New FIRE lifestyle technique - "Bursty" spending

[Rockies]

This is a new concept that I heard which is an interesting thing to consider for FIRE lifestyle. It was described the youtuber LitNomad, who has a 4M net worth but lives very minimally in his Tesla and spends approx 80K annually. He outlines the "Bursty" concept in this video: https://www.youtube.com/watch?v=YYC8KlT4yNE

The idea is that you cut your expenditures hardcore so you get used to a reduced lifestyle, but then occasionally massively increase it for short periods of time.

His example is that he lives in his car the entire month, but then once a month buys a fancy Air Bnb for a weekend. He lives off Soilent protein shake most days, but then once a month will go out to a 400$ Michelin star meal.

He argues that the Bursty method:
-Is better than a stable lifestyle of living daily in the "middle" which becomes normal and boring
-The delta of happiness of going from a extremely minimal lifestyle to an oppulent lifestyle is much greater than if you lived a "middle class" lifestyle and occasionally tried to burst to the upper class spending level.
-This method resets the hedonic adaptation mechanism in the brain.
-Gives him more fun memories in life. He places high value on memories.

This is a new concept to me that I thought I'd share with the group. I think it would take a financially disciplined and intentional person to accomplish, but it may be a useful technique for some.
I personally am not sure if I actually appreciate expensive experiences. For example, I value an outdoor picnic with a good friend more than a dinner at a stuffy restaurant. But I could see myself utilizing his technique for travel to places that are a bit more expensive to get to and outside of my normal budget.

[NotJen]

80k seems like a heck of a lot of spending for someone living in their car 28 days a month!

I personally am not sure if I actually appreciate expensive experiences.

Same.  There is no way in hell I'd get enough enjoyment out of a $400 meal to warrant eating Soilent the rest of the time. (Granted, I've never tried Soilent, but drinking all my meals when I don't have to doesn't sound pleasant).

A fancy AirB&B for 2 nights also sounds, well, stupid.  I guess that's a chance to do your laundry and cook a few real meals, but that seems the opposite of luxurious.  Certainly a fancy hotel would be nicer and possibly cheaper.

It's an interesting concept, and I'm glad his choices work for him, but I won't be emulating any time soon.

I overcome the normal/boring thing by doing summer seasonal work, where I do live in less-than-ideal conditions for the experience factor.

[Tasse]

Interesting concept, and certainly aspirational, but I have a couple questions about how to apply this at different spending levels.

It seems like the obvious pitfall would be using this to justify lifestyle inflation by doing the bursts without the minimalist cutbacks. He has significantly more money than I do, but I am not willing to live in my car. So does the idea still apply if we bring both extremes in toward the "middle" and make the bursts smaller? I think I already apply this at a very small scale--for example, I'd rather have infrequent, quality restaurant sushi than frequent mediocre grocery store sushi.

The other flaw I see here is just variation in what people value. He says "There's no point in living a boring life," but who decides what's boring? I value living near my family very highly, even though I'm getting used to it, making it part of my baseline expectations in life. But I'm delighted to have a baseline filled with things I value. On the other end, I feel no longing to experience "a baller-ass airbnb."

To be clear, I don't mean to say the concept is worthless--the people who get attention for these ideas online are always the ones who take it to an extreme, and I can learn from it even if I don't copy his approach to the letter. I'm just not sure how I would apply this to my current standard of living.

ETA: I think he pitfalls of his argument come out in the final third of the video. I don't agree with his claim that, in a hypothetical deal where you're offered 20 years of living like a king followed by 20 years of living like a slave, the "correct" answer is to agree because "You'll always have those memories." I just don't think "living like a king" is very much more valuable than living like a middle-class American. And he goes on to talk about what kind of hedonic "highs" he would pursue if he had 10x more money, so clearly this approach doesn't insulate you from wanting MORE!!! I guess the part of this that I fundamentally disagree with is the idea that hedonic highs are the best way to maximize happiness.
 
