Author Topic: New Yorker Article: The Scold - Mr. Money Mustache’s retirement (sort of) plan  (Read 172776 times)

nereo

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I think it takes an amazing will to have all that money and not spend it a little.  If he indeed has over $1million which he claims to now have which more than covers his lifestyle, it is a rare person indeed who will make an income of $400K pay 30% in taxes, and not spend some of the cash.  By now he should be easily sitting on a SWR of 2%.  It just makes sense spend some of it and increase your lifestyle a little.  Maybe craftier beer, maybe more exotic cheeses, or something as simple as now flying first class or staying at nicer hotels when traveling. 

Now that I think of it.  I bet he doesn't include traveling in his expenses since traveling is a business expense and fully deductible from the blog.  All he needs to do is write a post about it and viola fully deductible.  No reason why not to travel first class now.  I know I would.
As Eric said, the blog covers these things in detail. He certainly mentions spending on fancier ingredients at the grocery store, but that's about it from the things you mentioned.
Also, if you are thinking like this, you are missing the point. There are always ways of spending more money - using your example, you could upgrade to fly first class, then you could charter a private jet, then you could buy a private jet. Ultimately these things do little to "increase your lifestyle" (as you put it) and don't have a lasting effect on happiness.

EnjoyIt

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I think it takes an amazing will to have all that money and not spend it a little.  If he indeed has over $1million which he claims to now have which more than covers his lifestyle, it is a rare person indeed who will make an income of $400K pay 30% in taxes, and not spend some of the cash.  By now he should be easily sitting on a SWR of 2%.  It just makes sense spend some of it and increase your lifestyle a little.  Maybe craftier beer, maybe more exotic cheeses, or something as simple as now flying first class or staying at nicer hotels when traveling. 

Now that I think of it.  I bet he doesn't include traveling in his expenses since traveling is a business expense and fully deductible from the blog.  All he needs to do is write a post about it and viola fully deductible.  No reason why not to travel first class now.  I know I would.
As Eric said, the blog covers these things in detail. He certainly mentions spending on fancier ingredients at the grocery store, but that's about it from the things you mentioned.
Also, if you are thinking like this, you are missing the point. There are always ways of spending more money - using your example, you could upgrade to fly first class, then you could charter a private jet, then you could buy a private jet. Ultimately these things do little to "increase your lifestyle" (as you put it) and don't have a lasting effect on happiness.

I have read every post on his blog.  It is where I came up with my examples of fancy cheese and craftier beer.
But flying first class, I dunno, it doesn't use up any extra fuel, takes little effort on his part, and is a tax deduction on his business. I'm no MMM, but I would succumb to that in a heart beat

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I think it takes an amazing will to have all that money and not spend it a little.  If he indeed has over $1million which he claims to now have which more than covers his lifestyle, it is a rare person indeed who will make an income of $400K pay 30% in taxes, and not spend some of the cash.  By now he should be easily sitting on a SWR of 2%.  It just makes sense spend some of it and increase your lifestyle a little.  Maybe craftier beer, maybe more exotic cheeses, or something as simple as now flying first class or staying at nicer hotels when traveling. 

Now that I think of it.  I bet he doesn't include traveling in his expenses since traveling is a business expense and fully deductible from the blog.  All he needs to do is write a post about it and viola fully deductible.  No reason why not to travel first class now.  I know I would.
As Eric said, the blog covers these things in detail. He certainly mentions spending on fancier ingredients at the grocery store, but that's about it from the things you mentioned.
Also, if you are thinking like this, you are missing the point. There are always ways of spending more money - using your example, you could upgrade to fly first class, then you could charter a private jet, then you could buy a private jet. Ultimately these things do little to "increase your lifestyle" (as you put it) and don't have a lasting effect on happiness.

I have read every post on his blog.  It is where I came up with my examples of fancy cheese and craftier beer.
But flying first class, I dunno, it doesn't use up any extra fuel, takes little effort on his part, and is a tax deduction on his business. I'm no MMM, but I would succumb to that in a heart beat


In first class you take up a lot more space.  I'm guessing 4x the space.  So by upgrading to first, you use up as much fuel as 4 people.  Doesn't sound very badass or efficient to me.

nereo

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I think it takes an amazing will to have all that money and not spend it a little.  If he indeed has over $1million which he claims to now have which more than covers his lifestyle, it is a rare person indeed who will make an income of $400K pay 30% in taxes, and not spend some of the cash.  By now he should be easily sitting on a SWR of 2%.  It just makes sense spend some of it and increase your lifestyle a little.  Maybe craftier beer, maybe more exotic cheeses, or something as simple as now flying first class or staying at nicer hotels when traveling. 

Now that I think of it.  I bet he doesn't include traveling in his expenses since traveling is a business expense and fully deductible from the blog.  All he needs to do is write a post about it and viola fully deductible.  No reason why not to travel first class now.  I know I would.
As Eric said, the blog covers these things in detail. He certainly mentions spending on fancier ingredients at the grocery store, but that's about it from the things you mentioned.
Also, if you are thinking like this, you are missing the point. There are always ways of spending more money - using your example, you could upgrade to fly first class, then you could charter a private jet, then you could buy a private jet. Ultimately these things do little to "increase your lifestyle" (as you put it) and don't have a lasting effect on happiness.

I have read every post on his blog.  It is where I came up with my examples of fancy cheese and craftier beer.
But flying first class, I dunno, it doesn't use up any extra fuel, takes little effort on his part, and is a tax deduction on his business. I'm no MMM, but I would succumb to that in a heart beat

Ok, so in the name of friendly push-back, let's consider air travel as an example.

A typical reaction to having a lot more money might be: "Yes, now I can finally afford to fly first class to my resort vacation in Fiji.  I so deserve this!"
A more mustachian reaction might be: "wow, what a wonderful world we live in where I can fly 500mph and see a part of the country I've never seen before, and it's so cheap when I buy online"

the problem with thinking like the former is that there is no limit to the hedonistic treadmill. There will always be more expensive things you can spend your money on, from first-class plane tickets to meals served on gold plates.  If you start wanting fancier and more expensive things, you won't be happy with what you have.

