4 ms·

How should one go about doing this?

seemslegit 7y ago
Step 1. Make sure everyone else don't do this or else equity will be worth less than wages and drive actual wages down. Step 2. Make sure you yourself are exceptional as far as step 1 is concerned. Step 3. Make money while asleep.
m42 7y ago
Naval podcast is pretty good: https://www.youtube.com/watch?v=jemPACNo1_I&list=PL5QAQBV5zCqVsMqk5UH-LVYuNmM4i6pgW https://www.youtube.com/watch?v=jemPACNo1_I&list=PL5QAQBV5zC...
close04 7y ago
You wouldn't really. Because the current projections assume most people will "rent their time" and a minority lean towards equity. It's like saying "everybody should buy second hand things to save money", ignoring the fact that the saving comes from many not buying second hand.
mdorazio 7y ago
Realistically, most people can't and/or shouldn't do this by building a business or working at a startup. Both of these are very risky and won't generally accomplish what I think the parent comment implies. Instead, the more reliable way is to invest as much of your income as you reasonably can in securities like stocks and bonds so that over time you are indeed making money doing nothing. Also, if your company offers stock options, opt for those if you think the company is going to do well in the future.
- SolaceQuantum 7y ago
  How does the reasoning of buying stocks and bonds work over time given the current crisis has wiped out all the gains for many people made in the past several years utilizing this strategy, and before that was 2008 which did the same?
  - tomrod 7y ago
    Tends to work well, outside black swan events.
    - SolaceQuantum 7y ago
      Yes, if black swan events happen every 10 or so years, and the black swan events wipe away all the gains of before... is that really helpful advice?
      - tomrod 7y ago
        For people who never want to look at their balances and don't have a coherent strategy? No, it's terrible, use ETFs and target funds.
      - jonmb 7y ago
        The S&P 500 has been a solid investment, historically speaking, even with the black swan events. It has more than tripled since 2009, and doubled since 2007 (before the 2008 drop). And with dividends it's even better. This idea that black swan events keep knocking out all the gains just isn't true, looking at the numbers. But if you don't like stocks, buying real estate and renting it out is also a good option.
  - esotericn 7y ago
    You don't need to make gains. You need to spend significantly less than you earn. If you can work for 4 months and survive for 12 then you're there. Compound returns are a nice bonus if they come, but not necessary. Sensible frugality is the important part.
    - SolaceQuantum 7y ago
      This doesn't work for people who want to have children, who may have healthcare conditions, who need to take care of their parents, etc. Spending significantly less than you earn won't mean much if inflation means anything you earn is worth less year over year.
QuixoticQuibit 7y ago
You need to FIRE. Don’t necessarily need to retire early if that isn’t your thing, but being financially independent is key. See https://reddit.com/r/financialindependence https://reddit.com/r/financialindependence

Step 1. Make sure everyone else don't do this or else equity will be worth less than wages and drive actual wages down. Step 2. Make sure you yourself are exceptional as far as step 1 is concerned. Step 3. Make money while asleep.

m42 7y ago

Naval podcast is pretty good: https://www.youtube.com/watch?v=jemPACNo1_I&list=PL5QAQBV5zCqVsMqk5UH-LVYuNmM4i6pgW https://www.youtube.com/watch?v=jemPACNo1_I&list=PL5QAQBV5zC...

close04 7y ago

You wouldn't really. Because the current projections assume most people will "rent their time" and a minority lean towards equity. It's like saying "everybody should buy second hand things to save money", ignoring the fact that the saving comes from many not buying second hand.

mdorazio 7y ago

Realistically, most people can't and/or shouldn't do this by building a business or working at a startup. Both of these are very risky and won't generally accomplish what I think the parent comment implies. Instead, the more reliable way is to invest as much of your income as you reasonably can in securities like stocks and bonds so that over time you are indeed making money doing nothing. Also, if your company offers stock options, opt for those if you think the company is going to do well in the future.

SolaceQuantum 7y ago
How does the reasoning of buying stocks and bonds work over time given the current crisis has wiped out all the gains for many people made in the past several years utilizing this strategy, and before that was 2008 which did the same?
- tomrod 7y ago
  Tends to work well, outside black swan events.
  - SolaceQuantum 7y ago
    Yes, if black swan events happen every 10 or so years, and the black swan events wipe away all the gains of before... is that really helpful advice?
    - tomrod 7y ago
      For people who never want to look at their balances and don't have a coherent strategy? No, it's terrible, use ETFs and target funds.
    - jonmb 7y ago
      The S&P 500 has been a solid investment, historically speaking, even with the black swan events. It has more than tripled since 2009, and doubled since 2007 (before the 2008 drop). And with dividends it's even better. This idea that black swan events keep knocking out all the gains just isn't true, looking at the numbers. But if you don't like stocks, buying real estate and renting it out is also a good option.
- esotericn 7y ago
  You don't need to make gains. You need to spend significantly less than you earn. If you can work for 4 months and survive for 12 then you're there. Compound returns are a nice bonus if they come, but not necessary. Sensible frugality is the important part.
  - SolaceQuantum 7y ago
    This doesn't work for people who want to have children, who may have healthcare conditions, who need to take care of their parents, etc. Spending significantly less than you earn won't mean much if inflation means anything you earn is worth less year over year.

QuixoticQuibit 7y ago

You need to FIRE. Don’t necessarily need to retire early if that isn’t your thing, but being financially independent is key. See https://reddit.com/r/financialindependence https://reddit.com/r/financialindependence