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Money: Living Life Now vs Saving for Later

Scarpozzi

Scarpozzi

Lifer
What's better.....Going on vacations and accruing some short-term debt or saving more money for retirement? (please don't misread that, I'm suggesting to save *less...but not less than 12% of income for retirement)

Right now, we feel like we're not in good shape because we're throwing so much money at our house, car payments, daycare, etc... We've accrued some cc debt from taking trips this year. At this point, my daughter has Fall break coming up. I had a trip to Disney planned, but scrapped the plans because it seemed like it was too expensive...now I'm looking at possibly doing a beach trip...but again....trying to decide if we should pay down more debt or simply do the trip and save less for retirement.

I'll have the house paid off in 10 years and we'll likely be debt free by that time since I won't be dealing with 2 kids in there. Life's short....is splurging now worth the risk and paying higher interest on past short term debt or should I stick home and be responsible?
 
I don't know if I'm going to be around long to enjoy that retirement money, but I know for sure I'll enjoy that vacation.
 
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What's better? Doing both. But most of us are not that lucky. Sacrifices have to be made. My sacrifice is I drive 15 yr old truck as DD and 14 yr old minivan as family vehicle. My recreational vehicle is 10 yr old sports car.

I would never go on vacation if that meant accruing any type of debt. That's just crazy talk.
 
Ns1 said:
I don't know if I'm going to be around long to enjoy that retirement money, but I know for sure I'll enjoy that vacation.
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And there are plenty of people who had wished that they saved up for retirement, you may live longer then you planned on.
 
Money: do both. Spend now AND save for later.

Save 15% of your total income, no matter how you do it. If your employer matches 5%, then you only need to save 10%. If you also count social security as 5%, then you are left with only 5% of your own money to save. But actually save it. Do not borrow money in order to save, otherwise you are just fooling yourself. That way, you will have a financially secure retirement.

Spend the rest and enjoy life now. But again, don't go into debt for fun. Spend only the leftover money.
 
Thankfully we're doing well enough that we can take a good amount of vacations a year without going into debt while saving for retirement. When I go on vacations I typically will pay the hotel, rental car, and flights (or taxes on flights since been paying with points the past few years) with money I have saved up months before the vacation. Then that gives me 2-3 months to save 3-4 grand to take on the trip.

And when we're at home, I'm not spending too much extra money on stupid shit so I end up having extra disposable cash that we choose to spend on the next vacations. Sure I could put it into the house, or into another investment plan, but I'd rather enjoy life right now while I can. Our income-to-bills-we-have-to-pay ratio is pretty damn low. And we paid off both of our cars this year so that is an extra $850/month we have, which is over $10k/yr extra.

My dad died 8 years ago when he was 57 and he was still working his normal job as a urologist at his own practice. It was hard work and time consuming. He never even got to retire. You never know when your time is going to be up.

I don't know if I would go on vacations if it meant I was going to be going into debt though. Maybe if it was the kind of debt that I knew 10000% that I'd be able to easily pay off when I got paid when I return. But not if it was the kind of debt that would take me months to pay off.
 
I would say I do both. But part of that is based on living below your means - which most people just can't handle that.

I live in a neighborhood of people that make waaaaay less than me - and probably they only have 1 working spouse. Our mortgage payment is $450/month. Mind you, I don't care for this situation, I don't like the house much - but were also 40% away from having the house paid off before I'm even 30.

At the same time I max out my 401s, IRAs (2 each for both me and the wife). But we still have plenty of money leftover to fly a few places each year. We don't go balls to the wall with stupid expensive resorts for $10k, but we always go to visit distant family and at least once a year we pick another random country to visit - been to Russia, France, Japan, Brazil, and Cook islands so far. Next up is Germany and Belgium later this year.

My main point is that I want to retire at a young age. I don't want to retire with just the ability to sit around and pay for an old-folks home, I want to retire and still be able to travel the world - which is something you can still definitely do in your 50's.
 
