166 on: March 13, 2014, 02:27:23 PM »
As I've let go of stuff and other financial commitments, a far greater sense of peace and freedom has come over my life. It's so easy to get caught up in maintaining an expensive lifestyle, where you are working mostly to maintain that lifestyle and the stuff, rather than the other way around.

@WF, you've said you've read all the MMM articles -- one thing MMM mentions is how he was just as happy as a poor college student as he was as a relatively high earning engineer. The same has been true for me; having stuff and unnecessary financial obligations were more of an anchor than any of the usual trappings that would tell the world that I had "made it." I've been a relatively high earner with some stuff, and giving up that lifestyle has been heaven on earth to me. Now I'm FI, and the financial security is gold, worth so much more than country clubs, gyms, private educations, expensive cars, etc. We live a middle class lifestyle in a somewhat snooty upper middle class area. Not having to work every day is a godsend, as is knowing we've accumulated enough to live forever at our very comfortable lifestyle.

I'm both impressed by your earnings, but simultaneously dismayed at the thought of having so much baggage holding you back if I was in your shoes. I would feel terribly insecure with such high expenses and relatively lower net worth given your extremely high earnings. I don't know what your actual net worth is, but if it's in the $2-3 million range, that would put you at $80,000 - $120,000 annual income with a 4% SWR if you gave it all up and retired today. By most of humanity's standards, that is such a lavish retirement income, it would appear (to me at least) ungracious to suggest otherwise.

As others have said, you choose the life you want. I'll vote for trading in the high expense lifestyle, it sounds like it's holding you back.

Daleth

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #167 on: March 13, 2014, 02:49:16 PM »
56 Clinton's backyard is I-95, the major interstate/artery for the entire northeast, that's why it's so cheap

20 Hillandale is actually a very nice house and being a 1938 Colonial similar to ours, but it is in Rye Brook (different town); it's almost more of a back country property, being close to the Merritt and a bit of a trek from town and not as commuter friendly - but still not a horrible consideration if you don't mind driving a lot and not being close to everyday stuff

94 Betsy Brown is in Portchester; this is not a good deal at all

Hillandale would be considered a secondary location in desirability, which in real estate is pretty important.  I don't think the maintenance/upkeep costs for that house would be any different (it's actually more acreage than our current primary residence).  Clinton and Betsy Brown will be extremely difficult to unload when the time comes to sell

We looked a few years ago before we started doing all the renovations to our home, and the market in this area is pretty efficient.  I think we might be able to squeeze $200-400k in savings if we downsized in our general area, but we would not recoup any of the improvements we made to our home (which would delay and reduce ongoing maintenance) and would most likely need to sink a bunch of money in renovations into wherever we moved to.
Quote
What's wrong with Portchester? It's not like you're using the public schools...
The desirability is all relative - it's a fantastic location compared to the Bronx, a horrible one compared to the surrounding neighborhoods.

I simply commented that it was not a 'bargain' and would be very difficult to sell eventually.

I'm sorry, I'll bow out now. You are still too caught up in measuring your life according to the lives of your peers--god forbid you should live in 7BR/7ba $1.1 million Westchester mansion with a pool and high-end appliances in a particular neighborhood (of million-and-up Westchester homes) that one's peers consider to be below the fold. Gosh, would people not come to your dinner parties if you had them there? Um... are those really people you want to be "friends" with?

I used air-quotes there because people who value you as human beings, and not as trophies attesting to their own personal success, will come to your dinner parties even if you live in a mere $1.1 million mansion in Portchester, or a mere (snif, well-coiffed hair toss) "secondary location" in Hillandale.

By the way, keep your eye on those listings--I think you will be surprised how quickly they sell. (And if it's genuinely not a bargain at its asking price, some lucky family will get it for less--sparing themselves more unnecessary expense). Why will they sell quickly? Because they're not selling to your "friends," they're selling to slightly less snobbish and less wealthy people--of whom there are far more than there are people like your "friends."

It's funny, because you're clearly conflicted--there are genuine personal values of your own in there struggling to get out (that's why you even came to this forum), but they're drowned out by the snobbish, artificial values you learned and are still parroting.

The simple answer to your question is, no, one cannot "have it all"--since by "have it all" you clearly mean continue living up to the expectations of your peers, which you learned from them and are parroting--and also retire early. The only way you could get the answer to "yes" is by sloughing off all this artificial crap and reconnecting with the genuine personal values that brought you to MMM in the first place.
« Last Edit: March 13, 2014, 03:04:46 PM by Daleth »

emilypsf

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #168 on: March 13, 2014, 02:52:15 PM »
Westchester Frugal, thank you for posting.  Your case study and the comments have given us a lot to think about (two working parents, intense jobs, young kids, living in an expensive area), so I think that your post does achieve at least one of your goals.  I am far from Mustachian but am actively trying to move toward a less expensive, simpler life.  I have found that it is much easier not to take on a new expense than to cut an existing expense.  It sounds like you have already come around to cutting/minimizing some of your smaller but still significant expenses, like the car.  If you can keep that mindset, it should help you from taking on new expenses in the future, and, perhaps it will lead you to making some more drastic changes.

This comment is intended to be 100% constructive, not negative or judgmental in any way.  I have read your postings and all of the comments.  Please forgive me if I repeat or misunderstand anything.

