Author Topic: What can you do now to make your post-FIRE life cheaper?  (Read 10345 times)

Alpinweiss

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What can you do now to make your post-FIRE life cheaper?
« on: August 05, 2021, 11:26:43 AM »
As someone who is hopefully approaching FIRE (I put myself somewhere in between the 2022 to 2024 cohort depending on my tolerence with the job, and various financial factors) I keep thinking about what I can do now that reduces my cashflow required after retiring. A few examples:

Mortgage: An obvious example is paying off the mortgage... By paying that off I can significantly reduce the monthly cash I need. Of course, there are many other considerations especially since I have a very low interest rate.

Solar: The other thing I can think of is solar for the house. Which aside from being cool and environmentally friendly, fits into the bucket of spend now while employed and reduce monthly expenses for the future.

What are other ideas in this bucket? Would love to hear others thoughts here.

I also realize the best thing to do is probably nothing and just stay the course or reduce your spending needs/desires... but at the latter stages of FI accumulation there's less work to do and these types of thoughts are fun and interesting :).


ericrugiero

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #1 on: August 05, 2021, 11:39:59 AM »
Those are both things that as you could choose to spend on now in order to save later.  But, unless you have a reason to lower your monthly cash flow you may not have an advantage from spending more now vs later. 

Lowering spending to stay below an ACA limit that allows you to get better health insurance could be a good reason to shift costs forward.  Otherwise, there generally isn't a big advantage in general to spending more now vs later.  Depending on your asset allocation and age, it could be cheaper to spend the money later at a lower tax rate. 

What is your motivation for shifting expenses forward to while you are working?  In general, I would suggest evaluating each expense on it's own to see if it's cheaper overall to pay now vs later. 

ixtap

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #2 on: August 05, 2021, 11:51:35 AM »
Getting ahead on maintenance and upgrades is a common theme in pre retirement checklists. We have been working through some projects. Usually, it just means you cash flow those items now, rather than saving the money. And so, like paying off the mortgage, the utility depends on what the market does in those first few years.

We are doing the projects for a number of reasons. It encourages us to save a bit more. After all, spending is higher this year than usual with all those upgrades! We are also hopeful that it will allow us to have more time for travel and fun the first year or so if we don't come up with any new projects.

How to make life cheaper kind of depends on where you are starting. It is easy for me to convince DH to give lots to charity while he is at Megacorp because they have a generous charity match. I budget smaller charitable contributions in retirement because it will be harder to get him to contribute large amounts without the match.

Check if any of your hobbies offer discounts to volunteers. A lot of dances organized as dances (rather than just a cover at a bar) will offer free entry if you work the door or run the refreshments table for an hour or two. Maybe your local hobby store offers discounts in exchange for help with a promotional event. A club could offer free membership for teachers or mentors. You may not have the time or energy for that while working, but would enjoy the new challenges when retired.

thesis

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #3 on: August 05, 2021, 11:58:11 AM »
It's interesting to think of front-loading some of your costs now to avoid needing to spend money on them later in early retirement. That's kind of how capital works, so I understand why people want to buy tools beforehand, or solar panels. But sometimes tools are lost or stolen, and sometimes solar panels get smashed by hail. While these events are relatively rare, I think the ERE approach is more sustainable and rewarding, i.e., learning how to perform maintenance to your house if you own a house, or learning how to work on your car if you own a car. Skills that help you save at multiple positions in life are pretty useful, so I guess you could front-load certain types of learning, especially if they require paid training in order to master or become competent in, but really only if you expect those skills to have a high ROI in general.

EDIT:
Learning how to grow your own food might fall in this category. If you learn while you have the money, it has a much smaller impact on your post-FI budget if your plants die early and you learn from the experience, just as an example. Get good at growing plants now, it will be useful whether you are employed or not.
« Last Edit: August 05, 2021, 12:05:51 PM by thesis »

wageslave23

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #4 on: August 05, 2021, 12:02:55 PM »
I think the biggest thing is buying a house with a mortgage or refinancing before your retire, if you are planning on doing either of those things.  Both are extremely difficult without w2 income.  Everything else can easily be done at any time.

MoneyTree

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #5 on: August 05, 2021, 12:05:22 PM »
Very interested in this topic, as I am essentially FI right now but still working, so everything I am making at the job now is extra and I would love to get some ideas on larger one time expenses I can make now to lower ongoing expenses after RE.

Some good ideas thus far, but looking forward to hearing more.

ixtap

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #6 on: August 05, 2021, 12:38:27 PM »
Very interested in this topic, as I am essentially FI right now but still working, so everything I am making at the job now is extra and I would love to get some ideas on larger one time expenses I can make now to lower ongoing expenses after RE.

Some good ideas thus far, but looking forward to hearing more.

It won't really lower our expenses later, but one thing we are doing in this last year is splashing out on vacations with extended family. If we do need to lower expenses later, we won't feel too bad about skipping a visit once in awhile because we already made the time and effort while we were flush. I can't imagine every joining my parents for a cruise again, even if they stick with these smaller boats.

Alpinweiss

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #7 on: August 05, 2021, 12:39:20 PM »
As to the why I think it really boils down to a few reasons:
  • Reducing Taxable Income needed post retirement
  • Reducing sequence of returns risk by potentially avoiding larger expenses shortly after leaving employment
  • Coming up with projects/work that helps you feel like you are doing something to get ready for leaving the job

I'll totally admit that I think most of it is #3... but you gotta do something to keep yourself busy and at least I'm not trying to justify buying sports cars :)

Steeze

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #8 on: August 05, 2021, 12:52:22 PM »
I have a post FI pre-RE check list that is something like:

Replace cars, computers, roof, boiler, HVAC, install solar, clothes, appliances, phones, bikes, outdoor gear, clean septic, fill propane, purchase landscaping materials & equipment... etc.

Basically move forward spending while I am working at a high income - not really as a way to save money in the end, but rather as a SORR strategy. Try to pre-pay the big ticket discretionary spending for a decade. That way you can cut to a barebones withdrawal rate of the markets don’t cooperate.

Basically divert money into 100% spending for a few months after you hit The Number.

jim555

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #9 on: August 05, 2021, 01:04:22 PM »
Tooth work, take care of any open items like implants, replace fillings, crowns.

Morning Glory

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #10 on: August 05, 2021, 01:09:16 PM »
I have a post FI pre-RE check list that is something like:

Replace cars, computers, roof, boiler, HVAC, install solar, clothes, appliances, phones, bikes, outdoor gear, clean septic, fill propane, purchase landscaping materials & equipment... etc.

