Ask the grumpies: How does not wanting to retire early affect your savings decisions?

Leigh asks:

How [does] having careers, not jobs and not wanting to retire early, while still having healthy retirement savings all ties in together. How does that affect how much you put into retirement accounts vs other accounts each year, etc.?

TBH it really doesn’t. But I do think it accounts for some of the calm we wouldn’t be feeling if we weren’t in good financial shape right now.

Back tracking a bit though…

As Leigh notes, we’re working because we want to, not necessarily because we have to.  We do like our high incomes, but a lot of why we work is because we’re trying to make the world a better place and in my case partly because of ambition.  We have no plans on retiring ever, though we may change our minds in the future.  Early retirement is definitely not in our plans.

Right now we’re maxing out all of our hassle-free retirement savings.  So I’m putting away my mandatory match, my 403(b), my 457, and DH’s 401(k) (now with Fidelity and a much better deal!  Asking for change works sometimes!).  We are on an “over-saving” track for retirement at this point given our lack of desire to retire early and my relative job security (though who knows what will happen in 30-50 years!).

The main reason we’re putting this much away is to take advantage of the tax advantage and to make it more likely that schools will give our kids financial aid.  We (as of this moment in our current situation) have plenty of money leftover to spend.  But there’s not much to buy around here and we don’t really have the time or energy to go looking for things to buy.  This is the first year that we’re starting to accumulate additional money after the targeted retirement/529/mortgage/sabbatical saving is done since before we bought a house.  If the US were stable, we’d be putting it in lump 10K sums into the stock market (with a 25K donor advised fund that we may still do), but instead we did one lump and now it’s accumulating in savings waiting to see what happens with DH’s job and the political climate.

(As we’ve expressed probably ad nauseum to our regular readers– we have more than enough to live on in our current low cost of living area, but not enough to safely buy a house in Paradise, even assuming we move to Paradise for a high paying job for DH.  But there’s always the chance we’ll want to move to Paradise with only one job and will be very happy that we “over-saved” even if we can’t afford to buy a house when we get there.)

I guess if we wanted to retire early we’d spend less.  I would probably have to actually sit down and figure out what numbers we could retire at assuming different draw down rates and stock market returns etc.  Depending on how early we wanted to retire, I’d have to figure out how to ladder accounts to draw down from (probably the easiest way is just to use the 457).  And I’d probably be freaking out about money more because it would matter for our “freedom” date.  But instead I’m expecting another 30-50 years of work so it’s easier to roll with uncertainty.  There aren’t money worries on top of everything else.

If we get more tax-advantaged space to save for retirement (because of changes to tax laws), I guess we’ll use it, but at some point we’d have to think hard about when to stop maxing it out.

So right now we’re just going with the max defaults because where else are we going to put the money?

Grumpy nation:  Do you have a career or a job?  Are you aiming for early retirement, not retiring at all, or something in between?  How does that decision impact your retirement savings decisions?

What is culture for?

I am extremely cultured.  I know history and philosophy and I’ve read most of the classics (and can fake many of the ones I haven’t read).  I enjoy opera and theater (but not ballet or symphony, though my sister loves ballet) and old movies and classical music.  I can swim and play the piano and embroider and cook (though I was never able to get over my complete lack of artistic talent when it comes to drawing or painting or my complete boredom with ballet lessons).  #2 and I can trade Gilbert and Sullivan or PG Wodehouse jokes with ease.  I know which silverware to use at a fancy restaurant (pro-tip:  start with the outermost) and how to pretend I know what I’m talking about with wine.  Sadly I only speak two languages (English and Spanish), but I know enough French and Italian to get around as a tourist or to get most literary references without Google translate (ditto Latin).

I used to think that I had all this culture because my parents were sharing what they enjoyed, and culture was something to make it easier for me to entertain myself.  (And part of this is true– my father is a European immigrant who grew up in a fancy US coastal city, so his love of operetta patter songs is as real as his love for Jacques Brel or the Beatles.)

But a couple years ago I was rereading Penrod, by Booth Tarkington (free on Kindle).  In addition to being shocked by the casual racism and animal cruelty that I did not remember from my initial childhood reading (from my mother’s childhood hard copies), I was struck by a passage.  Penrod, who is established as having been from a middle- to lower-middle- class family, takes ballroom dancing and etiquette lessons.  A public school kid, this is the only time he rubs shoulders with the private school children of the town elite.  His mother wants to social climb.  His parents, I realized, are trying to help him advance.