The overall idea maps pretty well onto MMM's "treat luxury as a recreational drug," which I do find valuable as an approach. https://www.mrmoneymustache.com/2013/08/29/luxury-is-just-another-weakness/

[Cranky]

I personally love “boring and normal”, and think *adventure* is a euphemism for “uncomfortable “. No thanks. But I also think you could live pretty darned fancy on $80k for one person.

[ixtap]

I thought the two of us lived pretty fancy for $96k, including paying rent for someone else. Those bursts must really be something!

"There's no point in living a boring life" sounds a lot like Thoreau's judgemental vision of society. I don't want to be judged for my non traditional lifestyle, so I try to minimize the judgements I make out loud about other people's lifestyle choices.

[Tasse]

I do think if you water this concept down enough, you'll find that it's just an intense version of "Spend money on the things you value, not on the things you don't." And some of us just disagree with what this guy considers valuable.

[Wolfpack Mustachian]

From a 10000 foot view, I'm not super opposed to the concept. But as others have said, 80k for a single person in a car with no house payment is an insanely expensive lifestyle.

[CoreyTheMan]

He has a networth of 4mil, why is he doing this?

[Wolfpack Mustachian]

He has a networth of 4mil, why is he doing this?

That's another thing, if I had 4 mil as a family much less a single person, I would retire with DW doing tons of travel for less than 100k a year and spend around 2-2.5% WR with no worries of running out of money. No need to live on Soilent....

[Villanelle]

I feel like I need to remove all the details from the story and distill it down to the most basic concept.  Because there are so many crazy things about the details.

But the concept itself seems like what many people here (@Metalcat) comes to mind, frequently discuss.  You spend money in specific, targeted ways.  If a $400 dinner is that for you, so be it.  If owning a second home in an exotic, vacation destination is it, great. Or getting a pedicure every two weeks or owning multiple fancy guitars or drinking expensive wine. When something doesn't matter much to you, then don't spend a lot.  If for him that's living arrangements, then live in a Tesla. 

It feels like he slapped this new "bursty" title on an old, boring concept, which is "spend money where it matters and you really get enjoyment out of it, and don't send money where it doesn't improve your life.

