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Tuesday, March 28, 2017

What to “Sacrifice”?

Posted by Dave on November 11, 2014

The basic premise of any retirement plan, whether it’s at 70 years or 35 years is to abstain from spending today, so there is money left at some future date. The difference between early and a more “advanced” retirement is the level of savings over the accumulation stage of life. My wife and I have chosen 45 as our goal, as our savings rate when we started this plan seemed to allow this to work out.

As people who have read this blog know, I have a few non-frugal hobbies that I enjoy, and my wife loves to travel, also not a really cheap thing to do. These are things that we want to do, knowing that they would be a significant hindrance to our early retirement plans. In order to balance off these relatively expensive activities, we have to give up other “grown up” things.

One of the major things we’ve given up is a “nice” house. We have lived in our house for almost 6 years now and have really done nothing to it. There’s a pretty long laundry list of things we’d like to do to our house that would update our current living situation from “student chic” (builder grade everything from the late 90’s) to something much nicer.

We like the small changes we have made – some new flooring to go over the plywood that was here when we moved in, and some paint that we applied shortly after that. Our next “major” purchase (which should be exciting) will be some matching blinds that will allow us the option of privacy in the kitchen in the evenings (the old blinds fell off and we never replaced them). We would like to take out a load-bearing wall to open up our closed-off first floor, but that would mean giving up a year’s vacation, and right now, that doesn’t seem worth it, for now – especially with winter coming.

When I write posts like this, I realize that these are particularly first-world problems – what “cool” stuff are we trading off in order to not have to minimize the number of years I have to work? These are really small issues to have, but still is a topic of conversation in our house. We are fortunate to have good paying jobs that even afford us the option of weighing these kind of choices.

Realistically, if we cut out doing everything that cost us any money, we could retire in a very small number of years, especially if our retirement plans continued with a really frugal way of life. Our issue, and the reason why our retirement plan is taking us 15 years instead of 5 is that we like the “extra” stuff.

What have you given up to achieve early retirement? How did you decide what expenses to keep?

Comments

4 Responses to “What to “Sacrifice”?”
  1. Jacq says:

    “If I had known I would live this long, I would have taken better care of myself.” ~ Mickey Mantle

    “If I had known I would have wanted to work this long and end up making this much this consistently, I would have lightened up.” ~ Me

    It seems like there are few people who ER’d before say 50 y.o. that didn’t do something to earn some money at some point after that stage. If you worked towards it for years (not relying on a pension – that’s probably a different mentality I don’t understand), generally you have some strong level of internal drive and ambition and that often manifests itself in doing something for cash.

    What that would mean for any specific plan? – Could mean you call it a day from your day job when you’re a bit short of your ultimate goal if there’s something else you really want to do that could pay something. Could mean you get to your bare bones survival number and do some type of activity for pay that you really want to do (maybe something a bit riskier) to lifestyle inflate to the lifestyle you wish to have after that (that includes all the things you gave up – that really did matter to you -to get there). Could mean you get to continue hoarding money because you just love DIY-ing / only camping / have some kind of mental resistance against spending more than $25k/year.

    I didn’t donate as much as I could / should have.
    Didn’t travel enough the way I like to to the places I really want to go.
    Didn’t spend enough on making the house the way I would really like to have it.
    Didn’t spend enough time / money with friends in the way they (and I) like to socialize (eating out, grabbing a coffee, dinner theater, movies with the kids, ski trips to places where I didn’t already have a pass – even golf would be ok…)
    Buying clothes I really love vs. what was a good deal.
    Worst offense was not spending on things that would have made life exponentially easier during times I was working 60+ hours a week (dog daycare, house cleaners, yard care…). I think I thought I was showing weakness if I needed help and couldn’t do it all myself.

    That’s about it. The books (in moderation), the RV, the large periods of time off never got cut.

  2. deegee says:

    I can’t say I gave up anything in order to retire at 45 six years ago. I have never lived extravagantly. My big ticket expenses, mainly cars, I buy rarely. I have bought cars, owning one at a time, in 1986, 1992, and 2007. I moved to my current residence in 1989, 25 years ago. My expenses (excluding taxes) have been remarkably stable over these 25 years. Only health insurance, something which was cheaper and mostly/partly subsidized by my employer prior to my retiring, has risen a lot in cost.

    One condition to my ERing was that my day-to-day lifestly would not change. For example, if I want to go out to eat with my ladyfriend or with my dad and pay for the whole meal, I can do it without worrying about its effect on my budget. The main way I accomplish this is to build into my budget a surplus I can tap into to cover any small expenses such as that. This means the size of the surplus is either big or not as big, neither of which affects my spending.

  3. Jacq says:

    Significantly more important than expense sacrifices was giving up the belief that I had to become a workaholic (or even work more at all) to make considerably more money (I know it sounds weird, but I had a huge mental block against earning more). Also gave up the idea that paid work is inherently bad or that suffering or deprivation along a journey is necessary and even virtuous. I just don’t have the inner strength or stubbornness to stick to a job I hated for years without trying to find something I was better suited to – and would probably do better at, therefore ultimately making more money.
    Also gave up the whole idea of “I will be happy when…” (insert magical ER date). Cripes, I wasted a lot of mental bandwidth in that mindset.

  4. jon_snow says:

    My wife and I feel like we have sacrificed nothing to achieve FI in our early 40’s. The life we love to live has just organically evolved into an inexpensive one. Some big choices during the course of our marriage have helped make it possible.

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