Basically move forward spending while I am working at a high income - not really as a way to save money in the end, but rather as a SORR strategy. Try to pre-pay the big ticket discretionary spending for a decade. That way you can cut to a barebones withdrawal rate of the markets don’t cooperate.

Basically divert money into 100% spending for a few months after you hit The Number.

Why not just stick the cash in a sinking fund for these things and buy them when the need arises?  In good market years you replenish your sinking fund from stock sales, in bad years you draw from the fund for your spending needs.

I would maybe get the solar first, because I see it as more of an investment. I don't see the point in replacing appliances before they break just to FIRE with newer ones.

ETA another reason to wait would be that you will have more time to research and shop around for the purchases after you no longer have to work.
« Last Edit: August 05, 2021, 01:13:25 PM by Morning Glory »

GodlessCommie

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #11 on: August 05, 2021, 01:15:49 PM »
Regarding home improvement... for myself, I don't see a reason to front-load on things that I can do myself, and even enjoy doing. But things I'm not comfortable taking on - like HVAC - I do plan to replace.

Solar... if it has value for you in and of itself, absolutely! It has for us, and we have it. ROI of ~8% is a cherry on top. But on a strictly $$$ basis, a lot depends on your location - be it net metering rules, ability to sell SRECs, local prices, local incentives, amount of sun you get. It may be more or less desirable depending on all of that.
« Last Edit: August 05, 2021, 01:17:26 PM by GodlessCommie »

vand

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #12 on: August 05, 2021, 01:30:38 PM »
Good cooking and DIY skills will get you far.

Villanelle

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #13 on: August 05, 2021, 01:41:57 PM »
Paying attention to health.  It will help keep health care costs down and also allow you to DIY more things for longer. 

In the same category, if you have good health insurance that the job, get a thorough check up and treat any conditions while still insured.  Same with dental care. 

Go down to 1 car if you have 2.  Learn basic auto skills (I admit to having none of those, ATM). Move to a walkable neighborhood, since commute time is no longer a concern. 

Volunteer somewhere that offers a benefit that fits your lifestyle.  Free theater if you are a docent, first grab of donated books if you work at the library, etc. 

I don't really consider things that I can either do now or do later, to be making post-FIRE life cheaper.  I suppose technically they are, but if it just a change in date for the expense, I don't really see the point.  In fact, one could argue that doing that actually hurts you in FIRE because the money could be invested for a while if you spend it later instead of now.  I look at a mortgage the same way.  Yes, if paid off then your monthly outflow will be lower.  But if you are pulling that out of a smaller investment account (and smaller relative to the lower monthly expense), you are actually worse off.  And even if you don't take investment growth into account, it's still mostly a shell game where you aren't actually spending any less money in total. 


Steeze

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #14 on: August 05, 2021, 01:55:41 PM »
I have a post FI pre-RE check list that is something like:

Replace cars, computers, roof, boiler, HVAC, install solar, clothes, appliances, phones, bikes, outdoor gear, clean septic, fill propane, purchase landscaping materials & equipment... etc.

Basically move forward spending while I am working at a high income - not really as a way to save money in the end, but rather as a SORR strategy. Try to pre-pay the big ticket discretionary spending for a decade. That way you can cut to a barebones withdrawal rate of the markets don’t cooperate.

Basically divert money into 100% spending for a few months after you hit The Number.

Why not just stick the cash in a sinking fund for these things and buy them when the need arises?  In good market years you replenish your sinking fund from stock sales, in bad years you draw from the fund for your spending needs.

I would maybe get the solar first, because I see it as more of an investment. I don't see the point in replacing appliances before they break just to FIRE with newer ones.

ETA another reason to wait would be that you will have more time to research and shop around for the purchases after you no longer have to work.

Aside from the SORR consideration, probably just mental trickery at some point also - I HATE spending money, huge guilt complex around spending. So I am providing myself a window of time to spend freely on non-essentials where I don't have to feel the guilt. I won't spend now when my income is great, I can only imagine that feeling being 10x when I have to drawdown my savings to buy stuff. Not a healthy relationship with money at all, I admit. Suppose it is a bit of 'risk off' too - I plan on having a paid off house which is also ignoring the math. Just feels like belt-and-suspenders to have mostly new paid for stuff going into FIRE.

My current spending / FIRE budget already includes sinking funds for everything; new laptop every 8 years, new cellphone every 5 years, new (used) car every 10 years, etc. Suppose in my mind I am supposed to reset all those timelines before I jump ship. Timing wise, for me, I will probably be ready for a lot of that stuff anyway.

shuffler

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #15 on: August 05, 2021, 01:57:07 PM »
What are other ideas in this bucket?
If charity is one of your post-FIRE line items, then start a Donor Advised Fund (DAF) now, and contribute shares.  This gets you the tax-deductions now, when your tax-bracket is (presumably) higher.  The net value of the fund can continue to be invested and grow over time, while you mete out donations over years. 

If you don't normally itemize deductions when filing your taxes, then make your contribution in a single year if at all possible, so that you only have to itemize your tax deductions that one year, and can continue to take the standard-deduction in other years.

It is easy for me to convince DH to give lots to charity while he is at Megacorp because they have a generous charity match.
Yes.  I made donations to max-out the MegaCorp matching, and then contributed a significant amount beyond that to DAF, specifically intended for it to cover my charitable giving for the first 7-10 years of FIRE.

Tigerpine

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #16 on: August 05, 2021, 02:03:46 PM »
Paying attention to health.  It will help keep health care costs down and also allow you to DIY more things for longer. 

In the same category, if you have good health insurance that the job, get a thorough check up and treat any conditions while still insured.  Same with dental care. 

Go down to 1 car if you have 2.  Learn basic auto skills (I admit to having none of those, ATM). Move to a walkable neighborhood, since commute time is no longer a concern. 

Volunteer somewhere that offers a benefit that fits your lifestyle.  Free theater if you are a docent, first grab of donated books if you work at the library, etc.

+1

You have nothing if you don't have health.

FIRE Artist

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #17 on: August 05, 2021, 02:04:30 PM »
Increasing your skill sets in areas that allow you to do the work yourself instead of outsourcing it, or spending money on getting the skills you need for a side hustle that you might enjoy doing for some extra cash in retirement. 

Basically pay any class tuitions while still working if you can.  Where I live (Canada) there are tuition tax credits which may be less useful in retirement.

