3 ms·

I thought about MMM earlier today at the grocery store (wondering if we were spending too much), so I was surprised to see him profiled on this week's issue. I

I thought about MMM earlier today at the grocery store (wondering if we were spending too much), so I was surprised to see him profiled on this week's issue. In a way, his methods make me feel relieved that a particular income benchmark or the wild growth of a business is not needed to lead a happy/sufficient life, yet I feel anxious because 1) I didn't have the best start (law school debt), 2) I haven't cut down my spending/saved as much as I should. Just curious, are there any anti-mustachians who 1) bust ass to maximize earnings, 2) have unabated spending habits, 3) believe they are happier to live such a lifestyle?

hkmurakami 11y ago
I'm a "cautious skeptic" mustachian because MMM's net worth was fueled by the historic bull run in asset markets during the early--mid parts of his professional life. I hesitate to be fully devout in the belief that asset markets will always produce outsized returns like it did for him.
- burritofanatic 11y ago
  Agreed. The article also touches on the point that his blog alone earns 400K yearly. Though it's honorable that he makes an effort to only spend 24K a year, he has safety net that sets him as a 1 percenter.
- JoshTriplett 11y ago
  Investment success might make some difference in how quickly you can retire, but the various planning around early retirement makes conservative assumptions about long-term returns. The fraction of your income you save makes a far larger difference than how much index funds gained or lost in any given year. This holds true not only because the money you save goes to fund your future retirement, but also because your retirement income doesn't need to match your current income, only your current spending. So if you save 40% of your income, you need your retirement savings to produce 60% of your income; if you save 70% of your income, you only need your retirement savings to produce 30% of your income. That means you both increase your savings rate and decrease how much savings you need before retirement.
  - icebraining 11y ago
    That's only if you make the heroic assumption that expenses are static. From expenses related to ageing itself (increased need for healthcare, possibly even moving to an assisted care facility) to the particular conjuncture during old age (for example, in my country many unemployed adults and their children are living with the help of the pensions of their parents), I would avoid assuming that.
- runamok 11y ago
  I agree with you to a point but his math checks out with 'only' making 4% (the 25x your yearly costs number to retire). I just lost about 2 years of gains in one year in my betterment accounts for instance. His fundamental point of making far less than you spend and not to have consumer debt is clearly sound advice.
kylemuir 11y ago
Honestly, I feel that everything in moderation is a good rule to follow. I spend a more than I perhaps should but I enjoy my life. As long as I am putting money away into savings each month and not going backwards I see it as a win. Going to extremes where you're worried about whether or not you put pieces of plain pizza in with mushroom pizza I feel is a bit too far for my liking.
deleted 11y ago
[deleted]
superuser2 11y ago
My natural burn rate is well below my income and I like my job. It's very nice that money is mostly abstracted away: I swipe my card when I want to, don't look at my accounts or pay stubs that much, and maintain solid financial health. As long as I don't lust after anything too ridiculous, money isn't a point of tension in my life. I certainly wouldn't want to make it one.
johnloeber 11y ago
Regarding the last point: one of the most common deathbed regrets is to have worked too hard. An extension can be made for being overly frugal: leading your life hamstering cash is not much fun, and ultimately, pointless. A common pitfall of frugality is to save money at the expense of your personal happiness. Example: In many companies, people head out to lunch together, grab a sandwich or whatever, eat together, and try to have a social time. That costs about $3300 a year, assuming 220 working days with the price of lunch at $15. That's a pretty large expense, and if you frame it solely in terms of food, probably not worth it for most. MMM would say that you should bring a packed lunch to work. However, I would argue that it is absolutely worth it for most office workers: chances are their jobs are in some way unpleasant, and if they bring a lunch from home, it's only a small step to eating that embarrassing, soggy PB&J in front of the screen, working and missing out on that small break. That can be very demotivating. Beyond that, I think that some contrarian cases can be built for high-income, high-expense lifestyles. For one, an expensive lifestyle can be a great way to meet other successful people, which may open doors to opportunities. (There's a caveat on this: some kinds of expensive goodies, like vacations to Zermatt or living in a great area, are probably much better investments than buying a $15k handbag.) Spending money on great experiences while young is also probably worth it. Having had "boring" 20s and 30s is another common regret, and it's quite feasible to prevent that, if you're confident in your earnings potential later on.
- s3nnyy 11y ago
  I disagree. It all boils down to social skills. I am living frugally in Zurich and I am saving 80% of my income (see post above). What I do when I want to participate in social meals is this: I just eat my own food before so I am not hungry, and then I just order a drink at the restaurant. My colleagues at work know my lifestyle and accept me the way I am. If I am eating out with people who don't know me, I just say I am not hungry.
  - johnloeber 11y ago
    I gave an example to illustrate a point. Granted, my example was not perfect. The overall point still stands: not to make the mistake of sacrificing expenditures that are (in some way) critical to your happiness and motivation.
mightybyte 11y ago