So, starting with the little changes, first I'd cut the country club and trim the vacation budget.  It is unfortunate that you spent so much time and energy getting into the club, but that is not a reason to continue spending so much money on it.  Find the public tennis courts, pools, golf courses, and parks in your area.  I'll bet they are nice.  Host BBQ's at your home, the park, or the beach instead of socializing at the club.  Perhaps try out not using the club for a month or two this summer to see how it goes before you drop your membership.  On the vacation side, I'm not clear on whether your figure includes the cost of the hotels/flights that are paid by miles or not.  Regardless, you can really trim this and still have a great time with your family.  It will probably be less stressful to drive to the shore instead of flying to the Caribbean, too.  I think you said you're already planning to do this, which is great.

Fully commit :) to getting rid of the fancy car, and buy something fuel efficient instead.  As a side note - take a look at your gas spending - you're spending quite a bit for a family that lives 2 miles from groceries, 6-8 miles from school, commutes by train, and has one electric car. Where is the gas money going?  We spend about half of that in CA and both commute by car (one of us 70 miles per day - so unmustachian!), but fuel efficient cars, so perhaps that explains it.

One poster mentioned that switching internet providers at this level is not useful.  I humbly disagree.  I think that scrutinizing all of your spending and making the small changes prepares you for making big changes and makes you think about big changes.  You do want to make big changes at some point, even if it is 10 years from now, so it's a good idea to establish these habits now.  So look at your utility bills.  Can you cut your cell phone bills down, why are your gas/electric bills so high, does the lawn really need to be watered so often, etc?  It won't save you tons of money in comparison to your income, but it is a good and pretty painless way to start building your frugal muscles.

Doing all that landscaping/maintenance yourself sounds exhausting and time consuming, but replacing a lot of the lawn with something low-maintenance is a great idea (at least for the house you're not planning to sell).  It should cut your utility and maintenance bills, too.  Perhaps you can cut down to a small lawn that you can mow yourself once a week (or your kids can do it) and native plants that need maintenance once a month for the rest of the area.  I'd think this would even add value to your home, at least it would in CA.

Now, this is where we get into areas that are more difficult.

As far as live-in help, we have an au pair, which is actually a relatively inexpensive childcare option with two kids under the age of three in our particular situation/expensive area, so I'm not going to say live-in help is not wonderful, and it is worth the cost to us.  I wonder if it's the best option for you, though.  If your live-in help is an au pair, I'd consider moving to a babysitter for a few hours a day who can help drive the kids to activities if that is your primary childcare need now that your kids are older.  Alternately, can you find a carpool for at least some of your needs?  If your help is a live-in nanny who has been with your family forever and also helps with the elderly grandparent, that's a different story.  In that case, I'd explore whether it would be possible for her to share time with another family while your kids are in school.  You might find someone who is willing to drop their kids off at your house for her to care for so that she'd still be at home with the grandparent in case of emergency.  That arrangement is very common where we live and would cut down on your expenses.

Next, your housing costs are a huge portion of your spending (even when I subtract out what I think are the costs associated with the rental property).  Your landscaping, maintenance, and utilities are more than we pay on our mortgage, and we have a very unmustachian 4br single family home in a very expensive city with a very high mortgage.   Purchased before I started reading this blog.  :)  I would seriously consider moving if I were you.  I am.  I know it sounds like a drastic step that is unnecessary when you can pay your mortgage every month and still save a lot of money, but when you sit down and do the math on how much money you can save by moving, it is eye-opening.  There are tons of little costs that add up when you have such a big house - even down to replacing the batteries in the many, many smoke detectors that such a big house has, so include all the little stuff in your calculations.  Start out by going to open houses just to look.  Are there nearby suburbs on the same train line where the schools are not as good?  You don't need excellent public schools if your kids are in private, and houses tend to be cheaper in areas where the schools are not as good.  Do you find yourself thinking about how nice it would be not to worry about having huge grounds to keep up when you're looking at houses on the market?  As you go to open houses, think about how your family would fit into them.  Maybe you can find something with an in-law apartment above the garage or something similar that would allow your nanny and/or grandparent her/their own space but cut down on the size of your home.  You could even rent it out once your kids leave home, so you don't have to move again when you retire.

I understand your reluctance to cut private school for your kids.  It's difficult to justify doing something that is not strictly necessary and that you think could negatively impact them when you are making plenty of money.  I do not come to the same conclusion that you do about the benefits of various schools and the impact on your kids of going to an excellent public school, but I understand you're not going to change your mind and won't push the issue.  Could you cut down on the yearly gift to the school?  My kids are young and will (hopefully) attend public school, so I do not understand the expectations or politics of these things, but perhaps there is some flexibility there.

Finally, I'd explore some of your assumptions in your retirement budget.  I have not seen it, so these are just questions that came to mind in reading your post.  Do you want to plan to stay in a house where your kids will have their own bedrooms to return to while they are in college and possibly a year or two after if they don't get a job or at least one that can pay for an apartment in Manhattan right away?  Then you'll need at least 4 br's (assuming the grandparent continues to stay with you).  Are you going to find a 4br house for $1M in Westchester?  If you want to downsize and move to Florida, do you really want 4 br's or do you want something smaller?  Will your time in your current house will be more like 15 years, not 10?  If so, that puts transaction costs of moving in a different perspective.  Do you want to continue to fund the same types of vacations for your kids - they probably won't be able to pay their own way starting out, and you'd probably like them to be able to come with you?  For how long are you going to pay for them to come?  Will you run out of miles to pay for flights/hotels on vacation if you're not working?  What is the real cost of your vacations now (i.e., not using miles) and what do you expect it to be when you retire?  For groceries and entertainment, how are you calculating those?  I don't think you can just lop off half the budget because you'll have half as many people (or a third, depending on whether you keep live-in help). 