Of course everyone has their ideas of what's the minimum level they are willing to accept.  As you noted, MMM spends more on fancier cheeses and beer.  But if you start thinking of 'upgrading' your life everytime your income increases you will spend more and more money, often without a significant improvement in happiness.  worse, many choices (like driving a luxury SUV vs riding a bike) make us unhealthier and unhappier.

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He's a very stoic and DIY type of guy, so it makes sense to see where he's coming from when he says those things. I personally don't see where stoicism and hedonism differ that much - both are seeking greater contentment and "pleasure"/happiness. Stoics get it in the form of occasional deprivation, hedonists get it in the form of buying or indulging in more things. Then we get into environmental issues...stoics are obviously better on the environment where the converse is true for hedonists. Then there's also the art of being a minimalist -balancing just the number of things in your life that you own so that your stuff doesn't end up owning you.

Especially on this blog, I think undercover hedonists get their "fix" from travel. There's some stoicism in there in dealing with flying and physically moving your body from place to place. There's minimalism in the sense that you aren't necessarily acquiring more stuff. And then there's hedonism in the sense that no matter how much you travel, you'll still want to travel more. But is there anything necessarily wrong with this? No. Even Pete travels A LOT and fully admits to it. I just think that there has to be balance in everyone's lives but also recognize how ridiculous our lives already are.

All you have to do is look at the last 9 years of "No Impact Man" to become a bit cynical of people who set out to change the world because they feel like such misfits and end up just carving their place into the system. He went from stripping his life down to nothing wanting to "save the trees" to massively producing hardcover books and holding seminars all over the world. See any problem with that? Regardless, any blog or idea that at least shakes things up a little is ultimately a good thing in my book.

I'm curious if MMM ever ends up posting his 2015 numbers.
« Last Edit: March 09, 2016, 07:40:35 AM by Ricky »

tooqk4u22

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I'm curious if MMM ever ends up posting his 2015 numbers.

In his defense it takes a lot of time to sort out and separate all of the blog related expenses (travel, food, beer, home projects, bikes, etc) to be able to identify what his actual expenses were for the year.

EnjoyIt

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I think it takes an amazing will to have all that money and not spend it a little.  If he indeed has over $1million which he claims to now have which more than covers his lifestyle, it is a rare person indeed who will make an income of $400K pay 30% in taxes, and not spend some of the cash.  By now he should be easily sitting on a SWR of 2%.  It just makes sense spend some of it and increase your lifestyle a little.  Maybe craftier beer, maybe more exotic cheeses, or something as simple as now flying first class or staying at nicer hotels when traveling. 

Now that I think of it.  I bet he doesn't include traveling in his expenses since traveling is a business expense and fully deductible from the blog.  All he needs to do is write a post about it and viola fully deductible.  No reason why not to travel first class now.  I know I would.
As Eric said, the blog covers these things in detail. He certainly mentions spending on fancier ingredients at the grocery store, but that's about it from the things you mentioned.
Also, if you are thinking like this, you are missing the point. There are always ways of spending more money - using your example, you could upgrade to fly first class, then you could charter a private jet, then you could buy a private jet. Ultimately these things do little to "increase your lifestyle" (as you put it) and don't have a lasting effect on happiness.

I have read every post on his blog.  It is where I came up with my examples of fancy cheese and craftier beer.
But flying first class, I dunno, it doesn't use up any extra fuel, takes little effort on his part, and is a tax deduction on his business. I'm no MMM, but I would succumb to that in a heart beat

Ok, so in the name of friendly push-back, let's consider air travel as an example.

A typical reaction to having a lot more money might be: "Yes, now I can finally afford to fly first class to my resort vacation in Fiji.  I so deserve this!"
A more mustachian reaction might be: "wow, what a wonderful world we live in where I can fly 500mph and see a part of the country I've never seen before, and it's so cheap when I buy online"

the problem with thinking like the former is that there is no limit to the hedonistic treadmill. There will always be more expensive things you can spend your money on, from first-class plane tickets to meals served on gold plates.  If you start wanting fancier and more expensive things, you won't be happy with what you have.

Of course everyone has their ideas of what's the minimum level they are willing to accept.  As you noted, MMM spends more on fancier cheeses and beer.  But if you start thinking of 'upgrading' your life everytime your income increases you will spend more and more money, often without a significant improvement in happiness.  worse, many choices (like driving a luxury SUV vs riding a bike) make us unhealthier and unhappier.

Ok, I am in full agreement with what you say, but what if you have enough for your current FIRE lifestyle. Let's for example say you are living on $25k/yr. at a 2% SWR you need $1.3 million which we can all assume MMM already has acquired. Now what if through sheer growth and increased savings he now has an extra $500K saved up and invested. Now even at the 2% SWR he can spend an extra $10K/yr. without ever affecting FIRE. Why not then splurge on that nicer hotel room? Why not sit in the front of the cabin on a plane?  Not spending that money may be considered waste as well.

As for the fuel consumption comment. The plane will fill that first class seat if MMM pays for it, or a frequent flyer gets upgraded to it. No extra fuel consumption occurs. Those seats do not go unfilled.

Don't get me wrong. I'm sure MMM lives the life he preaches. Living an efficient healthy lifestyle. I would also bet that there are a few more luxuries in his life than he lets on. It wouldn't be human not to indulge from time to time.

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Ok, I am in full agreement with what you say, but what if you have enough for your current FIRE lifestyle. Let's for example say you are living on $25k/yr. at a 2% SWR you need $1.3 million which we can all assume MMM already has acquired. Now what if through sheer growth and increased savings he now has an extra $500K saved up and invested. Now even at the 2% SWR he can spend an extra $10K/yr. without ever affecting FIRE. Why not then splurge on that nicer hotel room? Why not sit in the front of the cabin on a plane?  Not spending that money may be considered waste as well.

Personally, the only reason I can think of is he wants to minimize his impact on the environment whilst being somewhat stoic. Otherwise, if there's functionally no difference between "upgrades" then you're right, it makes zero sense not to take them when you can overwhelmingly afford them.

