7 ms·

The teacher example is an extreme version of the long game. There is a middle path - where you focus on investing, invest in your health, treat your job less as

The teacher example is an extreme version of the long game. There is a middle path - where you focus on investing, invest in your health, treat your job less as a job and more as a career.

eloisant 8y ago
Well, let's see... After a career of 35 years she had 6 millions. Did she save 171k a year off her teacher salary? "They didn't throw anything away" said the lawyer. I'm not sure how a school teacher who makes 50k a year will save 170k a year by not "throw away anything". Or maybe... She got lucky with some investments, maybe real estate. That reminds me all the stories of engineers who retire early by "saving instead of spending" that start by "I got 500k from stocks when the startup I worked for got bought out". Sure, saving every year and investing instead of buying everything credit is a good thing, just like avoid to sink all your savings + 25 years mortgage when you buy a house, and many Americans especially need to be reminded that. But showing a lady who end up with 6M "just by playing the long game" sounds a lot like the old Adam Smith/American dream bullshit. "If you work hard and save, one day you'll be a millionaire". That's bullshit. You can't become a millionaire just by saving your blue collar salary (or school teacher salary) and saving up instead of overspending.
- thinkloop 8y ago
  > "If you work hard and save, one day you'll be a millionaire" I've always been surprised how much traction this saying gets. If you look around, not only is it untrue, it's actually the opposite. The hardest, most boring, most unpleasant jobs are generally the lowest paid: custodian, service industry, tellers, cashiers, csr's, etc. The most fun, desirable and easiest jobs are generally the higher paying ones: management, tech, academia, etc. Optimizing life for hard work is misguided and reaps only coincidental benefits. It's more directly about value, moving up the value chain, which generally ends up reducing "hardness".
  - mattkrause 8y ago
    Academia is high paying? I made more as an undergrad intern than as a postdoc with an Ivy League PhD.
    - thinkloop 8y ago
      My buddy is a prof in finance with summers off, light weekly schedules, and generally the most relaxed lifestyle around, and he makes more per hour than a wall street hotshot (because they work many more hours). He's in a lucrative department (finance) but my understanding was that other disciplines are not far off. From what I've seen, finance prof may be the single best job in the world.
  - Jtsummers 8y ago
    Management may be high paying, but it's often not fun or easy. Though it may be one of the easier careers to "fail up" in.
  - Reedx 8y ago
    There's a lot more to it than that. They are hard and easy in different ways. For one thing, your hardest examples are easy to learn and execute. The barrier to entry is low and a lot of people can do it. Not so much with tech, for example. There's a lot of work you have to put in before anyone is going to pay you and you may be breaking new ground. The ongoing work is often very hard, very complex and not fun.
    - thinkloop 8y ago
      Sure, but what's "harder", slogging mindlessly 8 hours a day dealing with the public for 10 years, or hanging out in a cafe with buddies memorizing text books for 5 years, then coming in at 11am and playing ping pong building software for 5 years?
- neogodless 8y ago
