In Praise of Restraint

This week, the ThreeYear Family has had the incredible privilege of spending the week at a swanky island resort. We’ve swum at the lovely resort pools, eaten in delicious restaurants next to a marina filled with forty-foot yachts, and marveled at a collection of world-class cars from around the US–Teslas, Rolls Royces, Land Cruisers, and many German-engineered automobiles.


We were able to vacation in such a luxurious setting mostly due to dumb luck (having to do with winning the genetic lottery).

My grandparents lived on the island during their retirement. My grandfather, of the best Yankee stock, relied on hard work, brains, frugality, good investments, and a little luck to arrive at retirement with a solid net worth and the ability to live out his days on this scenic island, pursuing various hobbies, or not doing much at all. My grandmother, his second wife, did likewise, although she was of a more vigorous disposition, and biked, gardened, and cooked her way through their years together. When he, and then she, many years later, passed away, the house was left to my father and his siblings.

And so, here we are, in this lovely setting, biking by houses straight out of Lifestyles of the Rich and Famous. Our own accommodations, though very comfortable, are a bit less ritzy. My grandparents’ house is forty years old, and almost everything in it is original. The linoleum in the kitchen is a bit worn, the outside paint is peeling, and the deck is about to be dangerous, the wood is so worn out. But it is a solid, well-made house, and it’s a great place to relax and enjoy ourselves.

View from the
Our view from the deck

It is evident, though, as we ride around, that this is an enclave of extreme wealth. As we look around the multi-million dollar homes and imagine what the inside of the massive yachts look like, my sister and I wondered at the stories behind these houses. How did the owners make their money?  It could be that the families that own these houses have inherited their wealth, although that seems unlikely to account for the majority of home owners, given that around 70% of family wealth is lost by the end of the second generation and 90% by the end of the third.

Could these be successful business owners, who have created great wealth through entrepreneurism and ingenuity? Possibly. It could be a collection of high-income earners, who like big displays of their big bonuses. All of this is conjecture.

According to the site, there are around 1800 residents living on the island as of 2014. The median age is 67.3 years, which is unsurprising, given that it was founded as a retirement community. The estimated median household income is $105,480. The estimated property value is $728,117. This average is skewed by some of the mega mansions on the island, that are currently selling for $4 and $5 Million US, according to Zillow. If we look at the mean housing price, it is $369.748, which makes a little more sense, given the average income.

Many residents only vacation here–homes on these islands are second homes. In 2009, there were 52 non-occupant loans (meaning families owned other homes in other places that they considered their permanent residences) that were originated for an average of around $535,000 (20 applications for non-occupant loans were denied, withdrawn, or not accepted). That tells me that many homes purchased were not purchased outright with cash, and that a large percentage of the purchase price was financed ($535K is 73% of the average home value of $728K, not adjusting for differences in years).

All of that is to say, it looks like aside from the very wealthy home owners who can purchase the $4Million home outright, many of the vacation homes on this island are financed. Perhaps many of the home owners here are living high-income lives, but unable to support their lifestyles without their bi-weekly paychecks.

Frankly, I don’t know. And honestly, I don’t think I care that much. But it does lead me to evaluate our own choices. As Mr. ThreeYear and I ran to the workout center each morning and spent an hour working out, then ran back home, I thought, “I want the ability to do this every morning.” It didn’t matter that we were running along beautifully landscaped streets, although that was nice. The freedom to be in charge of my time is worth infinitely more than a fancy vacation experience or fancy second home. Having choices, having freedom over our time–that’s the key to our long-term happiness.

Having fun in the sun

As we were surrounded by so much excess this past week, I thought a lot about the word “restraint.” We certainly didn’t participate in a lot of restraint during our vacation, especially with regards to food, drink, and soaking in the sun. And there are definitely times when I believe a bit of excess is appropriate–family vacations seem like an excellent time to let loose, eat, drink, and be merry. But the opposite concept, restraint, once embraced, brings us many of the benefits that Mr. ThreeYear and I are looking for over the next three years, to help us achieve our goals and become location independent.