So I don't disagree, but.... yawn. 



~~~~~

I recently bought and moved into a ridiculously large house.  So, so, so large.  I wanted something smaller, but I couldn't find that with a short commute for DH, in a style that I loved.  It's important to me that my home feel a certain way, and the style of homes in this area I generally really dislike.  So I spent--overspent, by many standards--on a home I love.  And I own far, far more shoes than anyone needs.  Theyse aren't $500 shoes, or even $200 shoes (most aren't even $100), but they are beautiful and colorful and unnecessary.

 But I drive my cars for forever.  I have a 2020 Corolla, bought used.  My previous car was a 2000 Toyota Echo.  (To be fair, that car was stored--for free--for several years while we were overseas, though it did move to Germany and back with us.)  I don't drive much.   Car was purchased in 2021 and I've put >10,000 miles on it.  I bathe my own dogs.  (I mention this because people always seemed surprised by it.)  So, I guess I "bursted" on the home, and I save in other areas.  Like almost any fiscally responsible person does. 

[Tasse]

I think what makes this distinct from "spend in areas that matter to you, save in areas that don't" is the cycle of deprivation and excess in a single area--an area that does matter to you.

[Metalcat]

I think what makes this distinct from "spend in areas that matter to you, save in areas that don't" is the cycle of deprivation and excess in a single area--an area that does matter to you.

Yeah, that's also what makes it sound like it's more like someone who is engaging in unhealthy behaviours and calling it a life hack.

It's metaphorically like "I super restrict my calories most of the time and then I have periods where I binge eat for a week, but then I go back to extreme restriction and overall, I lose weight, it's great!"

Uh...that's an eating disorder...

[Villanelle]

I think what makes this distinct from "spend in areas that matter to you, save in areas that don't" is the cycle of deprivation and excess in a single area--an area that does matter to you.

It feels to me like he's claiming that these things don't matter to him.  That he's cool living in his Tesla, but maybe not. 

I do think that 95% of your meals being the same protein shake is not healthy--physically or perhaps emotionally. 

[Tasse]

I do think that 95% of your meals being the same protein shake is not healthy--physically or perhaps emotionally.

Oh, definitely agree.

[GilesMM]

Sounds like a good technique for making Youtube content that will attract viewers if nothing else.

[ixtap]

He has a networth of 4mil, why is he doing this?

That's another thing, if I had 4 mil as a family much less a single person, I would retire with DW doing tons of travel for less than 100k a year and spend around 2-2.5% WR with no worries of running out of money. No need to live on Soilent....

You know, if they found out about this, my partner might switch to Soylent. They have the same breakfast and the same lunch every day. The evening meal rotates between about three options. They just don't like making food choices.

[EliteZags]

this was one of the most honest and accurate takes out there

https://www.youtube.com/watch?v=o-anlvyXdl4

[Rockies]

I think what makes this distinct from "spend in areas that matter to you, save in areas that don't" is the cycle of deprivation and excess in a single area--an area that does matter to you.

Yeah, that's also what makes it sound like it's more like someone who is engaging in unhealthy behaviours and calling it a life hack.

It's metaphorically like "I super restrict my calories most of the time and then I have periods where I binge eat for a week, but then I go back to extreme restriction and overall, I lose weight, it's great!"

Uh...that's an eating disorder...

I agree with these points. I personally dont think this concept as presented holds a lot of water but its interesting to discuss. To me it seems like a lonely and unfufilling life. I personally enjoy having stability and being responsible to my family and community and friends a lot. These expensive experiences are really often quite empty, and even more often a dissapointment.

I'd rather go on a 5 day wilderness backpacking trip with my best friends (which is quite cheap) than spend 5 days at an outlandishly expensive hotel. And on my average day I'd rather spend time with my partner and pets and eat ground beef and pasta and volunteer in town than sit in my car feeling lonely and drinking soilent.

But in other ways I can see his point. I have a fairly frugal friend that travels often and spends a lot of time hanging out with friends. These things are normal to her and they dont seem to excite her a whole lot. For me im an introvert and I travel rarely. But when I do hang out with friends or go on vacation its a really exciting pop of colour and excitement in my world, and the memories generated are cherished.

I guess I just am happy with a balanced "boring" life, and I see the romance, meanining, and beauty in my life with the rare occasional excitement. But again, I realize many different personality types get off on different things and I am not here to judge.

[2Birds1Stone]

I think the example from the OP is quite extreme and maybe a sign of bigger issues.........but your thread reminded me of a post I made back when I was noodling on a VERY similar concept, albeit way less extreme and made a post about it in my journal the same month I was pulling the plug on work and FIREing.

On a related note....