  There is an obvious flaw in your math. You are completely discounting investment returns. You don't have to "get lucky" to multiply your money over 35 years. Ignoring inflation for the moment, if you invest $1750/month and the stock market returns 10%, after 35 years, you'll have roughly $6 million. So that means the teacher only needed to save $21k each year, and dump into index funds. (The pre-inflation annualized return for the S&P 500 from 1980 to 2015 was 12.97% - if you use that for your assumptions, you only need to invest $875/month or $10,500 each year. Obviously after 35 years, that money will have lost some steam due to inflation, but it will have grown a ridiculous amount). Footnote: The "retired teacher" article didn't seem to mention investments, beyond a few savings bonds and calling it a "portfolio", - or the actual time span of saving money. Just that she "worked" for 35 years.
- mattkrause 8y ago
  You’re right that is is optimistic—and totally ignores the fact that you probably don’t just want to hit an arbitrary target with your bank balance; you’ve got to live for those 35 years too. However, the numbers aren’t totally bonkers. Suppose she invested $15,000 saved from her first year, which would be hard but not totally impossible on a teacher’s salary. If that makes 7 percent per year for 35 years, it will be worth about $160,000 at retirement. That’s just for the first year. Money earned and invested the next year will earn a bit less, though with raises, etc, perhaps she could invest a bit more....
  - teachrdan 8y ago
    Your argument is well-intentioned, but there is no way a first-year teacher could save $15,000, unless they lived at home. (or were already wealthy) The latest data I could find (2010) shows that even the highest-earning first year teachers only earned $39,259. The perverse reality for many professions is that, when you are youngest and best able to take advantage of the magic of compound interest, you are barely paid enough to survive independently. After paying for loans to cover college and graduate school, a public school teacher would be lucky to save $15,000 a year 10 years after starting their career. https://work.chron.com/annual-salary-firstyear-teacher-5573.html https://work.chron.com/annual-salary-firstyear-teacher-5573....
    - mattkrause 8y ago
      People certainly live on $25,000/year--ask a grad student. Actually, the median household income is a bit over $50k (~$57k, I think), but many households include more than one earner, so there are a lot of people getting by on about that. It would not be particularly pleasant, but as I said, it would be hard (possibly hard enough to merit a newspaper article), but not impossible.
      - kazen44 8y ago
        this still comes down to the reasoning if suffering "for the long game" is worth it in such a case, especially with growing inequality? Why would i skim off all money in the first 10 years of my working life if i know the pie gets bigger, but my share as a working class person is getting smaller and smaller?
- sharadov 8y ago
  It says here that her brother was a financial whiz http://www.courant.com/news/connecticut/hc-simsbury-millionaires-nextdoor-20131122-story.html http://www.courant.com/news/connecticut/hc-simsbury-milliona... He left millions too..
anonunt 8y ago
the teacher example is a total embarrassment! that lady was straight up lucky, the article linked to doesnt say she was an amazing saver it says that she was a messy hoarder who happened to come from a rich family that meant that the trash she didnt tidy up was worth lots of money. Also it looks like half or more of th emoney cam from a relative that happeded to move in with her yeaars before dying. the lady got given a house to live in for free and had no requirement for money. This article can be summed up as: long term efforts chipping away at something can ALSO pay off. I am yet to see a success story that is not heavily leaning on situation or luck. our system is simply not fair and i really tire of bullshit like this trying to pretend that it has some purpose or value beyond exploitation.

