Investing for Retirement

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Michael
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Re: Investing for Retirement

Post by Michael »

IMADreamer wrote:It's more about having less obligation and doing more of what you want to do. Being in a position of being able to say screw it I'm not doing this today, is way better than having to go into work at some job you don't like just to pay your mortgage. Obviously if you enjoy what you are doing it wouldn't make sense to stop and do nothing.
Agree with this.

If I had the money to retire today I wouldn't do it. I actually like my job and I don't really have a hobby/passion I want to retire to. I guess I could become a semi-professional poker player, but I think that would suck.

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Swirls
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Re: Investing for Retirement

Post by Swirls »

Michael wrote:
IMADreamer wrote:It's more about having less obligation and doing more of what you want to do. Being in a position of being able to say screw it I'm not doing this today, is way better than having to go into work at some job you don't like just to pay your mortgage. Obviously if you enjoy what you are doing it wouldn't make sense to stop and do nothing.
Agree with this.

If I had the money to retire today I wouldn't do it. I actually like my job and I don't really have a hobby/passion I want to retire to. I guess I could become a semi-professional poker player, but I think that would suck.
My wife and I combine to make almost $250k a year. We both have great jobs. I'm about to turn 35 and she's only 30. However, we also currently have about $450k in debt between our mortgage and various loans (student, car, debt consolidation). We both have very expensive hobbies (her moreso than me since upkeep on her horse is anywhere from $400 to $500 a month).

We literally can't afford to have kids for the next several years. Both of us have hobbies/passions that we could certainly enjoy doing for the rest of our lives, but they wouldn't provide much income. They'd be fine for ancillary income if you were living off interest for investments with the 4% rule, but neither would likely ever be enough to live off of.

Debt's a funny thing. I would feel comfortable in saying that our annual income puts us comfortably into upper middle class and borderline wealthy territory. But we have so much debt that, despite having a number of retirement investments set up and enough disposable income that we don't want for anything, we feel quite poor most of the time.

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Popeye_Card
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Re: Investing for Retirement

Post by Popeye_Card »

Swirls wrote:
Michael wrote:
IMADreamer wrote:It's more about having less obligation and doing more of what you want to do. Being in a position of being able to say screw it I'm not doing this today, is way better than having to go into work at some job you don't like just to pay your mortgage. Obviously if you enjoy what you are doing it wouldn't make sense to stop and do nothing.
Agree with this.

If I had the money to retire today I wouldn't do it. I actually like my job and I don't really have a hobby/passion I want to retire to. I guess I could become a semi-professional poker player, but I think that would suck.
My wife and I combine to make almost $250k a year. We both have great jobs. I'm about to turn 35 and she's only 30. However, we also currently have about $450k in debt between our mortgage and various loans (student, car, debt consolidation). We both have very expensive hobbies (her moreso than me since upkeep on her horse is anywhere from $400 to $500 a month).

We literally can't afford to have kids for the next several years. Both of us have hobbies/passions that we could certainly enjoy doing for the rest of our lives, but they wouldn't provide much income. They'd be fine for ancillary income if you were living off interest for investments with the 4% rule, but neither would likely ever be enough to live off of.

Debt's a funny thing. I would feel comfortable in saying that our annual income puts us comfortably into upper middle class and borderline wealthy territory. But we have so much debt that, despite having a number of retirement investments set up and enough disposable income that we don't want for anything, we feel quite poor most of the time.
I can relate. Hard to believe that such a sizable income can disappear so fast. But much of the debt (at least for us) you bring upon yourself with your life choices. We could certainly still live comfortably in a smaller, cheaper house. We could drive old beat-up vehicles. Sometimes I think about "what if we just cut all this way down?". Is it worth it to be more frugal on these things to be able to retire earlier, or party harder in the meantime (i.e. baller vacations, etc.)? I don't know. There's something to be said for driving a nice vehicle back from the office to a nice home every day.

Arthur Dent
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Re: Investing for Retirement

Post by Arthur Dent »

Michael wrote:
Arthur Dent wrote:
Michael wrote:So my rhetorical, and totally not douchey, question is - can you make more money without inflating your lifestyle and making yourself miserable?
I mean, maybe, but also "try to make more money" is not exactly an original idea.

Edit: My feeling is that a better scheme, to the extent it exists, is to accept lower pay for a lower stress job you enjoy rather that take a high stress one accompanied by an extreme program. As to trying to make more money, I have the perfect solution: my wife gets a better job! Seriously, in her case getting back into the profession she is trained for after years in exile has been a huge happiness boost totally independent of the pay.
I'm going to challenge you a bit here. In many situations (maybe not yours) a better paying job does not have to mean less free time or more stress. In my opinion, it's a false dichotomy many people make. Some of the most highly compensated people I know work the least amount of hours. How does your compensation compare to the rest of the market with your skillset? Do you ever press your management for larger raises? Have you considered moving somewhere else?