Some thoughts to share on the benefits of spending variability/flexibility....

There are obvious reasons for being flexible in ones spending in retirement. MadFIentist just released a timely post about it this past week. (https://www.madfientist.com/discretionary-withdrawal-strategy/)

You may end up with unexpected expenses in FIRE.
The future market performance could be abysmal.
Inflation could hit unprecedented highs.
Flexibility could let you retire sooner (a la the linked post above).

The reason I want to focus on in this post doesn't really have anything to do with those. It's about hedonic adaption and spending/consumption variability.

For long time followers of my journal here, y'all probably realized by now that our spending tends to be very non-linear. We go through periods of extremely low expenses followed by relatively high expenses. This isn't out of necessity, it's just how things played out of the past decade. That being said, I've drawn some very interesting observations and conclusions from the past decade of life....

Spending in the "ultra-low" realm out of necessity must suck, but doing it temporarily or having it happen as a byproduct of lifestyle design is pretty awesome and very convenient for the early retiree who leans towards the "leanFIRE" side of the spectrum.

The "high roller" lifestyle get's old fast. Now hear me out, not saying that having creature comforts and nice things should be fleeting, but rather that extravagant living quickly becomes the "new normal" and we don't find ourselves any happier than when we're "roughing it".

DW and I have had the pleasure of traveling to some pretty amazing places, eating at overpriced restaurants, mingling with people who make and consume in the top 1% of the developed world (largely thanks to my career in sales, and the companies I worked for paying for these experiences)......and it gets old quick. BUT, for a short while, it's fucking awesome.

So what's the point? That variable spending and consumption allow you to experience the best of both worlds. Maybe not everyone is wired like this, or has the flexibility, but I foresee our perfect consumption model to continue to ebb and flow between living a life of modestly priced adventure and great outdoors, human powered travel, exchanging our skills and time to offset some costs....and much more expensive "fatFIRE" type lifestyle where we may rent an overpriced (for us) STR in a highly desirable place (Hawaii anyone?) for other periods.

Both experiences tend to make you appreciate the other side of the spectrum more. It's easy to sleep in a tent and camp your way up one of America's long trails after you spent two months living and surfing in Hawaii, and similarly you tend to enjoy renting a ski on/ski off condo in the alps much more after you've finished a bikepacking trip across Romania.

With a seemingly modest budget of ~$52-55k a year (per the #'s in previous post), an average year, broken down by month could look like this;

January - Thailand - $3k/month
February - Bali - $3k/month
March - Spain - $3k/month
April - Long Section hike on AT - $2k/month
May - Long Section hike on AT - $2k/month
June - Long Section hike on AT - $2k/month
July - USA Road Trip - $5k/month
August - USA Road Trip - $5k/month
September - MTB Trip New England $5k/month
October - Surf/Hike Hawaii - $7.5k/month
November - Surf/Hike Hawaii - $7.5k/month
December - Snowboard/Ski Alps - $7.5k/month

$52,500/yr total spend.....these are just examples off the top of my head for some things DW and I would be interested in, but use your own imagination.

The low cost months could be something as simple has stringing together a house-sit or two, for homeowners it could be renting out your primary residence while hitting the road, for the more adventurous, it could be doing a workaway or work-stay program.

I'm sure no one needs inspiration on how to come up with ideas for the "blow out" months.....but doing this type of cyclical spending/consumption keeps you from getting complacent in one lifestyle, and provides the ultimate flexibility/experience/adventure.

YMMV.

And yes, We're almost 2 years in and it's worked out almost exactly how we thought it would. Spending ranges from $1500 a month to $5000 a month and we've spent months living out of a van exploring the western USA this past summer/fall and now we're enjoying 5-star hotels in SE Asia.

[Metalcat]

I think what makes this distinct from "spend in areas that matter to you, save in areas that don't" is the cycle of deprivation and excess in a single area--an area that does matter to you.

Yeah, that's also what makes it sound like it's more like someone who is engaging in unhealthy behaviours and calling it a life hack.

It's metaphorically like "I super restrict my calories most of the time and then I have periods where I binge eat for a week, but then I go back to extreme restriction and overall, I lose weight, it's great!"

Uh...that's an eating disorder...

I agree with these points. I personally dont think this concept as presented holds a lot of water but its interesting to discuss. To me it seems like a lonely and unfufilling life. I personally enjoy having stability and being responsible to my family and community and friends a lot. These expensive experiences are really often quite empty, and even more often a dissapointment.

I'd rather go on a 5 day wilderness backpacking trip with my best friends (which is quite cheap) than spend 5 days at an outlandishly expensive hotel. And on my average day I'd rather spend time with my partner and pets and eat ground beef and pasta and volunteer in town than sit in my car feeling lonely and drinking soilent.

