The Whole Delayed Gratification Thing

[kissfan]

Hi all.

Just trying to find out how others feel about delayed gratification, specifically, at what what point do you say enoughs enough and start to enjoy the fruits of your labour.

Is it when you have replaced your current income?

I read where some have the outlook that you are only here once so enjoy it while you're here, while others (including myself ) seem to always be penny pinching with "the future" in mind. Where is the halfway mark, or the balance.

I feel like I'm getting close to be able to live off equity, but that sort of scares me a bit too. A lot of "what if's".

How much do we have to sacrifice?

Would be interested in what others have to say on this.

Regards
Marty

 

[Brizzy Boy]

Hey Marty,
having read Jan Somers books, "the marshmellow test" a marshmellow now or 2 later, I am a firm believer of putting of gratification till later. "mine till I retire at 55". Buy my boat that I have dreamed of all my life, at constant odds with my wife as she says, that she wants a lick of that marshmellow at least once in a while to keep her on track with our ultimate goals.

So I believe to put off gratification till later but you may have to reward yourself every now and then as long as you don't go overboard.

regards
John

 

[Jacque]

Hey Marty,
having read Jan Somers books, "the marshmellow test" a marshmellow now or 2 later, I am a firm believer of putting of gratification till later. "mine till I retire at 55". Buy my boat that I have dreamed of all my life, at constant odds with my wife as she says, that she wants a lick of that marshmellow at least once in a while to keep her on track with our ultimate goals.

So I believe to put off gratification till later but you may have to reward yourself every now and then as long as you don't go overboard.

regards
John

Well said. Balance is the key and good old fashioned commonsense.
I enjoyed Jan's story in her book of the old lounge on the patio, and have tried to apply this to my own life. Happy to say that, just on a yr ago now, I purchased a new lounge to reward my hard investing work over recent times. It's lovely, comfortable and especially satisfying as I waited for it Am now anticipating when the wait for the new wall to wall bookcases in my loungeroom is over

 

[Peter 14.7]

All relative I agree.

A fine line between stingy and prudent. Personally once we got rid of all bad debt in mid 2003 we relaxed a bit.

In some area we spend up. Weekends away, car, air travel.
Others we skimp, budget funky clothes against name brands. Good cheap meals rather than fine dining.

All save can be a bad thing, Peter 147

 

[Steve Navra]

I read where some have the outlook that you are only here once so enjoy it while you're here, while others (including myself ) seem to always be penny pinching with "the future" in mind. Where is the halfway mark, or the balance.

I'm firmly of the belief that each day is precious; so live for the day, whilst planning for the future.

Each investment that I procure has three purposes:
1) Capital Growth (For the future)
2) Income (To cover the holding costs)
3) To fund current lifestyle

To fund current lifestyle

The answer of course is to convert a fraction of each investments growth into cash, which then might be used for lifestyle. I define lifestyle as the extra little luxuries like: private education for children; holidays; better car . . . we all have different dreams.

Example:
Property valued at $400,000
At the end of the first year re-value the property. Assuming some CG has been achieved, draw down the extra growth into a LOC. Assuming 5% then $20,000 at 80% = $16,000.

Spend $5,000 on lifestyle . . . invest the balance.
Eventually you might have two properties and this will increase to $10,000 + and so on.

Eventually your ever increasing asset base is providing you with an ever increasing lifestyle . . . and you are enjoying every day of the journey.

Notice of course that you could have NOT drawn down any of your growth and saved it all for the future, when you are 55++

There is NOTHING WORSE than seeing a crusty old grey haired male driving around in his Porsche
(Especially when he can't remember what he is supposed to do with it!!)

Regards,

Steve

 

[quiggles]

The take-home quote from this thread for me is the 'lick of the marshmallow'. (thanks, Brizzy Boy, I'm going to steal...er research that comment, and use it in future).

That's us now, we're licking the marshmallow, but not consuming it entirely. Spending is allowed to increase as long as income increases by substantially more.

 

[Mrs Bird]

I must admit that I like nice things sooner than later.

I am the type of person who will take the lolly now then scheme my way into getting another lolly. In other words, I want it now and will also find a way to have it later as well.

I have seen too many people wish and dream their lives away, waiting for that day when they can retire comftably. In the meantime they have missed out on life.

The biggest impact on my life in regards to this was when my best friends father died suddenly at the age of 55 one week after he had just retired. He had planned to start a wonderful life full of travel etc but never lived to do anything.

I plan for the future always but never forget the present and will always spend money on a wonderful lifestyle today.