Another vote for both. You don't have to save every single cent but you can also not spend every cent you have (and them some) too. There are tons of ways to save money here and there that won't impact your lifestyle too much, little crap always adds up. Obviously it's hard to give specific advice to a super general question and subjective life scenario, but in general I would say it's possible to enjoy your life and spend money but also not screw yourself for future monetary needs.
 
purbeast0 said:
Thankfully we're doing well enough that we can take a good amount of vacations a year without going into debt while saving for retirement. When I go on vacations I typically will pay the hotel, rental car, and flights (or taxes on flights since been paying with points the past few years) with money I have saved up months before the vacation. Then that gives me 2-3 months to save 3-4 grand to take on the trip.

And when we're at home, I'm not spending too much extra money on stupid shit so I end up having extra disposable cash that we choose to spend on the next vacations. Sure I could put it into the house, or into another investment plan, but I'd rather enjoy life right now while I can. Our income-to-bills-we-have-to-pay ratio is pretty damn low. And we paid off both of our cars this year so that is an extra $850/month we have, which is over $10k/yr extra.

My dad died 8 years ago when he was 57 and he was still working his normal job as a urologist at his own practice. It was hard work and time consuming. He never even got to retire. You never know when your time is going to be up.

I don't know if I would go on vacations if it meant I was going to be going into debt though. Maybe if it was the kind of debt that I knew 10000% that I'd be able to easily pay off when I got paid when I return. But not if it was the kind of debt that would take me months to pay off.
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My dad passed from cancer when he was 52 during his prime earning years. His new business was taking off and it seemed like the best days were in front of him until we got the dreaded cancer news. My dad was a workaholic and rarely had the time to take vacations. Before he passed, he told me he regretted not taking more time off and traveling and seeing the world. He had planned to do that with my mother after he retired. He didn't expect to die early. None of us did. I had just graduated from college. His death changed my view and outlook on life, vacation, and traveling. I quit my corporate job a year later to start my own business and have never looked back. And I remember the regret my father had so I've tried my best not to repeat it. I try to take plenty of vacations even if it's just short extended weekend trips. And if I'm too busy with work to go on vacation, I send my wife and daughter on their own trips so they don't miss out because of me.
 
ponyo said:
My dad passed from cancer when he was 52 during his prime earning years. His new business was taking off and it seemed like the best days were in front of him until we got the dreaded cancer news. My dad was a workaholic and rarely had the time to take vacations. Before he passed, he told me he regretted not taking more time off and traveling and seeing the world. He had planned to do that with my mother after he retired. He didn't expect to die early. None of us did. I had just graduated from college. His death changed my view and outlook on life, vacation, and traveling. I quit my corporate job a year later to start my own business and have never looked back. And I remember the regret my father had so I've tried my best not to repeat it. I try to take plenty of vacations even if it's just short extended weekend trips. And if I'm too busy with work to go on vacation, I send my wife and daughter on their own trips so they don't miss out because of me.
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Damn sorry to hear that 🙁

My dad too was somewhat of a workaholic. He had just made changes to his practice though and partnered up with 3 others so that he would work less instead of running his own private practice. So he was starting to just get into the "work less" mode. He died suddenly unfortunately so I don't know how he felt about taking more vacations and stuff. I do know that he didn't take many though. But part of that was because where they lived, which was on a golf course with his own pool in the backyard. My step mom said they didn't really want to go many places, but I also don't know if they could have afforded it.

Either way, I believe it did somewhat change my outlook on life as well. When is the last time you heard anyone, whether they are old or young, say "I wish I took less vacations and went on less awesome trips?" I'm guessing never lol.

My wife told her friend that we were taking our son with us on some trips and she thought it was a waste because he won't remember it and it would be hard on us. I think that is a terrible outlook to have, and I think a lot of it is her just being jealous. He has a blast when we go and I love seeing him excited at the beach and seeing him learn how to swim and get over some fears he has in water. It's been awesome to see it. Even though he may not remember it when he's older I am of the mindset that it's still grooming his personality and what he likes. He's not even 2 and a half years old and he's been on more trips out of the country than my brother has lol. And he may be going on another one in November since my mother in law is going out of the country and won't be able to watch him like we originally planned.

