5 ms·

Move to a country where I can live off the 40k -> 60k a year an interest or whatnot. This basically means either Southeast Asia, or some parts of Latin America

Move to a country where I can live off the 40k -> 60k a year an interest or whatnot. This basically means either Southeast Asia, or some parts of Latin America. Asian languages tend to be extremely hard, and it might be a lot easier to sort of blend in with the populace in Latin America. The last thing I want to do in my retirement is draw needless attention to myself.

war1025 6y ago
> Move to a country where I can live off the 40k -> 60k a year an interest or whatnot. You realize the median US household income is like $40k/ year right?
- offtop5 6y ago
  Yeah but I'm not trying to struggle in America, so cómo estás ¿
- pvarangot 6y ago
  With $40k a year you can live with the rich in some Latin American countries, if you can also spend 250k/350k on buying your own place in a high rise with private security or a gated community. You won't have access to Amazon and be able to buy all the top notch gear for your new hobbies in a week like as a tech worker in the US, but you can have a nice house with cleaning staff, a nice car or just take Uber or private cars everywhere, and do fancy dining two or three times per week. The median American household doesn't have all this luxuries.
groby_b 6y ago
You assume that a million generates $40k to $60k, inflation-adjusted, for the next 40 years? I suppose that's one assumption to make. You know that the last time the US GDP grew more than 4% was back in 2000, right? And 2010 worldwide? Both with a continued downward trend since at least the 60's? (This obviously doesn't preclude >4% ROI, but that in turn means increasing income inequality, and at some point, there's a price to be paid for that)
- edoceo 6y ago
  It's not about GDP, it's about Equities - eg: SPX which averages like 10% growth over last 30 years or something. Getting 4% off $1M isn't that hard at all. And with $1M you may be able to get some portion to work higher yields.
  - groby_b 6y ago
    Equities don't keep growing indefinitely without underlying economic growth, and GDP represents that economic growth. There is no immutable law that SPX needs to keep growing 10%. It has been outpacing GDP because increasingly, production is being concentrated in fewer, larger companies. So right now, they are growing. There are limits to that growth if GDP isn't growing as well - there are only so many smaller companies you can put out of business. This - investing into SPX, or VFIAX, or any other market aggregate - is a viable strategy in the face of unlimited growth. It's a reasonable mid-term strategy. It's entirely unclear that there will be unchecked economic growth for 40 years. In fact, there's very good reason to assume there won't. As for "get some portion to work higher yields" - those yields carry risk. They're not just making you more money, you stand a better chance to lose money, too. Which in turn means much less return, even if you manage to maintain 4%. And to make matters worse, you're timing dependent - if you'd invested $1M in 1999, you would've been back to $1M in 2012. Except, if you'd lived off it for those 13 years, you'd be down to half your initial investment, ~$480K. FIRE is a high-risk strategy. I'm not saying it can't work out, but over 40 years, there are a lot of things that can happen, and most FIRE proponents have very small safety margins. The crux is that that doesn't seem particularly problematic in your 20s and 30s - worst case, you start again, right? Except "start again" in your 50s, 60s, 70s is a really sucky proposition. Ultimately, everybody takes their own risks, but let's not underplay those risks.
    - edoceo 6y ago
      Folks keep saying lots of logical things like this (for decades). And yet TSLA p/e is 1800. And there are a dozen TSLA on the horizon. And the market keeps making new ones.
kingnothing 6y ago
You can also live just fine off that amount in most American cities. $40k is basically $2,500 / mo after tax. In the Atlanta area for example, there are plenty of nice 2-3 bedroom houses for $200,000 or even less, which puts your mortgage at $1,000 / mo. That leaves $1,500 / mo for a car, utilities, and food, which is plenty doable. Rent out a room if you want to for more income.
- watermelon59 6y ago
  Health and dental insurance can be a huge cost though.
  - kingnothing 6y ago
    Healthcare can definitely be expensive and you'll need a plan for that until Medicare kicks in.
    - war1025 6y ago
      I have a dream that someday America will get its head out of its ass and decouple health insurance from employer benefits. That would change the employment calculus for a ton of people.
    - sgerenser 6y ago
      ACA actually makes health insurance very cheap if you can control your income (I.e. retired and living off investments). My in laws were paying a couple bucks a month for a Silver plan, I think it’s up to $100-$200 now. ACA subsidies do not take into account wealth, only adjusted gross income.
- gnicholas 6y ago
  How does this work if you have kids that will be going to college when you’re ~50? That is, how do you know at 40 how much you’ll want to spend on your children’s college education?
  - 6y ago
hinkley 6y ago
Most people who get rich get that way by saving money. That means living on less money than you can make. Indefinitely. If you want to get sucked into every ad campaign that comes along, you'll end up broke even if you get a huge windfall. Which is in fact exactly what happens to many lottery winners, sports stars, musicians, child actors...
- Viliam1234 6y ago
  > Which is in fact exactly what happens to many lottery winners, sports stars, musicians, child actors... I suspect the problem of sport stars et cetera is that they have to focus most of their time on their career, thus most don't have time to learn about finance (and not being from rich families means they can't simply copy the strategy of their parents), but it is publicly known that they are rich, and there are scammers who specialize on exactly this kind of victim. That is, I suspect that many sport stars will at some moment of their life meet a "financial advisor" with references from fellow sport stars, who offers to take care of their finance, and they go "lucky me, now I can focus 100% on my training", only to find out later that the money is gone. To get rich, you need two different skills -- one to make money, and one to keep it -- and they both compete for your time. If you only focus on being good at what you do professionally, you may see lot of money flowing through your hands, but the part that you don't spend will somehow disappear anyway. > Most people who get rich get that way by saving money. That means living on less money than you can make. Indefinitely. That's true, but it is much easier to save money if you already started with a large amount. With enough starting money, it simply means not spending more than the interest you get (after adjusting for inflation).