Mrs Bird

 

[Patosan]

You ain't gettin' anywhere without some delayed gratification !

My view is that the whole delayed gratification thing is not something that you turn on now and plan to stop after 3 years. It's an attitude that becomes part of you, even at 55 driving the porche you'd hope to live many more years so are still investing in the future.

Rather than when do you stop delaying it's more an issue of after initially only licking the marshmellow, you start to suck at it, then later nibble off a small piece and so on till eventually there is none left. As opposed to not touching it then later gobbling it all down and wondering what all the anticipation was for.

So I agree wth Steve and others who say enjoy now while at the same time planning for the future. By definition investing is delaying ... in hope of a greater return down the road. If you are investing you are delaying.

 

[likewow]

Hey Mrs Bird, great post and i agree entirely. It is possible to have a life now and save for the future as well. They are not mutually exclusive as a lot of people seem to think, it just needs a bit more thought to the process.

I asked myself years ago, why would you be doing all this investing & business stuff to live like a monk now for the benefit of having a bit more at retirement? It didnt make sense, so i thought 'll have both thanks and worked successfully to that end.

And so can anyone.

 

[austini]

This is an interesting topic.

It is very easy to become so focused on investing for the "future" that there can at times be a tendancy to neglect having fun in the meantime.

I have lost count of the number of friends and acquaintances who didn't even make it to 40 let alone 55. In fact 4 of my 5 closest high school friends died before age 25.

The other thing I have noticed is that many people who train themselves to be very frugal during the accumulation stage çan't seem to bring themselves to part with their money when they do eventually retire. In some cases these people seem happy in doing this. However quite often it seems that some are depriving themselves of enjoyment just because they can't let go of their money.

I have a very contented friend up north who has very little but is one of the happiest and healthiest people I have ever known. He has the philosophy that the only thing you can be sure of is "now". Hence he makes sure that he lives every moment to the fullest. This doesn't mean to say that he still doesn't try to plan for the future but he also recognises that despite all the best planning under the sun unexpected events or tragedies can happen at any time.

Crikey I need a drink - tooo much philosophy first thing of a morning

Cheers - Gordon

 

[Bill.L]

Hi all, very interesting thread.

As John Lennon stated "Life is what happens while you are busy making other plans."

To me the journey is part of the fun(or game). Many on this forum could retire right now and nibble on that marshmellow rather than just lick it, but they don't. It's because investment is in the blood, the best game in town. It IS their life.

To go out and borrow more for the next project is the buzz that keeps the investor at heart going, not the sell down of assets and living off the proceeds. The discovery and education in the next deal is the spice of life.

bye

 

[Theresa]

although its important to plan for the future, I believe you need to reward yourself often in the meantime. Everyone has their long term goals , but set yourself some short term goals as well then achieve them and reward yourself . Life's too short , how many of you can remember your 21st birthday as if it was yesterday?
My father-in-law had his own business, worked hard seven days a week and died of a stroke at 46. In that time he provided very well for his family.When he died, the house was paid off and 5 acres in the country (where he planned to retire). Although my mother-in-law was financially ok , she was left without a hubby and four children whom incidently never saw their father, always working. He certainly didn't enjoy the fruits of his labour.
Unfortunately from early on we are educated to work hard for your dollars and reap the benefits at retirement, save! save! save! , but what do we sacrifice along the way
regards
Theresa

 

[perky29]

Previous years - pretty much save save save (our relatives thought we were tight asses ....last 2 years - 85-90% of profits pay off bad debt (and 10-15% for little luxuries - just got ducted air two months ago after a good sale )....once PPOR is paid off by end of year we plan to get an above ground pool....and then make sure our LOC debt is kept under control....
So for us NOW - there is some spending for lifestyle but also some delayed gratification too - as I want to retire within 10 years !!

 

[Patosan]

To me the journey is part of the fun(or game). Many on this forum could retire right now and nibble on that marshmellow rather than just lick it, but they don't. It's because investment is in the blood, the best game in town. It IS their life.

Well put Bill. If you're an investor and bing here (forum) means you could be, then you may wish to continue indefinitely ... doing what you like doing. In this case perhaps we can't use the word delayed ?
It changes the whole perspective.

 

[House_Keeper]

Interesting thread, thanks for bringing it up.

Like many other things, it's about balance.

I live a relatively frugal lifestyle while investing. However, I recently bought a new motorbike (actually it's second hand and not that expensive). That's because I want to enjoy it (with my family) now while I am fully able to enjoy it. There is no point having the greatest motorbike when your body is falling apart.