Morning Glory

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #18 on: August 05, 2021, 02:09:14 PM »
I have a post FI pre-RE check list that is something like:

Replace cars, computers, roof, boiler, HVAC, install solar, clothes, appliances, phones, bikes, outdoor gear, clean septic, fill propane, purchase landscaping materials & equipment... etc.

Basically move forward spending while I am working at a high income - not really as a way to save money in the end, but rather as a SORR strategy. Try to pre-pay the big ticket discretionary spending for a decade. That way you can cut to a barebones withdrawal rate of the markets don’t cooperate.

Basically divert money into 100% spending for a few months after you hit The Number.

Why not just stick the cash in a sinking fund for these things and buy them when the need arises?  In good market years you replenish your sinking fund from stock sales, in bad years you draw from the fund for your spending needs.

I would maybe get the solar first, because I see it as more of an investment. I don't see the point in replacing appliances before they break just to FIRE with newer ones.

ETA another reason to wait would be that you will have more time to research and shop around for the purchases after you no longer have to work.

Aside from the SORR consideration, probably just mental trickery at some point also - I HATE spending money, huge guilt complex around spending. So I am providing myself a window of time to spend freely on non-essentials where I don't have to feel the guilt. I won't spend now when my income is great, I can only imagine that feeling being 10x when I have to drawdown my savings to buy stuff. Not a healthy relationship with money at all, I admit. Suppose it is a bit of 'risk off' too - I plan on having a paid off house which is also ignoring the math. Just feels like belt-and-suspenders to have mostly new paid for stuff going into FIRE.

My current spending / FIRE budget already includes sinking funds for everything; new laptop every 8 years, new cellphone every 5 years, new (used) car every 10 years, etc. Suppose in my mind I am supposed to reset all those timelines before I jump ship. Timing wise, for me, I will probably be ready for a lot of that stuff anyway.

Mad props to you for being able to make a cell phone last five years 😁. I suppose "learn to fix phones" should go on my immediate post fire activity list.

I have that issue with money too, plus I hate shopping. I don't budget because I have never needed to.

Metalcat

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #19 on: August 05, 2021, 05:13:07 PM »
Paying attention to health.  It will help keep health care costs down and also allow you to DIY more things for longer. 

In the same category, if you have good health insurance that the job, get a thorough check up and treat any conditions while still insured.  Same with dental care. 

Go down to 1 car if you have 2.  Learn basic auto skills (I admit to having none of those, ATM). Move to a walkable neighborhood, since commute time is no longer a concern. 

Volunteer somewhere that offers a benefit that fits your lifestyle.  Free theater if you are a docent, first grab of donated books if you work at the library, etc.

+1

You have nothing if you don't have health.

As a very ill person, I wholeheartedly disagree with this, you can be extremely sick and still have a really awesome life.

That said, the sicker you are, the more important healthy habits become, so either way, starting as early as possible on establishing healthy habits is critical. My illness would be much worse has I not spent my 20s and 30s eating well, exercising, and generally taking excellent care of myself.

So yeah, build up as much health as you can as early as you can, that way no matter what happens on the health front, you will always be in the best shape possible to handle it.

bryan995

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #20 on: August 06, 2021, 05:59:40 AM »
This is the exact point I was trying to make in another thread that was completely shot down. It is a valid strategy, that in essence “hides spend”. Spend that is not accounted for when folks break out their post-FIRE yearly spend measuring sticks.

But I agree completely with such a strategy ;)

The whole point to me is to pre-spend on fixed costs or the every so often large-ticket-items (car, appliance) to then minimize outflows during those first few crucial years in case of a large market downturn.  As they say, spend it while you got it !

Once I approach my FIRE target, I will likely continue to work for 6-18 months and divert 100% of excess cash flow into such pre/spend type efforts. The only thing I am not sure about is paying down fixed low interest rate debts (mortgages, solar loan, etc).

We added solar and home batteries (via a 0.99% 10yr loan), though I view this more so as an investment.
Fix up or replace cars. We added an EV to then leverage solar, no more gasoline, horray.
Repair/remodel home if needed (appliances?).
Invest in a home garden?
Rain barrel capture system / grey water reuse?
Home efficiency upgrades (whole house fan?, a/c, newer windows, roof etc)
Equipment for your favorite hobby? (bike, surf board, golf).
Tools for minor home/car repairs
Carpets, flooring, furniture?
Health, exercise, home gym?
Doctor, dentist procedures

There are some things that are simply better to de-risk and tackle while working than to wait until after retirement where budgets are less flexible.
I am sure there are other great ideas, following.
« Last Edit: August 06, 2021, 08:03:51 AM by bryan995 »

Morning Glory

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #21 on: August 06, 2021, 07:33:07 AM »

Some of this stuff just sounds like straight-up consumption, especially the idea of replacing perfectly good things for the sake of starting retirement with newer ones. "Spend it while you got it" sounds a lot like the disappearing money theory that keeps people poor. Buying a bunch of depreciating shit won't make your withdrawal strategy any safer, it will just keep you working longer. 

Note, it's fine to buy things that make you happier: it's just that if you feel like you need to use sequence risk to justify it, you probably don't need it.


bryan995

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #22 on: August 06, 2021, 07:59:52 AM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

Metalcat

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #23 on: August 06, 2021, 08:09:32 AM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

It doesn't matter if you pay for things while you still have an income though, it shouldn't make a lick of difference.

Zikoris

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #24 on: August 06, 2021, 09:42:59 AM »
Probably the best things people can do to make their current and future lives cheaper are getting off the hedonistic treadmill and unplugging from consumerism. I personally found that learning more about marketing made me spot their tricks more readily, and better recognize the difference between a genuine desire versus a marketing-induced one. Also, learning about and pursuing zero waste/anticonsumption and embracing stoic principles does lot of good.

Reading list:

Why We Buy: The Science of Shopping by Paco Underhill
Buyology by Martin Lindstrom
Brandwashing by Martin Lindstrom
Lives of the Stoics by Ryan Holliday

Documentary list:

The Story of Stuff
The Story of Plastic
Just Eat It

GodlessCommie

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #25 on: August 06, 2021, 10:10:00 AM »
Probably the best things people can do to make their current and future lives cheaper are getting off the hedonistic treadmill and unplugging from consumerism.

You won the thread! we can shut it down now.

