Tag: t_creepSplurge22

“unnecessary commercial offerings”… mostly creep, but some splurge too.
I want this tag to be strict.

##jolts2tighten belt^勇敢花钱

Posted on by tiger40490

Whether it’s a reason to spend my savings or a reason for tighter-belt, each reason usually comes to me as a jolt, or sometimes a wake-up call. The more I internalize these ideas, the less of a jolt they will be.

[s=specific jolts.. much preferred]

— [G2] job insecurity .. If I lose this job, I’m forced to return to the U.S.

Stress job -> income insecurity -> tighten belt.

[s] During the December 2024 long chat with R.Dong, I felt his (hardly sustainable) work stress, the fragile boss-relationship, tough deadlines, PIP … all the stressors. They actually remind me of my GS, Qz,,, jobs.

— [G7] return to U.S. as family .. higher living costs

— [G3] long-term .. the uncertainty over long-term inflation
How much confidence do we have in the PAP team to control the omnipresent inflation hazard, and keep up SGD purchasing power?

— [G5] grandma .. may need to live with us in Sgp. She may need lots of medical care. Both grandparents need medical care already. I don’t need “projected” figures.

++ [G7<6] [s] oversized bonus .. invest meaningful amount in my productivity, home office, commute
A short-lived jolt.

++ [G7] [s] pay for more stress-reliefs, given our rising income

— [G9] barebones .. my ffree is barebones. I may gradually feel impoverished about it.

++ [G6] I disapprove the Chinese tradition of million-dollar inheritance .. it could deprive them of the motivation, the rewarding strugle, the confidence, and the self-learning adventure.

There are plenty of /documented/ hazards of an /oversized/ bequest. I can spend more time reading. See ## faking-> slow conviction-> behavior change

If my kids lack character then such a bequest is probably more harm than good.
— [G9] my kids may not become high-earners.
I would want to show them conserver livestyle .. tight-belt

— [s] med costs after MLP .. after I leave MLP, I need to prepare my family for medical costs, including my CAD check-up

++ CRBR: Financial advisors often point out that we only need about a million to retire

— [s] private schools .. my son may end up in some private school rather than a poly

++ NetAsset annual snap in recent years [ex_china, high pay] often show a large increment, but I remind myself to arrest the splurge impulse

++ Shiller: live more like millionaires

— [s] DJDJ pricing and care level increase

my frequent DJDJ visits .. is a smaller but more visible cost

++ I’m considering donations to “buy” social interaction in my old age.

Just_Say_No to creep,peerPressure.. #PerTrain

Posted on by tiger40490

Saying NO is one of my G3 most important principles in ffree, burn rate mgmt, long-term fin-security.

median household income & middle-class living standard is one of the first blogpost to introduce this JustSayNo principle.

SG government probably follows the same principle many times, but I won’t digress.

— eg: branded college and SDXQ home
— eg: retirement burn rate .. cpfLife ERS pays out about $2200/M, considered adequate for a Singapore retiree. I think this is a reasonable, sensible assessment. What if many among your cohort are building bigger nest eggs to provide $5k/M of retirement income? Would you feel the pressure to match up? This pressure is comparable to the pressure to buy a SDXQ home [Orchard mansion]
— eg: In 2011 or 2012 I hosted Haitao.Fu in my Newport home. I bought 3 small dishes from a nearby Chinese restaurant. One of them (toufu?) we didn’t finish — I kept the clean leftovers for my next meal. I have recalled this experience many times. I feel the /splurge/ peer pressure in hindsight.

I may or may not be right to assume him as a relatively thrifty student. He didn’t show any negative reaction about our meal but now I assume he has moved to higher positions on WallSt… In hindsight, I feel he might have been shocked by my thrift, even though the meal was way more than basic-healthy!  I probably spent USD 40. In hindsight, I feel a more “decent” delivered meal would be 50% higher. Leftovers would be … discarded?

— eg: Personal Trainer (fitness)
At OneNorth office complex, I visited a fitness center that offers nothing but PT (personal training). Minimum membership is $1800/12 PT sessions. If you earn a decent salary nearby, then you would probably consider this package. Now, suppose most of your colleagues have signed up. They tell you various reasons. You accept some of those reasons, but ultimately unconvinced. Some may point at LKY’s attitude on casinoIR and remind me that “Time has changed”. I think I am not old-fashioned, and would consider to accept that package if the $cost/benefit ratio improves. At the current price level, the ratio can become acceptable if I perceive significant benefit in the package vs the alternatives.

