Many people assume I was able to accumulate a large net worth simply because I made a lot of money coupled with a natural tendency to be frugal.
No. That’s not how it happened.
First of all, I didn’t make a lot from the get-go. Like most millionaires, I had to work long and hard, delivering lots of value to my employers until my salary steadily grew.
Second, I was certainly not naturally frugal. I had to learn to be thrifty.
Consider this:
A low to low-middle class boy goes to college, then grad school. He has no real financial education, but when he leaves with his MBA he takes a job making more money than he thought imaginable. No, it wasn’t a fortune, but to me it seemed like I had won the lottery. I was rich!!!
Do you think this is going to end well?
What’s the first thing I did with my newfound income? Bought a brand new car, of course!!!
My first car out of school was a new Toyota Celica (sporty). I went to the dealership as green as a meadow in summer. I knew enough not to pay full price, but not much more. I think they knocked off $200 or so from the sticker, I felt victorious, and I said, “yes.”
And of course I used the dealership’s financing.
Yeah, I’ve come a long way, baby.
Fortunately this was only a few years before I met my wife, who is naturally frugal, so I didn’t have a ton of time to do massive damage.
It took a while but I eventually got on board with the whole “control your spending” thing as I saw it was key to becoming wealthy.
Then I read The Millionaire Next Door and knew saving money was vital.
But that doesn’t mean it was easy. Through the years I’ve had my bouts with keeping spending in line — it’s anything but natural for me.
Even today, I struggle to keep spending reasonable in some areas and have to check myself now and then.
I thought it would be “fun” to share eight of the areas where I still battle to keep spending in line. If nothing else, you’ll probably find these amusing.
My Spending Kryptonite
Here are the categories that tempt me even to this day…
1. Luggage.
As many of you know, I like to travel a bit now and then (like most millionaires do).
And when I go, I like to travel LIGHT. I hate to check bags for a million reasons, so I travel with a small carry on as well as a backpack as my personal item.
With this in mind, I have been on the hunt for the perfect travel bag, which seems just out of reach. This is one reason we have six or so smaller, checked bags down in our basement. As soon as I find one that does ABC, I realize it doesn’t do XYZ so I begin to look for another one.
I have come to realize there’s not one bag that does everything, so I need to stop looking for it. As such I have canceled emails from eBags as well as stopped searching for various luggage on the web.
I just need to let…it…go…
2. Backpacks.
This is an extension of point #1 above.
Along with my carry on bag I need the perfect personal item, a backpack that can carry 100 pounds of stuff while feeling like it weighs 10 pounds. It also needs to have a gazillion compartments for my various items and be as durable as a tank.
Again, there is not a perfect backpack that does everything which (again) is why I have three or four unused bags in my closet now (in addition to the two I use every day — one for working out and one for pickleball.)
I will mention those:
- Speedo — I like the Speedo Printed Teamster 35L Backpack because it carries all my workout gear, has pockets for my sunscreen, soap, earphones, keys, etc., and stands upright, making it perfect for the vertical lockers at Lifetime Fitness.
- Osprey — I originally got the Osprey Skarab 30 Hydration Pack for hiking (and still use it for that at times) but my main use for it five days a week is as my main pickleball bag. I pack up my shoes, paddles, balls, towel, etc., strap on the bag, and walk to our park about 20 minutes away. I love it because it’s so light and yet very durable.
As for traveling, I still switch up between one backpack and another. Despite the fact that I haven’t yet found the perfect one yet, I’m trying not to buy any more.
3. Coins.
I am a coin collector from way back!
I don’t know what it is about them, but I just love the idea of collecting coins.
I’ve never been serious (or good at it), but over 50+ years I have managed to collect a few good ones.
It started with an 1888 silver dollar my grandfather gave me (which I still have) and just blossomed from there.
There is NO WAY I can go to coin shows or anything similar. The combination of me not knowing what’s a good value and what isn’t plus my love of anything coin related would be a money mess waiting to happen.