I also think he gets enjoyment out of finding efficiencies everywhere he can by maximizing happiness with the lowest amount of spend. I've always thought he treats his life like a business and he gets happiness out of that in itself. So it's not that he wouldn't enjoy the additional luxury of having a nicer hotel room - it's just that his brain is wired to "stop" when enough is enough.

I agree that, in some ways, hoarding the cash and doing nothing with it is as wasteful as spending it on unnecessaries.

Quote from: tooqk4u22
In his defense it takes a lot of time to sort out and separate all of the blog related expenses (travel, food, beer, home projects, bikes, etc) to be able to identify what his actual expenses were for the year.

Yeah - I just think that when his "business" expenses heavily overlap with his "personal" life, like traveling, he should be transparent about that too.

nereo

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Quote
Ok, I am in full agreement with what you say, but what if you have enough for your current FIRE lifestyle. Let's for example say you are living on $25k/yr. at a 2% SWR you need $1.3 million which we can all assume MMM already has acquired. Now what if through sheer growth and increased savings he now has an extra $500K saved up and invested. Now even at the 2% SWR he can spend an extra $10K/yr. without ever affecting FIRE. Why not then splurge on that nicer hotel room? Why not sit in the front of the cabin on a plane?  Not spending that money may be considered waste as well.

sure, but when does it stop?  If you are happy with your lifestyle at $25k, why spend $40k?  As soon as you start longing for fancier things your happiness with what you have becomes diminished.  That's the basis of the hedonistic treadmill.

I also disagree that not spending money is a waste.  The money isn't sitting in a safe somewhere - it's invested in diverse collection of companies and is busy employing people and developing things.  Then there's always charity - ultimately everything gets diverted to something or someone.

tooqk4u22

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Quote
Ok, I am in full agreement with what you say, but what if you have enough for your current FIRE lifestyle. Let's for example say you are living on $25k/yr. at a 2% SWR you need $1.3 million which we can all assume MMM already has acquired. Now what if through sheer growth and increased savings he now has an extra $500K saved up and invested. Now even at the 2% SWR he can spend an extra $10K/yr. without ever affecting FIRE. Why not then splurge on that nicer hotel room? Why not sit in the front of the cabin on a plane?  Not spending that money may be considered waste as well.

sure, but when does it stop?  If you are happy with your lifestyle at $25k, why spend $40k?  As soon as you start longing for fancier things your happiness with what you have becomes diminished.  That's the basis of the hedonistic treadmill.

I also disagree that not spending money is a waste.  The money isn't sitting in a safe somewhere - it's invested in diverse collection of companies and is busy employing people and developing things.  Then there's always charity - ultimately everything gets diverted to something or someone.

That's the tricky part...I don't fault MMM for elevating his lifestyle. If he does, and he has, it doesn't mean that he is a fraud, or is suddenly wasteful, or deprived himself early on.  Everybody seems to ignore the fact that people change and evolve over time...the things that he needed/wanted/believed may have changed from 30 years old to 40 years old...I know I have over time and expect to change going forward.  He may very well decide to spend $100k to take his family on a world tour and show his kid all that the world has (an African safari would be cool, but can be really expensive)....and in the spirit of homeschooling he would learn far more from that than being in a classroom.  Traveling to different cities in the US to experience the arts or cultures or whatever is fun and valuable, but still costs money...that's ok.  He has plenty of it, more than he needs now.....and just because he may do these things doesn't mean he needs these things to be happy or maybe he will, who knows...no different than the houses he has had. 

There are things I spend money on that I, or we as family, enjoy and get value out of but certainly aren't necessary for happiness.

I know there is some line (imaginary as it may be) that it could or will cross over to the dark side so who knows, but it's not about spending the bare minimum to survive it's about living how you want in a conscientious way.

zephyr911

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I know there is some line (imaginary as it may be) that it could or will cross over to the dark side so who knows, but it's not about spending the bare minimum to survive it's about living how you want in a conscientious way.
Right, and MMM has been at that point for like 10 years straight without changing his spending substantially. He is 100% living his own message that consumption should not be driven by available funds.

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I know there is some line (imaginary as it may be) that it could or will cross over to the dark side so who knows, but it's not about spending the bare minimum to survive it's about living how you want in a conscientious way.
Right, and MMM has been at that point for like 10 years straight without changing his spending substantially. He is 100% living his own message that consumption should not be driven by available funds.
Taking a cue from Nereo, 'in the name of friendly push-back', I think you would agree that Pete's 'business expenses' (and income) have grown substantially in the past 10 years.  The fact that he can separate out blog expenses (which are most likely well within the income) has allowed him to travel more and indulge in side projects / experiments, which makes his lifestyle much more appealing. 

Reacting to an earlier comment from Tooq that got me thinking, my lifestyle has changed substantially from 10 years ago.  Because life is not a controlled scientific experiment, who knows what 2006-me would be doing today if I had ER'ed and limited lifestyle to COLA.  I would have certainly survived, but things would be vastly different than the family we are today.  Realizations like these help keep me 'conscientious' of just how exploding my volcano of luxury continues to be.  For example, I personally don't see a conflict of exposing children to more domestic and international travel if increased FI allows for it.  The internet has made our lives phenomenally information / data rich, but I go crazy seeing my kids in front of a screen watching 'life'.  There is absolutely no substitute for 'being there'.

Good discussion!   
« Last Edit: March 09, 2016, 11:04:39 AM by EscapeVelocity2020 »

Cassie

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People do change with time and if at some point he spends a ton on travel who cares?  We used to spend very little on travel and now spend a ton.  I don't think he has to keep his spending at 25k for his point to be relevant.

zephyr911

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Taking a cue from Nereo, 'in the name of friendly push-back', I think you would agree that Pete's 'business expenses' (and income) have grown substantially in the past 10 years.  The fact that he can separate out blog expenses (which are most likely well within the income) has allowed him to travel more and indulge in side projects / experiments, which makes his lifestyle much more appealing. 
I don't know how much biz expenses have grown, but I don't think the quantity matters as much as the motivation. It's not just that the blog makes enough money to pay for experiments with e-bikes and light bulbs, or more travel. The blog and the deliberate spreading of the MMM message are the core reason for those things happening, not just an excuse to deduct them.

