41–50 of 316 posts
Earlier quoted context omitted.
The benefit of leaving my heirs a legacy far outweighs any 'benefit' I'd get from spending money needlessly...
Presume you don't have any heirs, either. (Which is likely: when people are intent on "living frugally", having kids is usually seen as an expense they can't afford.)
When done properly, it can be fairly tax efficient.
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Optionality has value but it decays over time. If you forgo consumption in favor of savings up until the very end then you haven't been better off, you've been worse off. The dead can't benefit from spending money.
The benefit of leaving my heirs a legacy far outweighs any 'benefit' I'd get from spending money needlessly...
Fuck. I'm 30, and I just went through this. I quit a bad job to try to do my own thing; after a few months without a paycheck - despite having plenty of saving six ways from Sunday - I clammed up almost completely, not wanting to spend a dime. I was miserable. It's the same feeling as item hoarding in CRPGs. Seems like I either need to never retire, or set up a trust for myself so I have a guaranteed allowance. (Or d…
Assuming you're a US citizen? If so vote for politicians who support better welfare systems and free healthcare (if you don't already), it would help take the edge of this stress.
Unfortunately voting in America doesn't really do squat. We're first past the post and the corruption runs so deep no politician can stand against the health care industry. Elections here are a joke.
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I'd be comfortable 'spending my money' in a future retirement if the retirement could generate decent passive income. As it stands, though, it's looking like many folks like me will have to work until we die and/or save enough to burn with just living and healthcare costs.
Do you foresee medicare failing? Also, what's stopping you from setting up your retirement such that you do have passive income?
> "As a result, millions of Americans are living too frugally" WTF, really? Reminds me of Edward Bernays [1], the "father of public relations", who set out to help Americans become materialistic (and succeeded!). If someone is enjoying their life without blowing all their money, that person is BETTER off. It's just corporations that want to suck the money away from them that need to "train them to spend." [1] https:/…
Just another way in which "the world is becoming more like Japan" (wrt to its demographic and economic woes). (The generaltional wealth gap is such that corporations have been shifting product strategy away from the youth and towards the elderly)
Fear? Seems more that there are simply no safe investments with decent returns, interest rates are abysmal. I think folks are 'hoarding' simply to not run out by the time they die. Low interest rates are painted as great for the economy, but they amount to a war on savers and fixed incomes.
Savers like "money in a bank account" savers, or savers as in "I have a bunch of money I want to put somewhere, where does it go between ETFs/Real Estate/etc". Low interest rates are great for the 2nd group because of the insane asset price inflation we've seen in the past few years, especially in housing, which is the largest store of wealth for most old folks in the US IIRC.
One of the things my parents get exposed to fairly heavily are stories that our entire financial system is teetering on the brink of massive depression. Often times it comes with an offer for a 'sure fire' investment that will ride out this calamity. Well if you're parents are still clued in enough to not buy the snake oil, they might miss that their future outlook is being swayed by these pitches even if they don't buy into them. My great aunt, before she passed, had a suitcase in her closet with lots of cash in it to survive the coming collapse of society.
It can be very sad to watch.
That said, a number of financial planners have moved their estimates of the 'safe withdrawal rate' from 7% down to 4% or sometimes lower. This based on the anemic rate of returns over the last decade. As a result if you reduced your withdrawal rate to 4% and you were still getting returns that could have supported 7% your retirement funds will in fact grow by 3% per year.
And finally there is the whole inheritance thing. When you have kids, anything you leave them when you pass will help, except if you live in the US your "kids" will be retired already when you die. So perhaps you leave your estate to your grandchildren, or your great grandchildren. Then the kids who chose to lower their carbon footprint by not having kids themselves get angry that they don't get any of your inheritance. That causes a family dispute and all your children stop talking to each other. It isn't a laughing matter, although it is predictable. Sometimes I think it is better to leave nothing but memories, at least everyone gets to keep all of those.
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Way to take down that strawman.
It's not a strawman. Most of the article is written with the assumption that not spending all your money is sub-optimal. From the article: > After a lifetime of saving, it requires some psychological gymnastics to start spending your nest egg. Browning’s suggestion is that financial planners urge their thriftiest clients to make big purchases–like a second home or a fancy car–before they retire, out of their pot of s…
It's not at all clear that the authors of the article are concerned about the well-being of rich old people. There seems to be some other argument that's not being stated explicitly.