I consider myself a little bit of an anti-mustachian. But I'm sure the majority of Americans would probably consider me quite mustachian. I spend significantly less than 10% of my gross income on housing. I almost never take a cab when I could take the subway. I save enough so that for all practical purposes I never have to worry about money. But at the same time I spend substantially more than the mustachian 24k / year. I don't particularly enjoy cooking, so MMM would consider my food expenditures to be grossly high. My view is that people should live in a way that maximizes their happiness. MMM seems to enjoy taking frugality to the extreme. But I'm different. That lifestyle would not make me happy at all. In the past I have lived with very little left over for savings. That way of living also caused a lot of stress any time unexpected expenses pop up. It absolutely did not maximize my happiness. I'm fairly careful with my money naturally, so my current mode of living doesn't require any effort on my part. It leaves me free to make what many would consider pretty large splurges from time to time while still maintaining a nice cushion for unexpected expenses as well as a nicely increasing investment portfolio that should allow me to retire well before the standard retirement age. So no, while you might not be able to say I have fully unabated spending habits, MMM might say that I do. And in that case I would satisfy all three of your points.
beningrad 11y ago
I think blogs like his seek to do for your lifestyle what meditation does for your thoughts--make you aware of your choices and their effects. At their best, they enlighten you toward a more conscious design of your own lifestyle. I'm not "anti-mustachian," but I can speak to the choices I've made. I could be saving waaaay more, but I have no burning desire to optimize my lifestyle toward freedom. I'm super lucky that I enjoy my work. It's not fun 100% of the time and I'm not free to come and go as I please without consequences, which is something MMM especially optimizes for. I'm optimizing to always be doing interesting work with people more intelligent or creative than me. Right now this is best accomplished by doing good work for companies with deep pockets so that I can do the fun stuff. I also optimize for exciting experiences and good connections with people. Sometimes those two optimization goals are at odds, but I've managed the cognitive dissonance by being more loosey goosey with my priorities than MMM advocates. This has led to immense fun, personal satisfaction, and growth. I've lived and worked abroad. I make big, silly art. I'm floored by some of the people I work with. I'm lucky to have several big friend group--often the result of working on fun stuff together and then continuing those relationships outside of their original contexts. All that said, I might totally change my tune if I had a kid and wanted to build a family or I suddenly wasn't making good money.
- noelwelsh 11y ago
  Can you say a bit more about what you do? Sounds very interesting.
  - beningrad 11y ago
    Right now I work in R&D for toys, VR, and IoT. I started as a straight up game designer, but I got very into programming and embedded electronics. If I went searching for a new job tomorrow, I would bill myself as a T-shaped HCI R&D guy with a deep knowledge of game design.
- dagw 11y ago
  As someone with a kid and family and all that jazz, I am so happy I spent my 20's frivolously 'wasting' my money on fun adventures and silly projects. Easily some of the best times of my life.
sdrothrock 11y ago
> In a way, his methods make me feel relieved that a particular income benchmark or the wild growth of a business is not needed to lead a happy/sufficient life Are you sure about that? He worked during the boom era (1998 to 2007) and the article says he saved 250k in five years, which indicates that he had a very good salary. In addition, he says that he and his wife still work occasionally (and she was also a developer in the boom era) and that he makes 400k/year from the site. I imagine that it's much easier to retire at 30 if you have a crapton in the bank made on a high salary in a good economy (when you bought your houses [one of which they rent out]) and then have recurring income that can pad out your savings in event of any emergencies that might come up. Someone who's budgeted 30k a year for the rest of his life and doesn't have the kind of job/expertise to do random contract work and retires could easily find himself completely ruined by one bad accident.
- desdiv 11y ago
  >and that he makes 400k/year from the site Fool-proof retirement plan that anyone can follow: 1. Have 400k/year of passive income. 2. Retire.
  - w23j 11y ago
    Of course the timeline in this case was: 1. Retire 2. Live of savings as planned for years 3. Start a blog that ends up making money
  - bildung 11y ago
    According to his site, he was already retired when he started blogging.
    - nodamage 11y ago
      Be that as it may, there's a pretty big difference in financial security between retiring at 30 with $600k in the bank (where one financial emergency puts you on pretty thin ice) and retiring with $600k in the bank plus $400k/year extra income.
damon_c 11y ago
I pretty much do this. Not that I am an "anti-mustachian" by philosophy, I just have had pretty good paying jobs since the day I got out of school and have spent a lot all throughout... The money I have saved has been automatically deducted from this or that... the rest... poof!
morgante 11y ago
> Just curious, are there any anti-mustachians who 1) bust ass to maximize earnings, 2) have unabated spending habits, 3) believe they are happier to live such a lifestyle? I'd classify myself as a bit of an anti-mustachian in the sense that I pay 0 attention to 99% of purchases. I don't think twice about going out to dinner regularly, buying a round of drinks, or going on random trips. It's rare for me to look at a receipt. Despite spending freely, I still manage to save around $80-100k annually. Increasing earnings is far more effective than trying to minimize earnings. Trying to cut your spending by 25% is pretty challenging, but making 25% more is totally doable and often involves just getting a few competitive job offers. As Ramit Sethi sometimes says, skipping lattes never actually lets someone retire early. A lot of the things MMM recommends are actually economically irrational for developers (unless you enjoy them). Why would I ever cook when I can earn $150 from the equivalent time and get a nice meal delivered for $20? The only bit of spending I pay attention to is rent, because that can eat up a huge portion of your salary if left unchecked—particularly in the places with the highest salaries.

