perspective...

[LivingAlmostLarge]

I was contemplating as I wrote an email to a friend, that I openly email finances with, she's a PF blogger so yeah everything. That it's amazing how your perspective on money can change a lot and yet not at the same time.

I realized 10 years ago in 2003 we were making jointly $43k gross, I looked at our paystubs and taxes. We married in 2004 and filed jointly and paid like 1% federal taxes on $43k income. Ridiculous we were graduate students at the same time.

Fast foward 10 years later and we've increased our income five fold and I can't even fathom if we've managed to increase our lifestyle five fold. This is sort of what Singuy said of his coworkers. I know my DH's coworkers make substantially more since most are Dual income wage earners.

But I feel our lifestyle is generous now and I remember thinking back then if I made $60k one day we'd be set and $100k jointly we'd be set. Yet now it seems like the more we make we do spend a little more, but more goes into savings. And there isn't really anything I "want" so much more because all the "needs" I used to want I seem to have.

It's funny how little you need to feel rich. Has your perspective on money changed as you age? Now I find myself thinking wow perhaps we can "retire" early because we need a lot less than I thought.

[disneysteve]

Yet now it seems like the more we make we do spend a little more, but more goes into savings.

We have definitely elevated our lifestyle over the years but have also boosted our savings rate. It makes sense. Let's say you earn 50K and save 10%. That means you live on 45K. Fast forward to earning 100K and saving 25%. Now you live on 75K. So you've got 30K more to spend day to day while also having 25K going to savings instead of only 5K. It's a win-win. Obviously, it would be even better if you kept living on 45K but there needs to be some pay off to earning the big bucks.

[Eagle]

Yes, I guess it's all about perspective. We make a little over double what we made 3 years ago. And my career is finally taking off as we're both done with school and I have decent job. We feel very blessed.

We've found the more we have the more we can save and the more we can be generous.

Speaking of feeling rich check this link out. Comparing to our old incomes is one thing. Comparing to what others face around the world is another.

[Like2Plan]

Has your perspective on money changed as you age? Now I find myself thinking wow perhaps we can "retire" early because we need a lot less than I thought.

DH and I generally put pay raises into savings whenever we receive a raise. That really helps prepare for retirement because it is money we are not spending in a stepped up lifestyle. All of our needs are being met.
My perspective on money has changed. When DH and I were younger, we had to set up and furnish a household. Now after many years of accumulating stuff, we are downsizing and getting rid of stuff to some degree. I find it easier to put off purchases. I rarely set foot in a store without a shopping list.

[feh]

My wife and I really have not changed our lifestyle as our household income increased over the last 20 years. We simply saved more.

That's why we'll be retiring early.

[disneysteve]

When DH and I were younger, we had to set up and furnish a household. Now after many years of accumulating stuff, we are downsizing and getting rid of stuff to some degree. I find it easier to put off purchases. I rarely set foot in a store without a shopping list.

Very true for us too. I've commented before that I no longer enjoy "recreational" shopping. We used to like going to the mall, going to the outlets, going to flea markets, etc. Now, I find those trips increasingly boring because there just isn't much of anything that I need.

Last weekend, DW and I went to the local outlet mall. We mainly did it to get out of the house and get some fresh air walking around. I bought one shirt at Under Armour. DW bought one shirt at Vanguard. That was it, even though we browsed in numerous stores and walked right past a couple dozen others. And I rarely go to the regular mall now. If I go into a store, it is almost always because I am looking to buy a particular item.

[JoeP]

My last pay raise went almost exclusively toward my 401k, and my wife's pay raises go toward offsetting inflation, service price increases, and tax increases. So we're sitting fairly neutral when it comes to lifestyle.