Villanelle

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #26 on: August 06, 2021, 10:11:29 AM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.  Your blender doesn't peer out of the cabinet to see if you are home during the day and decide to off itself because you are still working and it knows you want to replace it before you retire.  It dies when it dies.  Same with your car and your windows and your carpets, flooring, and furniture.  Why would you replace carpet before you quit, when it could last another couple years?  In the long run, that costs you more because you lost 2 years worth of the initial carpet life.  And if you are replacing it because it truly needs replacing, then you are in no way tinkering with anything in a way to "pay the piper" less money, or even pay him sooner or later than would happen naturally.
 
And yes, at some point you have to pay for these things.  Whether that happens 6 months before you retire or 6 months after is irrelevant, and in fact on a macro level, the latter buys you an extra 12 months of letting that money grow a little bit, so after it is spent, you still have a few dollars extra left behind.


BDWW

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #27 on: August 06, 2021, 10:21:23 AM »
We are continually working on lowering our running costs, insulating and sealing, replacing windows, slowly adding topsoil and clover to help water retention and drought tolerance, etc.

We're planning on replacing both our vehicles in the year or two before retirement.  We'll probably pay off the remaining mortgage balance at that time(should be <50K).   Mathematically optimal, no, but the idea is to lower the floor on our minimum spend. It will protect a bit from SORR, and generally just add peace of mind knowing our barebones budget will be as low as possible.

bryan995

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #28 on: August 06, 2021, 10:50:29 AM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.  Your blender doesn't peer out of the cabinet to see if you are home during the day and decide to off itself because you are still working and it knows you want to replace it before you retire.  It dies when it dies.  Same with your car and your windows and your carpets, flooring, and furniture.  Why would you replace carpet before you quit, when it could last another couple years?  In the long run, that costs you more because you lost 2 years worth of the initial carpet life.  And if you are replacing it because it truly needs replacing, then you are in no way tinkering with anything in a way to "pay the piper" less money, or even pay him sooner or later than would happen naturally.
 
And yes, at some point you have to pay for these things.  Whether that happens 6 months before you retire or 6 months after is irrelevant, and in fact on a macro level, the latter buys you an extra 12 months of letting that money grow a little bit, so after it is spent, you still have a few dollars extra left behind.

Not sure I buy that…

If you are a true MMM fan, you purchased a 15 year old 1990 Honda Accord the day you started working. 15 years later, that car is now nearing its EOL being 30 years old, just as you are approaching FIRE. Guess what. Time for a new car!

I don’t believe that FIRE is just single day that comes and goes. You can often chose and optimize your exit point. Which I think is what this thread is getting at. Optimizing expenses around a flexible fire date.

The easiest solution to buying down your expenses prior to FIRE may be to just move into a newer home. You could get another 20-30 years before anything BIG is needed.. Any by then, your stash has settled and grown and you’ve survived any initial market corrections and can now support some healthy maintenance related withdrawals.  But I would never dare suggest such a maneuver knowing how folks here would react....! 

Not sure if I want to withdraw 40-60k for a new roof and  HVAC on day 1 of FIRE. If it’s close to coming due I would simply fix now and add a modest delay to FIRE. Or being a few years out, start planning ahead of time and charting my path.
« Last Edit: August 06, 2021, 10:54:35 AM by bryan995 »

GodlessCommie

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #29 on: August 06, 2021, 10:54:10 AM »
This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.

Two examples come to mind:
- HVAC. If you replace it when it fails, it will be likely be peak of summer or peak of winter (for heat pumps), when everybody else replaces them. You have no negotiating power, and weather puts additional pressure on you.
- Water heater (although the cost is rather trivial, especially for electric+DIY). You really don't want to wait until it fails.

But in the grand scheme of things, that's not what makes or break your FIRE plans, and for many, I suspect, not worth the brain cycles.

Morning Glory

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #30 on: August 06, 2021, 11:14:58 AM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.  Your blender doesn't peer out of the cabinet to see if you are home during the day and decide to off itself because you are still working and it knows you want to replace it before you retire.  It dies when it dies.  Same with your car and your windows and your carpets, flooring, and furniture.  Why would you replace carpet before you quit, when it could last another couple years?  In the long run, that costs you more because you lost 2 years worth of the initial carpet life.  And if you are replacing it because it truly needs replacing, then you are in no way tinkering with anything in a way to "pay the piper" less money, or even pay him sooner or later than would happen naturally.
 
And yes, at some point you have to pay for these things.  Whether that happens 6 months before you retire or 6 months after is irrelevant, and in fact on a macro level, the latter buys you an extra 12 months of letting that money grow a little bit, so after it is spent, you still have a few dollars extra left behind.

Not sure I buy that…

If you are a true MMM fan, you purchased a 15 year old 1990 Honda Accord the day you started working. 15 years later, that car is now nearing its EOL being 30 years old, just as you are approaching FIRE. Guess what. Time for a new car!

I don’t believe that FIRE is just single day that comes and goes. You can often chose and optimize your exit point. Which I think is what this thread is getting at. Optimizing expenses around a flexible fire date.

The easiest solution to buying down your expenses prior to FIRE may be to just move into a newer home. You could get another 20-30 years before anything BIG is needed.. Any by then, your stash has settled and grown and you’ve survived any initial market corrections and can now support some healthy maintenance related withdrawals. But I would never dare suggest such a maneuver knowing how folks here would react....! 

Not sure if I want to withdraw 40-60k for a new roof and  HVAC on day 1 of FIRE. If it’s close to coming due I would simply fix now and add a modest delay to FIRE. Or being a few years out, start planning ahead of time and charting my path.

And are you going to just keep buying houses every 20-30 years?  I think that our consumer throwaway culture might have gotten to that point, had it not been for HGTV. Now it's just the cupboards and carpets that are treated as disposable. Also you must have a huge house in an extreme hcol for your roof and hvac to cost that much.

I think what you want out of this thread is an excuse to have some kind of spending rumspringa before you decide whether you really want to ditch your consumer ways for good and retire early. Nobody is stopping you, even if your strategy is suboptimal and makes no sense. At that point it becomes a matter of how much you like your job, similar to fat-fire/bogleheads people.  Just don't go around saying that it will help mitigate sequence risk.

bryan995

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #31 on: August 06, 2021, 11:42:33 AM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.  Your blender doesn't peer out of the cabinet to see if you are home during the day and decide to off itself because you are still working and it knows you want to replace it before you retire.  It dies when it dies.  Same with your car and your windows and your carpets, flooring, and furniture.  Why would you replace carpet before you quit, when it could last another couple years?  In the long run, that costs you more because you lost 2 years worth of the initial carpet life.  And if you are replacing it because it truly needs replacing, then you are in no way tinkering with anything in a way to "pay the piper" less money, or even pay him sooner or later than would happen naturally.
 
