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I know one guy that managed to retire before 40 (he's now 45), following the boring route. Roughly, it went like this - He chose to go to trade school, and bec

I know one guy that managed to retire before 40 (he's now 45), following the boring route. Roughly, it went like this - He chose to go to trade school, and become an electrician - He chose to live in his small rural town - He worked overtime whenever he could, but not at the cost of his social or family life. - He saved around +/- $30k every year, for almost 20 years, and invested it all on index funds. - He didn't splurge on excessive travel, electronics, cars, etc. lived a modest life. After he "retired", he enrolled community college to study Electrical Engineering, and now does smaller contracting work that he finds interesting.

CountDrewku 5y ago
It's possible to live a very comfortable lifestyle and save a lot if you're not consumed by the idea that you need to live in SF or NY to enjoy your life. I always see these stories about how it's impossible for millenials to own a house etc. I bought my first house at 24 and sold it for 80k profit 5 years later, paid off my student loans. I'm on my second house now and it's appreciated considerably in the last few years. Both houses were below 250k with and over 1400 sqft. My wife and I have pretty modest incomes and only bring in about 100k a year together. While there are certainly things I would like to buy that I cannot afford I can buy most of the things I enjoy when I want to without having to worry and still save a lot for retirement.
- vineyardmike 5y ago
  > if you're not consumed by the idea that you need to live in SF or NY to enjoy your life And yet some people enjoy big cities more than they'd enjoy living in a small town and it is not a moral failing or a sign of stupidity or weakness. Many people enjoy the multiculturalism found in cities, and many immigrants or minorities feel out of place in small towns while major cities offer them the opportunity to connect with people like themselves. Obviously owning a big residence in a city will never be affordable but as a society we should ensure that people can affordably live where it makes sense for them.
  - subsubzero 5y ago
    Why bring multiculturalism into it, or minorities feeling out of place? the parent comment never mentioned it, and I have been to small towns that were extremely welcoming to all groups. I agree with his statement, why live somewhere where housing is astronomically expensive, unless you enjoy it so much that living somewhere else would bring you sheer misery, be prepared to either rent forever or hustle your life away to afford that lifestyle.
    - mc32 5y ago
      Having a preference for multiculturalism is something mostly expressed in the west. People in Nigeria, Iran, Iraq, Peru, India, etc. Live just fine with it without it. They don’t feel inadequate living in a city or village that is monocultural. Neither is right or wrong. Cities develop over decades and they will have their unique histories. But seldom do people in other places say, oh my town is so monocultural, I wish it were a stew of cultures. No, mostly they are okay with their towns character. Interestingly besides Singapore, we have Beirut, Teheran, Khartoum, Baghdad which have lost multiculturalism over time, but those are mostly due to civil strife caused in part by the different cultures at violent odds with each other.
      - nemo 5y ago
        Really, I would suggest you read up about Peru. They're one of the more multicultural countries in the Americas, they've got multiculturalism enshrined in their constitution.
        mc32 5y ago
        They have indigenous, mixed race, Japanese and others, that’s not in dispute. What I’m saying is I’m sure in the hinterlands the locals aren’t saying “oh, woe is us, we aren’t multicultural like those folks in Lima” Multiculturalism can be good, it can be neutral or like Beirut or Baghdad it can lead to violence. What I’m saying is most people overseas are totally okay with it, with few exceptions, but they don’t bemoan it’s absence.
- coryrc 5y ago
  > and sold it for 80k profit You seem to miss the issue.
- frankbreetz 5y ago
  Had you not bought the first house, would you be able to afford you current house on your salary? People who bought houses in the last 10 years were lucky enough to get in when the market was historically low. People currently shopping for there first house are not so lucky.
  - CountDrewku 5y ago
    The market is always "low" in the areas I've lived in. That's my point. My brother also just but a very nice house for 180k. There are plenty of affordable places in this country. >People who bought houses in the last 10 years were lucky enough to get in when the market was historically low. You realize those same people also had to deal with a shitty job market and college loans to pay off as soon as they graduated right?
    - nate_meurer 5y ago
      > You realize those same people also had to deal with a shitty job market and college loans to pay off as soon as they graduated right? I think this is a good point that's worth repeating in these conversations. It's easy to forget in better times, but economic crashes are really scary. The financial crisis scared the shit out of me; my job situation was tenuous and our finances were shaky, but my wife and I took a big gamble and bought a foreclosed house at what turned out to be the bottom of market. It seems like an obvious choice in hindsight, but it could easily have gone very badly.
  - ipaddr 5y ago
    Exactly.. I couldn't afford to buy before but for a brief window my salary allowed me to buy a home in the area of my city most people were choosing to avoid. I wouldn't qualify the following year and I would be very far off now as my salary did not rise at the same level. What I see smart young people doing is moving away from bigger cities. They get a decent house / lot compared to a condo in a bigger area. Every generation has to move further away (or make more than others) if a city is growing. You don't have to live in a growing city.. you could move to a declining area or a neutral area. There are advantages to living in a declining city.
- nonameiguess 5y ago
  Not that this is entirely wrong in principle, but it sounds like you got into the market for a house right around 2009. "Happen to enter the market at the exact bottom of a historic crash" isn't exactly a strategy. It's just luck.
  - UncleMeat 5y ago
    I think it will be fascinating to watch the FIRE movement and the broader trading communities through the next crash. It is easy to feel like a genius when the market is going up 30% in a year.
