I’d rather deal with having to cut unnecessary spending if needed than be sitting on a big pile of money and die at 55 or 60. Or maybe even worse work and save for all those years, live to 90 and still have a big pile of money that wasn’t used.
There is definitely a balance for me where we are still saving generously and not racking up debt but I also have no desire to budget and constantly worry about what we’re spending on everything when that isn’t necessary with our income. If you asked me to give a detailed budget/accounting of our spending I wouldn’t be able to without digging deep and I don’t mind that. That’s like the ultimate goal for me I think, not to have a bunch of houses or physical assets but to be able to just live my life completely carefree about money and expenses.
The people on that site see massively over saving as equating to some kind of moral superiority. I get the instinct to be conservative but spending vs. saving is a choice and there are very valid arguments for spending your money while you’re alive and healthy instead of hoarding it.
I think having a detailed spending plan that shows how your money is flowing in/out is an incredibly empowering document, and I cannot imagine living without one. It is what allows me to not worry a damn about what I’m spending on, because it’s in the budget.
It takes me probably 2 hours a year to keep it up to date.
Also if you’re a standard middle class person there’s definitely an argument for just spending your money. You’re all but assured to run out anyway. Of course, in Europe people make less and are happier because they don’t have money anxiety. Education, health care, retirement are all provided as a birth right. This country legit fucking sucks at such things.
I use Excel. Most expenses are pretty damn stable (mortgage, insurance, utilities, gas, subscriptions, payroll deductions, groceries). And I don’t need to track to the dollar things like “eating out”. But what I like about a budget is that it is an opportunity for my spouse and I to sit down and have a conversation about things like
“How many times a month should we sit down and have a nice $150 meal?”
“How many vacations should we take this year and how much should each cost”?
“How much should we donate to charity”?
Once I’ve factored in all the income and estimated expenses, I just have whatever should be leftover get automatically withdrawn into a HYSA. If I notice that the checking account is dwindling then it means something is off. If we have unexpected expenses, then they get withdrawn from said HYSA.
Once we have discussed and agreed on these things then there isn’t that feeling of anxiety or doubt about every little decision point throughout the year. We’ve already discussed it, and it’s in our budget.
I think what DUCY is saying is that he’s at a point where there is already no anxiety or doubt. He can go to as many $150 dinners as he desires, any vacations he wants, and there is still plenty left over. This only works because his “natural” desires for expensive meals and vacations just happens to be much less than the money available. If he suddenly developed a taste for chartering private jets everywhere he went and the like, that may change his views on budgeting.
I know we’re saving what we want to save and after that more money is coming in than going out. Good enough for me. I’m very much a wing it and see what happens kind of person.
This doesn’t work for me because I want to understand to some reasonable degree of accuracy when when I can bag work permanently. The only way to do this calculation is to understand what it costs to fund your desired lifestyle and map it against your current savings, savings rate, and withdrawal strategy. I’m not really trying to work any longer than I need to.
You could still do it with a retrospective analysis. That is, instead of budgeting, just look at the prior year and see what you spent when you didn’t think about it. Putting together a few years of that data should help you figure out what you are trying to figure out. It also may lead you to the conclusion that you should be budgeting, so maybe you have just skipped a step.
By the time I figure out what the delta should be in the retrospective analysis of my expenses while working vs. retired (i.e. differing deductions for income tax, FICA, savings, medical, eating out, gas, travel, etc), I could have just spent that time building a proper budget.
That’s fair, but that is also quite a different reason from the one you initially gave.
I have a similar goal as you, but I’m just doing the retrospective thing. When I’m ready to think about cutting back on the work, then I’ll probably sit down and do some real number crunching.
It’s actually not, because the implication is that something like “eating a $150 meal once a week” or “giving X to charity” is a lifestyle/values thing that would continue into retirement whereas, “spending $500 on gas to get to work” isn’t. You can’t parse that out without parsing it out.
I could understand not doing it if you think you are 20+ years from retirement, or you are so wealthy that you have 100x annual expenses saved up (where I agree that budgeting is truly irrelevant), but otherwise I think you have to get into the details.
For a lot of these people, the Social Security system that they never stop complaining about (SOCIALISM! PONZI SCHEME! I COULD MANAGE THE MONEY BETTER MYSELF! PERSONAL RESPONSIBILITY!) is what’s going to stop them from being destitute at 70. Of course, when they don’t have the lifestyle at age 70 that they want, they will blame Big Government and immigrants.
Well if i die with a boat load of money then id be helping out my kids so i wouldnt look at it as a total loss.
I agree in living life to the fullist and such but i try to acknowledge that we continuosly cycle between boom and bust cycles and spending 400 a month on massages or w/e may not be an option for me down the road - and weve seen a hard break like that in this economy fairly recently that heavily affected those particular folks.
Sometimes i wonder if its all the poker ive played that makes me look at decisions from an EV standpoint more than i really should.
The few well off family members I have in their 70s+ always come to me for retirement finance advice (because I run retirement plans for a living) and the main advice I can actually give them that they like and benefit from is that if they are on track to have a boat load of money to hand over to their kids, they should just give some to their kids now and enjoy actually seeing the help it provides.