At what age do you hope to retire/Personal Finance and Investing Thread

[MrTPlush]

I'm all in favor of frugality and delayed gratification, but it got too extreme for me. What gets overlooked by the movement is that yes, you are now 35 or 40 and are independent. And you did it at the expense of the first 35 years of your life. Your relative youth. And that's a good cost to consider. A lot of the things I spent money on, I won't enjoy later on.

 

You would have to live and breath the FIRE concept to not only be successful (still requires investing luck), but to actually enjoy it. If someone does good for them, but I am guessing most don't. I just can't get behind something that requires me to pretty much have no spending money for 35 years of my life to make the years following that pretty much the same way. It isn't like at that saved money is going to be blown on your dreams then...its for basic living expenses if you stop working.

 

A more effective method would be to find something you love and make it your career. Then you would never have to worry about suddenly not wanting to work or retiring early. I know, crazy concept right?

[nodakfan17]

Some people just get their jollies from saving.

[homer]

I think I'd rather get a job I enjoy for 35 years than one I feel the need to retire from after 15.

[GAME05]

It's really a best-case scenario to be smart enough to have a job that would pay you six figures shortly after college and then have no speedbumps along with way like kids and layoffs. And if you're in a place like NYC the cost of living is so much higher.

 

I'm starting to think along the lines of good investments for when this money train finally comes off the rails. I have to do my research on it, but I'm thinking along the lines of a trailer-park REIT or Dollar General.

[nodakfan17]

McDonald’s actually had a pretty good run in 2009 because everyone wanted $1 hamburgers. I like low cost, equity index funds in my retirement accounts as much as the next guy, but I’m skeptical about getting 10% annual returns over the next 20-30 years. Too many variables to treat that as a certainty.

[homer]

McDonald’s actually had a pretty good run in 2009 because everyone wanted $1 hamburgers. I like low cost, equity index funds in my retirement accounts as much as the next guy, but I’m skeptical about getting 10% annual returns over the next 20-30 years. Too many variables to treat that as a certainty.

 

But haven't those indexes achieved about the same return the last 75, 100 years? yeah there've been dips along the way but it always bounces back and then some.

[nodakfan17]

How can you be sure the market won’t be in a trough when you want to (or are forced to) retire? Don’t get me wrong, I like equities. I’d just prefer to diversify with my non-qualified funds in case those 10% returns don’t materialize.

[homer]

How can you be sure the market won’t be in a trough when you want to (or are forced to) retire? Don’t get me wrong, I like equities. I’d just prefer to diversify with my non-qualified funds in case those 10% returns don’t materialize.

 

Well yeah there's always that risk but the market has always rebounded within a few years. And let's say you have $2 million when you retire. If the market tanks as bad as the depression or great recession or whatever other market calamity that has struck, it will go down probably 40 - 50%. You will still have $1 million and within a few years you'll be back to $2 million. Putting off retirement for a couple of years is probably a wise move if it tanks right before you want to call it quits.

 

And if it tanks more than 40 - 50% that probably means every investment on the planet is tanking.

 

And I'm not saying seeing 50% of your net worth go away is easy to swallow. I'm just saying expecting 10% return on an index fund is reasonable given historical returns and time.

[OldSchoolSnapper]

I think I'd rather get a job I enjoy for 35 years than one I feel the need to retire from after 15.

 

In defense of FIRE, a lot of them don't hate their jobs. The movement is really about the freedom to choose. If they decide at 43 that IT Director is a boring job, they go coach wrestling or open an Etsy shop. They can do what they want at any moment. It's cool.

 

But I have regrets and I was very watered down fire guy in my late 20s. I have weddings that I skipped, concerts, sporting events, because I didn't want to spend $500 on travel.

 

I do get my jollies from saving, to a degree, but the level some of the movement takes it too was just too much for me. I tried it, for at least 2 years, and it just simply was't for me. I enjoyed "extravagance" too much. Once in while I liked taking my wife out to a $500 dinner or buying a stupid tech device nobody actually needs.

 

I just learned I was made more for balance.

[nodakfan17]

Homer - You’re right. 10% is a reasonable projection, provided you account for alternative (more conservative) scenarios in your planning.

[nodakfan17]

I do get my jollies from saving, to a degree, but the level some of the movement takes it too was just too much for me. I tried it, for at least 2 years, and it just simply was't for me. I enjoyed "extravagance" too much. Once in while I liked taking my wife out to a $500 dinner or buying a stupid tech device nobody actually needs.

Do you mean $50 dinner? Because that’s a pretty reasonable date night. Otherwise, I can see how you had trouble with the FIRE lifestyle if you enjoy $500 dinners.

[OldSchoolSnapper]

Lol, no, I meant $500. On my anniversary I go to Sanford for the tasting menu. That + some form of entertainment after is right around there. Not something I do all the time, but something FIRE dudes would have a problem with.