war1025 6y ago

> Move to a country where I can live off the 40k -> 60k a year an interest or whatnot. You realize the median US household income is like $40k/ year right?

offtop5 6y ago
Yeah but I'm not trying to struggle in America, so cómo estás ¿
pvarangot 6y ago
With $40k a year you can live with the rich in some Latin American countries, if you can also spend 250k/350k on buying your own place in a high rise with private security or a gated community. You won't have access to Amazon and be able to buy all the top notch gear for your new hobbies in a week like as a tech worker in the US, but you can have a nice house with cleaning staff, a nice car or just take Uber or private cars everywhere, and do fancy dining two or three times per week. The median American household doesn't have all this luxuries.

groby_b 6y ago

You assume that a million generates $40k to $60k, inflation-adjusted, for the next 40 years? I suppose that's one assumption to make. You know that the last time the US GDP grew more than 4% was back in 2000, right? And 2010 worldwide? Both with a continued downward trend since at least the 60's? (This obviously doesn't preclude >4% ROI, but that in turn means increasing income inequality, and at some point, there's a price to be paid for that)

edoceo 6y ago
It's not about GDP, it's about Equities - eg: SPX which averages like 10% growth over last 30 years or something. Getting 4% off $1M isn't that hard at all. And with $1M you may be able to get some portion to work higher yields.
- groby_b 6y ago
  Equities don't keep growing indefinitely without underlying economic growth, and GDP represents that economic growth. There is no immutable law that SPX needs to keep growing 10%. It has been outpacing GDP because increasingly, production is being concentrated in fewer, larger companies. So right now, they are growing. There are limits to that growth if GDP isn't growing as well - there are only so many smaller companies you can put out of business. This - investing into SPX, or VFIAX, or any other market aggregate - is a viable strategy in the face of unlimited growth. It's a reasonable mid-term strategy. It's entirely unclear that there will be unchecked economic growth for 40 years. In fact, there's very good reason to assume there won't. As for "get some portion to work higher yields" - those yields carry risk. They're not just making you more money, you stand a better chance to lose money, too. Which in turn means much less return, even if you manage to maintain 4%. And to make matters worse, you're timing dependent - if you'd invested $1M in 1999, you would've been back to $1M in 2012. Except, if you'd lived off it for those 13 years, you'd be down to half your initial investment, ~$480K. FIRE is a high-risk strategy. I'm not saying it can't work out, but over 40 years, there are a lot of things that can happen, and most FIRE proponents have very small safety margins. The crux is that that doesn't seem particularly problematic in your 20s and 30s - worst case, you start again, right? Except "start again" in your 50s, 60s, 70s is a really sucky proposition. Ultimately, everybody takes their own risks, but let's not underplay those risks.
  - edoceo 6y ago
    Folks keep saying lots of logical things like this (for decades). And yet TSLA p/e is 1800. And there are a dozen TSLA on the horizon. And the market keeps making new ones.

kingnothing 6y ago

You can also live just fine off that amount in most American cities. $40k is basically $2,500 / mo after tax. In the Atlanta area for example, there are plenty of nice 2-3 bedroom houses for $200,000 or even less, which puts your mortgage at $1,000 / mo. That leaves $1,500 / mo for a car, utilities, and food, which is plenty doable. Rent out a room if you want to for more income.

watermelon59 6y ago
Health and dental insurance can be a huge cost though.
- kingnothing 6y ago
  Healthcare can definitely be expensive and you'll need a plan for that until Medicare kicks in.
  - war1025 6y ago
    I have a dream that someday America will get its head out of its ass and decouple health insurance from employer benefits. That would change the employment calculus for a ton of people.
  - sgerenser 6y ago
    ACA actually makes health insurance very cheap if you can control your income (I.e. retired and living off investments). My in laws were paying a couple bucks a month for a Silver plan, I think it’s up to $100-$200 now. ACA subsidies do not take into account wealth, only adjusted gross income.
gnicholas 6y ago
How does this work if you have kids that will be going to college when you’re ~50? That is, how do you know at 40 how much you’ll want to spend on your children’s college education?
- 6y ago

hinkley 6y ago

Most people who get rich get that way by saving money. That means living on less money than you can make. Indefinitely. If you want to get sucked into every ad campaign that comes along, you'll end up broke even if you get a huge windfall. Which is in fact exactly what happens to many lottery winners, sports stars, musicians, child actors...

Viliam1234 6y ago
> Which is in fact exactly what happens to many lottery winners, sports stars, musicians, child actors... I suspect the problem of sport stars et cetera is that they have to focus most of their time on their career, thus most don't have time to learn about finance (and not being from rich families means they can't simply copy the strategy of their parents), but it is publicly known that they are rich, and there are scammers who specialize on exactly this kind of victim. That is, I suspect that many sport stars will at some moment of their life meet a "financial advisor" with references from fellow sport stars, who offers to take care of their finance, and they go "lucky me, now I can focus 100% on my training", only to find out later that the money is gone. To get rich, you need two different skills -- one to make money, and one to keep it -- and they both compete for your time. If you only focus on being good at what you do professionally, you may see lot of money flowing through your hands, but the part that you don't spend will somehow disappear anyway. > Most people who get rich get that way by saving money. That means living on less money than you can make. Indefinitely. That's true, but it is much easier to save money if you already started with a large amount. With enough starting money, it simply means not spending more than the interest you get (after adjusting for inflation).