Recent readers of the blog may also be aware of my current turn to regency romances.  In regencies (and in steampunk), women have “accomplishments”– somewhat useless entertainment skills such as embroidery or harp or watercolors that are class markers.  Wealthy tradespeople could send their daughters to finishing school so as to marry up into the aristocracy without embarrassing their impoverished future sons-in-law.

One of my mother’s refrains has always been, “to make you a more cultured person.”  And “to give you opportunities I didn’t have.”

I suspect that many of these skills and much of this knowledge that was poured into me may have been for the same reason we were pushed into math and science.  To improve our lot in life with the next generation.

But… Penrod was written in the 1910s.  By the time he was an adult, the parlor manners he resisted being taught along with the formal dancing would be archaic.  In Regency novels, the landed aristocracy of the early 19th century would be replaced with the age of industry and business would supplant tenant farming.  Eventually, stenography would be a more important skill for young ladies than the harp.

I always thought, growing up, that once I got to college I would meet people who were passionate about opera and history and so on.  (Note, this is one of the reasons that #2 and I hit it off right away in high school.)  But even though I went to a top small liberal arts college, that was not the case.  I would even occasionally have to explain literary references to professors in college and graduate school.  I did spread my various loves to my friends (especially those with cars!) and in return picked up passions for anime and Asian food.  High school also provided me with nerd culture in abundance adding, for example, the entire Monty Python library to my repertoire.

As an upper-middle class citizen approaching middle-age, I haven’t found my elitist skills to be particularly useful.  They still provide me joy, but to be honest, they are not shared by many people.  I don’t have much outlet for them away from the city.  When I am in a city partaking, I’m surrounded by professionally coiffed white hair.  These elite class markers are markers of a previous generation.

Times change.  Social class markers vary.  The approaching-middle-age elite who we rub shoulders with today are also first generation wealthy and formerly from the midwest.  They are not from East coast old money.  And so, my esoteric knowledge that my mother worked so hard to provide me with, those classics I was forced to read to “be a more cultured person,” were not as useful as the love of math and ambition that she also fostered.  In fact, I’m a bit out of place with them– elitist in many eyes.

But fortunately, even when it is lonely, cultural knowledge still provides personal entertainment.  It still makes jokes more funny and deepens appreciation of even modern media (since people in the film industry who direct and design are remarkably cultured themselves).  So maybe that itself is enough in this ever-changing world.

Was I more confident 5 years ago?

Man, so I’ve been scraping the 2010 and 2011 drafts for posts (it is insane how many unfinished posts we have), and I’ve been noticing how much more I dunno, prescriptive a lot of these posts are.

Like… how to do cognitive restructuring.  On the importance of moxy.   That post (It takes a village) from the other week about getting out and being with adults was actually written in 2011.  I even have one that ironically talks about our students getting cognitive dissonance when we tell them they have to think in shades of grey.

It’s ironic, because I think as I age, some things get greyer.  Like, meta-grey.  I mean, sometimes things really are black and white and not shades of grey at all.  Sometimes people go farther in life if they ignore ambiguity, even if things are grey.  Who am I to say what is right or wrong.  There’s even a post in here somewhere (vintage 2012 or 2013) talking about how people like to be told what to do, they like to be lead.  And… I dunno, do they?

I do think part of it is I’ve spent the year surrounded by everyone being at least as smart and accomplished as I am and most people even more so.  All my coauthored projects finished in the fall.  I haven’t started anything new, no new collaborations etc.  I’m sort of a silo surrounded by amazing people that I don’t often ask for help.  And it has kind of eroded my confidence a bit.  I do like it better being a little fish in a big pond because for whatever reason, I feel a bit uncomfortable as a big fish in a small pond.  But man, have I got imposter syndrome.  Maybe if I were getting more done, making more progress on my projects I’d feel more confident, but right now I’ve got a bit of “will I ever amount to anything” thing going on.  Plus my big projects aren’t working and there’s too many of them and I’m having trouble finding direction.  And I’m going back to teaching and service and things that make it hard to be productive very soon.  If I can’t get things done while on leave, how will I get them done when I’m working full-time?

If I regain my confidence, will it be a false confidence, and will I realize it is so?  Does it matter when moxy is so important?

So, I dunno, a bit of melancholy to add to the lack of certainty.

Or…. maybe those drafts have been sitting there since 2011 for a reason and I’m just overthinking.

Also… I can see that several of these posts were reactions to obnoxious parenting or personal finance blogs that I no longer read and may no longer even exist.  It’s a bit easier to argue the opposite when someone is saying something ridiculous.