 

Cutting cable, getting a $75 cell phone, driving a 15 year old car, I'm on board with all of that.

[wallus]

People often look at things like cable which don't save a lot of money. Things like food waste, living close to where you work, buying things you don't use and having a modest mortgage are much big money savers.

[FVBrewerFan]

FIRE, lol. Never heard of it, but the concept has been around forever, just constantly rebranded. I have no problem with people who want to adhere to this. I do have a problem when some treat at as a religion, and feel the need to save me from myself. (Not saying anyone here is doing that!)

 

I could have a smaller home and/or mortgage, I don't. I could travel less and spend less on entertainment, I don't. Best way I can describe it, we live within our means but not below our means. Just my own opinion, I rather do things now with friends and family rather than when I'm 80. For all I know, I won't even be around to enjoy it when I'm 80. I just try to balance as best I can "live for today" vs "save for tomorrow."

[OldSchoolSnapper]

People often look at things like cable which don't save a lot of money. Things like food waste, living close to where you work, buying things you don't use and having a modest mortgage are much big money savers.

 

 

Living close to work is like the #1 mantra of that movement. But cable isn't expensive? It's a lot more than $8 for Netflix.

 

The cost of cable for a year is a vacation for most people.

[wallus]

People often look at things like cable which don't save a lot of money. Things like food waste, living close to where you work, buying things you don't use and having a modest mortgage are much big money savers.

 

 

Living close to work is like the #1 mantra of that movement. But cable isn't expensive? It's a lot more than $8 for Netflix.

 

The cost of cable for a year is a vacation for most people.

 

You still have internet right? The cost of bundling cable and internet versus internet plus streaming isn't that significant; definitely not enough for a vacation.

[OldSchoolSnapper]

Internet alone can be $30-$40. In most cases cable adds $100 to that. Internet is a necessity for almost anyone with a corporate job, it certainly is for me. Netflix is $8.

 

This doesn't even broach the topic that cable is trash and the programming is terrible. I had cable and cut it, so I'm not sure why you're trying to mell me it's not expensive.

 

The promo where its $100 or something for both isn't ridiculous, but I wouldn't pay $10 for what you get. The problem is that promo ending and it shooting up 70%.

 

In most cases it's over $1k per year, why anybody is paying that for what you get, I can't figure out. It seems like nobody under 35 still has it.

[wallus]

Internet alone can be $30-$40. In most cases cable adds $100 to that. Internet is a necessity for almost anyone with a corporate job, it certainly is for me. Netflix is $8.

 

This doesn't even broach the topic that cable is trash and the programming is terrible. I had cable and cut it, so I'm not sure why you're trying to mell me it's not expensive.

 

The promo where its $100 or something for both isn't ridiculous, but I wouldn't pay $10 for what you get. The problem is that promo ending and it shooting up 70%.

 

In most cases it's over $1k per year, why anybody is paying that for what you get, I can't figure out. It seems like nobody under 35 still has it.

 

I'll compare Spectrum because AT&T internet is awful. Sure it is $45 for the first 12 months, then it is $65 afterwards. I bundle Cable and Internet for a little over $100. When my promo time is up, I just call and threaten to cancel. It isn't as easy to get the bundle promo price as it used to be but you can still get it. Now add the streaming services like Netflix/Hulu (which aren't that great btw) and you are almost at the same money.

 

If you don't like cable programming, that is fine. The savings just aren't that significant at all.

[OldSchoolSnapper]

I've been paying 34.99-39.99 for Internet for 3 years, simply by calling like you said and threatening to cancel. I don't bother with TV, because I think it's awful, but I'm simply never going to agree that $60/mo is some throwaway money. That's $4k in a 5-year period assuming a constant rate, which it is not.

 

Run that amount per year through an index for 30 years and tell me it's not significant for the average Joe, which is the crux of this conversation and the basis of FIRE.

 

You can argue that anything isn't significant if you are just looking at a gross number. A $60 Armani suit is incredible, $60 for what I get from AT&T programming is one step above lighting it on fire, especially when Netflix is offering some of the best original content out there for $8.44.

 

$60/mo is $15 more than what I pay for cell phone service for the wife and I...it's very significant, for what you get. It's all relative.

 

"Significant" is a totally subjective term; you simply can't say something is or isn't. As is dismissing Netflix by saying it isn't great. I get that I'm saying cable sucks and that's my opinion, but cable isn't $8.

 

I don't have an acquaintance that thinks cable TV is a better value than Netflix.

[OldSchoolSnapper]

Let be explain it better.

 

FIRE at its core is about efficiency and getting value more than it is about money.

 

Cable is one of their favorite targets because it is one of the worst values out there for the consumer – a high monthly fee for marginal entertainment that encourages you to sit on your butt and be unproductive.