So these days I limit my coin collecting to purchasing some American Eagle Silver dollars now and then.
4. Athletic clothes.
I have worn “nice” clothes a handful of times since I retired:
- At my aunt’s funeral
- Each year at our church’s Christmas program
- At my daughter’s wedding
Other than that, I swear off anything that’s even remotely “nice.” I put nice in quotes because it’s not like I’m even talking about formal clothes here. When I “dress up” it’s usually a pair of Dockers and a collared shirt, a combination that wouldn’t have even passed muster on work casual day a decade ago.
I do have some business-style dress pants and suit coats that have visible dust on them — since they haven’t been used in over three years (except for one set I wore at the wedding). Of course I keep them since the second I get rid of them I’ll need them, but I do give away a few more every year.
For now they are moved to my daughter’s old room and sit in her closet — out of sight and out of mind.
That said, athletic clothes are a whole different story.
I spend my life in athletic clothes (shorts, sweatpants (in the winter), and synthetic shirts in both long and short sleeve). I wear them to workout and play pickleball, of course, but also they are my top choice for non-sporting activities like going to the movies, eating out, and writing blog posts. They are very comfortable.
For the record, I also have a lot of cotton t-shirts that I throw into the mix.
Anyway, I love having a wide variety of athletic clothes to wear. And since we hit the outlet mall in Castle Rock a few times a year — where they have stores for Nike, Adidas, Under Armour, and Puma, not to mention The North Face and Columbia — I always have a wide variety of new ones to choose from.
Plus I found an affordable Nike men’s long sleeve shirt on Amazon this summer and bought several for pickleball. They are light and protect me from the sun. My dermatologist approves! 😉
I’m also a fan of Spyder, the ski brand (even though I don’t ski), and pick up their clothes at discounts when we go to Breckenridge (summer sales!) and Costco (which carries Spyder now and then.)
I have so many at this point that I literally think I could never purchase another piece of clothing even if I live to be 85.
Ok, maybe it’s not that bad, but you get the point.
I did institute a rule to try and limit myself in this area — I can’t buy any new clothes unless I get rid of the same number of older items. I’ve got a whole host of dress clothes earmarked as trade-ins (the ones in my daughter’s closet), so I should be able to stick to this. But really I need to do better than that anyway as it’s getting kind of ridiculous.
I’ll let you know how it goes…
5. Books.
All my life my book buying has gone something like this:
- I see a book I like.
- I buy it.
- I get 1/4 done with book 1.
- I see another book I like.
- I buy book 2.
- I get half way done with book 1.
- I see another book I like.
- I buy book 3.
And so it goes. Almost my entire adult life I’ve had a stack of books sitting on my desk ready to read.
I took a break for many years when our library in Michigan would ship almost any book I wanted to our local library. However Colorado doesn’t have as much selection and I find them not stocking many of the books I want.
I did try Audible for some time but then I just ended up collecting audio books on my phone.
I tried the Libby app where I can listen to books from the library but the selection is even weaker than the printed options. Even if they have the book I want I often have to wait months to hear it.
So I’m back to Audible and fighting this never-ending battle, as I look at four un-read books that I’ve purchased from Amazon in the last few months sitting on my desk. Ugh.
6. Pens.
This was a thing for me back in the day. I LOVED Cross Classic pens.
I must have had 5 to 10 of them at one point, some engraved with my name as an award from an employer or two.
Anyway, I loved a great pen.
It’s not as much of a temptation for me these days (I had to Google to see if Cross was even still around) as I prefer disposable pens.
But every now and then I do run into a nice pen that I briefly think I must have! 🙂
7. Travel.
I’m in a gray area on this one.
On one hand, I’m trying to 10x my travel spending.
To this end I went to Florida at the end of October and am planning a likely trip to Hawaii in February. I was in DC in September as well.
On the other hand, how much is too much? How many trips, at what price first class, how much should we spend for beach versus non-beach stays, etc.?