That said, if you're happy with your job that's great and you shouldn't make waves. I'm just making the point that another way to move your financial independence date is to make more money while keeping your expenses static. It's a weird message to give, but there you have it.
FTR, there's nothing wrong with your tone. My comments were about the tendency in general and some of it representations, not your posts on the topic, which I enjoy. The taboo about discussing personal finances is mostly bad, and it's good, though tricky, to be more open.

Regarding you comments here, I largely agree. There's not necessarily a trade-off and obviously the jobs with the lowest pay also have some of the worst working conditions. I guess my point here is that I think that it makes much more sense to try and find decent work and working conditions in the present rather than doing crazy gyrations that prioritize amassing a huge savings in hopes of exiting.

Personally, my work conditions are currently above average for the industry, and I am close with my colleagues. Alternative positions are heavily concentrated where cost of living would more than wipe out any salary bump. Those factors and therefor my choices will likely change with time, but my current view is that the realistic range of higher paying positions for me would not be worth sacrificing much, if anything, to get. I already have a high saving rate and throw any bonuses/raises into that bucket to lessen my dependence on the whims of bosses and the labor market. That won't get me exit in my 40s but it does give me options which seems to me a healthier, more balanced goal.

On the larger situation, which is maybe neither here nor there for this discussion, it should go without saying that this concept only works if it's confined to a narrow slice. If national savings rates were actually 70% or even 25%, returns on investment would go way down, probably negative. The individualist response to pervasive social dysfunction screams out at me reading this stuff. Bad work conditions, poor job security, and excessive housing costs are social problems. We all have to do our best to make our way in this fallen world, and all that, but this is not really an answer.
Last edited by Arthur Dent on September 7 18, 2:53 pm, edited 1 time in total.

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Swirls
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Re: Investing for Retirement

Post by Swirls »

Popeye_Card wrote:
Swirls wrote:
Michael wrote:
IMADreamer wrote:It's more about having less obligation and doing more of what you want to do. Being in a position of being able to say screw it I'm not doing this today, is way better than having to go into work at some job you don't like just to pay your mortgage. Obviously if you enjoy what you are doing it wouldn't make sense to stop and do nothing.
Agree with this.

If I had the money to retire today I wouldn't do it. I actually like my job and I don't really have a hobby/passion I want to retire to. I guess I could become a semi-professional poker player, but I think that would suck.
My wife and I combine to make almost $250k a year. We both have great jobs. I'm about to turn 35 and she's only 30. However, we also currently have about $450k in debt between our mortgage and various loans (student, car, debt consolidation). We both have very expensive hobbies (her moreso than me since upkeep on her horse is anywhere from $400 to $500 a month).

We literally can't afford to have kids for the next several years. Both of us have hobbies/passions that we could certainly enjoy doing for the rest of our lives, but they wouldn't provide much income. They'd be fine for ancillary income if you were living off interest for investments with the 4% rule, but neither would likely ever be enough to live off of.

Debt's a funny thing. I would feel comfortable in saying that our annual income puts us comfortably into upper middle class and borderline wealthy territory. But we have so much debt that, despite having a number of retirement investments set up and enough disposable income that we don't want for anything, we feel quite poor most of the time.
I can relate. Hard to believe that such a sizable income can disappear so fast. But much of the debt (at least for us) you bring upon yourself with your life choices. We could certainly still live comfortably in a smaller, cheaper house. We could drive old beat-up vehicles. Sometimes I think about "what if we just cut all this way down?". Is it worth it to be more frugal on these things to be able to retire earlier, or party harder in the meantime (i.e. baller vacations, etc.)? I don't know. There's something to be said for driving a nice vehicle back from the office to a nice home every day.
Agreed 100%.

Michael
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Re: Investing for Retirement

Post by Michael »

Arthur Dent wrote: <snip>

That won't get me exit in my 40s but it does give me options which seems to me a healthier, more balanced goal.
Agree with all your points. Thank you for your kind words. It's also worth noting I'm 41 now so my 10 year plan will take me in to my early 50's.

The FIRE messaging appealed to me because it fits nicely with my natural behaviors. Compared to my income I've always been reasonably frugal and a saver. I don't have kids and my wife is self sufficient so before I found the FIRE community I was dealing with existential questions like "Why am I going to work everyday day so I can die with a huge amount of money? Should I buy more crap I'm not really interested in?" At the time I didn't really consider a future without me retiring at the age of 65 like my dad. FIRE has given me more of a feeling of purpose when I go in to work and excitement about the future. The irony is once I get there I'll most likely keep working because I have to do something.

