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Post by ca on Feb 9, 2011 11:18:42 GMT -5
www.theglobeandmail.com/globe-investor/personal-finance/rrsp/should-frugal-savers-enjoy-their-money-while-they-can/article1898322/HE SAYS: SQUIRREL THAT CASH AWAY
Over the years we’ve managed to amass a net worth of about $3.5-million, mostly in stocks, GICs, bonds and real estate. We maximize our RRSP contributions every year. Though our annual income is over $200,000, we’ve never had a lavish lifestyle – we’ve always driven our cars into the ground. I’d like to maintain our savings until I turn 61. Then I’ll consider semi-retirement, though I don’t believe I’ll ever stop working – it’s important to stay active mentally. I’m also interested in philanthropy, and I hope to increase our charitable giving. But I’m concerned with planning for our future and making sure we have enough for 25 or more years of retirement. You never know what the markets can do, and I’d like to have that extra cushion. I grew up in a very poor family, and I remember what it’s like to worry about not having food on the table. Even now, a $20 bill seems like a lot to me. I’ve spent most of my life working hard to make sure I’ll never be in that position again.
SHE SAYS: YOU CAN’T TAKE IT WITH YOU
I know Mike and I are lucky to be in this position, but I can’t help but think that all this saving has come at a personal cost. We have such busy schedules and so many work demands that we haven’t had much time for vacations, even if we wanted to spend the money. Two years ago, we took our first-ever winter holiday together, a trip to Mexico. Mike isn’t much of a traveller and prefers short getaways. I’d really like to see more of the world, maybe Greece or Scotland. And I wouldn’t mind a few golf trips and some new clothes. I don’t want to wait until we’re too old to really enjoy these things, and you never know when your number is going to get called. When Mike turns 61, I think any amount of savings over $2-million is excessive; we don’t really need that much. To sum up: 48 and 40 years old, no kids, no debt, net worth $3.5 million, $200,000 income, fully funding retirement and making $8000 a year in donations, lots of liquid cash savings. They live in freezing cold Edmonton, Alberta Canada. She wants to take a trip to Scotland or Greece and buy some new clothes, he says no way we're not secure enough. I though this article was like those fake Suze Orman SNL skits where the multimillionaires call in and ask to take a $5,000 trip and Suze tells them to go to Disney World's Epcott center instead. Holy hell, if I were the woman in this article I would divorce the asshole and take half the money and do what I wanted. Unless I really really loved him and then I would insist he get therapy to treat his insecurity from growing up poor that doesn't allow him to live. Of course, I'd never marry someone who didn't want to travel. So that's moot.
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Gardening Grandma
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Post by Gardening Grandma on Feb 9, 2011 11:29:19 GMT -5
One of these days a friend, co-worker, or acquaintance will keel over with a heart attack and maybe, just maybe, he'll realize just how uncertain life is.
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stats45
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Post by stats45 on Feb 9, 2011 11:35:02 GMT -5
Well-said, gardening. There is more insecurity to life than simply not having enough money. It is important to gather experiences, time, and memories with the people you love.
I agree CA, and I think that sometimes (just sometimes!), the posters here focus on money as an end in and of itself instead of as a means to an end. For example, I wouldn't trade my experiences traveling for anything, but I do have posters here to thank for helping me balance these things into the rest of my life and thinking more carefully about my future.
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Deleted
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Post by Deleted on Feb 9, 2011 11:37:08 GMT -5
Mr grandmother died with a sizeable estate, yet she walked around her house at night with a flashlight in order to save money on electricity..
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Post by ca on Feb 9, 2011 11:39:15 GMT -5
I really think it's a sickness in some people to hoard money due to insecurity; and they can't spend it. They can die the richest one in the graveyard I guess.
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 11:41:20 GMT -5
Well-said, gardening. There is more insecurity to life than simply not having enough money. It is important to gather experiences, time, and memories with the people you love.
Profound statement. We can then eliminate 66% of the federal budget and a larger percentage of state and city budgets.
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Gardening Grandma
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Post by Gardening Grandma on Feb 9, 2011 11:42:03 GMT -5
Mr grandmother died with a sizeable estate, yet she walked around her house at night with a flashlight in order to save money on electricity..