I hope you find a path that works for you and your family.  Best of luck!


Daleth

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #169 on: March 13, 2014, 03:23:56 PM »
We don't need 7br/7ba and 7000 sqft - we need 5br and 3000 sqft (above ground) which is more than enough and incidentally what we currently have

You have it for $2 million. It's available for $965k-$1.425 million. Having less space but paying twice as much money for it is not frugal or an accomplishment to flaunt.

Keeping up with the Joneses will cost you millions of dollars and years of your lives (i.e. years spent working--in a cold climate you dislike--instead of retiring early to a climate you enjoy). You can't "have it all" (= keep up with the Joneses) and retire early. As you may have noticed, the Joneses don't retire early.

snuggler

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #170 on: March 13, 2014, 03:26:02 PM »
Just wanted to add a couple of thoughts.

I work in a field with a lot of high-income folks, and I have to disagree that some of the things you think are necessary to socialize and network with wealthy individuals are necessary. For example, while I myself am not a country club member, I often attend events at country clubs and socialize with people who are members, based on my work on boards and in groups that have very wealthy members. It just isn't that hard to become friends with very wealthy people if you are very engaged in an industry that produces them, or in certain philanthropic organizations. Surprisingly, they don't seem to care that I drive a 5 year old car worth only $10k or that my purse is from Target. They somehow still invite me to events and are interested in my work and my life. The material stuff is just not necessary to be friends with the wealthy who have good values- it's only the shallow ones who care, and who wants to be friends with them anyway. It sounds like you are thinking you might downgrade the car, so kudos to you- I hope you do it.

Another thing you may want to think about is having your children take over the landscaping work and/or other chores you may outsource now. Instant cost savings that could be applied towards your very generous college fund for them. Not to mention instilling a good work ethic.

Also, letting them have ownership of some of their own college costs can be a great education as well. I know that the awareness that I was incurring debt while I was in school was a motivating factor for me to graduate on time, and to work while attending school. It forced me to feel what a tight budget felt like, and to understand the value of time and money. Not to mention the fact that the debt I had at graduation made me live frugally after graduation, and led me to invest a substantial amount of time in self-education about finances.

It is also very possible to get amazing credentials for a career by attending a state school and then going to a very prestigious graduate school. This offers a lot of cost savings. This could reduce your future education liabilities.

You also mentioned being a big fish in a small pond, but is that really what the private school is offering your children? If the school is highly competitive and prestigious, it may be more of a small/mediocre fish in a small pond situation.

I'm also surprised that your children's monthly activities expenses are so high, given that you said that the school's extracurricular programs are so strong. You should be able to afford even private lessons in sports and music and still be able to save a ton on this line item- just find some local college kids who need extra cash. Also, remember that sleep and unstructured play time is also very important for a child's developing brain. And that being in a very competitive environment can cause burnout at a young age (believe me, I know- that is why I read early retirement blogs!).

You also mentioned that you wouldn't have much more time with your children if one or both of you didn't work. If this is really true, then why do you need the nanny? Even part-time help to pick up and shuttle the children would save lots of costs. I understand that your children are attached, but if the nanny is only around for the money, and is not willing to maintain a relationship with them without getting paid for it, then your children are going to suffer those consequences at some point, either now or in the future. You also should be able to cut the phone line and home office if quitting wouldn't increase your time with your children, since you could just do your work in your office. If you really want home office space, no need to get a whole extra bedroom for it. Just use a dining room, extra family room, part of the living room, etc. With homes like the ones that have been linked in this post, even a walk-in closet would work just fine.

One thing that I like to think about as well is the actual value I am getting from expenses. Not in relation to my income (because that skews things since I earn a decent salary), but to actual, real-world value. A Louis Vuitton purse can easily pay for things like a cow or goat for a poverty-stricken family, which can drastically change the quality of life for an entire family for many years. Thoughts like this keep me back in the real world when I am surrounded by wealthy people who spend a lot of money.

It is much more important for me to have more time to volunteer and enjoy life and to accumulate wealth to give away than for me to have the latest and greatest items in order to keep up with the lifestyle of the rich. Even if you don't want to retire early, think of the absolutely amazing and wonderful things you could do with the extra cuts you can make to your expenses that could literally change the world. And think about what an amazing lesson to teach your children about the value of humanity and community vs. material possessions.

thepokercab

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #171 on: March 13, 2014, 03:33:19 PM »
We don't need 7br/7ba and 7000 sqft - we need 5br and 3000 sqft (above ground) which is more than enough and incidentally what we currently have

You have it for $2 million. It's available for $965k-$1.425 million. Having less space but paying twice as much money for it is not frugal or an accomplishment to flaunt.