  • alternative: You could try jogging on the street near office (unappealing to me). Re Wayne St…
  • alternative: You could do some simple workout in office, or at home. Re Wayne St.
  • alternative: You could join a regular gym somewhere farther out, for $100/M.

At the current ratio, I would say it’s really important to justSayNo. Even if I earn 20k/M, this salary is /unsustainable/ in X years so now I need to spend like ordinary locals and save. Their business model (designed for the super rich) is too costly for the nearby office professionals.

Yoga membership is comparable, but per-session price is about $15 (compared to $150/PT)

y parents buy expensive gears4kids’ new hobby

Posted on by tiger40490

I always laugh at the middle-class Singapore parents who buy high-end equipment whenever their kids start learning a new skill

  • musical instruments
  • art equipment
  • sports gears
  • multimedia gadgets

Now I ask myself

Q: what’s the priority of a middle-class parent? I guess answer is motivation, commitment. Some of these parents are not mindless — they are mindful of the psychological effect on the child.

Don’t forget a small percentage of the equipment has a resale value.

DRIP to build snowball@@ #w1r2

Posted on by tiger40490

Compound return fallacy is the bigger framework.

— stock DRIP… There is widespread brainwash about the miracle snowball of ECP (exponential compound return) via DRIP

  • AA) For example, with XOM (or SPY), my uncle re-invests dividends every quarter. If my aunt chooses to receive dividends but do not invest further, then yes she would get no “snowball”.
  • BB) In contrast, I choose to receive dividends, but later at my own timing[1] invest the same [2] amount into XOM or unrelated stocks [3].
  • BB^AA prognosis ….. if I invest at least the same [2] aggregate amount as my uncle, and at least once a year[1], I won’t lose out to my uncle.

[1] My frequency is sometimes higher sometimes lower than quarterly. I always prefer to time my entry. About half the times, the DRIP default timing is not ideal. If my timing decisions turn out to be inferior to the default, I won’t blame anyone, but this won’t be a valid explanation for the “snowball” or the absence thereof.

[2] The amount I invest is often bigger than my uncle’s tiny dividends. High dividend years are over, so those “snowball” stories are outdated because nowadays the smaller dividends make the snowball growth slower.

[3] Usually, my “reinvestment” amount goes into a stock different from the original stock (XOM in this example), often a stock outside SP500. This diversification is usually beneficial, though it breaks the compound return paradigm. In fact it can beat the compound return snowball.

My uncle’s robot uses market orders, which are inferior to my limit orders.

One advantage of automated (robotic) DRIP is tcost. (Tcost is a different concern in recreational investing.) In view of that, I may need to reduce trading frequency..

— splurge .. Somehow the brainwash theory assumes that most investors who opt for cash dividend would spend the payout. Suppose the typical investor Cody spends $5000/M on average. When $770 dividend received in June, how much would Cody spend in that month? The brainwash theory assumes answer is $5770, because the dividend would feel like a windfall to be spent.

Well, I think the answer for some people is $5000. They save the windfall.

Actually, some investors simply leave the dividend payout in the brokerage account to buy more stocks. If they withdraw the cash dividend, then indeed there is higher chance of spending it.

SG casinoIR: lifestyleCreep “endorsed”by LKY

Posted on by tiger40490

in https://www.straitstimes.com/singapore/in-his-own-words-irs-needed-for-spore-to-keep-abreast-of-the-top-cities, LKY said

The old model on which I worked was to create a First World city in a Third World region – clean, green, efficient, pleasant, healthy and wholesome; safe and secure for everyone… Now we also have to be not just economically vibrant, but also an exciting, fascinating city to visit, with top-class symphony orchestras, concerts, dramas, plays, artists, singers and popular entertainment. These are lifestyles of international professionals and executives who locate in Singapore, working in multinational banks, finance houses and other MNCs… And we want those companies who manage entertainment troupes to include Singapore in their tour of cities around the world.

Q: Are these unnecessary finer things in life?
A: I think LKY would not approve his family members engaging in gambling, drugs, extravagance/decadence lifestyle etc. Those things would cross his baseline. However, he recognizes that many “international professionals and executives” have a high lifestyle. If put in his shoes, I would say there are many sides [wellness, reward/motivation, sustainability..] to this issue, but many of those finer things in life are “nothing wrong” by default.