I have so many pictures and memories of vacations that are priceless to me. I've splurged on trips and spent over $1k in a single day on vacations before for exotic excursions and fancy dinners. I don't regret one second of any of it.
 
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Save up short term for the vacation then take it without any debt. Ex: have money go to a tax free savings account each pay cheque and when you have enough for a vacation then go on one.

You could also just have a normal bank account for that, call it the vacation fund and put like $100 in it every pay or something. That way it's kind of set and forget, then in a year or two you have enough for a decent vacation.

When I'm on vacation I tend to somewhat follow a #MINO approach when it comes to checking out something though. Like say at an amusement park a certain attraction might cost extra, well I'm there, may as well do it. 😀
 
I'm already a pretty boring person, and I know as I age I'll become even more boring... so saving much for retirement (at the moment) seems like a waste. I won't have the energy to do anything with it, and I earned the money so I'll be damned if I just pass it along to someone else!

long story short: I buy what I want and hope it doesn't bite me later
 
brianmanahan said:
i make myself save %50 of my income every year

but then i'm allowed to spend the other half however i like
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Lol I wish I had that much to save. Like 90% of my income goes towards bills. They keep going up every year too. 10% goes towards savings/spending.

I keep trying to find ways to cut my expenses but it's all stuff I can't control, like taxes and utilities. You can only reduce usage so much, they just keep raising the prices.
 
Red Squirrel said:
Lol I wish I had that much to save. Like 90% of my income goes towards bills. They keep going up every year too. 10% goes towards savings/spending.

I keep trying to find ways to cut my expenses but it's all stuff I can't control, like taxes and utilities. You can only reduce usage so much, they just keep raising the prices.
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Part of your issue here comes down to due diligence. I don't take bill hikes lightly, so unless there is a valid reason for hiking my bill, I will immediately call them when i get their raised bill and threaten to quit.

This goes for insurances, cable bill, electric bill, cell phone, security alarm bill, etc...
 
s0me0nesmind1 said:
Part of your issue here comes down to due diligence. I don't take bill hikes lightly, so unless there is a valid reason for hiking my bill, I will immediately call them when i get their raised bill and threaten to quit.

This goes for insurances, cable bill, electric bill, cell phone, security alarm bill, etc...
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Yeah I'm sure Hydro One and Kathleen Wynne are going to care when I complain about yet another increase. 😛 There's practically been protests over that. Or my city about a tax increase etc. They really don't care. It's either you pay it, or they cut service. Or in case of taxes, take your house.

Non essential stuff like ISPs may give you a bone because they want to keep you as a customer, but it seems those are not the bills that go up as much, it's stuff like utilities, and especially municipal taxes. TAxes are the worse because there is literally absolutely nothing you can do. At least with hydro, I could in theory generate my own power and cancel the service. I do want to look into at least a small solar setup to slightly offset the cost. It's the delivery fee that is bad though. It's more than half the bill.
 
Take low budget vacations, e.g. drive to national park(s) to hike and camp instead of staying in an expensive hotel. That way you can save and have fun.
 
Red Squirrel said:
Lol I wish I had that much to save. Like 90% of my income goes towards bills. They keep going up every year too. 10% goes towards savings/spending.

I keep trying to find ways to cut my expenses but it's all stuff I can't control, like taxes and utilities. You can only reduce usage so much, they just keep raising the prices.
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List your bills and income so we can help you figure something out.
 
Herr Kutz said:
List your bills and income so we can help you figure something out.
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Not really anything that can be done, the price is the price, and these are all things I need to pay, like electricity, gas, taxes etc. The ones that are technically optional, like internet and alarm system are not the ones that keep going up, they stay the same, so those don't even concern me much. Heck my alarm system one actually went down. I am looking at reducing my internet one though, since I hardly use my landline or watch TV, so I may reduce it to an internet-only package. Going to be peanuts compared to the amount taxes go up by each year though but every little bit helps I suppose. Municipal taxes are about 20% of my income alone, that is really the big one, because it keeps going up at such a fast rate.
 
Your first sentence throws me...why incur debt? Vacations are what you do with excess money...not money you don't have. You can put a little back, cut back on the extras over time to help that happen.
 
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