How do you not spend money?

Then there's this.....

"I decided that retiring a little poorer was the better way to go. Enjoy life while you can with a nod toward tomorrow. Buy the expensive meals, take the trips, and play with the toys. Tomorrow you may not be able to."

My strategy is to have a wildly expensive but not year round hobby. 6-8 months out of the year basically all of my money goes to that, so I'm encouraged to not spend wastefully (on other things). Then the rest of the year isn't enough time to unlearn those good spending habits but is enough time to catch up and make sure I have some savings.

It comes down to "Needs" vs "Wants" really, and understanding and accepting which is which.

"Wants" may bring you some happiness, but happiness can literally be like a drug. You get a temporary dopamine hit, and then when it's gone there's not much left. So you're left chasing all of these external drivers and always looking for the next fix.

"Needs" may not bring as much happiness, but they do bring acceptance and contentment. Contentment is the only emotion that comes from within. I consider it to be a very helpful baseline in life that helps to avoid the lows that might come in between happiness spikes. And when the lows aren't as low, the highs of temporary happiness have less of a draw.

So, I always address "Needs" first. For me, that begins with food/shelter/clothing and healthcare for myself and my kid. After that, I put my money to work for me by maxing out tax advantaged accounts for our future. Anything that's left over can be used for "Wants", but honestly once the "Needs" are met there's not a ton that I want badly enough to spend the money on. I'll occasionally splurge on a random item or experience and because the important stuff is already taken care of, I can do that without much guilt. And when the dopamine hit wears off, I've still got the baseline of contentment to tide me over.

In reply to Javelin :

I have 4 kids too....why I had to wait so long for my first build....worth the wait because family comes first!

Lots of good advice here that I won't repeat, but I don't think I've seen this, which has always worked for me:  think about future you. 

Think about you as a youngish retiree with plenty of money and plenty of time, and contrast that with you at the same age and still having to toil for the man, not sure if you will ever be able to finally stop.

Think about you as an old man who can't work any more. Take care of that guy. Make sure he has great health care that he can afford, a clean and safe place to live, maintained by others, good food and plenty of it, and competent, trustworthy advisors.

In reply to Uncle David (Forum Supporter) :

Even knowing that advice... and I endorse it fully! ..., when young enough to think that far ahead, it was much better odds, considering my lifestyle, that I would not live to an old enough age for it to matter. By 40, I was a bit behind, but doing ok. Till my health care went up over 900%.  8 years ago, 42% of my gross income (not net) went to health care insurance and out of pocket. Since me income is little better, it looks like I can retire 2.5 years after I die. 
So don't be like me, is my only advise!!!!

Uncle David (Forum Supporter) said:

Lots of good advice here that I won't repeat, but I don't think I've seen this, which has always worked for me:  think about future you. 

Think about you as a youngish retiree with plenty of money and plenty of time, and contrast that with you at the same age and still having to toil for the man, not sure if you will ever be able to finally stop.

Think about you as an old man who can't work any more. Take care of that guy. Make sure he has great health care that he can afford, a clean and safe place to live, maintained by others, good food and plenty of it, and competent, trustworthy advisors.

Came here to say this.

Any advice I might have is said already, but *in order to achieve the motivation required in order to execute on delayed gratification* may I suggest that you take a look at your finances and see how early you could retire in comfort if you lived like a pauper now? And then -- with that ideal age in mind -- turn back the dial enough to where you're comfortable now as well, but not retiring too much older than you want to.

I'd always figured 65/67 is a set age, but someone put a bug in my ear one time that it doesn't have to be that age and it's up to you to decide when it will be. 

I’m by all accounts,  a miser. I spend money on very few things that are not needs. My home is paid off and have never had any other significant debt. 

I intend to not have to work full time in five years. I’ll be around forty. 

My concerns are more about missing experiences, waiting too long to see and do things that I won’t be able to enjoy before I’m too old. 

From the opposite end of the spectrum, party on!

Congratulations on the new $$$.  Most importantly, it is great you ask the question before you blow it all!

Now you need a spending plan!  Don't call it a budget, but that is what it is!

Lots of good advice has been shared.  Get some where it earns and you cannot get to it easily.  Oh, and an emergency fund.  Build that first!