[hamchan]

I am making over 3X what I was ten years ago. There has not really been a change to my lifestyle at all, but there are a lot of differences. A lot of the extra money goes to increases in cost of living, which has been massive. DH's health care expenses are a big continuous challenge. But the biggest changes are that I don't fall short all the time on bills. If we have an unexpected expense of, say, $100 we can just pay it and not worry about where that money is coming from. If either of us misses a few days of work we are not left scrambling to pay rent. We don't ever have to choose between buying food or not having a utility shut off. There is always money going into savings, even if it has to get used eventually, and it doesn't seem like a lot to me. I don't have to go without things I need to make sure I have bus money to get to work. We don't have dozens and dozens of medical accounts in collections and no money to pay any of them. We actually have zero accounts in collections, and only one left that we are making payments on, which we plan to be done paying off by the end of this year. I don't know that we'll ever be wealthy by any stretch of the imagination, but I appreciate the level of comfort we have.

[snafu]

When we chose to sell SFH and buy a Condo we sold, re-gifted, donated and trash about 50% of our stuff and never missed or regretted any of it. With the exception of electronics, we only shop to replace items as needed following the new item in - old item out protocol.

I know our friends are sometimes puzzled as I don't equate shopping with entertainment and even stranger that I prefer to have friends and relatives in for dinner than to go to restaurants. I am reluctant to explain that so many restaurants now use highly processed foods with a lot of unpronounceable chemicals. Lately more restaurants are being fined for not meeting health department criteria. This week there has been a serious outbreak of measles in our city all traced back to kitchen staff in a prominent, popular restaurant.

With a modest amount of risk our portfolio has escalated beyond any expectation. If it weren't so boring we could retire early.

[bjl584]

I remember when I turned 16 and got my first part time job. I started at $4.75 an hour. When I got my first ever pay check it was for something like $120. I felt RICH! Talk about perspective...

[Nika]

My older friend's mother, who was a single mother working in a laundromat, was able to purchase a large 3br apartment on Upper West Side. Such apartment is now out of reach of double income professional couples. Granted, UWS was not such a good area back than, but now someone working a job like that can't purchase anything, and can't even survive without gov. assistance. Talk about perspective.

[Joan.of.the.Arch]

Thinking about this made me pull up an inflation calculator to see how much actual purchasing power increase we have had over time. Convenient starting and end points were my husband's 25 year teaching contract history. (Before the 25 years period he was teaching part time.) The results emphasize that teaching really is not the career for anyone who wants to see hefty increases. His final contract was for about 20% more real dollars ($67K in 2009) than his initial contract. And that is as a college professor with rank promotions.

My own contributions to our income have been negligible and erratic, so I did not even bother looking at that.

Guess what? I feel rich anyway. I have much more materially than I expected in life and, more importantly to me, I feel more security now than I could imagine even ten years ago.

Anyway, run your before and after numbers through an inflation calculator to get some idea how much your earnings increases "really" have been.

http://www.westegg.com/inflation/

[Redraidernurse]

Our savings rate has decreased. 5 years ago we when we were both working and had no kids we saved approx 65% of of our income. Now, 3 kids later, and we are down to one income, we save approx 40% of our income. I'll be interested to see if the more kids we have the more that percentage decreases because I imagine that will be the case. I feel very rich - we have a home, two vehicles, food on the table every day, and 3 beautiful healthy children. I am blessed.

[Reggie]

I remember when I turned 16 and got my first part time job. I started at $4.75 an hour. When I got my first ever pay check it was for something like $120. I felt RICH! Talk about perspective...

Yes! I remember my first paycheck of $136. It was awesome! i was so rich. now, I was just offered a promotion and my first thought was anything less than a $10k increase and they can take a hike. Crazy! 10 years ago, I got a $2.50 an hour pay raise and cried tears of joy in the bathroom at my job.

[KTP]

I bought a 25 pound bag of long grain rice at Costco today and was struck by how easy and cheap it was to buy that much food for so little money and time ($10)

I could buy 4000 bags of rice with just our EF and yet there are so many people in the world who would see one bag as a bounty.

Really puts our first world problems in perspective. We feel poor when we have to deny ourselves a new smartphone but once every few years. We pat ourselves on the back for *only* spending $300 a month on groceries (I actually spend around $600 but I know you guys are more frugal).