And yes, at some point you have to pay for these things.  Whether that happens 6 months before you retire or 6 months after is irrelevant, and in fact on a macro level, the latter buys you an extra 12 months of letting that money grow a little bit, so after it is spent, you still have a few dollars extra left behind.

Not sure I buy that…

If you are a true MMM fan, you purchased a 15 year old 1990 Honda Accord the day you started working. 15 years later, that car is now nearing its EOL being 30 years old, just as you are approaching FIRE. Guess what. Time for a new car!

I don’t believe that FIRE is just single day that comes and goes. You can often chose and optimize your exit point. Which I think is what this thread is getting at. Optimizing expenses around a flexible fire date.

The easiest solution to buying down your expenses prior to FIRE may be to just move into a newer home. You could get another 20-30 years before anything BIG is needed.. Any by then, your stash has settled and grown and you’ve survived any initial market corrections and can now support some healthy maintenance related withdrawals. But I would never dare suggest such a maneuver knowing how folks here would react....! 

Not sure if I want to withdraw 40-60k for a new roof and  HVAC on day 1 of FIRE. If it’s close to coming due I would simply fix now and add a modest delay to FIRE. Or being a few years out, start planning ahead of time and charting my path.

And are you going to just keep buying houses every 20-30 years?  I think that our consumer throwaway culture might have gotten to that point, had it not been for HGTV. Now it's just the cupboards and carpets that are treated as disposable. Also you must have a huge house in an extreme hcol for your roof and hvac to cost that much.

I think what you want out of this thread is an excuse to have some kind of spending rumspringa before you decide whether you really want to ditch your consumer ways for good and retire early. Nobody is stopping you, even if your strategy is suboptimal and makes no sense. At that point it becomes a matter of how much you like your job, similar to fat-fire/bogleheads people.  Just don't go around saying that it will help mitigate sequence risk.

Lots of assumptions here. And no, the strategy would not be to rebuy a house every 20-30 years.  Though even if it that were the plan, what is the downside?  Its not as if the house becomes abandoned and a scourge on the earth. Someone else buys and enjoys it, yes?  Many here plan to downsize or move out of HCOL and stash more capital pre-fire.  You could parlay that move into a home requiring less 'work' all while buying yourself time to mitigate sequence risk and reduce initial expenses.

And you are right, no one is stopping me.  I was simply responding to the OP and others who were hoping to discuss similar strategies.
« Last Edit: August 06, 2021, 12:17:49 PM by bryan995 »

BoonDogle

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #32 on: August 06, 2021, 12:07:05 PM »
Nothing that has not already been said, but the things that will really make a difference are things that you can consider anytime, not just right before RE.  Move closer to where you plan to commute to reduce mileage and maybe even reduce your number of vehicles that you own (if you plan on staying in the same general area after you retire).  Downsize your home.  Other things that have value are things that have a return on your investment like better home insulation, possible window replacement/repair, attic fan, etc.  Start doing your own vehicle maintenance and home projects (though you can always learn those skills after you retire and have more time).  On reducing taxable income, now is the time to come up with a plan to minimize the amount of income subject to tax after you retire (Roth conversions, ACA limits, etc).

TreeLeaf

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #33 on: August 06, 2021, 02:00:48 PM »
If the concern is really SORR, why can't one simply buy a bunch of IBonds and TIPS before retirement and then replace things as needed by cashing in said IBonds and TIPS when replacement of said items is needed after retirement?

Cranky

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #34 on: August 06, 2021, 02:06:41 PM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

I’m always confused by people who stock up on stuff because they might lose their job. You know what I’d stock up on? Money. It’s easy to store.

I think the things that you can do to prepare for retirement are basically “build community”. Know what resources are available to you.

It doesn't matter if you pay for things while you still have an income though, it shouldn't make a lick of difference.

Villanelle

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #35 on: August 06, 2021, 02:21:49 PM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.  Your blender doesn't peer out of the cabinet to see if you are home during the day and decide to off itself because you are still working and it knows you want to replace it before you retire.  It dies when it dies.  Same with your car and your windows and your carpets, flooring, and furniture.  Why would you replace carpet before you quit, when it could last another couple years?  In the long run, that costs you more because you lost 2 years worth of the initial carpet life.  And if you are replacing it because it truly needs replacing, then you are in no way tinkering with anything in a way to "pay the piper" less money, or even pay him sooner or later than would happen naturally.
 
And yes, at some point you have to pay for these things.  Whether that happens 6 months before you retire or 6 months after is irrelevant, and in fact on a macro level, the latter buys you an extra 12 months of letting that money grow a little bit, so after it is spent, you still have a few dollars extra left behind.

Not sure I buy that…

If you are a true MMM fan, you purchased a 15 year old 1990 Honda Accord the day you started working. 15 years later, that car is now nearing its EOL being 30 years old, just as you are approaching FIRE. Guess what. Time for a new car!

I don’t believe that FIRE is just single day that comes and goes. You can often chose and optimize your exit point. Which I think is what this thread is getting at. Optimizing expenses around a flexible fire date.

The easiest solution to buying down your expenses prior to FIRE may be to just move into a newer home. You could get another 20-30 years before anything BIG is needed.. Any by then, your stash has settled and grown and you’ve survived any initial market corrections and can now support some healthy maintenance related withdrawals.  But I would never dare suggest such a maneuver knowing how folks here would react....! 

Not sure if I want to withdraw 40-60k for a new roof and  HVAC on day 1 of FIRE. If it’s close to coming due I would simply fix now and add a modest delay to FIRE. Or being a few years out, start planning ahead of time and charting my path.

I wouldn't love that, either.  But how is it better to withdraw it 6 months before FIRE?  And increase the chances that you will need to buy an additional roof in your lifetime (though admittedly not by much)? 

As for your car example, if you intend to replace the car at 15 years, then that's a specific time, and has nothing to do with whether you FIRE at the 16 year mark (so new-to-you car one year before retirement) or at the 14 year mark (new car one year after retirement).  And that's the point.  Things wear out when they wear out.  If you buy a new car at 14 years instead of 15 so that you have that expense before retirement instead of after, you are more likely to need one extra car purchase in your life because you threw away one viable car-year.  And you didn't save any money buying early (unless your employer offers some sort of car discount), and you took money out of the market 12 months sooner. 