Keeping up with the Joneses will cost you millions of dollars and years of your lives (i.e. years spent working--in a cold climate you dislike--instead of retiring early to a climate you enjoy). You can't "have it all" (= keep up with the Joneses) and retire early. As you may have noticed, the Joneses don't retire early.

This!

If you want to retire early you have to not give a shit about what anyone thinks of your lifestyle.  I don't own a car, rarely eat out, and I have a really dumb phone.  This prompts some people to snicker and make weird faces, but I honestly couldn't care.  My friends are the ones that accept who I am regardless of how much money I'm spending. 

snuggler

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #172 on: March 13, 2014, 03:39:14 PM »
We don't need 7br/7ba and 7000 sqft - we need 5br and 3000 sqft (above ground) which is more than enough and incidentally what we currently have

You have it for $2 million. It's available for $965k-$1.425 million. Having less space but paying twice as much money for it is not frugal or an accomplishment to flaunt.

Keeping up with the Joneses will cost you millions of dollars and years of your lives (i.e. years spent working--in a cold climate you dislike--instead of retiring early to a climate you enjoy). You can't "have it all" (= keep up with the Joneses) and retire early. As you may have noticed, the Joneses don't retire early.

I also don't see any necessary renovations in many of those links. And don't see the problem with living near a highway. Or with living in the second most desirable area in the city. I assume you probably didn't live in the world's most desirable area growing up, and yet you likely had a wonderful and happy childhood. Your children can have the same.

In fact, if I were you, I might even consider getting two condos right next to each other. I bet that would save even more money and get you the space you need. Not to mention save you in landscaping and other maintenance costs :).

I think this is an easy next step, and would give you lots of money. Think of the amazing things you could do (either with extra time, or with extra philanthropy) with that money. Makes me salivate just thinking about it...

warpgirl

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #173 on: March 13, 2014, 08:04:42 PM »
I often find a bit of extremism from this blog, which can be great if one needs to jump start a change in lifestyle that is on an unsustainable path due to the nature of actions that were not well thought out prior.  I own up to a fair number of my own past mistakes, but in reality I don't think my situation is really that unsustainable or uncommon in my corner of the world.  I am looking to make changes to work towards becoming better, and as Voltaire famously stated "Le mieux est l'ennemi du bien."  (google translate for those who don't speak french)

"The kittens are in the bushes"?? I think the smugness broke Google Translate!

tomsang

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #174 on: March 13, 2014, 08:37:56 PM »
I am more likely to get to that place by maximizing my income than cutting $20k or $40k a year from my budget.

And I am starting to think that I am getting to the point where making an extra 5% in our jobs is actually easier than cutting $50k from our expenses based on some of the less realistic options that are starting to be thrown out there.

Why are you here?  You really come across as a troll. I think Joet has resurfaced.  You sound really bitter. I hope you find happiness.

EscapeVelocity2020

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #175 on: March 13, 2014, 09:24:13 PM »
I'll preface my comment by the fact this is a very active thread and I have skipped some of the latest back and forth, but I've done my best.  Because of this, I am somewhat hesitant to join in, but like a moth.... 

I would like to know, WF, if you grew up the way that your children are being brought up?  You mentioned being from the South, but that could mean anything (lots of old money in the South). 

If you want to know more about my feelings on your situation, I am contemplating early retirement and blogging about why I would be willing to pay the opportunity cost of ER in my latest post, Time and Money, it or Retirement Fragility would be of interest to you, to at least get you thinking.  One small, specific criticism of your financial situation, and also your ER plan - I think that too much of your net worth will be tied up in real estate which is generally an under-performing, non-liquid asset.  You are planning for the necessary liquidity to have 80k passive, but with a million dollar house and your current lifestyle, 80k might go as far as you're thinking - only you can really judge that one.  But that's my personal worry about getting used to 'the good life' then retiring early (40 - 45y.o.) to much less than the pre-retirement income, and what that income could have been in our 50's...  Also, needing a large portfolio to meet your passive income needs increases risk: tax drag goes up, market volatility means income instability, and now ACA is like a means test on health insurance.

Thanks for baring your financial underpants, it's gutsy and I'm impressed that you have the wherewithal to come back and continue to respond fairly.  I have made the mistake of commenting after a beer or two, and find that the 'modify' button is worth its weight in bitcoin, just FYI  :)   
« Last Edit: March 14, 2014, 07:51:20 AM by EscapeVelocity2020 »

TreeTired

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #176 on: March 13, 2014, 10:01:26 PM »
Quote
And I am starting to think that I am getting to the point where making an extra 5% in our jobs is actually easier than cutting $50k from our expenses based on some of the less realistic options that are starting to be thrown out there.

The problem with that mindset is that you are setting yourself up to remain in the cycle of making more money to buy more stuff.    Why cut any expenses?  Why not keep buying stuff if all you need to do is make some more money to pay for it?   You might have a big year next year and bring home $20mm.   Why retire at all when you can keep on making big money?

waltworks

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #177 on: March 13, 2014, 10:09:52 PM »
This was an awesome 10 minutes of hilarity, thanks to the OP and everyone else for putting a smile on my face. The Voltaire name-drop was the icing on the cake.

OP: If you want to change your lifestyle, change your damn lifestyle. If you don't, don't.  Who comes on a forum for thrifty people to look for validation of their country-club life? I can only assume that's what you want, since even a quick skim of the blog would have yielded ample ideas to cut spending or invest your piles of spare cash. You don't need advice from anyone here on how much you can water down Natural Ice before it loses it's refreshing crisp taste, or how to replace your alternator cap with legos and gum, or whatever.