It’s a balancing act for sure.
My wife does reign me in though since I travel with her most of the time. But when I go alone — whew! LOL!!!!
8. Electronics.
The manufacturers of electronics are killing me!
Every day I see a new TV, phone, computer, or some other sort of device that I’d like to have.
Fortunately I’m an old fogey so I’ve lived a lifetime without many of these and can resist the temptation — most of the time.
That said, I do want a great set of wireless speakers (like these) soon so I can blast my music throughout the house year around. Costco has some great options but I do need to ditch my wife to get them. 😉
To Spend or Not Spend
Of course some of this is a problem in the other direction.
In my retirement interviews I ask people:
Did you find it hard going from being a saver to a spender?
I can’t really answer that question because I haven’t had to face it yet.
This is for two reasons:
- We make more than we spend every year. Even though our spending is at a healthy $90k+ per year, we still make in the neighborhood of $120k per year. So we’re still saving…
- As a result, our assets keep growing. They are up close to $1 million since I retired!
In effect, I have more than enough to buy all the luggage, books, and electronics I want. And yet I don’t. Maybe I do have a problem going from being a saver to a spender…
Or maybe it’s that I just don’t want things as much any more. After all, do I really, really, really want more stuff? Do I think it will make me happier? I am pretty happy the way it is — so what will more stuff do for me? Not much really.
Anyway, I’d love to hear from you on this subject. Are there things you have to fight from spending too much on?
Or do you have the problem of not being able to loosen up your spending?
Or maybe you anticipate one of these problems in the future?
I’m excited to hear from people on both sides of the issue!
Dave @ Accidental FIRE says
Spending kryptonite, we all have it. I too made way below average at my first jobs and had to work my ass off to boost my salary. I didn’t reach a median salary until I was in my 30’s.
One of my spending kryptonite’s is just outdoor gear in general. Camping, backpacking, climbing… all of these require gear and I’m like a kid in a lego store when if comes to getting it. The good news is that I still do these things often and really get good use outta my gear.
Tink says
Check out small company called killspencer. I bought a weekender bag made out of recycled military tarp about ten years ago and it’s the perfect travel bag for me and still looks brand new. They have good sales a few time’s a year too.
Fritz @ TheRetirementManifesto says
You’re feeding his addiction. Tsk tsk.
MMiguel says
And mine too…. nice stuff! Forgot to add that to my list. I cannot resist a cool, functional bag 🙁
Is there a recovery group for this addiction?
Sheila and Mike says
It’s my husband and I were somewhat frugal our working lives, saving half of my salary (I was the higher earner) for many years. I retired early at age 49 by choice, and have done some short contract jobs and continue at age 59 taking the odd day long job now and again. He was forced to retire at age 53 a few years earlier than planned as his job moved to the US. But has done some contract work as well.
We are very comfortable due to savings, investing well, small DB pensions and spending habits. It’s a difficult thing to move from saving to spending. We have spent a lot more in her past couple years than ever. I am leery of this, we don’t want to become spenders for the sake of spending. I want to be mindful of consumerism, our footprint, etc etc. We don’t plan to have a lot left when we pass on. (No kids, grandkids) But difficult to know just how much to spend now and in figure. A good problem to have, we know!
MMiguel says
1) Dress Clothes – Since I still work and my work frequently requires business attire, I have closets full of suits, dress slacks, sport jackets, fitted dress shirts, etc. I like a good deal but in general I go for high quality over price. But at least I do tend to hang on to things for many years… until they fall apart or go out of fashion.
2) Shoes – my shoe thing is like ESI’s luggage thing… I am constantly looking for the perfect pair. And I believe greatly in specialization… the right show for the right whatever. Again, I tend to hang on to them for perhaps too long, usually until they disintegrate.
3) Outdoor/Athletic wear… I love all things outdoorsy… waterproof jackets, technical pants, hiking boots, etc. its a bit of a obsession… especially since our weekend house is on several acres in a semi-rural setting.