IOW, unless you think he decided to go to Costa Rica and then shoehorned a Mustachian gathering into the trip as a cynical means of paying less taxes, it's not an accounting dodge, because that really isn't lifestyle creep - it's a creative and effective way of spreading the message. And I give the guy the benefit of the doubt there, unless and until I encounter evidence to the contrary.
Quote
Reacting to an earlier comment from Tooq that got me thinking, my lifestyle has changed substantially from 10 years ago.  Because life is not a controlled scientific experiment, who knows what 2006-me would be doing today if I had ER'ed and limited lifestyle to COLA.  I would have certainly survived, but things would be vastly different than the family we are today.  Realizations like these help keep me 'conscientious' of just how exploding my volcano of luxury continues to be.  For example, I personally don't see a conflict of exposing children to more domestic and international travel if increased FI allows for it.  The internet has made our lives phenomenally information / data rich, but I go crazy seeing my kids in front of a screen watching 'life'.  There is absolutely no substitute for 'being there'.
Oh, absolutely. I don't even have kids but when I think about maybe doing it someday, that's the first thing that comes to mind. To me, it's not worth having them if I can't rock their world with huge in-person experiences in history and culture.

EnjoyIt

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Right, and MMM has been at that point for like 10 years straight without changing his spending substantially. He is 100% living his own message that consumption should not be driven by available funds.

He does indeed spend more today than he did 10 years ago and he uses the blog to pay for it.  These expenditures do eventually become blog posts and kudos for him to be able to do fun stuff with pre-tax money. And I don't fault the guy one bit for doing so. I wish I could expense my entertainment as a business expense.

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* Literally my only bad reaction to this article was the imputed rip on The Complete Tightwad Gazette, which broke my heart since that book is epic.

* $400k/yr. BADASS. Don't forget to subtract server fees and time and stuff. I'm assuming that's gross, but it's still awesomesauce.

* Today I took my kids to their pediatric ophthalmology appointment by bus because "Paying for parking is a sign from God that you're in an area not designed for a car. You are fighting the design of your city." I saved $9.50 and am about 5,000 steps above average for the day. So there you go.

jengod

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The piece was, unfortunately but inevitably, written/edited to fit the tone of the New Yorker: wry, eyebrow-archingly cynical, and ultimately comforting to its target demographic. To expect anything else of a publication that's financed by selling ads for Cadillac SUVs and other luxury lifestyle products would be naive.

The writer's intent wasn't to examine the principles behind FI/RE: it was to paint a portrait of a "colorful" individual. This is why eccentricities were highlighted, his adherents were relegated to shadowy, supporting roles, and no effort was made to place his achievements in context. There were certainly no attempts to evaluate the efficacy of his philosophy, much less understand how it might be effectively applied to others. The foofraw about game cards and his mother-in-law's underwear existed only to make the average reader roll their eyes: that wacky pot-smoking, beer-drinking, Colorado utopianist crank!

The ultimate cheap shot was the $400K annual income from this website. Instead of that being used to demonstrate the power of his ideas, it was presented as if they undermined them--as if the success of the website somehow made his lifestyle an eccentric hobby. Never mind that he doesn't make use of that money or even live in its shadow, thereby making it about as relevant as his shoe size. (Speaking of the physical realm: was anyone else creeped out by the reference to his being in shape, and how that was somehow threatening?)

In other words the article, like so much media these days, comes pre-consumed: the expected reader reaction is already baked into the tone of the piece. To read it, it's implied, is tantamount to thinking about the topic at hand. I guess I'm glad it'll help at least a few new people find their way to MMM, but on the whole I think it exemplifies why Pete was prudent to craft a semi-anonymous persona in the first place.

I used to work in journalism, and this is the right reaction. The New Yorker is never going to print your brochure. The writer can't get this pitch past his editors if he takes Mustachianism on face value. In the context of journalism as a whole, please believe me this is actually a relatively flattering and gentle character profile.

zephyr911

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Right, and MMM has been at that point for like 10 years straight without changing his spending substantially. He is 100% living his own message that consumption should not be driven by available funds.

He does indeed spend more today than he did 10 years ago and he uses the blog to pay for it.  These expenditures do eventually become blog posts and kudos for him to be able to do fun stuff with pre-tax money. And I don't fault the guy one bit for doing so. I wish I could expense my entertainment as a business expense.
See my reply above for a counterpoint to that. And, to elaborate:
That spending has increased is a known fact. Whether any it is actual lifestyle creep is quite open to debate, and cannot simply be assumed.
If you think he is gaming the system by spending more for his own amusement and claiming it as business expenses, I'd be interested to know specifically which expenses were undertaken to indulge Pete and his family, as opposed to the furthering the MMM message, but claimed as expenses for the blog or some other aspect of the business. I've explained why, in general, I assume that this is not happening, but am open to counterexamples that don't pass the smell test. For example, a tool that becomes the subject of a blog entry generally fits within this "not personal expenses" view, but an Escalade probably wouldn't. Somewhere in the middle may be examples that are open to debate.

lifetimeguy

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I'm curious if MMM ever ends up posting his 2015 numbers.

In his defense it takes a lot of time to sort out and separate all of the blog related expenses (travel, food, beer, home projects, bikes, etc) to be able to identify what his actual expenses were for the year.

Ouch. That one hurt. :)

EscapeVelocity2020

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That's the tricky part...I don't fault MMM for elevating his lifestyle. If he does, and he has, it doesn't mean that he is a fraud, or is suddenly wasteful, or deprived himself early on.  Everybody seems to ignore the fact that people change and evolve over time...the things that he needed/wanted/believed may have changed from 30 years old to 40 years old...I know I have over time and expect to change going forward.  He may very well decide to spend $100k to take his family on a world tour and show his kid all that the world has (an African safari would be cool, but can be really expensive)....and in the spirit of homeschooling he would learn far more from that than being in a classroom.  Traveling to different cities in the US to experience the arts or cultures or whatever is fun and valuable, but still costs money...that's ok.  He has plenty of it, more than he needs now.....and just because he may do these things doesn't mean he needs these things to be happy or maybe he will, who knows...no different than the houses he has had. 
...