So either you're here to brag or you just don't get it. Actually, if you ARE here to brag, it ALSO means you don't get it, since nobody here is particularly impressed by people who have lots of money. We're impressed by people who overcame obstacles to achieve what they wanted to achieve and improved their lives/health/happiness. You have accumulated a lot of crap. I hope it makes you very happy.

-W

Undecided

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #178 on: March 13, 2014, 10:12:45 PM »
If the OP is making a ton of money to do anything that allows him or her to spend this much time posting here, why ever quit?

Jamesqf

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #179 on: March 13, 2014, 11:05:05 PM »
And my comment wasn't that Rye Brook was the second most desirable area, it was that it is considered a 'secondary' area in terms of desirability of location - meaning second tier.  This of course is nuance and the people who are just looking to live as cheaply as possible won't care, but it matters for resale, taxes (higher relative tax burden for towns that are not as strong financially), schools and services, and amenities - in other words any buyer with discretionary income will (and does) care when choosing a place to live.

I think you have a bit of a logic failure there.  Though I'm not really familiar with the area, I seriously doubt that everyone is leaving Rye Brook because it is a 'secondary' area.  Indeed, I would suspect that it is easier to sell ~$1 million houses there than a ~$2 million house where you live, simply because there are more people willing to pay the lower price.  So you (simplistically) sell $2 million house, buy $1 million house, and invest the extra million.

But I think you are still stuck on the notion of 'desireability' as defined not in terms of having a comfortable place to live, but in your perception that it is a status symbol.  If you'll forgive a little personal philosophy, that seeking after status symbols is going to forever doom you to second or third rank status.  The truely successful don't need symbols.

happy

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #180 on: March 14, 2014, 06:14:59 AM »
Though I'm not really familiar with the area, I seriously doubt that everyone is leaving Rye Brook                                                                               .



Boy Howdy Jamesqf, I can't believe I'm one step ahead of you, even this little Aussie has been to the Westchester Hilton in Rye Brook. But not the country club.
Actually Jamesqf, it was a bit like this when I was there:

http://www.youtube.com/watch?v=01NHcTM5IA4

Probably don't get that sort of knife in the country club.

Sorry OP, but  this thread needs some silliness…or perhaps, an argument, or not as the case may be.
http://www.youtube.com/watch?v=kQFKtI6gn9Y


 
« Last Edit: March 14, 2014, 06:23:14 AM by happy »

Phil_Moore

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #181 on: March 14, 2014, 06:29:00 AM »
This thread is very nearly perfect. I commend all involved. Or as Montesquieu would say "Bonnet de douche!".

happy

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #182 on: March 14, 2014, 06:34:08 AM »
Gorro de ducha!

MrsPete

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #183 on: March 14, 2014, 06:36:27 AM »
Groceries: $1200 vs 1640

$50/plow everytime it snows > 3".
Two ways you can save money: 

You can definitely cut this grocery bill. 

You're paying someone to plow your driveway?  Tell your kids that you're paying this amount every time it snows . . . offer it to them.  They clear the driveway, they get the money.  No, it doesn't save you a penny, but it provides them with a way to earn some extra money.  Do insist that it's done up to your standards, and be specific about when it's to be done.

happy

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #184 on: March 14, 2014, 07:01:21 AM »
Edit: I deleted this post, because this morning it really seemed to be too silly and off topic.


« Last Edit: March 14, 2014, 01:57:04 PM by happy »

jsloan

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #185 on: March 14, 2014, 07:28:31 AM »
Question to the posters in this thread:

It seems like this forum has a lot of mixed feelings on wealth at the level of the OP.  Do you all think that the kind of wealth described in this thread is a bad thing in and of itself?  If you have enough money to afford to be wasteful are you still ok with it because you are still living within your means (even if those means are unlike 99.5% of the global population)?   

What do you guys think the mustachian ideal should be for people at this income level?  Should they be downsizing and saving money like mad so they can donate a large portion of their assets to some research facility to cure horrible diseases, create a non-profit to support the arts, creating their own business or investing in businesses to support mustachian ideals like bike infrastructure, renewable energy, etc?  What if your dream is to become rich and spend your days at a country club?  Is that evil?

Lastly, I'm not sure why the OP would be coming here for advice.  The usual expenses of middle class life are a drop in the bucket for you (ie cooking food at home, cell phones, etc).  At that income level, you need to talk to some bad ass accountants who will know how to hide your money in Switzerland or create some shadow corporations to reduce your tax burden (a joke, sort of :-)). 

I'm sort of dumping a lot of thoughts into 1 post, but this thread has shown a different side of this forum and I'm curious as to why?

iris lily

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #186 on: March 14, 2014, 07:46:44 AM »
This thread is fascinating. Commenting so that I can follow it. Good luck, OP! You brought a lot of interesting issues to this board with your post.

