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I used to think that, but now I make $500k and I think you could convince me to work on something I like slightly less well for $700k. Once I achieve financial
by obstinate 10y ago
I used to think that, but now I make $500k and I think you could convince me to work on something I like slightly less well for $700k. Once I achieve financial independence, it will be different, but until then, changes that significantly impact the distance to that goal are motivating.
The interesting thing though is that you wouldn't really want to entice me that way, because I'd guess you'd get a worse product out of me. So there are different types of motivation that are important. The motivation to make a choice, versus the motivation to work hard on a choice.
- jimbokun 10y agoIf you're making $500k and not financially independent, or about to be very soon, you are doing something wrong, I think.
- Aeolun 10y agoIt only makes you independent for chunks of 6 months per month worked. You still have to work some 5-10 years before you are independent for the rest of your life.
- falsedan 10y agoPeople generally refer to that as 'retiring'; financial independence usually means, "don't need to ask parents for small loans/handouts".
- shostack 10y agoI thought it meant having enough investments to live off dividends/interest/rent without having to touch your principle such that it continues growing on its own?
- falsedan 10y agoI think 'independently wealthy' describes that situation more clearly/less confusingly.
- brokenmachine 10y agowealthy != independent. Financial independence to me is not needing to work ever again, even if I'm living quite frugally.
- falsedan 10y agoI don't understand the distinction; are there wealthy dependent people? I've run the numbers on what I'd need to not work and the total amount required would clearly put me in the 'wealthy' camp.
- brokenmachine 10y ago> are there wealthy dependent people? I would say yes. Well, maybe not dependent but not independent. Some people with large incomes are still up to their eyeballs in debt, or at least not living within their means. IMO financial independence requires living within your means until the point where you never need to work again to continue that lifestyle for the rest of your life.
- obstinate 10y agoI mean it in the sense of being independent of employment for income. This is the common meaning in my circles.
- falsedan 10y agoThat's 'retirement', living off your accumulated savings and guaranteed income.
- falsedan 10y agoHi downvoters, I don't understand why 'retirement' isn't an appropriate term, please help me grow my understanding by commenting instead. Thanks, --falsedan
- obstinate 10y agoRetirement is when you stop working. Financial independence is when you stop having to. They are different.
- falsedan 10y ago1. That's not the common meaning of 'financial independence' no matter how much you repeat it, it's really closely-associated with the coming-of-age rite when you no longer rely on financial support to survive 2. I can't imagine being independently wealthy & keeping my day job but I suppose it's conceivable!
- obstinate 10y ago1. How do you explain that your view is being downvoted, and mine, upvoted? This is the common understanding in the circles I run in. I think you may be the one whose definitions need an update. 2. For example, all employees at the VP and up level at Google, Facebook, etc., make more than a million dollars are year. It doesn't take long at this level of compensation to have more wealth than any reasonable person could spend. Yet they still work, normally not to satisfy an unmet financial need.
- SmellyGeekBoy 10y agoFinancial independence is when time != money.
- falsedan 10y agodon't understand? children can't turn time into money, it sounds wrong to call them financially independent.
- falsedan 10y agoHi downvoter, I'm not going to increase my understanding of 'time != money' without some explanation. Could you please comment so I might learn something? thanks, --falsedan
- brokenmachine 10y agoI'm not the downvoter but I'm pretty sure the original poster meant that a financially independent person no longer has to exchange their time for money, ie they can choose whatever they want to do with their time and no longer have to work just for food/shelter/etc.
- obstinate 10y agoSoon. But sooner is better.
- SubuSS 10y agoWith some very basic math and assuming an expenditure of about 120k in today's value per year (millionaire remember), taking into account 4% inflation and a 4% return rate, you need about 20MM+ to settle down with 100% financial independence. I made a bunch of assumptions like you need this for 50 years and 120k lifestyle today will be worth much more like 1.2MM in 50 years and so on. As much as I would love to be proven wrong on this math, 500k per month puts you very far indeed. Money may not motivate me in small numbers, but this goal of financial independence (what they call fuck you money) is definitely a motivator.
- dceddia 10y agoYou mentioned financial independence, so you may have already done some research into that, but I'll just leave this here: http://www.mrmoneymustache.com/ http://www.mrmoneymustache.com/ And this nifty calculator: https://networthify.com/calculator/earlyretirement https://networthify.com/calculator/earlyretirement It's mostly about the savings rate.
- obstinate 10y agoYes, I have been following him for some time. He inspired me to begin saving even harder than I was already naturally predisposed to. My savings rate is nearly eighty percent these days, so we're quite close. This calculator gives me a year based on rough numbers, which is about what I had calculated. I will probably engage in the standard one-more-year thing to make things even more certain.
- brokenmachine 10y agoI am very jealous. May I ask what you're doing to earn $500k? I'm guessing Finance industry.
- obstinate 10y agoI'm a programmer at one of the big web companies.