The archetype of these “finer things in life” — high-end alcohol, tobacco, fancy (unhealthy) food, massage parlor,

[21]Gabbar: no right or wrong@@

Posted on by tiger40490

 

See also

In my Dec 2021 year-end dinner with 3 colleagues, once again I noticed my breakaway from middle-class, in terms of priorities, blindFOMO

They talked about condo (1.2M was what they discussed), big mtg (like 900k), maid, private internaitonal schools as if there is no choice (They are foreigner in SG. Later I brought up college funding and SDXQ.) They also talked about car ownership… in a well-connected Singapore!

Varun reiterated that there’s no right or wrong, but I do have an opinion. I think some of those items are the wrong priorities for me (and probably for them too), because I have better self-knowledge. I think in old age some of these individuals would regret when they re-evaluate their past decisions in total honesty. Other eg of personal priority where there is no right or wrong:

  • To them, short commute is a good-to-have but low priority.
  • To them, healthy longevity is presumably low priority, and pleasure is high priority. Well, look at Grandpa’s experience after 85.
  • To them, my diet struggle, hazards, availability … are clearly a low priority. I feel some of their waistlines represent their growing income.
  • To many of my peers in their 30s and 40s, more time with kids is a priority, but for me, I don’t want too much time or too little time with kids. I know what I want.

I don’t want to spend on commercially popularized priorities like car, luxury housing, top SDXQ, branded colleges,,,

I’m willing to spend on my personal priorities such as family reunion trips, low-stress/low-pay jobs (like Mvea, Citi…) I think the issue of maid is similar.

— creep vs savings .. I think for some of these colleagues, their savings rate might be decent. However, their burn rate is probably higher than mine due to 1)housing 2)car 3)maid. I remember one Sonic guy used cheap credit to finance private school fees. Even without kids, some of them spend more than I do, perhaps spending 80% of salary.

Their lifestyle creep is probably higher than mine, influenced by peer pressure. Actually I don’t have enough insight. My lifestyle creep is non-trivial.

— high ground .. I feel they won’t reach my level of cashflow high ground any time soon.
I think their burn rate would be 80% of income including mtg P+I.
Their FullerWealth would be much low than mine.

Mtg .. They basically assume that a 30Y loan is “fine”, even though it would impose an extremely stringent obligation to pay $2k-3k/M non-stop.  Well, that’s Not “fine” to me, not a minor thing to me.

I enjoy a high brbr and FullerWealth (my priorities), but to them, those priorities may look like saving money for nothing.

def1[Lifestyle Creep] #R.Teo

Posted on by tiger40490

 

My colleague Bertrand said (in some context that I can’t recall) — spending money is easier in SG than in other countries.  Mall shopping is very popular in Singapore, more so than in other cities. When a family’s disposable income grows, family members break traditional guidelines of simple life

eg: “family car” -> 2 cars per family still not enough
eg: “sharing a bedroom between 2 kids” -> one bed room per kid
eg: “Aircon in bedrooms only” -> a/c in living room and kitchen

Lifestyle creep infects through a shared sense of rising living standard and rising income. However, I guess a minority of infected individuals do not experience rising income.

— disambiguation .. Lifestyle creep is slowly progressive, often recurring. In contrast, big ticket items [rEstate, branded college, or even cars] are usually not part of lifestyle creep.  This bpost tries to focus on a few common themes:

  • exclub, FOMO, comparing with the neighbours
  • semi-conscious “creep”
  • FTIL

— eg: Punggol experience .. In my Oct 2020 meet-up with Raymond in Waterway Point mall, I pointed at the rows of colorful lit-up shops all around me, and declared that virtually all of the fancy “things” on sale were unnecessary luxuries, if a family follows disciplined spending and a savings habit. Such a family of four (like my family or Raymond’s) can survive  easily in Singapore, thanks to the the essential livelihood supports (medical, housing, education, inflation..) provided by government.

However, if you always try to match the lifestyle of other people (exclub), then even 10 times more income would find their way out and you would still feel “not enough”… latency endless arms race

Raymond and I have similar spending habits, but not sure about the wives. Raymond said women “need” to spend more than guys, presumably in clothing, personal care.
— eg: Funan experience (On 2020 Christmas) .. looking at the fancy new shops in the renovated Funan mall (and the earlier Suntec mall), again I realized none of the thousands of commercial offerings is necessary for a healthy, fulfilling life.

Eg: without the learning programs, children can still grow well. Same can be said of MindChamps offering.
Eg: As to the relatively healthy but fancy foods, without any of them, you still can have a good diet. In fact, by my standard, those fancy foods are still too oily and sweet. Otherwise they won’t be popular.

— eg@FTIL: earliest example of unnecessary “finer things in life”… When I taste a fancy food, I find the taste special, but is it worth 5 times of the price of a regular meal like 杂菜饭 (mixed veg rice) ? Perhaps it’s worth 50% more. I have felt this way for 40 years, since my teenage years.