So… maybe this whole trying to compare posts from 5 years ago to now is just another lesson that no, it isn’t always about my internal omphaloskepsis; sometimes there’s an external factor.  Usually it’s something else.  Which is kind of comforting, really.

Has your certainty or confidence changed in the last five years?  Have you noticed any other changes?

I really do have an addictive personality: 1 week of coffee = 3 days of pain

I’ve talked about my addictive personality before in terms of why I don’t play video games and how it’s difficult for me to get off fora (until I’m kicked off or quit cold turkey).

I almost never drink coffee.  Usually this is because when I get a migraine, coffee + aspirin + sleep is the only way to make it go away, so I want to keep my tolerance low.  But occasionally after a bad night I’ll partake in some decaf or when things are really bad, a full cup of regular.  I almost never do this more than 2 days in a row.  And never after 11am if I want to get any sleep at night.

Recently I had some bad deadline times.  So I drank coffee for a full 7 days, starting with a cup of decaf and ending with 2 cups of regular by the time the week was over.  I started craving it and could feel it making my life better.

Then I turned in the thing and crashed hard.  The next day I had a major headache and had a cup of decaf to try to wean down.  It helped a little but not enough.  When the weekend came, I stopped drinking coffee and ended up in bed with a pounding headache.  I kept wanting coffee so badly.  A little sip of DH’s salted caramel mocha made angels sing in my head, but wasn’t enough to truly make things right.

I still want coffee.

Most people can drink caffeine for 7 days straight (some of them decaf or only half a cup!) and then go cold-turkey with maybe only a little bit of tiredness as an effect.  I can’t.

Most people take longer to become truly addicted to something.  Apparently not me.

I had Valium once prior to a surgery.  If it were available OTC, I would eventually never leave my bed.  I still want Valium.

So, this is why I don’t do drugs.  Because it doesn’t take me long to crave them and to crash when I don’t get them.  And it’s scary not being in control of my body.  Also, I don’t like withdrawal symptoms.

Do you have problems with addiction?  Do you ever wean yourself off caffeine?  How does that go?

Differences between your online persona and your IRL persona?

The blogosphere (including us) has recently been discussing how blogs are only a specific persona that the blogger shows (or curates, depending on your beliefs about the nature of truth and perception and personality).

That got us thinking about how we differ IRL vs. our blog personas.  We thought we’d share some of the differences.

I am a lot nicer IRL.  A LOT.  My snark only comes out with anonymity.  I may think things IRL but I don’t say things unless I can say something nice.  #2, however: I think I might actually be nicer on this blog than IRL.

I’m also more introverted IRL.  I’ve done meetups with groups of forum people and they are surprised that I’m quiet at the dinner table even though I’m super chatty online.  (This same thing isn’t true with people I know well IRL or when I’m at a conference on topics I’m an expert on– I’m perfectly chatty with subject matter I feel comfortable with.)  #2 is super-introverted all the time and prefers online communication.  Or books.

I’m less annoyed about giving an impromptu lecture on my subject matter of expertise IRL than online.  Online it often feels like someone should be paying me to argue with them.  (I know it may seem like this isn’t possible, but I promise, I lecture a LOT IRL.)

What don’t I share with you?  Mostly boring stuff.  I only online share things if I find them interesting and/or funny.  I also try not to share things that would hurt other people if our blog and real identities became front page news.

I’m often not as witty because online you only get the good stuff, not the stuff that failed at being funny or brilliant (at least IMO).

Who is the real us?  Well, what is reality anyway?

How do your IRL and online personas differ?  Who is the real you?

Is “everybody sucks/has crappy lives/etc.” actually helpful for people who are having difficulties?

One of the things I’ve noticed on blogs/fora where the author is having trouble with marriage or kids or work, or what have you, is that often someone in the comments will say, “Oh, everyone’s life is like that.  We’re all miserable/have terrible husbands/rotten kids/awful bosses.  You’re normal.  That’s normal.  Anybody who says differently is a lying liar who lies.”

And this is provided as comfort.

Does it work?

Honestly for me, if I were in a bad situation and got that comment and truly believed it, I might end up being all, “why bother?”  If life is going to nasty brutish and short what’s the point?  Why continue living or striving?  Why not just give up?

I’m glad I don’t believe it.  I’m glad I believe that life can be better.  That marriages can be functional instead of dysfunctional.  That kids can be helped.  That there are good job environments out there if the current one is bad.  I’m not an optimist, but I am optimistic that if I work hard to change things, life can get better.  Maybe not the way I would most prefer, but better than a horrible situation.

