I recently realised that we’d lost sight of our FIRE goal, so it’s time to revisit where we are, and where we want to be in the future. Part of where we’d like to be is not just saving, but enjoying our money in line with our values. In this post we’ll review our spending goals.
Going back to the very basics, I started with Pete Matthew’s Meaningful Money podcast Season 2 from 2016. This series was immensely helpful in getting us to actually start investing. One of the first episodes was named “Why Invest”. To be honest, listening back nearly five years after we’ve been investing to reach FIRE, it is targeted towards people brand new to the concept. However, a few things stood out to me as good reminders.
The Difference Between Saving and Investing
- Saving is for the short term – up to three years.
- Investing is for the long term, as investing involves more complexity, some costs, and higher risk.
Uses for Money
- Spend and enjoy
- Invest for the future
- Give away
Spend and Enjoy
In 2017, we listed our short, medium and long term saving/investing goals. Somewhere between then and now, we forgot about them. It was only because I wanted to write this blog post (and there’s the beauty of blogging!) that we sat down together to review those goals.
2017 Short Term Spending Goals (1-2 Years)
Visit New Zealand. Estimated cost $5,000
Visit England/Germany. Estimated cost $20,000
Before we left, we decided to focus just on the UK and leave Germany for another time. We visited Dubai, England, Scotland and Wales in 2018. That was the beginning of our Year of Change so I didn’t get around to posting about it. I still have all of my notes. In this time of COVID and travel shutdowns, I should write them up as a pleasant reminder. Actual cost $17,105.84
2017 Medium Term Spending Goals (2-5 Years)
Replace both our cars. Estimated cost $15,000 (Mrs. ETT) $50,000 (Mr. ETT)
Unfortunately my car had to be replaced earlier than expected. On one of the many trips back and forth between Western Sydney and Orange while we were moving, I was rear-ended and my poor car was written off. We received $4,900 from insurance. To me, cars are only a tool to get from point A to point B, so I set requirements that my new car must have air conditioning, cruise control, and cost no more than $5,000. Mr. ETT was working across the road from a car yard at the time, and he found a great car for me. I’m very happy. Actual cost $100 after insurance payout.
Mr. ETT had a Volkswagon Golf GTi that he loved. This was the one car in our lifetimes he bought as brand new. He customised the build and waited 6 months for it to arrive from Germany. However we discovered that zippy little cars with rock solid suspension don’t do so well on country roads. Driving around our new home became an uncomfortable ride. Some of the places we wanted to visit were down dirt or gravel unpaved roads. Besides being uncomfortable he didn’t want to risk stone damage to his precious car! He decided he didn’t want to wait until we’d saved our estimated $50,000 for another dream car, so found an acceptable substitute in a lower price range in Canberra.
What a difference the new Osko fast payments make. He did a transfer on his phone, we went to visit our friend for an hour, came back and the money was in their account! I’m showing my age when I say the era of bank cheques is fast fading. He then sold his Golf to a buyer from Sydney. Actual cost $13,500 after selling his GTi.
Visit Adelaide. Estimated cost $5,000 – We haven’t visited Adelaide.
Visit Tasmania. Estimated cost $5,000 – We went to Tassie in 2016 but didn’t manage to return since setting this goal in 2017.
Visit Japan. Estimated cost $10,000
We talked about going to Japan. I didn’t want to go when the Olympics were on, so we’d set 2021 as the year to visit. At the time we had no idea we’d be getting new jobs or moving, but I like to think that without COVID, this is something we would have come back to.
2017 Long Term Spending Goals (5 – 20 Years)
Renovate or move house. Estimated cost $100,000
We moved house! To be honest, when we set this goal in 2017, we didn’t make any plans towards getting there. The move was entirely coincidental, with a new job as the trigger. Actual cost +$957.32. This was just for our Western Sydney house sale less real estate agent fees, vs. Orange house purchase plus stamp duty. There were many other costs involved, not the least being 12 months rent costing $19,184.55 while we were looking for the perfect house. I should probably sit down and work it out some time – is anyone interested?
New motorbike for Mr. ETT. Estimated cost $35,000
This hasn’t happened yet, but four years on he’s getting very itchy about wanting a new one.
Visit Canada. Estimated cost $20,000 – We haven’t visited Canada.
2017 Retirement Goals
Goes to show how early in our journey I was – in 2017 I thought that $1,000,000 would do it! No, if we need $80,000 a year, then according to the 4% rule we will require $2,000,000. We haven’t retired but we are still working towards this.
Our 2021 Spending Goals
It was a pleasant surprise to see that we had achieved some goals, accidental or otherwise. However… when we looked at the remaining goals, I felt really flat. There was no anticipation, no spark of excitement. Going through them one by one, asking if we still wanted to do them, our responses were “I suppose,” “I guess,”. Where has our joie de vivre gone? I was shocked. I couldn’t believe that I was feeling like that. Of course COVID has a lot to do with it, as many of our goals are related to travel, and we had no control over whether we could complete them or not. Maybe this was a protective mechanism, because having a goal that is outside your circle of control isn’t healthy.
We were both sitting silently in a bit of a funk, so I decided to jump on the internet and look up Adelaide and the Barossa Valley. We sat and looked at the tourism website, and that is when the excitement started to come back. They say that anticipation and planning add to the joy of travel. I think we need to spend more time looking around and planning a trip while waiting to see what happens with lockdowns ending and Australia reaching for 90% double-dose vaccinations. Not only will it give us something positive to focus on in the meantime, but we’ll be able to move quickly once we decide when we want to go.
We also decided we could start with some weekends away to one of the many country towns here in Western NSW. During one of the periods where Sydney went into a snap lockdown but Western NSW was still free to move around, Mr. ETT and I had a night out in Millthorpe. Millthorpe is only 20 minutes away from Orange, but we had a lovely weekend. We were able to walk to the cellar doors, to dinner, and around town. It really felt like a break and a mini-holiday. Given I’ve just realised it’s only 8 weeks until Christmas, we won’t go this year but we will look to go somewhere else early in 2022.
So our new list is:
Well looky there. It seems our planned spending for the next one or two years is more than twice that of three to five years. The next step is for us to sit down and set dates for when we want to complete each of these, which will allow us to set up a savings plan in the budget. I suspect we might have to move a couple of them around.
Do you have spending goals in your FIRE plan?