hkmurakami 11y ago

I'm a "cautious skeptic" mustachian because MMM's net worth was fueled by the historic bull run in asset markets during the early--mid parts of his professional life. I hesitate to be fully devout in the belief that asset markets will always produce outsized returns like it did for him.

burritofanatic 11y ago
Agreed. The article also touches on the point that his blog alone earns 400K yearly. Though it's honorable that he makes an effort to only spend 24K a year, he has safety net that sets him as a 1 percenter.
JoshTriplett 11y ago
Investment success might make some difference in how quickly you can retire, but the various planning around early retirement makes conservative assumptions about long-term returns. The fraction of your income you save makes a far larger difference than how much index funds gained or lost in any given year. This holds true not only because the money you save goes to fund your future retirement, but also because your retirement income doesn't need to match your current income, only your current spending. So if you save 40% of your income, you need your retirement savings to produce 60% of your income; if you save 70% of your income, you only need your retirement savings to produce 30% of your income. That means you both increase your savings rate and decrease how much savings you need before retirement.
- icebraining 11y ago
  That's only if you make the heroic assumption that expenses are static. From expenses related to ageing itself (increased need for healthcare, possibly even moving to an assisted care facility) to the particular conjuncture during old age (for example, in my country many unemployed adults and their children are living with the help of the pensions of their parents), I would avoid assuming that.
runamok 11y ago
I agree with you to a point but his math checks out with 'only' making 4% (the 25x your yearly costs number to retire). I just lost about 2 years of gains in one year in my betterment accounts for instance. His fundamental point of making far less than you spend and not to have consumer debt is clearly sound advice.