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MAGA
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Re: Investing for Retirement

Post by MAGA »

I’m curious what percent of the FIRE people Hate their jobs. Vs a normal sample.

we still don’t know how to link people with professions they enjoy and derive fulfillment from. Some of the high schools near me are becoming mini vocational schools and force kids to choose a “career” path after year one. STEM, mechanical, social work, etc. It’s admirable what they’re trying to do and I get it. But I don’t know if it makes anyone happier. When I hear someone say I want to go to 4 year school for XYZ they usually have no clue what a job in said field may consist of. My brother is an architect. Couple years into his career he realizes that school isn’t work and you’re designing pipes instead of skyscrapers. Maybe highschoolers should be required to shadow a couple dozen fields so they actually see what the Hells going on in the real world and what resonates with them. It’s like you need to get lucky and fall into something or hope you guessed right

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IMADreamer
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Re: Investing for Retirement

Post by IMADreamer »

MAGA wrote:I’m curious what percent of the FIRE people Hate their jobs. Vs a normal sample.

we still don’t know how to link people with professions they enjoy and derive fulfillment from. Some of the high schools near me are becoming mini vocational schools and force kids to choose a “career” path after year one. STEM, mechanical, social work, etc. It’s admirable what they’re trying to do and I get it. But I don’t know if it makes anyone happier. When I hear someone say I want to go to 4 year school for XYZ they usually have no clue what a job in said field may consist of. My brother is an architect. Couple years into his career he realizes that school isn’t work and you’re designing pipes instead of skyscrapers. Maybe highschoolers should be required to shadow a couple dozen fields so they actually see what the Hells going on in the real world and what resonates with them. It’s like you need to get lucky and fall into something or hope you guessed right

This was the way it was when I was in high school 20 years ago. Not to mention family pressure to go to college. Pretty early on the school counselor was making people decided what they wanted to do. If you wanted to go to college you went into math and science classes, if you wanted something more technical you got to take shop and whatever. The girls who were going to be Mom's took home ec and all those classes.

Looking back I think I'd love to have done something else. Actually I'd have love to have gotten into agriculture sooner, but I was a good student and good students were supposed to do something else. How in the hell are you supposed to know what you want to do at 15?

I guess it all worked out in the end but it was a weird hard road to get here.

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Transmogrified Tiger
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Re: Investing for Retirement

Post by Transmogrified Tiger »

MAGA wrote:I’m curious what percent of the FIRE people Hate their jobs. Vs a normal sample.
This is guesswork, but I'd wager that a similar percentage hate their jobs, but fewer love their jobs than average. Most people I've seen who are actually successful are able to do so because they have significant earning power, and that plus an interest in FIRE lends itself towards people who don't actively hate their jobs, but treat them as means to an end rather than a source of fulfillment. So FIRE presents a different way to play the game/fit the puzzle together that they can optimize for, but like this thread talked about, you also need to have a purpose when you get to that end. This combo is why many of the success stories I've heard of are software developers. For me, my interest in that world has been more to have the freedom to have more time that I can choose to be unselfish with. Basically helping more people(via church, volunteering, coaching, etc) as a balance to enjoying downtime/lack of responsibilities beyond day to day self and home care. Maybe exploring some business type work as much as a vehicle of learning as it is for the income. You can get that without FIRE, but I find it appealing to try to create a future where you can explore those things without the 40+ hour time commitment already spoken for.

As an aside, this is maybe my favorite thread on this site, and I really enjoy reading it.

BrntOrngStud
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Re: Investing for Retirement

Post by BrntOrngStud »

I trade stocks short term using technical indicators so I don't invest. The key is recognizing your strengths. If you can see that you have good vision for the future but are weak mathematically, invest and ride out the disturbances. I made quite a few stupid mistakes that caused me to lose a LOT of money (that's the downside of trading- you have to be right ALOT because you are constantly making trades).

Let's ignore natural fatigue. But lets say we had a pitcher that had to pitch every inning of every game. He will naturally have a few bad innings...but if you can identify the "solid pitcher", that pitcher will win over the season.

With me, I trade (only had for the day or a couple of days or weeks at the most), so I have to be right more frequently. That's like having a bullpen game where I constantly change pitchers.

For example, I shorted a stock that was exploding (ie. betting against it) and it kept on going up. I covered for a huge loss (like 40% loss) a couple of days later. It went up even more the next day after I covered. But then it crashed so if I held on to my short, I would have made money BUT you can't hold a short long term because your losses are unlimited. Let's say someone shorted 100 shares of Amazon at 300 in late 2014 and they never covered. They would have received 30,000 dollars for their short. BUT now they would have to pay 2000 dollars a shares so they would have to pay 200,000 dollars for it but only received 30,000 for a loss of 170,000 dollars.

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