The teacher example is an extreme version of the long game. There is a middle path - where you focus on investing, invest in your health, treat your job less as a job and more as a career.

eloisant 8y ago

Well, let's see... After a career of 35 years she had 6 millions. Did she save 171k a year off her teacher salary? "They didn't throw anything away" said the lawyer. I'm not sure how a school teacher who makes 50k a year will save 170k a year by not "throw away anything". Or maybe... She got lucky with some investments, maybe real estate. That reminds me all the stories of engineers who retire early by "saving instead of spending" that start by "I got 500k from stocks when the startup I worked for got bought out". Sure, saving every year and investing instead of buying everything credit is a good thing, just like avoid to sink all your savings + 25 years mortgage when you buy a house, and many Americans especially need to be reminded that. But showing a lady who end up with 6M "just by playing the long game" sounds a lot like the old Adam Smith/American dream bullshit. "If you work hard and save, one day you'll be a millionaire". That's bullshit. You can't become a millionaire just by saving your blue collar salary (or school teacher salary) and saving up instead of overspending.

thinkloop 8y ago
> "If you work hard and save, one day you'll be a millionaire" I've always been surprised how much traction this saying gets. If you look around, not only is it untrue, it's actually the opposite. The hardest, most boring, most unpleasant jobs are generally the lowest paid: custodian, service industry, tellers, cashiers, csr's, etc. The most fun, desirable and easiest jobs are generally the higher paying ones: management, tech, academia, etc. Optimizing life for hard work is misguided and reaps only coincidental benefits. It's more directly about value, moving up the value chain, which generally ends up reducing "hardness".
- mattkrause 8y ago
  Academia is high paying? I made more as an undergrad intern than as a postdoc with an Ivy League PhD.
  - thinkloop 8y ago
    My buddy is a prof in finance with summers off, light weekly schedules, and generally the most relaxed lifestyle around, and he makes more per hour than a wall street hotshot (because they work many more hours). He's in a lucrative department (finance) but my understanding was that other disciplines are not far off. From what I've seen, finance prof may be the single best job in the world.
- Jtsummers 8y ago
  Management may be high paying, but it's often not fun or easy. Though it may be one of the easier careers to "fail up" in.
- Reedx 8y ago
  There's a lot more to it than that. They are hard and easy in different ways. For one thing, your hardest examples are easy to learn and execute. The barrier to entry is low and a lot of people can do it. Not so much with tech, for example. There's a lot of work you have to put in before anyone is going to pay you and you may be breaking new ground. The ongoing work is often very hard, very complex and not fun.
  - thinkloop 8y ago
    Sure, but what's "harder", slogging mindlessly 8 hours a day dealing with the public for 10 years, or hanging out in a cafe with buddies memorizing text books for 5 years, then coming in at 11am and playing ping pong building software for 5 years?
neogodless 8y ago
There is an obvious flaw in your math. You are completely discounting investment returns. You don't have to "get lucky" to multiply your money over 35 years. Ignoring inflation for the moment, if you invest $1750/month and the stock market returns 10%, after 35 years, you'll have roughly $6 million. So that means the teacher only needed to save $21k each year, and dump into index funds. (The pre-inflation annualized return for the S&P 500 from 1980 to 2015 was 12.97% - if you use that for your assumptions, you only need to invest $875/month or $10,500 each year. Obviously after 35 years, that money will have lost some steam due to inflation, but it will have grown a ridiculous amount). Footnote: The "retired teacher" article didn't seem to mention investments, beyond a few savings bonds and calling it a "portfolio", - or the actual time span of saving money. Just that she "worked" for 35 years.
mattkrause 8y ago
You’re right that is is optimistic—and totally ignores the fact that you probably don’t just want to hit an arbitrary target with your bank balance; you’ve got to live for those 35 years too. However, the numbers aren’t totally bonkers. Suppose she invested $15,000 saved from her first year, which would be hard but not totally impossible on a teacher’s salary. If that makes 7 percent per year for 35 years, it will be worth about $160,000 at retirement. That’s just for the first year. Money earned and invested the next year will earn a bit less, though with raises, etc, perhaps she could invest a bit more....
- teachrdan 8y ago
  Your argument is well-intentioned, but there is no way a first-year teacher could save $15,000, unless they lived at home. (or were already wealthy) The latest data I could find (2010) shows that even the highest-earning first year teachers only earned $39,259. The perverse reality for many professions is that, when you are youngest and best able to take advantage of the magic of compound interest, you are barely paid enough to survive independently. After paying for loans to cover college and graduate school, a public school teacher would be lucky to save $15,000 a year 10 years after starting their career. https://work.chron.com/annual-salary-firstyear-teacher-5573.html https://work.chron.com/annual-salary-firstyear-teacher-5573....
  - mattkrause 8y ago
    People certainly live on $25,000/year--ask a grad student. Actually, the median household income is a bit over $50k (~$57k, I think), but many households include more than one earner, so there are a lot of people getting by on about that. It would not be particularly pleasant, but as I said, it would be hard (possibly hard enough to merit a newspaper article), but not impossible.
    - kazen44 8y ago
      this still comes down to the reasoning if suffering "for the long game" is worth it in such a case, especially with growing inequality? Why would i skim off all money in the first 10 years of my working life if i know the pie gets bigger, but my share as a working class person is getting smaller and smaller?
sharadov 8y ago
It says here that her brother was a financial whiz http://www.courant.com/news/connecticut/hc-simsbury-millionaires-nextdoor-20131122-story.html http://www.courant.com/news/connecticut/hc-simsbury-milliona... He left millions too..

anonunt 8y ago

the teacher example is a total embarrassment! that lady was straight up lucky, the article linked to doesnt say she was an amazing saver it says that she was a messy hoarder who happened to come from a rich family that meant that the trash she didnt tidy up was worth lots of money. Also it looks like half or more of th emoney cam from a relative that happeded to move in with her yeaars before dying. the lady got given a house to live in for free and had no requirement for money. This article can be summed up as: long term efforts chipping away at something can ALSO pay off. I am yet to see a success story that is not heavily leaning on situation or luck. our system is simply not fair and i really tire of bullshit like this trying to pretend that it has some purpose or value beyond exploitation.