But in other ways I can see his point. I have a fairly frugal friend that travels often and spends a lot of time hanging out with friends. These things are normal to her and they dont seem to excite her a whole lot. For me im an introvert and I travel rarely. But when I do hang out with friends or go on vacation its a really exciting pop of colour and excitement in my world, and the memories generated are cherished.

I guess I just am happy with a balanced "boring" life, and I see the romance, meanining, and beauty in my life with the rare occasional excitement. But again, I realize many different personality types get off on different things and I am not here to judge.

That's not really what I'm saying though.

I *am* someone who has pretty extreme spending variability and who prioritizes low core lifestyle spending, but doesn't hesitate at all to spend more when it makes sense.

I've often written about the power of a low general lifestyle spend is that it frees up so much cash to be able to do bigger things. Either saving more and retiring more, or spending on something substantial that makes a major life difference. I bought a second house.

But this video is talking about a timeline of regularly scheduled high spending. It's talking about keeping lifestyle spending *extremely* low, the guy lives in his car. But then on a regular schedule, splurging on things like renting an expensive place to live for a weekend.

That sounds a lot like a restriction-binge cycle to me where he's engaging in cyclical binges to be able to tolerate extreme restriction.

[bacchi]

He has a networth of 4mil, why is he doing this?

That's another thing, if I had 4 mil as a family much less a single person, I would retire with DW doing tons of travel for less than 100k a year and spend around 2-2.5% WR with no worries of running out of money. No need to live on Soilent....

You know, if they found out about this, my partner might switch to Soylent. They have the same breakfast and the same lunch every day. The evening meal rotates between about three options. They just don't like making food choices.

In the early 2010s, when Soylent was kickstarted, I mixed up some every morning before I commuted to work. It was quick, it was easy, and it was healthier than not. I'd probably still drink it they didn't settle on a formula that I couldn't stomach.

The bottles are hella expensive though. I used the powdered version.

[Just Joe]

He has a networth of 4mil, why is he doing this?

The $4M net worth and living in a car removes alot of credibility to me. That kind of money would justify livinging in a condo at least.

[Metalcat]

He has a networth of 4mil, why is he doing this?

The $4M net worth and living in a car removes alot of credibility to me. That kind of money would justify livinging in a condo at least.

Even a frickin yurt.

Not having access to private bathroom facilities, even an outhouse, when you have 4M suggests a level of psychological issues to me.

[41_swish]

This sounds cool in theory, but I am just such a routine driven person that it would almost be jarring to jump back and forth between such drastic lifestyles. Even when I go on vacation, it is usually just a trip to the family cabin in the mountains or a trip where I go somewhere and do a lot of the same stuff I do at home, run, hike, and paddleboard.

[Metalcat]

This sounds cool in theory, but I am just such a routine driven person that it would almost be jarring to jump back and forth between such drastic lifestyles. Even when I go on vacation, it is usually just a trip to the family cabin in the mountains or a trip where I go somewhere and do a lot of the same stuff I do at home, run, hike, and paddleboard.

By contrast, I LOVE constant change. I move between two drastically different locations thousands of kilometers apart just to shake things up a lot.

And even then, this sounds miserable to me. This is a starvation/binge cycle IMO. He's living in such austerity that it sounds absolutely untenable and then binging on breaks from the deprivation to be able to tolerate it.

I can't see any reality where living in your car in an ongoing fashion is a reasonable, mentally or physically healthy choice. This is someone who is mentally getting off on the deprivation and giving himself breaks so that he can keep pushing himself to do it, despite really, really not needing to.

This doesn't look like healthy stoicism to me, it looks like pathology.

[Tasse]

But even if he's taken it too far--do you think there's validity to the concept of keeping your regular life simple and your hedonistic treadmill rolling slowly, then breaking it up with big, periodic luxuries?

[41_swish]

This sounds cool in theory, but I am just such a routine driven person that it would almost be jarring to jump back and forth between such drastic lifestyles. Even when I go on vacation, it is usually just a trip to the family cabin in the mountains or a trip where I go somewhere and do a lot of the same stuff I do at home, run, hike, and paddleboard.

By contrast, I LOVE constant change. I move between two drastically different locations thousands of kilometers apart just to shake things up a lot.

And even then, this sounds miserable to me. This is a starvation/binge cycle IMO. He's living in such austerity that it sounds absolutely untenable and then binging on breaks from the deprivation to be able to tolerate it.