Free_at_50

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #187 on: March 14, 2014, 07:59:41 AM »
Hello there.  This is a very interesting thread.  One thought on a comment you made about increasing your income rather than cutting your exepnses.  At the end of the day it really does come down to what life style you want to be able to attain/ maintain and then determining how much money you need to sustain it indefinitely.  So in my mind your first step is aligning your lifestyle with your values without feeling like you are suffering.  Then determine what that is costing you.  Then determine your income potential especially if you can increase it and figure out how much you need to save to amass a stache large enough to support your choices.  Maybe that bogie is $10M maybe $20M.  Then set out to earn as much as you can while maintaining the lifestyle you agreed to.  Presto in a certain number of years you will have attained it all!  Good luck!

jsloan

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #188 on: March 14, 2014, 08:02:39 AM »
Quote
I'm not fazed by his stratospheric level of wealth, because I've known a lot of people with his means or more, including my aforementioned best friend. That being said, I place a high value on humility and simplicity, which he lacks. I'm also generally disgusted by his desire to pigeonhole his kids into the same way of life he has and his obsession with keeping up with his neighbors. He seems pretty shallow.

Based on your friend's experience, is raising kids in this environment detrimental?  Is there a lot of drug abuse, pressure to keep up, failure to live up to set standards which causes depression, mental issues?  I'm so far outside of this world I have no idea if these are just things I see in movies or if they are real problems.

Mama Mia

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #189 on: March 14, 2014, 08:46:38 AM »
I find this thread fascinating as well.  I have much too little experience to give any advice but, I'm interested in reading along.   

ragesinggoddess

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #190 on: March 14, 2014, 08:47:59 AM »
Folks, this person is clearly a troll. Next they'll be telling us they keep their dog on top of the car when travelling to save space, a la Mitt Romney.

iris lily

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #191 on: March 14, 2014, 09:04:57 AM »
Have you read much about personality types? They're not scientific, but they can be useful for providing insight into personal situations. Your personality type is almost certainly XSXX. This forum is overwhelmingly N-types, with 50% or so of people here being INTJs. 2% of the general population is INTJ.

http://www.mrmoneymustache.com/forum/welcome-to-the-forum/myers-briggs-type-indicator/?topicseen

So, with that in mind. S-types tend to me much more sensitive to their peer group.

Quote
Sensing (S)
Paying attention to physical reality, what I see, hear, touch, taste, and smell. I’m concerned with what is actual, present, current, and real. I notice facts and I remember details that are important to me. I like to see the practical use of things and learn best when I see how to use what I’m learning. Experience speaks to me louder than words.

The following statements generally apply to me:

I remember events as snapshots of what actually happened.
I solve problems by working through facts until I understand the problem.
I am pragmatic and look to the “bottom line.”
I start with facts and then form a big picture.
I trust experience first and trust words and symbols less.
Sometimes I pay so much attention to facts, either present or past, that I miss new possibilities.
Intuition (N)
Paying the most attention to impressions or the meaning and patterns of the information I get. I would rather learn by thinking a problem through than by hands-on experience. I’m interested in new things and what might be possible, so that I think more about the future than the past. I like to work with symbols or abstract theories, even if I don’t know how I will use them. I remember events more as an impression of what it was like than as actual facts or details of what happened.

The following statements generally apply to me:

I remember events by what I read “between the lines” about their meaning.
I solve problems by leaping between different ideas and possibilities.
I am interested in doing things that are new and different.
I like to see the big picture, then to find out the facts.
I trust impressions, symbols, and metaphors more than what I actually experienced
Sometimes I think so much about new possibilities that I never look at how to make them a reality.

You've managed to stumble onto a group of people who, by inclination, care a lot less about what other people think. As a group, we've decided to ditch what the dominant culture thinks of as the American Dream and follow our own intuitions. So you're unlikely to get much sympathy here for your obvious desire to play keeping up with the Joneses, because we've all decided to not play that game. Your personality isn't oriented the same way, which is fine. You clearly care what other people think, because if someone told me I had to apply for a club in which to recreate, I would just say, "oh, fuck it" and think of it no more. You don't operate that way. But with that in mind, the most important factor in determining your lifestyle is going to be your peer group, because your spending will match them. So, find a new peer group of people you can respect (hence trying the college alumni networks) but who made different life choices.

I'm glad to hear your day to day will soon be covered by your base pay. Does that include your tax commitments as well? The reality is, you aren't on the verge of a massive financial crisis, but, by a percentage of your income, you are way outspending the average mustachian here. The average savings rate here is 40%, and most of us are aspiring for higher. You did ok, by the standards of the average American. The question is, do you want to be mustachian or not? You must want something different, or you wouldn't be posting here.

this was a very smart post. One of the best ones on this thread.

jp

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #192 on: March 14, 2014, 09:07:31 AM »
Folks, this person is clearly a troll. Next they'll be telling us they keep their dog on top of the car when travelling to save space, a la Mitt Romney.

I have been following this thread for a few days, and I have to agree. 

"Hey guys... I was wondering, I make a million dollars a year, is there any way I can save $50 per month?  I don't want to change anything though.  Also, my entire identity is wrapped up in being rich and comparing myself to my friends, but I like that about myself.  So, what do you think?  I can't mow my own grass because, you know...how it would look.  Is there ANYWHERE, ANYWHERE at all I could save a few bucks?"


Cmon MMM forum.  It can't possibly be real.

jp

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #193 on: March 14, 2014, 09:25:42 AM »

It's pretty easy to be obnoxious on an anonymous internet blog

If nothing else, you have proved that. 