Congrats on the new job, you're asking the right questions. 

I was part of the FIRE community for years while we were in our accumulation phase. Back then it was mostly blogs (Mr. Money Mustache was the big one, also 1500 days and Early Retirement Extreme) and a few meetups a year. It was a lot of fun and we met some great people that we still call friends. 

If you want to become wealthy, start hanging out with people that have the same goal, or who are already there. Same things goes for getting fit, or building cars, etc. Who you hang out with really matters.

Honest answer when I was younger somebody sat me down are really explained compound interest. After that I made a decision. Every raise I got I would take 50% of it and invest it and have fun with the other 50%. I was already mostly happy so why upset that. If you are starting later and you were happy and safe before then I would do the same thing with the new raise. 

Tax deferred first, the real estate then index funds and once you get into the mid 7 figures net worth USD you can start to play with individual stocks and more none traditional investment strategy.  

Now I make more then I could spend, especially when you factor in investment and it just kind of piles up but I keep the same rules in place. In a normal year counting my wife/mine salary + investments and the side business we likely invest -55% of our total take before taxes. After living expenses, taxes and travel I have fun with the rest and if there is any leftover I fund my bonds, buy down our mortgage or more likely buy cars. When I sell the cars I tend to plow that money back into a bond fund or keep it in cash. I like having 1-2 years of expenses in savings at any time just in case things go completely crazy. This is not efficient at all.  

I live in a monstrously high cost of living area so when I move for retirement in 8 years my bills will be almost non esistant so even more cash can go to travel/projects. 

759NRNG said:

Then there's this.....

"I decided that retiring a little poorer was the better way to go. Enjoy life while you can with a nod toward tomorrow. Buy the expensive meals, take the trips, and play with the toys. Tomorrow you may not be able to."

That is great advice unless you outlive your money and you can't work and then you are living off your kids or eating cat food when you are 75. I've seen that. It isn't pretty. 

NY Nick said:

759NRNG said:

Then there's this.....

"I decided that retiring a little poorer was the better way to go. Enjoy life while you can with a nod toward tomorrow. Buy the expensive meals, take the trips, and play with the toys. Tomorrow you may not be able to."

That is great advice unless you outlive your money and you can't work and then you are living off your kids or eating cat food when you are 75. I've seen that. It isn't pretty. 

Yep!

Our plan is to continue living comfortably - but not extravagantly.  We'd like to travel more, but we're not looking at a second home or big RV purchase.  At this point we can live like we are now until 90 and have as much or more money than we do today.

It's not that we have all that much money.  It's that we do our best not to burn through it.

Both of our kids have said they don't expect to inherit anything, but as parents we absolutely intend to leave them as much as we reasonably can.

Duke said:

NY Nick said:

759NRNG said:

Then there's this.....

"I decided that retiring a little poorer was the better way to go. Enjoy life while you can with a nod toward tomorrow. Buy the expensive meals, take the trips, and play with the toys. Tomorrow you may not be able to."

That is great advice unless you outlive your money and you can't work and then you are living off your kids or eating cat food when you are 75. I've seen that. It isn't pretty. 

Yep!

Our plan is to continue living comfortably - but not extravagantly.  We'd like to travel more, but we're not looking at a second home or big RV purchase.  At this point we can live like we are now until 90 and have as much or more money than we do today.

It's not that we have all that much money.  It's that we do our best not to burn through it.

Both of our kids have said they don't expect to inherit anything, but as parents we absolutely intend to leave them as much as we reasonably can.

 

I don't think the difference between $1.5m and $2m is going to put me in cat food territory.

In reply to Toyman! :

Fair enough. But I also don't want a couple of nice vacations now to mean I can't get my bad knees fixed later.

In reply to Toyman! :

Sorry. I didn't read backwards. I just took the quote I quoted as the statement. I agree there is a limit to what you need but I'm telling people that are reading this. Saying berkeley it I'll probably die by the time I'm xx years old doesn't work for E36 M3 if you live to be xx +10. And when that happens your kids are left in an incredibly E36 M3ty place having to choose to support you or let you live in poverty. Or you aren't lucky enough to screw someone else with that scenario and you live in poverty. 

I don't think the difference there is 1.5 to 2 M. Not trying to offend. You seem to have made good financial choices.