Basic-healthy standard for nutrition might be too hard for some people, but I believe that with some variety, you can enjoy tasty food within the same budget. MixedVegRice used to be the best value in Singapore, either in coffee shops or food courts. I used to pick 2 veg or 1 veg 1 meat, for below $3. Nowadays I eat out only once a month or so. I now pick 3 or 4 items for $4->5-6. I used to flinch at such price figures for mixedVegRice. Now I don’t even notice my higher spend. The only explanation I have is higher disposable income and lifestyle creep.

Is if for nutrition? No. It’s only for pleasure [variety]

Alcohol, golf, luxury cars (relative to modest cars) … are other finer things in life.

— eg@FTIL: yoga and fitness classes? I do need help (esp. motivation) to sustain a yoga practice. Underlying issue is my personal limitation. Therefore, the commercial offering is needed i.e. without the external help my life would be poorer.

If you really hate creep, then look out for the many free classes.

— eg@semiconscious: hearing the Taobao discussion in the C-epa team.. I feel spare-cash-rich people have a tendency to spend on small fancy goods of acceptable quality. Imagine you bring home 10k/M and saves 90%. Would you feel an urge to spend a bit more on those small “fancy” items like accessories?

An honest review may show that those small spends add up to, say $2k – $8k a month. Over 250M (20Y), it adds up to $500k ~ $2000k

— Work hard play hard .. Perhaps Rahul, my sis and many of the high achievers would say that, but I am suspicious of the play-hard part. It often means spend hard, party hard. Inevitably, there’s a powerful exclub and FOMO element, which used some implicit benchmark. Behind these benchmarks there’s nothing but vanity.
— CpfLife ERS amount won’t be enough.
— which level of ffree? well above Level 5 ffree
— 80% of the local median income for a comparable family size is my reference burn rate.
— exclub, FOMO

buy+!oth #wife网购

Posted on by tiger40490

 

many purchases were bought-without-OTh but the rmSelf would inevitably become critical, and with guilt we will remember the purchase as a failure. Out of sight, out of mind… I would feel less guilt if I get rid of the physical objects.

creep/ctbz/guilt^buy+!oth .. Harmony and reconciliation between two conflicting directives can lead to a revelation and (personal) growth. There is a related case of reconciliation — frugal indulgence ^ ctbz

— keeping track ..
Related to “merchandize return”, another major tcost and stressor is keeping track of “stuff bought and disused long ago”.

When I lose such an item (perhaps at home or discarded), and have to buy again, I feel an acute self-hate, but this self-hate goes against use-without-care

For example, I removed the red pedestal pair from my bike after boy stopped using them. I kept them at home for a few years and discarded them. Then my daughter needed them so I had to buy online. Actually I did all the right things so regret is not justified.

— Directive 1: Below are SMS for many relatively small purchases. I invented these SMS’s more than 5 years ago. They are still valid.

  • use ….. without care
  • discard without guilt
  • buy ….. without oth
  • buy ….. without fear (of guilt, regret)

— Directive 2: ctbz@small spends

ctbz is my traditional strength in burn rate control. However, $2 wasted spend in Daiso .. is to be tolerated, given my nonwork incomes. Buy without oth, discard without guilt… Sounds like lifestyle creep !

Q: Will these spends accumulate beyond $1000/Y?
A: I doubt it. ctbz in this case can be ineffective. My due diligence (System 2) is sometimes too slow before spending such small amounts.

Over the years, Let’s record 10 – 20 small wasted spends (below $10) so as to calibrate System 1:

  • bicycle seat (boy) and helmet (meimei)
  • small paper punch (boy)
  • long cloth  hangers
  • Note: fancy indulgence/luxury foods (or consumables like battery) are never “wasted” esp. if eaten with pleasure
  • extra laptop .. now I feel a _burden_ to use it once a while to avoid disuse->oxidation
  • badminton net .. luckily, I didn’t make the buying decision.

Toilet blue flush .. I used to think this is unnecessary lifestyle creep. Now I think it can
* reduce water consuption because wife (and I) will not “flush again” when the blue conceals the light-yellow. Half flush never worked with my wife.
* reduce conflict with my wife

— How about wife’s online shopp habit? She bought many small furniture items (often non-durable models), used each for about a year and discarded them (regardless of damage) when she buys a replacement.

Beyond furniture, many of her purchases are decorative so she enjoys “churn”.

I think her practice is “buy without oth and discard without guilt“.