kylemuir 11y ago

Honestly, I feel that everything in moderation is a good rule to follow. I spend a more than I perhaps should but I enjoy my life. As long as I am putting money away into savings each month and not going backwards I see it as a win. Going to extremes where you're worried about whether or not you put pieces of plain pizza in with mushroom pizza I feel is a bit too far for my liking.

deleted 11y ago

[deleted]

superuser2 11y ago

My natural burn rate is well below my income and I like my job. It's very nice that money is mostly abstracted away: I swipe my card when I want to, don't look at my accounts or pay stubs that much, and maintain solid financial health. As long as I don't lust after anything too ridiculous, money isn't a point of tension in my life. I certainly wouldn't want to make it one.

johnloeber 11y ago

Regarding the last point: one of the most common deathbed regrets is to have worked too hard. An extension can be made for being overly frugal: leading your life hamstering cash is not much fun, and ultimately, pointless. A common pitfall of frugality is to save money at the expense of your personal happiness. Example: In many companies, people head out to lunch together, grab a sandwich or whatever, eat together, and try to have a social time. That costs about $3300 a year, assuming 220 working days with the price of lunch at $15. That's a pretty large expense, and if you frame it solely in terms of food, probably not worth it for most. MMM would say that you should bring a packed lunch to work. However, I would argue that it is absolutely worth it for most office workers: chances are their jobs are in some way unpleasant, and if they bring a lunch from home, it's only a small step to eating that embarrassing, soggy PB&J in front of the screen, working and missing out on that small break. That can be very demotivating. Beyond that, I think that some contrarian cases can be built for high-income, high-expense lifestyles. For one, an expensive lifestyle can be a great way to meet other successful people, which may open doors to opportunities. (There's a caveat on this: some kinds of expensive goodies, like vacations to Zermatt or living in a great area, are probably much better investments than buying a $15k handbag.) Spending money on great experiences while young is also probably worth it. Having had "boring" 20s and 30s is another common regret, and it's quite feasible to prevent that, if you're confident in your earnings potential later on.

s3nnyy 11y ago
I disagree. It all boils down to social skills. I am living frugally in Zurich and I am saving 80% of my income (see post above). What I do when I want to participate in social meals is this: I just eat my own food before so I am not hungry, and then I just order a drink at the restaurant. My colleagues at work know my lifestyle and accept me the way I am. If I am eating out with people who don't know me, I just say I am not hungry.
- johnloeber 11y ago
  I gave an example to illustrate a point. Granted, my example was not perfect. The overall point still stands: not to make the mistake of sacrificing expenditures that are (in some way) critical to your happiness and motivation.

mightybyte 11y ago

I consider myself a little bit of an anti-mustachian. But I'm sure the majority of Americans would probably consider me quite mustachian. I spend significantly less than 10% of my gross income on housing. I almost never take a cab when I could take the subway. I save enough so that for all practical purposes I never have to worry about money. But at the same time I spend substantially more than the mustachian 24k / year. I don't particularly enjoy cooking, so MMM would consider my food expenditures to be grossly high. My view is that people should live in a way that maximizes their happiness. MMM seems to enjoy taking frugality to the extreme. But I'm different. That lifestyle would not make me happy at all. In the past I have lived with very little left over for savings. That way of living also caused a lot of stress any time unexpected expenses pop up. It absolutely did not maximize my happiness. I'm fairly careful with my money naturally, so my current mode of living doesn't require any effort on my part. It leaves me free to make what many would consider pretty large splurges from time to time while still maintaining a nice cushion for unexpected expenses as well as a nicely increasing investment portfolio that should allow me to retire well before the standard retirement age. So no, while you might not be able to say I have fully unabated spending habits, MMM might say that I do. And in that case I would satisfy all three of your points.