The big question though is:  Does this kind of comforting actually provide comfort?  Do people feel better when they’re in a crappy situation and someone comes along and says yeah, all situations are crappy.  (Not, mind you, “it’s not just you” but the more inclusive, “it’s everybody.”)

What does the research say?  It is true that people are happier (and healthier) when they’re at the top of a distribution and can point to people with crappy lives.  This may be why the Koch brothers and others in the 1% of 1% of 1% are trying to destroy America. Big income disparities make people on the top happier than do little income disparities.

But I don’t think it has to be that way.  You’ve got people like Gates trying to bring the bottom up, trying to decrease the income differential.

Research also notes that people who satisfice– who set an external absolute level target– are happier than people who try to optimize.  Maybe if you’re focused on comparisons with others, you’re happiest on top, but maybe you’re happier still if you’re not comparing yourself with others at all.

I don’t know the research on this, but my guess is that it is best to focus on absolute levels rather than relative differences.  Comparing yourself to other people is a sure way to misery because someone will always be better on any level.  (And it must be lonely at the top.)  Instead, compare yourself now to the yourself from before and reach for the yourself that you want to be.

And it’s best if you know that that life that you want to have is actually achievable.  And it’s more likely to to be achievable if someone else is already achieving it.  Because it’s a big world out there, and it would be pretty difficult to be the first person to have a happy marriage, great kids, or a fulfilling job if that had so far eluded the entire world’s population throughout time.

I almost tagged this with deliberately controversial, but I wasn’t sure that it fit (since this is one of those things where there’s so much potential for individual variation), so I stuck with debatable.  Still looking forward to discussion!

What do you think?  Does being told that everybody has your problem (whatever your problem is) provide comfort?  Does it provide despair?  What do you prefer as responses ?

Am I a tiger mom?

Eh, maybe a little.  DH and I push our kids.

We’re not so far up the SES ladder that our kids can rest on their laurels– we both broke into the upper middle class this generation (DH from the rural working class, I’m first-gen on one side and come from a long line of middle-class working women on the other).  And OMG is it nice to be upper-middle class.  The stresses we don’t have that our parents had and that DH’s siblings and cousins still have, I can’t even.  Every day I’m mindful of (and thankful for) this miracle.

We got here from climbing the academic ladder and playing by the rules (and, of course, luck).  From pushing ourselves, and maybe being pushed a little bit too.  Well, not maybe, definitely.  (DH’s siblings, while not upper-middle-class are definitely doing much better than his cousins.) Definitely from being pushed a little bit too.  Our kids will have more freedom and latitude to maybe not play by the rules, but having that academic ladder cleared will certainly help if other ventures don’t work out.

A’s now mean life is easier later.  Challenges now mean that there’s less likely to be complete melt-downs in college.  So we push.  Not to breaking, but occasionally to leaving the comfort zone.  So far the discomfort (often followed by breaks, and then by trying again) has always led to epiphanies and growth, just as it should.

There’s no shame in getting a B, but a B also means that the material hasn’t been mastered.  There’s room for improvement and that’s a target to work on.  So, in that sense, Bs are addressed.  Material is mastered and then some.  Even if it’s not that interesting.  Even if school sometimes has arbitrary rules.

Granted, our kids are truly brilliant, and they’re highly capable of mastering many many challenges.  So it’s easier to have a home with the underlying belief that Bs aren’t good grades.  We have justifiably high expectations.  I have students who, as hard as they try, won’t pull off As in four classes a semester.  But it’s my job to get them to master as much of the material as they can, and it’s their job to try.  If my kids go someplace where they’re truly challenged, then even Cs may be fine as long as they’re still getting where they need to go, but they’re not there yet.

For K-12, A’s are pretty important.  Especially if they’re not going to fancy high schools that colleges know by reputation.  I trust that my kids will work hard and if they don’t get As it won’t be from lack of trying, but I also know that we will work hard to stem any damage by filling in knowledge gaps should a lower grade occur so that it won’t lead to downward spirals down the line.

DH and I have both gotten Bs in our high school and college careers, but not that many.  I think DH even has a C on his college transcript.  And, possibly related, we haven’t always gotten into our top choices for things.  But we keep working and we keep trying.  And that’s the message we want to send to our children.  That’s how we push.

Did you get pushed as a kid?  Do you feel like that affected your adult life?