Of course anyone who lives in Westchester knows it is an extremely small community and even just a few truths accidentally revealed would give away an identity, to much shame and embarassment, if for no other reason than people with money don't talk about money (as well as a few other topics)

I just want to know what would happen if Mr. and Mrs. Bottomtooth discover that you posted something on the internet pleb board, and with your own hand no less.  The shame, it would be unbearable.



windawake

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #194 on: March 14, 2014, 09:31:05 AM »

I have been following this thread for a few days, and I have to agree. 

"Hey guys... I was wondering, I make a million dollars a year, is there any way I can save $50 per month?  I don't want to change anything though.  Also, my entire identity is wrapped up in being rich and comparing myself to my friends, but I like that about myself.  So, what do you think?  I can't mow my own grass because, you know...how it would look.  Is there ANYWHERE, ANYWHERE at all I could save a few bucks?"


Cmon MMM forum.  It can't possibly be real.

Agreed. This post especially got my goat:


There will always be richer and poorer people than me - I am totally comfortable with that

When you are in a position of strength (rich) you can do whatever you want I agree

I am more likely to get to that place by maximizing my income than cutting $20k or $40k a year from my budget.

And I am starting to think that I am getting to the point where making an extra 5% in our jobs is actually easier than cutting $50k from our expenses based on some of the less realistic options that are starting to be thrown out there.

"Waaah, it's too hard to cut $50k from my yearly expenses of $700k, we better just work some more because an extra 5% of our income is more than you sukkas make in a year!"

jsloan

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #195 on: March 14, 2014, 09:37:10 AM »
Quote
I'm not fazed by his stratospheric level of wealth, because I've known a lot of people with his means or more, including my aforementioned best friend. That being said, I place a high value on humility and simplicity, which he lacks. I'm also generally disgusted by his desire to pigeonhole his kids into the same way of life he has and his obsession with keeping up with his neighbors. He seems pretty shallow.

Based on your friend's experience, is raising kids in this environment detrimental?  Is there a lot of drug abuse, pressure to keep up, failure to live up to set standards which causes depression, mental issues?  I'm so far outside of this world I have no idea if these are just things I see in movies or if they are real problems.

I should mention the OP's world is my old world. I'm a New England blueblood who went to an elite boarding school. My best friend probably isn't the best example. The entire family are part of an insular religious community, so things like drug abuse tend to be much less of a problem than the secular world. If you met her on the street, you'd think she's just another woman in religious garb with a bunch of children. Yes, they're major donors to the house of worship and local religious school, but you'd never know that except that her husband is on the board of a lot of community organizations and her FIL has a bunch of stuff in their city named after him. Our lives are very similar, which is why we've been close friends for the better part of a decade.

But, speaking to the OP's world. Most of the people I know are pretty functional. It is a culture that prizes achievement, so most people are pretty together. The big problems were as follows:

1. Not everyone has the cognitive ability, temperament or inclination to excel in the very narrow set of fields the OP finds acceptable for his kids. Intelligence has a strong genetic component, and many, many parents are unwilling to acknowledge that their kids may not be bright enough to be Ivy League material. This isn't a huge problem if you've set your kids up with skills and expectations so they can live another lifestyle, but if you haven't it can get ugly. My brother is less bright than I am, but it's fine. He's a qualified EMT and will be a firefighter paramedic soon. He's happy as a clam, but he'd have been miserable if my parents had pushed him hard on the achievement track and he'd washed out. Even assuming the ability is there, not everyone has a personality cut out for finance/major prestige corporations/BigLaw. I'm very shy and reserved by nature, and I wouldn't be able to survive in that environment, even though I have the brains to do it. That's also been my personality since earliest childhood, and I'm not sure how much parenting or schooling would shift it. The OP's field has an extraordinary burnout rate, and you're doing your kids a disservice if you don't set them up for that reality.

2. The culture is a very tiring treadmill. It's The Protestant Ethic on steroids, in some ways. You're always striving for the next promotion, next nicer thing, etc. Some people really thrive on this, but not everyone does. When you're not working, you're devoting all your time and energy to ensuring your kids will be able to get into the schools that let them be just like you. Actually, most women in that set who are in their mid-upper thirties have some sort of...not entirely empirical medical problem, like depression or fibromyalgia or whatnot. I'm sure they're suffering, but I think a lot of the time they're getting the diagnosis due to burnout, because it's incredibly difficult to work and engage in the kind of labor-intensive, achievement oriented childrearing normal in that class. Heck, just doing the childrearing is a massive amount of effort. I think this is one of those things noone is supposed to notice, but then the diagnosis means they can be a SAHM, which is otherwise sort of seen as laziness.

Great reply, thanks for taking the time to explain.  All of that sounds exhausting to me just reading it, it almost seems like training for elite athletes.

MrCash

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #196 on: March 14, 2014, 09:39:40 AM »
I think I'm just going to sit back and spectate on this thread...


Cromacster

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #197 on: March 14, 2014, 09:41:04 AM »
Question to the posters in this thread:

It seems like this forum has a lot of mixed feelings on wealth at the level of the OP.  Do you all think that the kind of wealth described in this thread is a bad thing in and of itself?  If you have enough money to afford to be wasteful are you still ok with it because you are still living within your means (even if those means are unlike 99.5% of the global population)?   

