5 ms·

> In my circles, everyone from 25-35 is simultaneously preparing to FIRE and no-one that's 35+ has actually changed jobs despite being 'financially independent'

> In my circles, everyone from 25-35 is simultaneously preparing to FIRE and no-one that's 35+ has actually changed jobs despite being 'financially independent'. I think your circles are rather unusual, if this is true. A $900k net worth is in the 99th percentile for 30-34 year olds and 95th percentile for 35-40 year olds in the US (https://dqydj.com/net-worth-by-age-calculator-united-states/ https://dqydj.com/net-worth-by-age-calculator-united-states/) Even among my anecdotal very-highly-compensated NYC tech-salary coworkers and friends, having money issues and easily sub $100k net worths is way more common than not.

ghaff 5y ago
I didn't have any substantial savings until I was well into my 30s. I didn't graduate from grad school until I was 28. (Worked for a few years prior in engineering but nothing like the salary levels in SWE today.)
- jghn 5y ago
  Despite being in software I had no savings until my late 30s. I am forever grateful that our field is one that allows for huge earnings, as it has enabled me to flip that all the way around. I'm now in my mid/late-40s and show up as low/mid 80s on that calculator depending on if I include my home equity. When I punch in my net worth at 40 I was around 20%. If my current glide path holds I'd be low-90s when I turn 50. While unlikely to be feasible, it's in the realm of possibility that I could retire by mid-50s. That's a privileged position simply not available to most human beings. Really remarkable when one thinks about it.
  - ghaff 5y ago
    Yeah, I did OK through the 90s but it was certainly not a high-paying job by current coastal software standards. (I actually looked at a few west coast jobs in that period and, frankly, they'd have been a downgrade because of CoL. Stocks were hit pretty hard, including my shares in my employer, and for various reasons my job during the next decade I generally liked (and it set me up for my current job well) but it didn't pay that well. It was only really my current job and associated stock which took savings from just OK to pretty decent. I could retire now if I wanted to but not really in a big hurry assuming business travel comes back post-COVID.
sokoloff 5y ago
A $900K net worth is not enough to FIRE in my estimation. $36K/yr with the need to still buy housing is spartan and/or risky with a 60-year outlook.
- geekster777 5y ago
  May not be enough to pull the trigger, but definitely enough to transition down to a part time or remote web dev gig in a low cost of living area. Once you have such a net worth secured, you just have to keep from pulling from it for a few years while it compounds. The big thing is that around 900k is when you get diminishing returns on savings vs market fluctuations. Bumping that amount by 10% would require saving $90k, which is a tall order. Or you could wait for a 10% market increase (it's up 14% this year). Not that the market is guaranteed to go up, or even by that much (we're in an unusually good market at the moment with inflated optimism). But at a certain point you hit a tradeoff where the market on average increases your wealth faster than savings off your salary will. At that point it makes sense to transition to a job that just covers your cost of living - one that you like more and offers more freedom.
  - foobiekr 5y ago
    I’ve never understood this logic. If you’re going to be working, why take a significant pay cut? It’s not like other lower tier jobs are actually that much less work; you’re working with less skilled people in general and often poor management. This is the coastfire philosophy and it makes no sense. You could work a a few more years at high-paying miserable job or an extra decade at low-paying probably miserable job.
    - jghn 5y ago
      There exist many jobs/fields where the pay is below top market but could scratch the person's personal itches. Non-profits, research, etc. At a former job we could not pay anywhere near top of the market and yet we attracted decent talent as the mission was something that resonated with many people. One category of people we'd attract were those who had already made enough money that they didn't have to focus on that, and now just wanted to do good in the world.
Epenthesis 5y ago
Of course it's unusual. If you're in SF and work in first tier startups/FAANG, your social circle is going to be mostly people in similar situations. It's a very unusually high earning and unusually rapidly high earning career path. I would be shocked if in that specific cohort the median net worth at 30 was less than 500 k$. And if less than 1/10 were millionaires at 30.
- AndrewUnmuted 5y ago
  SF is a bit of a one-trick pony these days, sure, but to me this is a broad over-generalization that is easily proven false. The individuals who occupy the upper-echelons of this world in SF tend to be the unusual kinds of unusual people. They often have unique upbringings, come from distinctly not-obvious academic/work backgrounds, and keep much more dynamic forms of company than the typical "Backend Engineer 3" at Amazon or Google.
  - xyzzy_plugh 5y ago
    This doesn't match my experience at all. I know a few extremely wealthy folks in SF, a bunch more wealthy folks but who still work 9-5, and there is nothing unusual about any of them. I've met CEOs and billionaires and there's nothing unusual about them, either. Sure, maybe SF has more unusual kinds of unusual people than the average city, but I wouldn't say that's the norm. VC folks are especially boring.
OldHand2018 5y ago
Being subject to constraints on your living standards can force you to be more disciplined. I’d bet that there are some in your circle that earn less yet are more financially stable than you would expect. They just don’t talk about it as much, partly out of politeness and partly because they think it’s pretty boring.
- the_gastropod 5y ago
  Oh, absolutely. My point was more that it's not particularly common. Having a relatively low-ish FIRE-worthy NW (e.g., the $900k in my example) is very uncommon for 30-40 year olds.