The math is pretty simple and clear.  Buying stuff sooner because it feels better to buy it while you have  paycheck doesn't make sense.  Unless, I suppose,  you keep the FIRE number the same, so you retire with $700,000 and a new a/c vs. $700,000 and a 30 year old a/c, and you don't account for that in your overall budget (which would be short-sighted).  But of course in that case, you will just work longer, so it's apples to oranges because with the same retirement date, writing that a/c check the day before or the day after, or the 6 months before or after, makes no difference. 

And maybe that can help you see the math more clearly.  If you decide your last day of work will be June 30, does it matter if you buy a replacement car June 29 or July 1?  Surely you don't think it makes any difference.  So why would June 1/July 30 make a difference?  Or Jan 1 and Dec 31?  It's all the same.  Except that in the latter grouping, your money actually has more time to sit and grow, so you come out slightly ahead, on average. 

Villanelle

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #36 on: August 06, 2021, 02:28:45 PM »
Who said anything about replacing something that does not need replacing?  Things age yes? Some things need to be replaced every so often (car, appliance, windows).

It does not make sense to wait for it outright die to then extract maximal value. Capitalize on a sale, or a quiet time in the year relative to the service needed. If you’ve been putting off repairs and maintenance to “spend less” well at some point you are going to have to pay the piper. The idea is to pay the piper while you still have a steady income, no?

This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.  Your blender doesn't peer out of the cabinet to see if you are home during the day and decide to off itself because you are still working and it knows you want to replace it before you retire.  It dies when it dies.  Same with your car and your windows and your carpets, flooring, and furniture.  Why would you replace carpet before you quit, when it could last another couple years?  In the long run, that costs you more because you lost 2 years worth of the initial carpet life.  And if you are replacing it because it truly needs replacing, then you are in no way tinkering with anything in a way to "pay the piper" less money, or even pay him sooner or later than would happen naturally.
 
And yes, at some point you have to pay for these things.  Whether that happens 6 months before you retire or 6 months after is irrelevant, and in fact on a macro level, the latter buys you an extra 12 months of letting that money grow a little bit, so after it is spent, you still have a few dollars extra left behind.

Not sure I buy that…

If you are a true MMM fan, you purchased a 15 year old 1990 Honda Accord the day you started working. 15 years later, that car is now nearing its EOL being 30 years old, just as you are approaching FIRE. Guess what. Time for a new car!

I don’t believe that FIRE is just single day that comes and goes. You can often chose and optimize your exit point. Which I think is what this thread is getting at. Optimizing expenses around a flexible fire date.

The easiest solution to buying down your expenses prior to FIRE may be to just move into a newer home. You could get another 20-30 years before anything BIG is needed.. Any by then, your stash has settled and grown and you’ve survived any initial market corrections and can now support some healthy maintenance related withdrawals.  But I would never dare suggest such a maneuver knowing how folks here would react....! 

Not sure if I want to withdraw 40-60k for a new roof and  HVAC on day 1 of FIRE. If it’s close to coming due I would simply fix now and add a modest delay to FIRE. Or being a few years out, start planning ahead of time and charting my path.

I wouldn't love that, either.  But how is it better to withdraw it 6 months before FIRE?  And increase the chances that you will need to buy an additional roof in your lifetime (though admittedly not by much)? 

As for your car example, if you intend to replace the car at 15 years, then that's a specific time, and has nothing to do with whether you FIRE at the 16 year mark (so new-to-you car one year before retirement) or at the 14 year mark (new car one year after retirement).  And that's the point.  Things wear out when they wear out.  If you buy a new car at 14 years instead of 15 so that you have that expense before retirement instead of after, you are more likely to need one extra car purchase in your life because you threw away one viable car-year.  And you didn't save any money buying early (unless your employer offers some sort of car discount), and you took money out of the market 12 months sooner. 

The math is pretty simple and clear.  Buying stuff sooner because it feels better to buy it while you have  paycheck doesn't make sense.  Unless, I suppose,  you keep the FIRE number the same, so you retire with $700,000 and a new a/c vs. $700,000 and a 30 year old a/c, and you don't account for that in your overall budget (which would be short-sighted).  But of course in that case, you will just work longer, so it's apples to oranges because with the same retirement date, writing that a/c check the day before or the day after, or the 6 months before or after, makes no difference. 

And maybe that can help you see the math more clearly.  If you decide your last day of work will be June 30, does it matter if you buy a replacement car June 29 or July 1?  Surely you don't think it makes any difference.  So why would June 1/July 30 make a difference?  Or Jan 1 and Dec 31?  It's all the same.  Except that in the latter grouping, your money actually has more time to sit and grow, so you come out slightly ahead, on average. 
This makes no sense.  If you are replacing them only when they need replacing, then there is no way to direct that timing into right before you retire.  So either you wait until they truly need replacing, or you replace them right before FIRE.  I don't see how it can be both. When it needs replacing is when it needs replacing.

Two examples come to mind:
- HVAC. If you replace it when it fails, it will be likely be peak of summer or peak of winter (for heat pumps), when everybody else replaces them. You have no negotiating power, and weather puts additional pressure on you.
- Water heater (although the cost is rather trivial, especially for electric+DIY). You really don't want to wait until it fails.

But in the grand scheme of things, that's not what makes or break your FIRE plans, and for many, I suspect, not worth the brain cycles.

Would you make the choice to replace the a/c or the water heater preemptively if you weren't close to FIRE?  If so, then the decision has nothing to do with FIRE so it's not an example of making post-retirement life cheaper, or a decision where the timing is based on a retirement date.  Or an example of how doing something before you quit is cheaper than doing it after you quit.

And if you wouldn't make that decision if you weren't retiring, then the logic  is deeply flawed.  Either you replace that 25 year old water heater now because you believe it needs replacing before it goes and you feel that's the best approach.  Or you don't do it now because you don't feel it is needed.  And that answer should be the same whether you retire in 6 months, 6 years, or did it a year ago. 

You can't conflate preventative maintenance and updates with maintenance and updates done based on the fact someone is retiring soon-ish when they otherwise would have waited.  Totally different questions.  Totally different logic. 

Alpinweiss

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #37 on: August 06, 2021, 03:00:04 PM »
I think there's a subtle difference between:
  • Avoiding a future expense by buying something "now" or while still employed
  • Doing/buying something to make your life cheaper in the future

I agree there's some value in #1 but it's probably more peace of mind and may be better covered by a bond tent or cash buffer... the time shifting only really helps by allowing the flexibility to stay working for longer to cover the expense if needed.

But for #2 this is where the real gems might be. And of course the best thing is to jump off the consumption bandwagon...