I think this would be a really great transition for the blog (or maybe that's just me being selfish, but I'd love to hear Pete's reactions on different cultures and Mustachian travel experiences) and makes sense with their home-school / ER lifestyle while their boy is young and that they can deduct the costs.  Certainly more inspiring, at least to me, than just quietly building up a massive charity fund in the background.  I think it will strain the idea that the MMM family is living on 25k/yr once you separate out 'business expenses'...  but I think people are OK with that.   

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See my reply above for a counterpoint to that. And, to elaborate:
That spending has increased is a known fact. Whether any it is actual lifestyle creep is quite open to debate, and cannot simply be assumed.
If you think he is gaming the system by spending more for his own amusement and claiming it as business expenses, I'd be interested to know specifically which expenses were undertaken to indulge Pete and his family, as opposed to the furthering the MMM message, but claimed as expenses for the blog or some other aspect of the business. I've explained why, in general, I assume that this is not happening, but am open to counterexamples that don't pass the smell test. For example, a tool that becomes the subject of a blog entry generally fits within this "not personal expenses" view, but an Escalade probably wouldn't. Somewhere in the middle may be examples that are open to debate.

Perhaps a yearly trip to Ecuador? Is it not possible to host a mustachian get-together somewhere within biking distance of his house? Just for argument's sake...

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Perhaps a yearly trip to Ecuador? Is it not possible to host a mustachian get-together somewhere within biking distance of his house? Just for argument's sake...

To be fair, the article that started this whole discussion mentions just such a get-together, and MMM attends get-togethers all over the place, wherever he may be at the time.  The Chautauqua was also not his idea, he attended at the request of the organizers.  Now, I'm not arguing that getting to travel across the planet isn't a ridiculous luxury, but then again, MMM himself would tell you so too.

Still, is the implication seriously that for MMM to be "ideologically pure," he's basically got to stay within biking distance of his house for the rest of his life? I'll grant that he's deducting the Ecuador trip (Mrs. MM said as much in 2013), but he is also copping to *thousands* in travel spending, all within his ~$25K budget. If he really wanted to game the budget, he could easily attend a meetup (which he often does/did) and write off the travel too (which he didn't).

I feel like "travel that is to promote the blog/its message that he ends up enjoying is indulgent" is fast becoming the new "any burning of calories means he's not retired."

Metric Mouse

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Perhaps a yearly trip to Ecuador? Is it not possible to host a mustachian get-together somewhere within biking distance of his house? Just for argument's sake...

To be fair, the article that started this whole discussion mentions just such a get-together, and MMM attends get-togethers all over the place, wherever he may be at the time.  The Chautauqua was also not his idea, he attended at the request of the organizers.  Now, I'm not arguing that getting to travel across the planet isn't a ridiculous luxury, but then again, MMM himself would tell you so too.

Still, is the implication seriously that for MMM to be "ideologically pure," he's basically got to stay within biking distance of his house for the rest of his life? I'll grant that he's deducting the Ecuador trip (Mrs. MM said as much in 2013), but he is also copping to *thousands* in travel spending, all within his ~$25K budget. If he really wanted to game the budget, he could easily attend a meetup (which he often does/did) and write off the travel too (which he didn't).

Of course not. I was merely pointing out that those trips are not included in his yearly budget. And, as can be seen from his blog, his previous travel was done very frugally - in his car, with a cargo box he built himself, often to Canada for several weeks to visit family. It's quite a step to go from camping on a budget around the U.S. to flying to Hawaii and Ecuador.  Again - the point is that this travel expense is kept separate from his other spending. We know Mr. MM can live a fantastic life on the budget he set; but he doesn't, strictly speaking. So if someone claims his lifestyle hasn't inflated at all, that would be intellectually dishonest, in my opinion.

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Perhaps a yearly trip to Ecuador? Is it not possible to host a mustachian get-together somewhere within biking distance of his house? Just for argument's sake...

To be fair, the article that started this whole discussion mentions just such a get-together, and MMM attends get-togethers all over the place, wherever he may be at the time.  The Chautauqua was also not his idea, he attended at the request of the organizers.  Now, I'm not arguing that getting to travel across the planet isn't a ridiculous luxury, but then again, MMM himself would tell you so too.

Still, is the implication seriously that for MMM to be "ideologically pure," he's basically got to stay within biking distance of his house for the rest of his life? I'll grant that he's deducting the Ecuador trip (Mrs. MM said as much in 2013), but he is also copping to *thousands* in travel spending, all within his ~$25K budget. If he really wanted to game the budget, he could easily attend a meetup (which he often does/did) and write off the travel too (which he didn't).

Of course not. I was merely pointing out that those trips are not included in his yearly budget. And, as can be seen from his blog, his previous travel was done very frugally - in his car, with a cargo box he built himself, often to Canada for several weeks to visit family. It's quite a step to go from camping on a budget around the U.S. to flying to Hawaii and Ecuador.  Again - the point is that this travel expense is kept separate from his other spending. We know Mr. MM can live a fantastic life on the budget he set; but he doesn't, strictly speaking. So if someone claims his lifestyle hasn't inflated at all, that would be intellectually dishonest, in my opinion.
j
I'm traveling this summer and most of the trip is not in my budget and the only reason we are going is travel hacking.  Should I consider my budget $1500 more even though the credit cards are covering those costs?  Or should I get that I found a deal that migh not exist in future years just like ebates, swagbucks, ting etc may not?

EnjoyIt

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Perhaps a yearly trip to Ecuador? Is it not possible to host a mustachian get-together somewhere within biking distance of his house? Just for argument's sake...

To be fair, the article that started this whole discussion mentions just such a get-together, and MMM attends get-togethers all over the place, wherever he may be at the time.  The Chautauqua was also not his idea, he attended at the request of the organizers.  Now, I'm not arguing that getting to travel across the planet isn't a ridiculous luxury, but then again, MMM himself would tell you so too.