I can't see any reality where living in your car in an ongoing fashion is a reasonable, mentally or physically healthy choice. This is someone who is mentally getting off on the deprivation and giving himself breaks so that he can keep pushing himself to do it, despite really, really not needing to.

This doesn't look like healthy stoicism to me, it looks like pathology.

Both ways are good! But, living in the car to just then ball out does seem a little wacky. To each their own, I guess.

[2Birds1Stone]

But even if he's taken it too far--do you think there's validity to the concept of keeping your regular life simple and your hedonistic treadmill rolling slowly, then breaking it up with big, periodic luxuries?

This wasn't directed at me, but since we're living it, I'll say yes!

I'm typing this from an Intercontinental ($$$$) hotel right now, after we check out we're moving a few blocks down the beach to a place that costs $13.50/night..........one makes you appreciate the other.

[spartana]

Well this guy seems to have taken lumpy expenses to extreme levels. From deprivation to ultra luxury. I think many of us FIREees have very lumpy expenses and varied lifestyles that those expenses cover. Some months I'll spend a hundred bucks on wants, other months it might be a few thousand bucks. Just depends what I do in any given time period. Some months I'll ride my bike to the forest or desert to hike or bike or climb and to hug trees and dig up rocks in the dirt while camping in a tent and eating ramen. Other months I'll rent a fancy AWD SUV to go to the forest or desert  to ski or mountain bike and stay in a nice place and eat out.   I think everyone does some version of that and doesn't have to be to such extremes, or that costly,  to be satisfactory. He could do a tiny shared rental room and still have so much left over for his larger luxury spending if that's what he feels he needs to make his life complete.

[Metalcat]

But even if he's taken it too far--do you think there's validity to the concept of keeping your regular life simple and your hedonistic treadmill rolling slowly, then breaking it up with big, periodic luxuries?

If you're asking me, I've already answered this in this thread. I have no issue with lumpy spending, I'm a VERY lumpy spender myself.

There are key lifestyle things that I'm extremely frugal about, and then there are lifestyle upgrades that I'm willing to spend absurd amounts on compared to others.

As I already said in this thread, one of the best benefits of being frugal is that it frees up so much capital to do bigger things. For some, the bigger thing is to retire early and never work again. For other folks who are less interested in not working, it means being able to spend on bigger things that improve lifestyle more than generic lifestyle inflation.

I often joked that our rice and beans diet pretty much single-handedly paid for our second home.

But that's not what he's describing. I'll use the eating disorder metaphor to make it clear.

Let's say someone has a very healthy diet at home. They consistently eat a modest calorie amount with very high nutrient density. But if they're invited to a BBQ, they have no limits on what they eat. Because they eat so well day in and day out, they never have to worry about watching what they eat on exceptional occasions. Their day-to-day diet buys them freedom for whatever degree of lumpy intake might come up within their social life.

That's freedom. It's very different from systematic restriction.

What the video shows looks more to me like a restriction-binge cycle. Let's say someone starves themselves on a day to day basis, but that's not sustainable, so they schedule in a bi-weekly, Friday night, planned binge session. This isn't about making room for the binge calories, the binging allows for more sustainability of the starvation.

Self-deprivation can be highly, highly addictive, and for those who engage in it, they tend to develop these strategies or "hacks" to make the deprivation more sustainable.

For me, it's the fact that he elects to live without access to private bathroom facilities despite having 4M that pushes me to see this as a deprivation-addiction pattern and not just a quirky lifestyle preference.

I've seen plenty of pretty extreme ERE type scenarios, and I'm pretty open minded about not judging the unusual choices that people can make. But if you show me someone who has massive wealth and  lives the bulk of their time without a private spot to have periodic diarrhea and ask me to bet if they're mentally thriving or mentally suffering, I'm taking the mentally suffering bet 100 times out of 100.

[Metalcat]

this was one of the most honest and accurate takes out there

https://www.youtube.com/watch?v=o-anlvyXdl4

This video is seriously concerning.

I don't think this is a well person.

[Tasse]

Yeah, I bailed on that second video almost immediately. That take is neither healthy nor unique.

[Villanelle]

I watched part of several of his videos.  Dude has a weird affect, which I generally try to just attribute to potential neuro-spiciness.  But... he seems really off.  Mentioning getting head in the library in the first 30 seconds of that video? Mentioning "quant", his former work, about a dozen times in a video?  Saying "Mexican girl" repeatedly in his video about dating an 18-yo?  "I thought having a companion that I could hook up with in my Airbnb... also so she could watch my stuff?" I couldn't finish it. 

I got serious red pill vibes.  This is a dude I wouldn't turn my back on or let near my beverage or my nieces.