I am almost 40, and I notice that every year, my body is a little less capable. I wouldn't want to reach "retirement" with plenty of money but a limited ability to enjoy it.

I also remember that I have very fond memories of my 20's, where I had little money yet was able to be very happy with my life.

I guess my current approach is to spend some now so that I enjoy the journey, but also invest some for tomorrow, so that I will be comfortable in retirement.

Cheers,

 

[Mr. Fabulous]

I myself am just now beginning to learn to loosen the purse strings a little. I grew up in a household where there was very little money and have inadvertently brought that scarcity mentality into my adult life. But no more of that thanks! I am now beginning to understand that I have money that I put away for investing and money to spend (and that it's okay to spend it!).
My financial goals are to get myself to financial independence by 31st December 2010 at the latest (in other words, it can happen at any time between now and then), so that I can leave work and concentrate on investing full time so as to become wealthy.

 

[<KS>]

Well this is a 2 bit answer.

1st Bit) I can dig delayed gratification and survive in a simple fashion - with the exception of very good food and clothing, other than that I dont smoke or drink much and am not fussed over much else.

2nd Bit) My G/F constantly wants lots of things. They are never overly expensive but it is so damn constant its like a cancer to getting anywhere. I am having to play doctor this year and cut out the cancer, because I cant justify going to every concert/event anymore when I want to get somewhere in the future. I took her credit card off her yesterday - she thanked me for it

<KS>

 

[bawley]

Enjoying this thread very much. I can identify with so much that has been said. I'm gradually reprogramming myself to be more "in the moment" - cultivating an active appreciation and gratitude for life. Until relatively recently I'm afraid I was putting all effort towards the future, continually calculating various scenarios and focussing on all the scary "what ifs". (read a book called "Feel the fear and do it anyway" which was a huge help to me)

The world (particularly commercial aspect) is very good at telling us what we haven't got and what we need to be happy. ie bigger house, flashier car etc etc. Thereis not much telling us how much we do have, how unique and wonderful we all are , with all our differences and similarities.

So when I fall into the old patterns of fear of shortage in the future I do a stocktake of all the beauty and positives in my life, make a really good coffee, or share a nice bottle of wine and get on with appreciating.

Best regards to all
Bawley

 

[kissfan]

WOW. Just want to thank those who have replied thus far (hope heaps more respond) and I sincerely appreciate your thoughts. To think I was a bit apprehensive initially to post this thread as I wasn't sure how well it would sit with you all. Suppose it goes to show that a lot of us investors do share the same concerns as others.

I personally got to seriously thinking along the lines of how long do I have to wait about a year ago and as a few others have already stated, it would be a shame to get to age X and not be able to enjoy lifes offerings even if you do have heaps of cash/equity. My own father passed away at age 54 and although he and my mother had done a bit of travelling and other things, what really annoyed me about his passing was that in the years leading up to his death he had really made a conscious effort to look after his diet a lot better (never smoked & only a social drinker) as to enjoy his twilight years, and I know that he had wanted to do a lot more things with my mother but alas he died before the opportunity presented itself.

We never know what the big man upstairs has in store for us but maybe we should be truly grateful for every day above ground as we all seem to say that if only I'd done (whatever turns you on) that earlier.
In concluding this post, I'd just like to pass on something I heard recently at a seminar. The talker was (I'm sure) trying to tell people to take action, but how he done it was to let on about a recent survey of elderley people in nursing homes in which they were asked "if you could have your youth again, what would do different". Of course there were varied answers but apparently one of the most common responses was "take more risks" in reference to financial matters.

Regards
Marty

 

[Brizzy Boy]

Hi Guys,
Know I started this whole mashmellow bit, I am frugal some say a real tight A**, my car broke down 2 years ago and is still sitting in my garage waiting to be fixed "thank goodness I have a company car". My priorities are to buy as many IPs as possible at the moment and nothing will get in the way of me acheiving that. To me each IP that I aquire is the lick of that marshmellow. Unfortunitly that is not the case for my wife, her lick of the marshmellow, is either aircon, solar hotwater, pergola, insulation, new car. "hey these are big bucks" to me this is the whole marshmellow not just the lick, LOL

"I know, I know, what some of you might be thinking" but I do relent at times as she just has this special way of getting to me and I give in, "I am a sucker to beautifull woman!"

Hope she does not read this thread them I am in ral strife!!! LOL
John sheeeez home!!!!