Saturday, May 7, 2016
Such a Thing as Too Stingy?
Saving money, spending less, and living more is a good thing. But like anything else, it could become an obsession.
I recently had some negative feedback from some readers about my decision to retire. One told me that once you retire, you have nothing to look forward to but death, which I thought was a pretty bleak outlook on life - and also wrong. We all have death to look forward to, regardless of whether we retire or not. For some, working is a way of drowning out the deafening silence in their lives, so they don't have to think about death.
Another chastised me for having such an extravagant retirement budget. My target is to live on an amount equal to or less than the median income in the United States, about $50,000 a year. I don't think this is a terribly fanciful budget, and in fact, I probably would come in far less. But they thought I was spending too much on housing ($850 a month) and too much on groceries, restaurant meals, and liquor ($1000 a month). I should live in a tiny house and eat raman noodles! I could retire on $7000 a year like the "early retirement extreme" guy says!
Well, I doubt anyone could live on $7000 a year, and if you did, well, you'd qualify for a lot of government assistance, and thus really have a larger income than that. But aside all of that, is there a point where trying to "save money" stops being a reasonable proposition and becomes an obsession like hoarding or OCD?
I think so, and perhaps the three are related. The hoarder is also often very stingy (hence the reluctance to throw anything away - it is "worth something"). My goal in starting this blog was to try to figure out ways to live a more enjoyable life on less money, not how to live like a monk. The local monastery has that whole thing sewn up. If I wanted to do that, all I need do is don the robes and join.
What I found in my wanderings is that it is possible to pay 2x, 3x, or even 4x the amount of money for the same level of enjoyment in life. Yes, you can "save money" by simply not doing anything at all. But that sort of defeats the purpose of life. You can reach a point where you are just warehousing yourself and indeed, merely waiting for death. Life should be about something more than that.
For example, I discovered that the cost of tea was about 1/4 to 1/10th the cost of coffee. So I switched to tea and found it also easier to deal with and clean up. I also appreciate a good cup of coffee now, on the occasions I have it. Of course, I could really save money by drinking tap water but that is such an obvious choice it is not worth exploring.
What are most Americans doing? Buying a $199 single-serve coffee maker and paying up to $1 a cartridge for stale coffee. It simply makes no sense - to take a part of your life and just make it more expensive for the sake of convenience and status. But that is what most Americans are doing - going to restaurants instead of making their own meals. Leasing cars instead of buying them. Padding the price of everything in their lives for the sake of convenience and status.
I discovered in my journeys that the major problem with Americans these days (in my opinion) is that they simply spend too much, want too much, and don't want to sacrifice as our forebears did, in order to get ahead. The "shrinking middle class" in America didn't shrink because of nefarious schemes promulgated by others, but because of our actions in pissing our money away and pissing our jobs away.
For example, whose fault is it that the most popular car sold in America is Japanese? Was it the assembly line worker at GM in 1975 who thought it would be "funny" to put a coke bottle in the door panel of a Monte Carlo so the rattle would drive the owner nuts? And when his job "went overseas" was that the fault of the company or the worker - who showed up hung over or outright drunk and put only half the frame bolts on each passing car?
You think I am making this shit up, I was there and saw it happen. People sabotaging the assembly lines and then saying, "they'll never close this place, they have too much invested" and "I'm underpaid, I'm going on strike!"
Greedy management or Wall Street didn't kill off those middle-class union jobs, the unions did and the workers did. The rest of us got sick and tired of shitty overpriced products.
Similarly, when Mr. and Mrs. Middle-America decided their tract home was a bank account and re-financed it three or four times to "take out cash" to buy shit they didn't need, was that the fault of "greedy bankers" or the fault of greedy homeowners?
Again, please don't tell me this didn't happen, because again, I was there and saw it. Indeed, I did it myself. I pissed away a lot of equity in my home by refinancing. It was stupid. But I was not as stupid as some were, which was my only saving grace.
We spend too much on shit. We want status items and we pay extra for them. People today are paying well over $50,000 for cars and trucks and SUVs and convincing themselves that they are "affordable" when you can buy a similar vehicle for a hell of a lot less that not only costs less, but provides a better service life and is more reliable. But right now, sales of Volvos and Jaguars are through the roof, and no one seems to remember how horribly unreliable those cars were just a few years ago - or that both companies now have foreign owners from India and China.
Status is what we blow our money on - status for things that are not substantially different than ordinary things, but are branded or marked or logo'ed with some Trademark that we convince ourselves will impress others.
And that right there is where you can save a lot of money.
On the flip side, there are folks who are taking stingy living to a whole new level - obsessing about spending money the way couponers obsess about their BoGos and double-coupon days. The want to make a game to see how little they can live on. And if you are really poor, then I suppose that is more than just a game - it is a matter of survival.
But life is about more than living in the most efficient manner possible. It is about experiences and doing things. Yes, I could live a much less expensive life by moving into my camper and spending all day reading library books while my battery recharges from my solar panel. But I think I would get rather bored by that in short order.
I want to do things and see things. I want to take a transatlantic cruise to Europe and rent an apartment in Spain for a month (who knows, maybe live there for a year or two - it is a cheaper place to live than the United States!). There are ways to do these things for not a lot of money. You can take the QEII to Europe and stay in a hotel and spend a lot of dough. Or you can take a "transitioning cruise" across the ocean for less than a thousand dollars and rent an apartment for a week for about the cost of a night in a high-end hotel.
An that is the trick, I think. Not to do with out and live with nothing. But to have more and live on less - the mission statement of this blog to begin with. You can blow a lot of dough showing off in a restaurant buying a $300 bottle of Champagne - and not really appreciating it. Or you can have a nice inexpensive Spanish Cava every day of your life instead. Um. Spain again. They really know how to live in Catalonia.
And so on down the line. When I had my 1974 BMW 2002, I enjoyed tinkering with it. And what I really enjoyed about meeting people with those cars was how resourceful many of them were. We went to a car show once, and a guy showed up with a 1975 model (not the best year) and with him were his mechanic, his body man, his paint guy, his upholstery guy, and so forth. He just wrote checks and had a very nice car and won trophies. Not a lot of talent in that.
Another fellow, who came in second, had a wife and kids and a job and a budget. It took him years and years to scrounge parts at swap meets and to make things himself and to do a lot of late-night wrenching, but he restored the car to a beautiful condition (perhaps not as nice as Mr. Checkbook) but something far more interesting to me. He actually made something with his hands and I find that far more creative and worthwhile than simply buying stuff. It also illustrates how you can really have more while spending less.
The least satisfying experiences in life are where you simply hand someone your credit card and they hand you goods or services. It is just spending and it is not very satisfying. Finding that special deal or putting something together yourself or working on something or whatever - that is a far more satisfying experience for most people. It satisfies the need to create and make and produce that our brains are programmed to do. Mere consumption leads to depression, no matter how many nice toys you have.
Making Stinginess into a hobby I suppose could be satisfying. But I think there reaches a point where it is no longer satisfying and more annoying. And a lot of "stingyness" things can backfire in a big way and end up costing you more money in the long run. Sure, you may think you are saving money by putting off having a new roof installed on your house, but the resulting water damage could double or triple the eventual cost of replacement. There is a happy medium.
Living a middle-class lifestyle in America is not, I think, an extravagance. Doing it on a budget is the real challenge. Trying to get by at the poverty line as some sort of stunt strikes me as kind of pointless. Leave that to the people who really have to get by that way.
There is such a thing as too stingy. Obsessions are never healthy things!