Another thought that I had: by paying off the mortgage one could avoid having to pay for homeowners insurance and self-insure (which of course has real risks) but at least in my case that would save me ~1500 a year probably still doesn't quite make the math work but it's interesting.

I still like the solar option (despite being in Montana) and I think the ROI is pretty good if you do a self-install. Need to do more homework there... might be my next thread.

Anyway some good ideas here. Keep them coming :)

Blissful Biker

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #38 on: August 06, 2021, 03:05:45 PM »
Basically divert money into 100% spending for a few months after you hit The Number.

This is my plan too, primarily focused on updating our outdoor gear to support really enjoying our sporty retirement. 

I have a hard time spending money, socking each available dollar into the stash so our gear continues to get older and rattier.  Replacing it once we've hit The Number provides me almost as much joyful anticipation as RE.  I will happily work a few more months to get a sweet new mountain bike, skate skis, telly skis, etc. 

Once I FIRE I know I will struggle to spend the money.  The short window between FI and RE will probably be the only time in my life where I allow myself to splurge.  It's going to be fun!  And set us up for the retirement of our dreams.

YK-Phil

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #39 on: August 06, 2021, 03:07:41 PM »
For me, the key to a good post-fire life was to eliminate all stressors and start simplifying everything in my life before pulling the plug and keep simplifying until I am left with very little to worry or stress about by the time I am eligible to old-age-security at 65: rent our properties then sell one or both once we have a better idea of where we want to be (in progress: daughter moved into our Calgary condo after we moved to Mexico when I retired last fall, she pays just enough to cover our cost; and our BC acreage is rented for cheap to someone doing permaculture, also just enough to cover taxes and whatnot), no vehicle and associated costs (in progress: my van and motorcycle are stored in a garage and I have no plan to use them in the near future, so will sell whenever we get back), consolidate all my bank accounts into one to get my pension, eventual government benefits, and my annual withdrawal from my investment accounts deposited. We moved to Mexico right after retiring and we've been house-sitting full-time all summer and will do that until November: no rent, no internet bill, no phone bill, no utilities, no insurance. Easy peasy. Then we will be renting a little all-inclusive studio apartment for a few hundred dollars a month. We already saw a few nice ones in that price range and will be checking another tomorrow. After almost a year into retirement, I am now totally stress-free and fully ready to start YOLOing.

BDWW

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #40 on: August 06, 2021, 03:11:23 PM »
I still like the solar option (despite being in Montana) and I think the ROI is pretty good if you do a self-install. Need to do more homework there... might be my next thread.

Good luck, I'll be interested in what you come up with. Northwestern energy and MT in general are fairly hostile to solar.  I've looked into it in the past, but my property isn't set up very well for it.  I have a shop running east-west that would be ideal for panels, but it's on a separate meter to the house (which consumes most of the power).  Montana doesn't allow (last I checked) you to combine meters. So I would likely have to route the solar from the shop to the house meter, or route power from the house to the shop and get rid of the second meter.

use2betrix

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #41 on: August 06, 2021, 03:49:40 PM »
I have a lot of “buy for life” items I am purchasing while my income is still significantly higher. They are things I know I will want in FIRE, but may have a much harder time justifying purchasing. These include things like: Home Gym, Tools/Welding Equipment, Guitar(s), etc.

Much easier to buy a $2000 guitar when it justifies less than 10% of my take home monthly income, vs when I’m FIRE’d and it’s 30-50% of my targeted monthly spending (with no income).

Many things I buy now (even clothes) I intend for it to last deep into FIRE.

chasingthegoodlife

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #42 on: August 06, 2021, 03:49:53 PM »

Two examples come to mind:
- HVAC. If you replace it when it fails, it will be likely be peak of summer or peak of winter (for heat pumps), when everybody else replaces them. You have no negotiating power, and weather puts additional pressure on you.
- Water heater (although the cost is rather trivial, especially for electric+DIY). You really don't want to wait until it fails.


I hear you, but I think this is what [mention]Zikoris [/mention] means about the value of Stoicism.

I’ve dealt with a broken water heater. It only took a few days to sort out.

Ideal? No. But you make do. You shower at the gym or someone else’s house and boil water on the stove.

Should we spend money on something that may not need fixing, in the hope of avoiding temporary discomfort that may never come? Discomfort that is not that different from what we willingly choose when we eg go camping?

Where I live I suspect we spend more time without heating and cooling because of blackouts than I ever will due to equipment failure.

And trust me, I am someone who enjoys my home comforts

GodlessCommie

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #43 on: August 06, 2021, 03:58:26 PM »
I hear you, but I think this is what [mention]Zikoris [/mention] means about the value of Stoicism.

No disagreement here! Although, the main problem with water heater failure isn't that it stops heating water. Granted, not every failure leads to a flood, but those that do... I don't want to put my stoicism under that test.

Metalcat

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #44 on: August 06, 2021, 04:11:08 PM »
I have a lot of “buy for life” items I am purchasing while my income is still significantly higher. They are things I know I will want in FIRE, but may have a much harder time justifying purchasing. These include things like: Home Gym, Tools/Welding Equipment, Guitar(s), etc.

Much easier to buy a $2000 guitar when it justifies less than 10% of my take home monthly income, vs when I’m FIRE’d and it’s 30-50% of my targeted monthly spending (with no income).

Many things I buy now (even clothes) I intend for it to last deep into FIRE.

But this really is mental gymnastics.

Whether the guitar is 10% or 80% of any given year's annual spend makes no difference overall except in your perception of it.

So what you're really saying is that you are taking advantage of a mental trick that allows you to *feel* more comfortable spending more, even though spending it later would actually cost you less because of opportunity costs.

That's fine, spend whatever you want to be happy, but let's acknowledge mental gymnastics.

Villanelle

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #45 on: August 06, 2021, 04:52:22 PM »
I have a lot of “buy for life” items I am purchasing while my income is still significantly higher. They are things I know I will want in FIRE, but may have a much harder time justifying purchasing. These include things like: Home Gym, Tools/Welding Equipment, Guitar(s), etc.

Much easier to buy a $2000 guitar when it justifies less than 10% of my take home monthly income, vs when I’m FIRE’d and it’s 30-50% of my targeted monthly spending (with no income).

Many things I buy now (even clothes) I intend for it to last deep into FIRE.

But this really is mental gymnastics.

Whether the guitar is 10% or 80% of any given year's annual spend makes no difference overall except in your perception of it.

So what you're really saying is that you are taking advantage of a mental trick that allows you to *feel* more comfortable spending more, even though spending it later would actually cost you less because of opportunity costs.