4) Tools and outdoorsy gadgets… wife refuses to let me go to Home Depot or Lowes or any hardware or sporting goods store for that matter alone (I sneak out anyhow). I go in to find some screws or socks, and manage to spend at least $100 no matter what I originally intended. One cannot ever have enough tools or hiking socks.
5) Electronics… modern life just seems to require frequent upgrade of phones, tablets, laptops, desktops, TV’s, etc. just seems to add up to a surprising amount each year even though we try to keep things until they break or stop working.
6) Vacation home – No it is not an investment, and boy oh boy it costs a lot to maintain. Yes, it is worth it but definitely belongs on the splurge list. We’re also always on the hunt to upgrade which scares me when wife starts looking at r.e. listings.
7) Travel – We don’t travel a lot since I’m not retired, but when we do it can add up. We’re both budget motel folks (great value when we’re say visiting relatives) and ritzy folks (when we just want to chill in some exotic destination). I usually have enough freq flyer points for upgrades.
8) Food – Last but not least, we shop at organic markets and eat out a lot. That really adds up.
We’re not saving the way we used to but as I am nearing retirement and we are already financially independent, our financial strategy is more about letting our assets continue to grow, delaying drawing down on assets for as long as I’m happy working, and preparing for retirement in terms of figuring out asset protection and tax minimization strategies.
Xrayvsn says
I used to be a coin collector back in the day too. I collected proof sets (still have them all I think starting in the 1950s) but stopped when I went to college so I’m thinking early 90s was last I have.
What luggage would you recommend after going through so many of them?
ESI says
I don’t think I have a favorite luggage brand. I can find a bag I like in almost any brand…that’s kind of the problem. 😉
Retire@55 says
It is a struggle to move from saver to spender, however…
Flying First Class has become an easy adjustment, would never have considered back in the saving days, now it is tough to even consider coach.
Sheila says
Oh boy, we can relate!!
Bag addict 2 says
Not to feed the addiction, but RedOxx (redoxx.com) has some unique bags. I used their Air Boss (large carry on) extensively, including a 4-week European vacation this past summer. Only problem is you can load it up…the do have a mini Boss which I’ve considered getting. They have a neat story…American made and veteran owned. My other favorites are the Tommy Bahama weekend bags…have way too many.
Addicted to Cars says
My spending “sins”:
My first car at age 16 was originally purchased for my mother for $400 in 1974, a 1968 AMC Ambassador. The car didn’t fit my mother well, so I inherited it when I got my drivers licence. Every car I bought since then has been brand new, a total of 4 for me in the last 43 years, and 2 for my ex-wife during our 10 years of marriage. I just love the feeling of a new car and usually buy a new model when they first come out; like a Miata in 1989 (drove for 226K miles) and a G35 Coupe in 2002, my current ride with 193K miles.
I currently have 21 speakers and 2 subwoofers in the house, and two home theater setups. This doesn’t include 10 speakers I gave away in the last few years.
We bought his and hers Rolexes in the “80s in Switzerland when the dollar was very strong.
I buy majority of my meals at restaurants. I’ve struggled with maintaining weight most of my life and have tried many diets and weight management programs. They all work, but I relapsed every time. For the last several years I’ve stopped keeping food in the house, so I have to go out to get every meal, now that I am retired, often by walking. I usually have two meals a day, choose healthy items and not having food in the house prevents snacking. Not a frugal choice, but this works for me.
Growing up in the former Soviet Union, I’ve spent nearly all of my available rubles on postal stamps. These were not rare stamps that are worth a fortune today, I’ve collected stamps with cars and flowers from exotic places in Middle East, the Americas and Western Europe. I still have them for sentimental reasons, but you can probably purchase a similar collection for a few bucks on ebay.
I’ve been retired for over a year and do struggle with losing up the purse strings even though I have a substantial investment portfolio.
Fuzzy says
This is low cost stuff John you really shouldn’t sweat.