Still, is the implication seriously that for MMM to be "ideologically pure," he's basically got to stay within biking distance of his house for the rest of his life? I'll grant that he's deducting the Ecuador trip (Mrs. MM said as much in 2013), but he is also copping to *thousands* in travel spending, all within his ~$25K budget. If he really wanted to game the budget, he could easily attend a meetup (which he often does/did) and write off the travel too (which he didn't).

Of course not. I was merely pointing out that those trips are not included in his yearly budget. And, as can be seen from his blog, his previous travel was done very frugally - in his car, with a cargo box he built himself, often to Canada for several weeks to visit family. It's quite a step to go from camping on a budget around the U.S. to flying to Hawaii and Ecuador.  Again - the point is that this travel expense is kept separate from his other spending. We know Mr. MM can live a fantastic life on the budget he set; but he doesn't, strictly speaking. So if someone claims his lifestyle hasn't inflated at all, that would be intellectually dishonest, in my opinion.
j
I'm traveling this summer and most of the trip is not in my budget and the only reason we are going is travel hacking.  Should I consider my budget $1500 more even though the credit cards are covering those costs?  Or should I get that I found a deal that migh not exist in future years just like ebates, swagbucks, ting etc may not?

You paid for that trip. It just so happens you paid very little and that is what came out of Yor budget. I would not consider the expected value as part of the cost. Just like if you bought a new bike but used a $50 off coupon. You would not consider the extra $50 as money spent.

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Perhaps a yearly trip to Ecuador? Is it not possible to host a mustachian get-together somewhere within biking distance of his house? Just for argument's sake...

To be fair, the article that started this whole discussion mentions just such a get-together, and MMM attends get-togethers all over the place, wherever he may be at the time.  The Chautauqua was also not his idea, he attended at the request of the organizers.  Now, I'm not arguing that getting to travel across the planet isn't a ridiculous luxury, but then again, MMM himself would tell you so too.

Still, is the implication seriously that for MMM to be "ideologically pure," he's basically got to stay within biking distance of his house for the rest of his life? I'll grant that he's deducting the Ecuador trip (Mrs. MM said as much in 2013), but he is also copping to *thousands* in travel spending, all within his ~$25K budget. If he really wanted to game the budget, he could easily attend a meetup (which he often does/did) and write off the travel too (which he didn't).

Of course not. I was merely pointing out that those trips are not included in his yearly budget. And, as can be seen from his blog, his previous travel was done very frugally - in his car, with a cargo box he built himself, often to Canada for several weeks to visit family. It's quite a step to go from camping on a budget around the U.S. to flying to Hawaii and Ecuador.  Again - the point is that this travel expense is kept separate from his other spending. We know Mr. MM can live a fantastic life on the budget he set; but he doesn't, strictly speaking. So if someone claims his lifestyle hasn't inflated at all, that would be intellectually dishonest, in my opinion.
j
I'm traveling this summer and most of the trip is not in my budget and the only reason we are going is travel hacking.  Should I consider my budget $1500 more even though the credit cards are covering those costs?  Or should I get that I found a deal that migh not exist in future years just like ebates, swagbucks, ting etc may not?

I think that's a little different, more like my saying I paid $15 for a new shirt, even though it was priced at $20 and I used a 25% off coupon.

My husband owns a business. There's certain costs we deduct against the business income that are truly business expenses, stuff we wouldn't be buying without the business, like getting business cards printed. There are also expenses related to our lifestyle that we can quite legitimately run through his business, but that add to our standard of living and we'd be paying for anyway. We deduct the costs of our second bedroom, which is great, but we'd still own the two bedroom apartment regardless. We went to Malaysia for a work contract my husband got, but we included a certain amount of sightseeing and visiting family, most of which was tax deductible. It inflated our lifestyle, but the business basically paid for everything, and we were there so my husband could work, and we could have quite legitimately said it wasn't OUR spending, it was business spending. That's what MMM is doing with ebikes and trips to Ecuador and bartered stays in Hawaii (I believe the IRS considers barter a form of income and you're supposed to pay tax on it, though I suppose most people don't): he's running expenses that inflate his standard of living through his business and not included them in his annual spending breakdown. It doesn't really bug me, because my parents are shopkeepers and I'm used to this, but I can see why it bugs some people. He's still way more open kimono about his finances than I would find comfortable.

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Just playing devil's advocate...but do you think he'd just be sitting at home if he wasn't using the business to travel? It seems traveling is important and enjoyable to him personally, so while it might be accurate to say that he wouldn't be going to "xyz" if he wasn't doing business there, we can't count out the possibility that he might instead go to "abc".

EnjoyIt

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Yup,
Although a family of 3 with no debt can live a nice mustachios life on $24K/yr.  That same family would also not be able to travel the world.  If I was MMM I would spend that extra money on things that bring happiness such as experiences.  Traveling is definitely one of them, especially if he gets to bring his boy along and show him what the world is like.  That is money very well spent.

serpentstooth

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Yup,
Although a family of 3 with no debt can live a nice mustachios life on $24K/yr.  That same family would also not be able to travel the world.  If I was MMM I would spend that extra money on things that bring happiness such as experiences.  Traveling is definitely one of them, especially if he gets to bring his boy along and show him what the world is like.  That is money very well spent.

I think our non- mortgage, not attributable directly to keeping a job costs are at about $24k/yr, but we'd be hard pressed to travel much on that, absent travel hacking and such. I assume his insurance costs are going to be going way up too, as he won't be eligible for ACA subsidies.

Metric Mouse

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Re: New Yorker Article: The Scold
« Reply #529 on: March 13, 2016, 04:46:20 PM »
Yup,
Although a family of 3 with no debt can live a nice mustachios life on $24K/yr.  That same family would also not be able to travel the world.  If I was MMM I would spend that extra money on things that bring happiness such as experiences.  Traveling is definitely one of them, especially if he gets to bring his boy along and show him what the world is like.  That is money very well spent.