Archie, your grandmother's sizeable estate probably got there, in part, because of her frugality. Habits can be hard to change.
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 11:42:59 GMT -5
48 and 40 years old, no kids, no debt, net worth $3.5 million, $200,000 income, fully funding retirement and making $8000 a year in donations, lots of liquid cash savings. They live in freezing cold Edmonton, Alberta Canada.
$3.5 million for a couple that age with that income is not anything to write home about. With that little amount of net worth, it seems they have been spending up a storm the last 20 years. They should be looking at a $10 million net worth, then, and only then would I concur.
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 11:44:06 GMT -5
Mr grandmother died with a sizeable estate, yet she walked around her house at night with a flashlight in order to save money on electricity..
Your grandma likely lived through the depression.
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Post by Deleted on Feb 9, 2011 11:44:24 GMT -5
Mr grandmother died with a sizeable estate, yet she walked around her house at night with a flashlight in order to save money on electricity..Archie, your grandmother's sizeable estate probably got there, in part, because of her frugality. Habits can be hard to change. No doubt about it...
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Gardening Grandma
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Post by Gardening Grandma on Feb 9, 2011 11:44:25 GMT -5
$3.5 million for a couple that age with that income is not anything to write home about. With that little amount of net worth, it seems they have been spending up a storm the last 20 years. They should be looking at a $10 million net worth, then, and only then would I concur.
SF, How much wealth does a person NEED?
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Post by Deleted on Feb 9, 2011 11:45:54 GMT -5
Mr grandmother died with a sizeable estate, yet she walked around her house at night with a flashlight in order to save money on electricity.. Your grandma likely lived through the depression. yup.... she always told us the story about when her house burned down when she was six or so. All they had left was literally the clothes on their backs. She said she worse the same dress and sweater for 6 months straight.
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Post by Deleted on Feb 9, 2011 11:46:24 GMT -5
This message has been deleted by the powers that be.
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stats45
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Post by stats45 on Feb 9, 2011 11:47:39 GMT -5
Also, I now have the DuckTales theme song stuck in my head. Thanks CA!
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 11:49:46 GMT -5
SF, How much wealth does a person NEED?
I do not think it is anyone's business how one saves, invests and handles their money. Nor should any govt entity stick their noses into a personal matter.
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Post by ca on Feb 9, 2011 11:50:04 GMT -5
It's a catchy tune!
I hope SF was being sarcastic...
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Gardening Grandma
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Post by Gardening Grandma on Feb 9, 2011 11:51:11 GMT -5
SF, How much wealth does a person NEED? I do not think it is anyone's business how one saves, invests and handles their money. Nor should any govt entity stick their noses into a personal matter. I agree. But the couple in the OP asked for advice. I didn't mean to hijack CA's thread. It's just a fascinating question to me.
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 11:52:09 GMT -5
I agree. But the couple in the OP asked for advice. I didn't mean to hijack CA's thread. It's just a fascinating question to me.
Conversely, how many articles of clothing are enough? Note that I replaced the word "money/wealth" with the word "clothes".
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Post by ca on Feb 9, 2011 11:53:33 GMT -5
Deleted.
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Post by Deleted on Feb 9, 2011 11:54:09 GMT -5
I agree. But the couple in the OP asked for advice. I didn't mean to hijack CA's thread. It's just a fascinating question to me. Conversely, how many articles of clothing are enough? Note that I replaced the word "money/wealth" with the word "clothes". ROFL!!!!
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Abby Normal
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Post by Abby Normal on Feb 9, 2011 11:54:09 GMT -5
From the article
It sounds to me like the guy needs some therapy. He's insecure about not having "enough" and probably can't even explain to himself what "enough" is.
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 11:56:32 GMT -5
It sounds to me like the guy needs some therapy. He's insecure about not having "enough" and probably can't even explain to himself what "enough" is.
That was not the take away I got. It read like the wife was a compulsive spender, who had several closets of perfectly fine clothes, and was someone who ****ed money away frivolously.