beningrad 11y ago

I think blogs like his seek to do for your lifestyle what meditation does for your thoughts--make you aware of your choices and their effects. At their best, they enlighten you toward a more conscious design of your own lifestyle. I'm not "anti-mustachian," but I can speak to the choices I've made. I could be saving waaaay more, but I have no burning desire to optimize my lifestyle toward freedom. I'm super lucky that I enjoy my work. It's not fun 100% of the time and I'm not free to come and go as I please without consequences, which is something MMM especially optimizes for. I'm optimizing to always be doing interesting work with people more intelligent or creative than me. Right now this is best accomplished by doing good work for companies with deep pockets so that I can do the fun stuff. I also optimize for exciting experiences and good connections with people. Sometimes those two optimization goals are at odds, but I've managed the cognitive dissonance by being more loosey goosey with my priorities than MMM advocates. This has led to immense fun, personal satisfaction, and growth. I've lived and worked abroad. I make big, silly art. I'm floored by some of the people I work with. I'm lucky to have several big friend group--often the result of working on fun stuff together and then continuing those relationships outside of their original contexts. All that said, I might totally change my tune if I had a kid and wanted to build a family or I suddenly wasn't making good money.

noelwelsh 11y ago
Can you say a bit more about what you do? Sounds very interesting.
- beningrad 11y ago
  Right now I work in R&D for toys, VR, and IoT. I started as a straight up game designer, but I got very into programming and embedded electronics. If I went searching for a new job tomorrow, I would bill myself as a T-shaped HCI R&D guy with a deep knowledge of game design.
dagw 11y ago
As someone with a kid and family and all that jazz, I am so happy I spent my 20's frivolously 'wasting' my money on fun adventures and silly projects. Easily some of the best times of my life.

sdrothrock 11y ago

> In a way, his methods make me feel relieved that a particular income benchmark or the wild growth of a business is not needed to lead a happy/sufficient life Are you sure about that? He worked during the boom era (1998 to 2007) and the article says he saved 250k in five years, which indicates that he had a very good salary. In addition, he says that he and his wife still work occasionally (and she was also a developer in the boom era) and that he makes 400k/year from the site. I imagine that it's much easier to retire at 30 if you have a crapton in the bank made on a high salary in a good economy (when you bought your houses [one of which they rent out]) and then have recurring income that can pad out your savings in event of any emergencies that might come up. Someone who's budgeted 30k a year for the rest of his life and doesn't have the kind of job/expertise to do random contract work and retires could easily find himself completely ruined by one bad accident.

desdiv 11y ago
>and that he makes 400k/year from the site Fool-proof retirement plan that anyone can follow: 1. Have 400k/year of passive income. 2. Retire.
- w23j 11y ago
  Of course the timeline in this case was: 1. Retire 2. Live of savings as planned for years 3. Start a blog that ends up making money
- bildung 11y ago
  According to his site, he was already retired when he started blogging.
  - nodamage 11y ago
    Be that as it may, there's a pretty big difference in financial security between retiring at 30 with $600k in the bank (where one financial emergency puts you on pretty thin ice) and retiring with $600k in the bank plus $400k/year extra income.

damon_c 11y ago

I pretty much do this. Not that I am an "anti-mustachian" by philosophy, I just have had pretty good paying jobs since the day I got out of school and have spent a lot all throughout... The money I have saved has been automatically deducted from this or that... the rest... poof!

morgante 11y ago

> Just curious, are there any anti-mustachians who 1) bust ass to maximize earnings, 2) have unabated spending habits, 3) believe they are happier to live such a lifestyle? I'd classify myself as a bit of an anti-mustachian in the sense that I pay 0 attention to 99% of purchases. I don't think twice about going out to dinner regularly, buying a round of drinks, or going on random trips. It's rare for me to look at a receipt. Despite spending freely, I still manage to save around $80-100k annually. Increasing earnings is far more effective than trying to minimize earnings. Trying to cut your spending by 25% is pretty challenging, but making 25% more is totally doable and often involves just getting a few competitive job offers. As Ramit Sethi sometimes says, skipping lattes never actually lets someone retire early. A lot of the things MMM recommends are actually economically irrational for developers (unless you enjoy them). Why would I ever cook when I can earn $150 from the equivalent time and get a nice meal delivered for $20? The only bit of spending I pay attention to is rent, because that can eat up a huge portion of your salary if left unchecked—particularly in the places with the highest salaries.