I think our non- mortgage, not attributable directly to keeping a job costs are at about $24k/yr, but we'd be hard pressed to travel much on that, absent travel hacking and such. I assume his insurance costs are going to be going way up too, as he won't be eligible for ACA subsidies.

He can just write a blog post about it and then deduct it from his budget.

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Why does everyone get hung up on the $24k figure?  It seems to me that it's just illustrating that you can live a very nice and very comfortable local life, especially if you don't have debt (like a mortgage).  To me this is really useful because it shows that you can be happy doing that. 

But now where does it say you have to live a $24k lifestyle.  I personally plan to live with $40k to $50k per year and do more traveling, especially since we have relatives in Europe that we can crash at for a few weeks at a time. 

I think the other value of the $24k example is that it blows out of the water the common "wisdom" of financial planners saying you need 80% of your highest income during retirement.  By focusing on expenses instead of income and also showing people how to dial down expenses, it makes the whole retirement and FI scenario much clearer and much less intimidating for the average person.

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Re: New Yorker Article: The Scold
« Reply #531 on: March 14, 2016, 05:51:40 AM »
He can just write a blog post about it and then deduct it from his budget.

Hey there. I know it's easy and fun to say things like that, but you're far from the first in this thread to insinuate that MMM is gaming the system by taking business deductions for things he would have to buy, or would choose to buy, regardless of the blog and related activities. Such an act would be hypocritical at best and illegal at worst.

I will once again ask for evidence. If you ignore the request, I'll assume you're retracting.

nereo

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Yup,
Although a family of 3 with no debt can live a nice mustachios life on $24K/yr.  That same family would also not be able to travel the world.  If I was MMM I would spend that extra money on things that bring happiness such as experiences.  Traveling is definitely one of them, especially if he gets to bring his boy along and show him what the world is like.  That is money very well spent.
Of course MMM and family can travel the world on $24k/year. All he has to do is rent out his paid for house for a year or two and go. They can easily live on $2k/month by doing one long trip rather than a bunch of expensive back and forth short trips that would be expensive. They can stay at hostels or Airbnbs or rent a modest home in various places they want to visit and stay as long as they want.  Arebelspy and others have done travel like that very cheaply. It's not like anyone in the MMM family HAS to come home after 2 weeks for a job or school.  Heck if his house rents for enough $$'s he'll probably be able to travel the world, cover all his  expenses AND actually make some extra money to add to the stash. It would be a great blog topic too.

Actually, he already wrote about doing just this:
http://www.mrmoneymustache.com/2011/08/05/making-money-while-taking-vacations/
I'm kind of surprised no one else has brought this up.

jengod

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Why does everyone get hung up on the $24k figure?  It seems to me that it's just illustrating that you can live a very nice and very comfortable local life, especially if you don't have debt (like a mortgage).  To me this is really useful because it shows that you can be happy doing that. 

But now where does it say you have to live a $24k lifestyle.  I personally plan to live with $40k to $50k per year and do more traveling, especially since we have relatives in Europe that we can crash at for a few weeks at a time. 

I think the other value of the $24k example is that it blows out of the water the common "wisdom" of financial planners saying you need 80% of your highest income during retirement.  By focusing on expenses instead of income and also showing people how to dial down expenses, it makes the whole retirement and FI scenario much clearer and much less intimidating for the average person.

THIS! This this this. Thank you.

Metric Mouse

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Re: New Yorker Article: The Scold
« Reply #534 on: March 14, 2016, 04:25:24 PM »
He can just write a blog post about it and then deduct it from his budget.

Hey there. I know it's easy and fun to say things like that, but you're far from the first in this thread to insinuate that MMM is gaming the system by taking business deductions for things he would have to buy, or would choose to buy, regardless of the blog and related activities. Such an act would be hypocritical at best and illegal at worst.

I will once again ask for evidence. If you ignore the request, I'll assume you're retracting.

As evidenced that he doesn't include travel to Ecuador/Hawaii etc. in his budget. Untwist your panties - no one was saying he was taking business tax deductions, please don't put words in my mouth.

People on this thread were pointing out, rightly so, that his lifestyle is inflated from blog income, and he is being less than fully honest by saying he lives on 24K but flies to Hawaii and SA, among other things, and the amount that this costs is not included in his 24k budget. I would stop short of calling it hypocritical... but it is a little spendypants, and not entirely honest.

I'll preemptively assume you're going to apologize - I prefer whiskey to chocolate. Everybody likes nice flowers though.

EnjoyIt

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I don't think it's spendy pants or hypocritical though it is a lifestyle that has inflated over the years.

I think he deserves to travel and do whatever he wants with that money. Who are we to judge?  It is his to spend any damn way he sees fit.

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Re: New Yorker Article: The Scold
« Reply #536 on: March 15, 2016, 09:21:21 AM »
He can just write a blog post about it and then deduct it from his budget.

Hey there. I know it's easy and fun to say things like that, but you're far from the first in this thread to insinuate that MMM is gaming the system by taking business deductions for things he would have to buy, or would choose to buy, regardless of the blog and related activities. Such an act would be hypocritical at best and illegal at worst.

I will once again ask for evidence. If you ignore the request, I'll assume you're retracting.

As evidenced that he doesn't include travel to Ecuador/Hawaii etc. in his budget. Untwist your panties - no one was saying he was taking business tax deductions, please don't put words in my mouth.

People on this thread were pointing out, rightly so, that his lifestyle is inflated from blog income, and he is being less than fully honest by saying he lives on 24K but flies to Hawaii and SA, among other things, and the amount that this costs is not included in his 24k budget. I would stop short of calling it hypocritical... but it is a little spendypants, and not entirely honest.

I'll preemptively assume you're going to apologize - I prefer whiskey to chocolate. Everybody likes nice flowers though.
Eh, but he didn't used to do all that.

I'm not sure if I remember correctly, but I think he spent a month or so in Hawaii in exchange for fixing up a condo, and the flights he used miles.