We are both addicted to our Beach house and I to my small plane. .
Would love a newer bird or tailwheel aircraft but spending lots of bucks for limited travel just not practical.
I justified the beach house as an investment we could enjoy. We rented it out until we retired, now just enjoy it and considering an addition and move.
We only bought both when we hit over seven figures from our real estate investments.
And of course, they are totally paid for with no other debts now. I’m a Dave Ramsey guy. 😊
FrankS says
Travel – We spent ‘85-‘87 in the Middle East on a work contract in Saudi and had two months a year vacation. My wife and I traveled extensively. Got home, had a career in clinical software development for 25 years, now retired. Had two sons, both are great and we have a super great relationship with them. I think the time overseas and associated travel made us very comfortable traveling in foreign countries which we currently do 1.5-2 months a year. We travel economically and try to stretch a dollar as far as we can. Current favorite is Italy, probably been 8+ times, all over. Try to go to Florence Italy at least once a year. Love it.
We have enjoyed three Celebrity Transatlantic cruises from Fort Lauderdale to Europe. Truly the slow boat but good time to relax, read and write, enjoy great food and shows and sone wonderful one day stops on the way. Always a great gym on the ship…..unfortunately no pickleball (my current addition 5 days a week). When we get to Europe we will travel for 10-15 days. We then take a one-way flight back to GA.
Technology – Love it; had a career in it; got to get the latest iPhone, iPad, etc. I even have an Italian cell phone to use over there. Originally very useful but now can get by with a Europe SIM card purchased at the train station (or Amazon) and then have access to my email, Google maps, and WhatsAPP (VOIP for phone calls);
Current Dave Ramsey fan with our family, but there were predecessors before him that were great as well, Christian Financial Concepts (Larry Burkett); changed my life;
Glad I started buying mutual funds at age 18 instead of cars and junk. I had a mom that trained me how to read Stock reports and financial statements like P&Ls and Balance Sheets at age 14. My dad was already deceased. A very wise mother. I passed the financial education on to our two sons who are both financially conservative.
ESI says
Larry Burkett was the same for us…
Steveark says
I rented an Osprey 65 litre pack for an overnight hike with my wife a few weeks ago. It was the most amazing piece of outdoor kit I’ve ever seen. And yes to no checked bags! I spent a week in San Fran recently with only one carry on bag, and I had to wear suits for the four day conference.
FrankS says
My wife and I are ultra-light travelers as well, gives up the ability to take trains in Europe easily, roll from train station to hotel w/o bus or taxi, we love to walk.
I have traded through many carryons and now have one soft-sided carryon about 6 lbs, it works. To me it is about great wheels when using over cobblestone streets and rolling distances.
My personal bag is called a “Nutsac Satchel 11”, I have carried for years and carry in the USA as well, even around town. Will carry a 10.5” iPad or iPad 12.9”, Kindle Paperwhite Reader, Bose noise-suppressing ear buds (not headphones) that are wired for plane use; I have a pair of wireless Bose Hearbuds that are great for everyday use like audio books and Podcasts. https://nutsac.com/products/satchel-11
Love the European travel.
SB says
Hi FrankS, we’re currently thinking about a trip to Italy. Would love to stay in the Dolomites. Have you been there? Any advice would be appreciated on where to stay for good hikes, food and scenery. Thank you.
FrankS says
SB:
We had one day in the Dolomites. We were staying in Venice and did a great day trip via a company called Viator. Nice Mercedes van, our group was 4 and there were another 4 persons also on the trip. Was a good day, saw some very old ski jumps, great Mountain View’s and overlooks. Had a great lunch with “barley soup”, a unique dish to me. I would imagine there may be some places to stay and hike, but we only had a day. Hope this helps, it is another scenic area of Italy probably not many people see.
You could probably fly to Rome or Milan and take a very fast train to Venice and rent a car and be pretty close to the Dolomites w/o extensive driving in Italy. Hope this helps.