ghaff 5y ago

I didn't have any substantial savings until I was well into my 30s. I didn't graduate from grad school until I was 28. (Worked for a few years prior in engineering but nothing like the salary levels in SWE today.)

jghn 5y ago
Despite being in software I had no savings until my late 30s. I am forever grateful that our field is one that allows for huge earnings, as it has enabled me to flip that all the way around. I'm now in my mid/late-40s and show up as low/mid 80s on that calculator depending on if I include my home equity. When I punch in my net worth at 40 I was around 20%. If my current glide path holds I'd be low-90s when I turn 50. While unlikely to be feasible, it's in the realm of possibility that I could retire by mid-50s. That's a privileged position simply not available to most human beings. Really remarkable when one thinks about it.
- ghaff 5y ago
  Yeah, I did OK through the 90s but it was certainly not a high-paying job by current coastal software standards. (I actually looked at a few west coast jobs in that period and, frankly, they'd have been a downgrade because of CoL. Stocks were hit pretty hard, including my shares in my employer, and for various reasons my job during the next decade I generally liked (and it set me up for my current job well) but it didn't pay that well. It was only really my current job and associated stock which took savings from just OK to pretty decent. I could retire now if I wanted to but not really in a big hurry assuming business travel comes back post-COVID.

sokoloff 5y ago

A $900K net worth is not enough to FIRE in my estimation. $36K/yr with the need to still buy housing is spartan and/or risky with a 60-year outlook.

geekster777 5y ago
May not be enough to pull the trigger, but definitely enough to transition down to a part time or remote web dev gig in a low cost of living area. Once you have such a net worth secured, you just have to keep from pulling from it for a few years while it compounds. The big thing is that around 900k is when you get diminishing returns on savings vs market fluctuations. Bumping that amount by 10% would require saving $90k, which is a tall order. Or you could wait for a 10% market increase (it's up 14% this year). Not that the market is guaranteed to go up, or even by that much (we're in an unusually good market at the moment with inflated optimism). But at a certain point you hit a tradeoff where the market on average increases your wealth faster than savings off your salary will. At that point it makes sense to transition to a job that just covers your cost of living - one that you like more and offers more freedom.
- foobiekr 5y ago
  I’ve never understood this logic. If you’re going to be working, why take a significant pay cut? It’s not like other lower tier jobs are actually that much less work; you’re working with less skilled people in general and often poor management. This is the coastfire philosophy and it makes no sense. You could work a a few more years at high-paying miserable job or an extra decade at low-paying probably miserable job.
  - jghn 5y ago
    There exist many jobs/fields where the pay is below top market but could scratch the person's personal itches. Non-profits, research, etc. At a former job we could not pay anywhere near top of the market and yet we attracted decent talent as the mission was something that resonated with many people. One category of people we'd attract were those who had already made enough money that they didn't have to focus on that, and now just wanted to do good in the world.

Epenthesis 5y ago

Of course it's unusual. If you're in SF and work in first tier startups/FAANG, your social circle is going to be mostly people in similar situations. It's a very unusually high earning and unusually rapidly high earning career path. I would be shocked if in that specific cohort the median net worth at 30 was less than 500 k$. And if less than 1/10 were millionaires at 30.

AndrewUnmuted 5y ago
SF is a bit of a one-trick pony these days, sure, but to me this is a broad over-generalization that is easily proven false. The individuals who occupy the upper-echelons of this world in SF tend to be the unusual kinds of unusual people. They often have unique upbringings, come from distinctly not-obvious academic/work backgrounds, and keep much more dynamic forms of company than the typical "Backend Engineer 3" at Amazon or Google.
- xyzzy_plugh 5y ago
  This doesn't match my experience at all. I know a few extremely wealthy folks in SF, a bunch more wealthy folks but who still work 9-5, and there is nothing unusual about any of them. I've met CEOs and billionaires and there's nothing unusual about them, either. Sure, maybe SF has more unusual kinds of unusual people than the average city, but I wouldn't say that's the norm. VC folks are especially boring.

OldHand2018 5y ago

Being subject to constraints on your living standards can force you to be more disciplined. I’d bet that there are some in your circle that earn less yet are more financially stable than you would expect. They just don’t talk about it as much, partly out of politeness and partly because they think it’s pretty boring.

the_gastropod 5y ago
Oh, absolutely. My point was more that it's not particularly common. Having a relatively low-ish FIRE-worthy NW (e.g., the $900k in my example) is very uncommon for 30-40 year olds.