The idea of restraint is a bit of an antiquated one–in our modern world, we tend to prefer the terms self-control or self-discipline. But the term denotes the idea of moderation. It calls to mind the Buddhist concept of the Middle Way. It is the idea that we must reel in our baser impulses, require a higher standard for ourselves. To me, it calls up the idea of not doing the things that we might really want to do, in the heat of the moment–not posting the incendiary internet comment, declining dessert if our pants are fitting a bit snugly, not buying a new car just because you can afford the payments. It is the ability to reign yourself in when your emotional reactions might get the better of you, to take a step back, to say nothing, to give yourself a moment to think of the long term implications of your actions.

We can have external and internal restraint. Externally, restraint is a measure or condition that keeps someone or something under control or within limits.

For us, external restraints look like automatic contributions to our retirement accounts, automatic payments to pay off our apartment in Chile, and written plans to carry out our yearly goals. It is not buying potato chips at the store so we won’t eat them on Friday nights.

Internal restraint is unemotional, dispassionate, or moderate behavior– self-control.

Internal restraints are those measures of self-control that make life better–regular exercise, moderate spending, choosing the more difficult, but ultimately more rewarding, choice: fixing the broken faucet ourselves, rejecting our impatient urges to have it all right now and wait, just a bit, until a better time or price comes along.

Our running route

Mr. ThreeYear and I need both external and internal limits to help us control our behavior and our spending. We appreciate the restraints we’ve created in our lives in order to encourage ourselves to save more, get into better shape, and ultimately, create more choice and happiness for ourselves.

Spending a week in the Land of Excess helped us appreciate restraint even more. We saw the beauty surrounding us this week and we admired it. We ate the food, drank the wine, and played outside with abandon. But we are ready to return to our lives of order, discipline, and self-control. We are ready to return to restraint, and watch it give us more choice and freedom as we march towards location independence.

Have you had any Lifestyles of the Rich and Famous moments lately?

Author: Laurie

Hi. I'm Laurie, and my family and I have set out to double our net worth and move abroad in the next three years. Join us on our journey!

6 thoughts on “In Praise of Restraint”

  1. when i ride through the harbor during the holidays or whip up to the mcmansion area in the mountains, it is fun to ponder about how these people came into their money and/or wealthy lifestyles. of course, always followed by “what did I do wrong?!” (which I know now, but some seem to have it so easy) to “I am just as smart”. And “I could be happy with a yacht name Mercedes”.
    I am finding my restraint. and find that more times to vaca/stayca are available in this mode from saving up and planning. I would like to say my restraint comes natural, but it does not. I am getting better at it and the challenge of reaching my goals is kind of fun right now.
    Great post. I like how you broke down and analyzed the population of home buyers. glad your family were able to let loose and have some fun.

    1. I am 100% with you, The One in Debt! Restraint definitely does not come naturally to me, which is why I need those external restraints that I impose upon myself during moments of sanity. 🙂 I, too, am prone to play the comparison game, but I’m slowly coming around to the idea that half of the fun of personal finance is the constant challenge–you’re never “there” per se; there’s always one more thing to pay off/save up for/invest in. Thanks for the kind words! We definitely had a great time this past week.

      1. Great post! I’m wondering, when you say “external restraint,” what do you mean? I’m always looking for ways to encourage more moderation and I know willpower alone won’t always do it. Would love to hear what external forces you use to help stay on track!

        1. That’s a great question, Kristin. I was thinking of something along the lines of GoCurryCracker’s great post: Basically, I think of external restraints as those outer parameters we build into our lives that help us make good decisions–like setting the thermometer’s automatic settings to 66 instead of 70. Buying a Prius instead of an SUV so that we use less gas. Purchasing a house closer to work so our commute is shorter. Automatic increases to your 401k plan around raise time. Anything that forces us to make better choices if our willpower fails us! Lol!

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