 

FIRE’s issue with cable really has more to do with the fact that isn’t a good use of your time than the bill. But another part of fire is how much waste is built into the typical American budget. So if you want to split hairs over the $60, the point is if you think $60 for cable isn’t significant, you are more likely OK with $125 for a phone, $425 for your pickup truck, etc. It has more to do with consumerism than just the $60-$80 for cable you are hung up on.

 

It’s more about people not thinking about their money enough.

[wallus]

I've been paying 34.99-39.99 for Internet for 3 years, simply by calling like you said and threatening to cancel. I don't bother with TV, because I think it's awful, but I'm simply never going to agree that $60/mo is some throwaway money. That's $4k in a 5-year period assuming a constant rate, which it is not.

 

Run that amount per year through an index for 30 years and tell me it's not significant for the average Joe, which is the crux of this conversation and the basis of FIRE.

 

You can argue that anything isn't significant if you are just looking at a gross number. A $60 Armani suit is incredible, $60 for what I get from AT&T programming is one step above lighting it on fire, especially when Netflix is offering some of the best original content out there for $8.44.

 

$60/mo is $15 more than what I pay for cell phone service for the wife and I...it's very significant, for what you get. It's all relative.

 

"Significant" is a totally subjective term; you simply can't say something is or isn't. As is dismissing Netflix by saying it isn't great. I get that I'm saying cable sucks and that's my opinion, but cable isn't $8.

 

I don't have an acquaintance that thinks cable TV is a better value than Netflix.

 

$60 a month for Cable isn't significant in terms of monthly expenditures. You could easily find way more savings than that in food waste, mortgage expenses, etc.

 

I don't have an acquaintance that thinks spending $500 on a meal is a good value either. Not everyone is going to agree where they should spend money but there are areas that saving can add up much faster.

[OldSchoolSnapper]

FIRE is about maximizing all those expenditures. Someone who lives fire cuts cable, has a minimalist house, cooks their own meals and uses leftovers...they do all of those things, not just pick one of them.

 

I'm not seeing your logic here though. $60 a month is a good chunk of change. Honestly, it just sounds to me like you have cable and are feeling like you have to justify it. A lot of this country is scraping to get by and would be served pretty well putting an extra $60 in an IRA. I think a blanket statement that $60 isn't significant is pretty ignorant.

 

Equating that with fine dining on your anniversary is about as apples to oranges as it gets...and the "meal" isn't $500, the night is.

 

...but I've spent $800 on a meal and it was worth every penny...a far more memorable life experience eating at NoMa than Law and Order reruns.

 

I'd also all but guarantee I'm spending less on food than the average American, just that when I decide to go out, it's going to be nice, not Applebee's, I'll just only do it a handful of times a year. Maybe I am more FIRE than I thought.

[OldSchoolSnapper]

This really isn't about cable, it's about the concept that $60 isn't a lot of money, which is a very typical non-FIRE mentality. The leading FIRE guy at the moment is Mr. Money Mustache, whom I assume at least a few are familiar with. His whole mantra is that early retirement is a series of good $10 decisions. I've read his literature for years and buy into a lot, but not all of what he says.

 

$60 not being a lot of money is exactly the kind of thing he writes about all the time, which is why it attracted my attention. You started the thread, so it surprised me to hear you say it. I'm just pointing out that it flies directly in the face of FIRE, sorry if it is coming across as insulting or something.

 

And again, FIRE is about more than just eating Ramen and shopping Walmart, it's more of a "buy it for life" community. Spending money on things that truly make you happy or increase your output or both...and endlessly pursuing value and efficiency.

 

Spending a lot a few times per year on a concert with friends or taking your wife to a special dinner is something they would "allow," cable TV isn't, is what I was trying to get at.

[wallus]

I think a blanket statement that $60 isn't significant is pretty ignorant.

 

 

Read it again, $60 in terms of monthly expenditures is insignificant which is 100% true. Everyone spends so much on entertainment and I choose to spend on cable. This is no different than someone choosing to go to concerts, sporting events, etc. It is all in the entertainment category.

 

This wasn't about me trying to justify cable, this was about areas where money can be more easily saved. Other areas that I have already mentioned offer a lot more opportunity in terms of savings but usually do not get talked about.

 

People like to focus on cable and things like rewards cards for some reason like it makes a big difference. Thinking that someone can make a big dent on savings from those things just shows a pure lack of financial sense.

 

Look at how much you pay for your mortgage, interest, insurance, and transportation if you want to actually make a difference in having more money in your pocket.

 

Also, I did not start this thread either like you mentioned.

[MrTPlush]

My parents were paying over $2,000 a year for cable. Being in a rural area may have aided to that, but $60 a month? What is that the entry deal? They cut the cord. The worst part was when the had to get a knee Internet package. The lowest possible speed was two times faster than their current plan and $10 cheaper a month. For the same price they were paying they could get 10x faster internet.

 

What a scam. Have never and will never have cable. You can get a cheap streaming option that gives you most sports for a fraction of the cost if you need it.