That's fine, spend whatever you want to be happy, but let's acknowledge mental gymnastics.

Yes.  People do things all the time (literally multiple times a day, for nearly everyone) that are based on things other than optimizing the finances.  There's nothing wrong with that.  But there is something wrong with pretending it is a financially beneficial decision, when in fact it is actually a more expensive choice. 

I just bought an immersion blender.  I own a regular blender, but I hate cleaning it.  I'm trying to some more healthy eating habits going, and a morning shake seemed like a great fit.  But I knew I wouldn't do it because I'm too lazy to deal with my blender.  For >$30, I have am immersion blender and have used it every morning since I got it, and it's really helping me be healthier and lose weight.  This decision was absolutely caving to my laziness (dealing with and cleaning the old blender).  It was $2X that I didn't need to spend.  It was in no way financially (or environmentally, for that matter) optimal.  And I'm still thrilled with and I would do it again.  But I don't try to trick myself into thinking that somehow I saved money with this decision.  I just own that I spent some optional money because some other factor was more important.

Not all decisions are about spending less.  But we need to at least be honest with ourselves.  Buying new windows now instead of 2 -3 years from now, because you have a psychological hang up that makes it easier to spend money when you have a paycheck, even if that costs you more money in the long run, is fine.  But own that you are indulging in some mental gymnastics; don't lie to yourself that it is saving money.
« Last Edit: August 07, 2021, 09:59:34 AM by Villanelle »

Metalcat

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #46 on: August 06, 2021, 05:00:30 PM »
I have a lot of “buy for life” items I am purchasing while my income is still significantly higher. They are things I know I will want in FIRE, but may have a much harder time justifying purchasing. These include things like: Home Gym, Tools/Welding Equipment, Guitar(s), etc.

Much easier to buy a $2000 guitar when it justifies less than 10% of my take home monthly income, vs when I’m FIRE’d and it’s 30-50% of my targeted monthly spending (with no income).

Many things I buy now (even clothes) I intend for it to last deep into FIRE.

But this really is mental gymnastics.

Whether the guitar is 10% or 80% of any given year's annual spend makes no difference overall except in your perception of it.

So what you're really saying is that you are taking advantage of a mental trick that allows you to *feel* more comfortable spending more, even though spending it later would actually cost you less because of opportunity costs.

That's fine, spend whatever you want to be happy, but let's acknowledge mental gymnastics.

Yes.  People do things all the time (literally multiple times a day, for nearly everyone) that are based on things other than optimizing the finances.  There's nothing wrong with that.  But there is something wrong with pretending it is a financially beneficial decision, when in fact it is actually a more expensive choice. 

I just bought an immersion blender.  I own a regular blender, but I hate cleaning it.  I'm trying to some more healthy eating habits going, and a morning shake seemed like a great fit.  But I knew I wouldn't do it because I'm too lazy to deal with my blender.  For >$30, I have am immersion blender and have used it every morning since I got it, and it's really helping me be healthier and lose weight.  This decision was absolutely caving to my laziness (dealing with and cleaning the old blender).  It was $2X that I didn't need to spend.  It was in no way financially (or environmentally, for that matter) optimal.  And I'm still thrilled with and I would do it again.  But I don't try to trick myself into thinking that somehow I saved money with this decision.  I just own that I spent some optional money because some other factor was more important.

Not all decisions are about spending less.  But we need to at lease be honest with ourselves.  Buying new windows now instead of 2 -3 years from now, because you have a psychological hang up that makes it easier to spend money when you have a paycheck, even if that costs you more money in the long run, is fun.  But own that you are indulging in some mental gymnastics; don't lie to yourself that it is saving money.

Fuck yeah!

I spend all sorts of money on shit that I really don't need to just so that my day to day life will be optimized. I have multiples of some expensive things in my house just so that my daily workflow is more comfortable.

Money is an amazing tool for improving quality of life, both in saving it and spending it, and being *honest* about that is critical to getting the maximum value out if it.

Weisass

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #47 on: August 06, 2021, 05:18:12 PM »
I've been lurking and listening. I can't help but think: Shouldn't you be planning for basic repairs and known maintenance in your retirement anyways? If you have a 10 year old roof when you retire at 35, you better have planned for the eventuality that the roof will need repairs!

use2betrix

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #48 on: August 06, 2021, 05:46:25 PM »
I have a lot of “buy for life” items I am purchasing while my income is still significantly higher. They are things I know I will want in FIRE, but may have a much harder time justifying purchasing. These include things like: Home Gym, Tools/Welding Equipment, Guitar(s), etc.

Much easier to buy a $2000 guitar when it justifies less than 10% of my take home monthly income, vs when I’m FIRE’d and it’s 30-50% of my targeted monthly spending (with no income).

Many things I buy now (even clothes) I intend for it to last deep into FIRE.

But this really is mental gymnastics.

Whether the guitar is 10% or 80% of any given year's annual spend makes no difference overall except in your perception of it.

So what you're really saying is that you are taking advantage of a mental trick that allows you to *feel* more comfortable spending more, even though spending it later would actually cost you less because of opportunity costs.

That's fine, spend whatever you want to be happy, but let's acknowledge mental gymnastics.

With the caliber of folks on this site, I didn’t feel like I needed to dumb it down. Thanks for pointing that out in the event anyone couldn’t connect those dots.

Paper Chaser

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Re: What can you do now to make your post-FIRE life cheaper?
« Reply #49 on: August 06, 2021, 07:02:17 PM »
I hear you, but I think this is what [mention]Zikoris [/mention] means about the value of Stoicism.

No disagreement here! Although, the main problem with water heater failure isn't that it stops heating water. Granted, not every failure leads to a flood, but those that do... I don't want to put my stoicism under that test.

The house next door was recently flipped. It was built in the mid 1960s, and still had the original water heater in working condition. They replaced it just to say that it was brand new to appeal to new buyers. Think of the money saved during those decades by not premptively replacing the water heater every few years. And think of the resources that weren't needed to manufacture and transport and install 5 or 6 unnecessary water heaters over the decades.
I'm not saying that's a normal lifespan for a water heater, but you might as well use things until they are obviously on their last legs or actually need replacement. Something like a flood is obviously not ideal, but that's what insurance is for. Spending money now to hopefully avoid expense in the future is really just increasing your insurance spend more than necessary. Why pay for insurance if you're going to pay additional money to reduce the chances of needing the insurance?
« Last Edit: August 06, 2021, 07:04:11 PM by Paper Chaser »