Arrgo says
Most of these dont seem too expensive especially considering your income and net worth. However, Im sure you end up realizing you dont really need more of it at this point and it ends up being more clutter and stuff to manage. I know from my own experiences. Moderate and really scale back the rate that you may actually purchase these things. You can still buy them, but have more self discipline and wait longer between purchases or when you want to treat yourself. In the end im sure you will feel better about it. Probably more about the principle than the money part. I used to collect coins in my teens, went to some coin shows etc. I still have them but only a few decent pieces. I think if I sold them now after over 30 years I might actually break even 😉
Maca says
Enjoyed this post and reading all the comments. We’re in the process of selling our house of 21 years and have been decluttering all sorts of “stuff”. So many shoes, suits, golf clubs, golf outerwear, stereo equipment, car magazines, padfolios, hats, books, bookshelf decorative items, etc. Hopefully, we’re through with the accumulative phase of our lives and on to simplifying.
Question for this wise group: As we gradually transition to retirement (wife is 54 with great benefits from her employer and she loves her job, I’m 60), does it make sense to park the proceeds from the sale of the house into a no-load muni bond fund and use the income generated to off-set the rent we’ll be paying before we buy our retirement home?
ESI says
I think it depends on your other plans, income needs, etc.
Millionaire73 says
Enjoyed this article and while my income was low in my early 20’s I remember watching my spending very closely as I would not buy something I wanted for months would research it and that delayed gratification was an important foundation longer term in growing net worth. The crazy part was at the same time I was trying for Home Run after Home Run in penny stocks and being a part time day trader (not my skill set) and still remember losing 40K (reducing my net worth from 50K to 10K) all while I had a $100 item I was waiting to purchase till the price went down. So obviously this made no sense 🙂
Over the years, I have a better sense of what I like and love and now and found that once I hit 8M Networth (not sure why that number) but it was when I felt like I had no $ worries anymore (yes crazy I know) and over the last few years if I find something I like (mostly clothes, electronics, things for house) I buy it right away after of course finding the best deal and some research depending on price.
The one areas I have spent extra on (that save $ longer term) starting about 8 years ago was laptops/computers as after going through many PC’s which lasted 2-3 years before they started to struggle performance wise I went with Macbooks and have not looked back. Definitely more expensive but my 2012 Macbook lasted 6+ years until the battery started to lose it charge (now my 12 year daughter is using as a quasi desktop) and I got a new top of the line one which was $3,500 but since I am a technology consultant it was not hard to justify 🙂
The major area of change for me was on vacations as I always like to travel but got in the mindset of a week of vacation would cost me X (ie lost revenue of 40+ hours X billable rate) + cost of vacation and my mindset was let’s do a lot of weekend or Fri-Sunday trips due to “cost” much of which was lost billing. Had some great vacations in 2019 and realized that my kids are at a great age 12 and 13 to travel and going to really enjoy experiencing a lot of fun travel before they leave the house for college.
M73
https://esimoney.com/millionaire-interview-73/
Robert says
Books and travel are my weak spots… and guns. I love buying historic guns, like the Springfield M1903 A4.
The good news is that collectibles don’t necessarily lose money like a new car – if you buy correctly, your net worth might even go up slightly over time!
At least… that’s what I tell myself. Please don’t correct my delusions. 😛
Ready2Retire says
ESI
Here is a great all in one carry on bag Tom Bihn Tri-Star
https://www.tombihn.com/products/tri-star?variant=15281608785983
RI-6 says
Wireless Speakers:
Run, don’t walk, to Costco and buy a house full of SONOS speakers. Great sound, great app, great ecosystem of inter-compatibility, wi-fi driven rather than bluetooth (wi-fi=better), and Alexa compatible. They are expensive, but IMHO worth every penny.
Yes, I’m addicted, and clearly one of my spending vices!
JoeHx says
I enjoy using a good pen, but I lose them too quickly to justify spending any money on them.