Though I don't think their child is ill cared for, MMM is a little overly flippant about children and frugality, I think. He mentions for example that some people move to specific neighborhoods to get their children into better schools (rather than optimizing for cheapness of the neighborhood), and says something to the effect of "But it is better to just have parents teaching them and a diverse range of experiences, instead of some fancy school full of rich kids!" Which is far from obvious, because although having parents who are active in their life is great, a child's peer group also has a huge influence on their development.
because although having parents who are active in their life is great, a child's peer group also has a huge influence on their development
Citation needed, but I had thought that recent research indicated that peer group is much more important than parenting.
The past few days have seen an increase of chatter concerning retirement and financial planning. One of us is even putting out a prospectus for a rational financial planning sequence. Some others have derided the concept of saving for retirement, as there is a probability of death before that time.
I am of the Extreme Early Retirement group. The idea is to save and invest 60-90% of your income, and you will have enough money to retire within a decade rather than four decades of the normal working career. This requires you to exercise your frugality muscle (such as cutting cable, biking to work, eating out less), but due to hedonistic adaptation, you will come out no less unhappy.
The sequences have already spoken on how spending money does not make us happier (after our basic needs are met). A Rational Financial plan should take this into account, even if a majority of people would not want to consider it.
I am just a beginner, so I linked the two big names in EEA, Mr. Money Mustache and Early Retirement Extreme. You can find their journeys towards financial independence here and here.
ERE is an austerity heavyweight, while MMM lives a pretty luxurious lifestyle, but still spends much less than his former coworkers. He just spends on what is important to him, such as travelling with his family and eating organic food, and not on anything frivolous, such as cable or eating out. He lives very far from a deprived lifestyle which the average person would shy away from. It takes a paradigm shift and some grit, but the people of LessWrong are not the type to reject munchkin ideas because it takes a little bit of mental effort.
If I were to make a compilation of posts for a Rational Financial Planning sequence, it will go as such…
How Little Money you need to Retire ?
Basic Retirement Math
Rationalist Spending
Maximizing Utilons per Dollar
Utilons Free Of Charge
Investing Rationally Basics
These are just the basics. Investment advice is scare, and the above does not talk about many fianacial aspects, such as insurance, children, career choice. The authors do speak about them on their blog’s, but I omitted them for brevity. Read and follow these posts however, and you will be better off than 90% of your peers, and well on the road to Extreme Early Retirement.
[Edit] This idea of cutting your expenses and maximizing your savings obviously do not apply only to early retirement. Other financial goals, such as saving for a house, building up capital for a business, or giving more money to charity all will be more quickly accomplished if you learn to cut excesses from your life. The driving idea is the cost to live is very small, you are not made any happier by spending money on the extras, and you should put this money where it matters to you the most.
Petruchio