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dancinmama
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Post by dancinmama on Feb 9, 2011 12:00:01 GMT -5
I really think it's a sickness in some people to hoard money due to insecurity; and they can't spend it. They can die the richest one in the graveyard I guess. That's my mom. She is going to be 85 this year and is JUST beginning to spend some of her money. My late father and my mom DID travel the world together, but other than that, have always been EXTREMELY frugal. And even in their travels, they were frugal. If they cruised, they were always in an inside cabin instead of spending just a little extra for a balcony, which is ALWAYS well worth the extra. DH and I have always been pretty frugal too, but it is so that he can take early retirement at age 55. Along the way, we have lived as well as we can, as cheaply as we can, taking in concerts and sporting events and ALWAYS treating ourselves when we travel. Seeing St. Sophia in Istanbul all lit up at night from our balcony stateroom was PRICELESS!! I wonder if my mom wishes that she had done it differently. What is the point of making/saving so much money only to leave it to your children who are doing pretty well without it. DH and I plan to spend close to everything that we have, only leaving the house to DS.
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dancinmama
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Post by dancinmama on Feb 9, 2011 12:05:53 GMT -5
48 and 40 years old, no kids, no debt, net worth $3.5 million, $200,000 income, fully funding retirement and making $8000 a year in donations, lots of liquid cash savings. They live in freezing cold Edmonton, Alberta Canada.$3.5 million for a couple that age with that income is not anything to write home about. With that little amount of net worth, it seems they have been spending up a storm the last 20 years. They should be looking at a $10 million net worth, then, and only then would I concur. It really would depend on HOW LONG they've been making that kind of income. They might have had a large jump in income over a short period of time - it happened to us. In the last five years, DH's income has doubled.
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thyme4change
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Post by thyme4change on Feb 9, 2011 12:10:08 GMT -5
My parents amassed their wealth through frugality - and then my Dad got cancer. It was quite treatable with surgery, so he didn't even have to go through all that yucky chemo and stuff - but shortly after being given a clean bill of health, he sold his old crappy Nissan and bought a BMW. 2 years later, insisted my Mom gets a Lexus, even though she loved her Camry. The travel internationally every year.
Sometimes you can look into the mirror and see a mortal and decide to have a little fun.
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 12:11:22 GMT -5
It really would depend on HOW LONG they've been making that kind of income. They might have had a large jump in income over a short period of time - it happened to us. In the last five years, DH's income has doubled.
It is doubtful that the above is true. The couple has likely been making a respectable combined income for a very long time. To be honest here, $200,000 combined income for two people is not much either, though it depends on where they live. $3.5 million in net worth at ages 48/40, really is just average.
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The J
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Post by The J on Feb 9, 2011 12:14:37 GMT -5
It sounds to me like the guy needs some therapy. He's insecure about not having "enough" and probably can't even explain to himself what "enough" is. That was not the take away I got. It read like the wife was a compulsive spender, who had several closets of perfectly fine clothes, and was someone who ****ed money away frivolously. Gee, you read it as a woman who overspends? You?? Really?? I'm shocked!!! If they didn't put away another dime and that 3.5m earned 8% until retirement, they're looking at about 10m. That's more than sufficient to replace their income stream. And she didn't say she wants to blow more money. She said she would rather spend money on X (clothes) than Y (golf trips)
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The J
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Post by The J on Feb 9, 2011 12:15:26 GMT -5
It really would depend on HOW LONG they've been making that kind of income. They might have had a large jump in income over a short period of time - it happened to us. In the last five years, DH's income has doubled. It is doubtful that the above is true. The couple has likely been making a respectable combined income for a very long time. To be honest here, $200,000 combined income for two people is not much either, though it depends on where they live. $3.5 million in net worth at ages 48/40, really is just average. Do you know what the word average means? Because it certainly doesn't sound like it here.
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Gardening Grandma
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Post by Gardening Grandma on Feb 9, 2011 12:16:20 GMT -5
$3.5 million in net worth at ages 48/40, really is just average.Wow. Now I feel POOR! LOL
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Post by Savoir Faire-Demogague in NJ on Feb 9, 2011 12:16:53 GMT -5
Gee, you read it as a woman who overspends? You?? Really?? I'm shocked!!!
As a guy who is twice your age, I have 100 times more experiences than you, and have also dated easily 20 times more women from all walks of life than you ever will dream of.
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