And the Ecuador trips - well yes, it's a business expense.  I assume that if the blog were not making money, then he wouldn't be going.  Not true?  So yes, for whatever particular year(s) he took the international trips and it was "business", he got a great trip.  But that does not define every single year since he retired.

On the Hawaii blog post, we (MMM and I) may or may not have had a discussion on how I live in a vacation destination, and he'd consider doing a similar thing...staying in my house for free while fixing things.  That Christmas, we went East for 1.5 weeks, and I was sorely tempted to take him up on it.  So the alternative back when the blog wasn't raking it in was a drive from CO to CA and a 1.5 week stay while fixing things around the house.

Tyson

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I suppose the only way to make these people happy is for MMM to not travel at all. 

Because if he pays for it and counts it as an expense, then HEY HE'S SPENDING MORE THAN $24K PER YEAR.

On the other hand, if he writes it off as a business expense or trades labor for a place to stay, then HEY HE'S NOT REALLY RETIRED.


OzzieandHarriet

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For me, the whole point of the MMM philosophy is not that you don't "work" but that by limiting spending you are free to do what you prefer rather than feel forced into doing something that you hate because you are locked into needing $x in income.

So whether he earns a lot of money with his blog or really spends more than $24k/year is totally beside the point. He doesn't like being trapped in an office all day, and he's not.

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Re: New Yorker Article: The Scold
« Reply #539 on: March 15, 2016, 12:35:48 PM »
As evidenced that he doesn't include travel to Ecuador/Hawaii etc. in his budget.
That he doesn't include it in the spending figures is a given. It's not evidence for your claim, because what is being debated is the characterization of the cost, whatever the cost may be, and the legitimacy of that characterization.
Quote
Untwist your panties - no one was saying he was taking business tax deductions, please don't put words in my mouth.
He better be, if he's not listing it under personal spending. It must be one or the other. *twists panties further* Mmm, feels good. (what makes you think I'm mad? I'm having fun)
Quote
People on this thread were pointing out, rightly so, that his lifestyle is inflated from blog income, and he is being less than fully honest by saying he lives on 24K but flies to Hawaii and SA, among other things, and the amount that this costs is not included in his 24k budget. I would stop short of calling it hypocritical... but it is a little spendypants, and not entirely honest.
People are claiming that. I am offering a rebuttal to that claim. The claim is not evidence for its own validity.
I offered what I believe are reasonable criteria for showing that this is lifestyle creep (and don't pull your punches - if it were true, hypocrisy would be an obvious corollary) and explained why I don't think it qualifies. I'd like to see someone demonstrate that it meets the criteria, or argue for different criteria - anything but just repeat the assertion.

I don't think MMM needs to be defended, least of all by me, but sound thinking and rational debate need all the help they can get these days. Just look at our political scene.
Quote
I'll preemptively assume you're going to apologize - I prefer whiskey to chocolate. Everybody likes nice flowers though.
How about a freshly picked kick in the ass? ;)

Metric Mouse

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Re: New Yorker Article: The Scold
« Reply #540 on: March 15, 2016, 11:58:49 PM »
As evidenced that he doesn't include travel to Ecuador/Hawaii etc. in his budget.
That he doesn't include it in the spending figures is a given. It's not evidence for your claim, because what is being debated is the characterization of the cost, whatever the cost may be, and the legitimacy of that characterization.
Quote
Untwist your panties - no one was saying he was taking business tax deductions, please don't put words in my mouth.
He better be, if he's not listing it under personal spending. It must be one or the other. *twists panties further* Mmm, feels good. (what makes you think I'm mad? I'm having fun)
Quote
People on this thread were pointing out, rightly so, that his lifestyle is inflated from blog income, and he is being less than fully honest by saying he lives on 24K but flies to Hawaii and SA, among other things, and the amount that this costs is not included in his 24k budget. I would stop short of calling it hypocritical... but it is a little spendypants, and not entirely honest.
People are claiming that. I am offering a rebuttal to that claim. The claim is not evidence for its own validity.
I offered what I believe are reasonable criteria for showing that this is lifestyle creep (and don't pull your punches - if it were true, hypocrisy would be an obvious corollary) and explained why I don't think it qualifies. I'd like to see someone demonstrate that it meets the criteria, or argue for different criteria - anything but just repeat the assertion.

I don't think MMM needs to be defended, least of all by me, but sound thinking and rational debate need all the help they can get these days. Just look at our political scene.
Quote
I'll preemptively assume you're going to apologize - I prefer whiskey to chocolate. Everybody likes nice flowers though.
How about a freshly picked kick in the ass? ;)

I guess I'm confused... are you saying that he would take trips to South America every year if he only had $24k/per year to spend? Because, before the blog, he didn't do things like this... And, he spends that much when these trips are not factored in... So logically he spends more than $24k/year... all while reporting that he doesn't. That is the claim - that he spends more than 24k per year in his retirement, while saying that he doesn't. The proof is that he mentions activities that cost money that he doesn't list in his budget. It's pretty cut and dried. No value judgement is placed upon these facts - they stand by themselves.  I would offer the same facts as an argument for lifestyle inflation - he didn't do these things before he had the income from the blog to cover them, so by definition his lifestyle has 'inflated' to include yearly trips to exotic places. Good for him.


And first you say that it would be illegal and/or hypocritical for him to take business deductions for such things....and then turn around and say "He'd better be" taking said deductions. Would you care to choose one side and then defend it? Or we can just say we agree that from a tax perspective they could be legitimately labeled as business expenses, but however he fills out the forms is none of our god damned concern.


So I would have to ask you to repeat your criteria of 'lifestyle creep' if you disagree with the definition as being 'lifestyle inflation above a $24k (USD)/year budget.' If you posted them before the first post I quoted, I apologize, but am unwilling to page through 12 pages of posts to find it.


And no, Mr. Money Mustache does not need to be defended, by anyone. He makes a lot of god damned money. If he wishes to suck cocaine-dusted caviar through the gold-plated horn of the last fucking Black Rhino, good for him. But I would still argue that it is lifestyle inflation from the 2012 baseline.
« Last Edit: March 16, 2016, 10:55:35 PM by Metric Mouse »