[Su]

I am in my early 30s. I am making significant progress towards FI, i am currently cash flowing about 50% of what I need in retirement.

But I feel like my lifestyle has been creeping below me the closer to FI I get.

This weekend I took an unplanned trip to Mexico and I spent 600 USD in restaurants in 2 days.

Apart from the food I enjoyed seeing what my FI life could look like and to know that there are other countries out there apart from the US where one can really enjoy themselves.

I am justifying the expenses by telling myself that this will give you a stronger drive to continue saving/investing.

And recently I have rented quite a big home in a central location where I live.

I am worried that I may need to plan for a much bigger number in retirement because I may fall into some similar situations.

It turns out that being alone is easy to have a high savings rate but I am easily peer pressured when I am around people.
Has anyone experienced this?

What would you advise? And do you think i am doing something wrong that needs to be fixed?

[Christopher]

It all boils down to annual expenses. If $600 per year is enough to derail your retirement, bump up your annual expenses by $600 x 24 (or whatever SWR you’re targeting).

Maybe do that a few times so you can make 3-4 such excursions annually.

Our spending in retirement is pretty lumpy. Some years it’s low, others we have big expensive projects.

We saved for the worst-case spending so that we don’t cut things too close.

[David]

I think having an FI number that gives you a buffer between base expenses and lavish spending is important.

With saying that I would do some self-reflection on why you spend more around your friends.

How does it make you feel, do you get value out of that, or is this something that does not bring you value?

I’m impressed you were able to spend that much in restaurants in two days in Mexico but I am guessing you went to more tourist spots.

I would never justify expenses in the mentality it will make me save more/invest more. I justify expenses based on how much value I get out of it period.

Since I retired last year at 38 I have been doing a lot of spending more on things to see if I get value out of them.

Mind you I have a huge buffer between my base expenses and the amount I can spend up to.

My base expenses are around $30K and I can spend up to about $115K.

Personally what I found is most of the extra spending did not bring me much more value.

One of those was spending very lavishly on going out to eat and drink.

I still go out to eat and drink but not spending nearly as much as I was.

But this is why I think a buffer is important because sometimes we might want to spend more.

The big thing is try to figure out if it brings you real value or not.

[Wendy]

I think it’s all about your “why”. If your why is having amazing dinners out with your friends that cost that much – then that’s what you’re working for.

I’m about to have baked beans for dinner.

I’m happy about it because it’s an easy dinner to eat in a hotel which I got on points and I travel full time with my family – that was my “why”.

(And no, I’m not confined to having baked beans every night). We don’t spend $600 on restaurants in a month let alone 2 days and there’s 4 of us.

But that doesn’t make that choice “wrong”.

There’s no right or wrong – only right for you or wrong for you. Why do *you* want to be FI?

What’s your “rich life” look like? (to borrow from Remit Sethi).

[Rick]

Every country can be as expensive as you make it. Including Mexico.
We spent two weeks in Oaxaca Mexico early this Spring and found it inexpensive even as we tried out a lot of eating food out places.

[Axel]

Can only say I am also experiencing lifestyle creep! Not sure how to combat it as these are things I want!

[Noa]

Pay yourself first, spend the rest. Once you decide how much you save, let yourself have fun with the rest.

Also, you can have levels of FI. We’ve got quite some time left until we get there, so I am planning to do all the cheap vacations I’d like to do first, and I’ll do the more expensive ones later on.

Also, once you reach FI, if your portfolio grows beyond your withdrawl rate, your budget could go up every year….

[Loraine]

l think you’re feeling guilty because you have always been deliberate with spending. Set aside money for

spontaneous, guilt-free splurges. You earned it.

After all, you only live once.

[LaShonda]

I came up with my FI number by taking my annual expense added 20% for the things I’ll want to do in retirement that I’m not doing now and then X 25.

I am curious what you got at the restaurants?

My husband and I can stay at an all inclusive resort for 4 days for $600

[Author]

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