What do you guys think the mustachian ideal should be for people at this income level?  Should they be downsizing and saving money like mad so they can donate a large portion of their assets to some research facility to cure horrible diseases, create a non-profit to support the arts, creating their own business or investing in businesses to support mustachian ideals like bike infrastructure, renewable energy, etc?  What if your dream is to become rich and spend your days at a country club?  Is that evil?

Lastly, I'm not sure why the OP would be coming here for advice.  The usual expenses of middle class life are a drop in the bucket for you (ie cooking food at home, cell phones, etc).  At that income level, you need to talk to some bad ass accountants who will know how to hide your money in Switzerland or create some shadow corporations to reduce your tax burden (a joke, sort of :-)). 

I'm sort of dumping a lot of thoughts into 1 post, but this thread has shown a different side of this forum and I'm curious as to why?

I'm not fazed by his stratospheric level of wealth, because I've known a lot of people with his means or more, including my aforementioned best friend. That being said, I place a high value on humility and simplicity, which he lacks. I'm also generally disgusted by his desire to pigeonhole his kids into the same way of life he has and his obsession with keeping up with his neighbors. He seems pretty shallow.
It's pretty easy to be obnoxious on an anonymous internet blog - I wouldn't be so quick to judge without really knowing anything about anyone else here besides the image/profile they have carefully crafted for all to see

I'm glad I could entertain and indulge

Of course anyone who lives in Westchester knows it is an extremely small community and even just a few truths accidentally revealed would give away an identity, to much shame and embarassment, if for no other reason than people with money don't talk about money (as well as a few other topics)

I sometimes worry about shame and embarrassment.  It's usually if I fart while working out. 

Must be a rough life having to be so guarded all the time. 

ysette9

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #198 on: March 14, 2014, 09:43:21 AM »
What a fascinating thread. Kudos to the original poster for being brave enough to post a reader case study that is definitely outside the norm. I also have to give kudos to everyone else in the forum for being polite, insightful, and not just devolving into throwing a bunch of insults.

So many great points have already been brought up, I won't harp on them much. I think the big things to take away are that you need to spend some serious time thinking about your goals and values, and then consider the impact this lifestyle is having on your very impressionable kids. I don't have an answer, but it is something i have thought about considering my husband and I are definitely better off at this stage in our lives than our parents were.

My real observation however is that I find it fascinating the cultural differences you describe between your lifestyle and ours. I wonder if part of it is a East Coast/West Coast thing going on? My husband and I went to an average public school and then went to UC Berkeley and Stanford for undergrad and grad respectively. Most of our colleagues here went to top schools (Stanford, Berkeley, the occasional Harvard/MIT/Purdue, etc.). While we are in tech and not finance and so don't bring in the kind of incomes you do, I really don't feel there is the pressure to "keep up with the Jones'" the way you describe in your post here! Our household income recently passed the $250K/year mark and the only person who has ever wondered out loud why we don't decorate our house with "real" furniture or rent a place with no insulation, single-pane windows, and no central heat is my mother. :) Some of my work friends travel the world yearly on exotic vacations and some talk about finances being tight and cutting back. Either way is fine; I think there is a curious freedom in surrounding yourself with that kind of social group.

Like anything in life, real change is hard and it would take you a while to adjust. That doesn't mean it isn't possible though. To illustrate a point ( not to draw a parallel!) I was in an Al Anon-type meeting several years back and one lady was talking about how their whole social life was constructed around wine tasting, the wine industry, and she couldn't imagine their social life not revolving around alcohol even though her husband was in rehab for alcoholism. The counselor leading the discussion pointed out that while in her dark moment she couldn't imagine anything else, her life would change, they would make new friends, find new hobbies, and be better for it in the end.

One other side point: I did my grad degree at Stanford with a friend. She did the East Coast private prep school route with lots of stress, high achievement, competitions, etc. I went to above-mentioned average public high school, spent a ton of time hanging out with friends, took a year off to be an exchange student, and went to junior college before transferring to a 4-year school. In the end, we have the same grad degree from Stanford, work at the same company, make similar salaries, and live very comparable lives. You don't HAVE to send your kids to private school in order for them to be successful later on in life. Drive comes from within and is instilled by good parents.

Dr. Doom

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Re: Reader Case Study: Can We Have It All But Still Retire Early?
« Reply #199 on: March 14, 2014, 09:45:12 AM »
I am not sure what type of work you do, but our jobs are pretty serious business and if I am on a conference call with executives (which granted does not happen more than a couple times a month) my reputation is at stake if there are kids running around, people chatting in the background, bad connection, etc.  This is the ultimate in what I would refer to as penny-wise, pound foolish - in our industry your reputation is actually more important than your actual results. 

This comment screams to me that a) your identity is primarily defined by your employment b) you take great pride in your work and c) you wouldn't have it any other way (i.e. you love your job.).  That's terrific, actually, most people would kill to love what they do but they don't.

Just wanted to say that I wouldn't recommend RE unless you are very certain you have other ways to engage and occupy your time that will make you feel engaged and important.  Otherwise I think there's a very good chance you'll be unhappy without work.  Don't do that to yourself, you'd be better off working as long as you are able.

In other words, I don't think you should make any changes at all to your life.  You're happy and you have it pretty good, according to your perceived needs. 

Cheers.