    - voidfunc 5y ago
      Im not sure what you expect to see with FIRE? Ill just keep investing through the down-cycle. Dollar cost averaging baby!
      - UncleMeat 5y ago
        I expect a fair number of people who think they've got the guts for this to panic. But more I expect the proliferation of advice to shrink.
      - imtringued 5y ago
        There are always people on the margin. Those who barely get by with FIRE will be the ones to go.
    - EEREPRESENT 5y ago
      why? fire participants are disciplined so they will just invest as usual. what do u expect to see?
  - CountDrewku 5y ago
    Oh you mean the same time I graduated into a shitty job market with thousands in college loans? No, I made smart decisions about purchasing a house in a good low col area and fixed it up. Honestly, this whole idea that anyone who's achieved some success is just down to luck is pretty disheartening. Do you think this is a good approach to improving your life? I don't see any advantage to thinking this way.
- zehaeva 5y ago
  I don't want to poopoo on your point about you and your wife having "pretty modest incomes" at about 100k together. However the median household income is only $68k a year[0]. That is 50% of households in the US earned less than 68k/year. You're actually in the top 30%[1] of US households if your income is about 100k together. I wouldn't call that modest by any stretch of the imagination. [0] https://www.census.gov/library/publications/2020/demo/p60-270.html https://www.census.gov/library/publications/2020/demo/p60-27... [1] https://www.ibisworld.com/us/bed/households-earning-more-than-100-000/35/ https://www.ibisworld.com/us/bed/households-earning-more-tha...
  - dcolkitt 5y ago
    The median income is brought down by two factors: 1) people completely out of the workforce (the labor force non-participation rate is nearly 40%), and 2) single-earner households. Neither of these are relevant to what we'd expect to be "reasonable" or "modest" for a married, employed couple. $100k/year for two full-time workers is $25/hour. This is a pretty reasonable wage for someone with a modicum of stability and employment consistency. For example Bank of America tellers now start at $20/hour and move to $25 in a few years.[1] [1]https://www.usatoday.com/story/money/2021/05/18/bank-america-raise-hourly-minimum-wage-2025/5152077001/ https://www.usatoday.com/story/money/2021/05/18/bank-america...
    - zehaeva 5y ago
      I hate to be the person to quibble about the semantics of words but when one says the word modest one doesn't usually imagine a situation that is more than 70% of all others. I agree, it's a reasonable expectation that two people working should have a lifestyle that something like 100k/year would support. That being reasonable doesn't change the fact that it's still more than what 70% of other situations get, regardless of how those situations came about. If you want to compare that on an individual level then it's still not modest. The median Individual income is only 36k/year. Even on an individual level they're still doing better than 70% of the population on that level. Yes, it's possible to be comfortable and live a nice life no in NYC or SF. But let's not delude ourselves into thinking that just because it's reasonable to expect that level of income for a household, that it's modest, or even the norm.
- deleted 5y ago
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- mustacheemperor 5y ago
  You bought your first house at the absolute bottom of the real estate market following a global crash, sold it at a profit, and bought another house during what continues to be a rapidly appreciating market. Would a 24 year old today in the same financial position you were in at 24 be able to afford that same first house? You applying this personal anecdote as some kind of geometric proof that living outside a major city is a pathway to simple financial independence is to me a bold-print example of how the very same people who had to fight their way up the ladder of success will promptly become oblivious to the fact that the rungs are becoming further and further apart every year, advising those behind them that "climbing it isn't that difficult, just try as hard as I did."
  - CountDrewku 5y ago
    No I bought a house in a low col area and worked. I have many more "anecdotes" from almost everyone I grew up with living in similar circumstances if you'd like to hear them. Pretty amazing that you somehow left out the fact that the while the market was low the job market was also bad and made it pretty difficult to pay off student loans. Somehow that doesn't factor in to your assessment though. >Would a 24 year old today in the same financial position you were in at 24 be able to afford that same first house? Yes and my brother just did that. Not bad for a musician that makes money of doing lessons and weekend gigs. According to you though I guess he should be wallowing helplessly in a gutter hoping someone else will come by and pull him out? I grew up in a midwestern farmhouse with no central AC or heat. We had one bathroom the size of a closet for 5 people. Sorry but I kinda don't care about you whining you can't make it due to some external force always making you a victim. I'm not sure what is with people like you but you always seem pissed off when you hear people are able to be self-sustaining. Must be an exhausting to live in constant victim-hood. What do you want? Someone else to pay for all of your stuff? Why should the rest of the country have to do that for you?
    - mustacheemperor 5y ago
      Okay, after reading that reply I will respectfully bow out after this reply, rather than try to force a rational conversation into an emotionally driven one. For your information I do work very hard and afford a comfortable life, but feel great empathy for the people for whom working hard is not enough to achieve basic comforts. I did not grow up in as challenging an environment so maybe I am overinclined to that empathy, because I feel lucky my own pathway up the ladder was aided by privileges others are not afforded. But that is not relevant to the original point, it is just the reply I feel obliged to make in response to your attack on my character. I didn't say I want anything for myself in my original reply. Broadly, I want equal opportunity for all. It was harder to get a job to repay loans in 2009 than today, but in the last 12 years college tuitions have continued to balloon while college graduate earning power continues to drop relative to the size of loans. I do not particularly understand or appreciate your decision to season your explanation with personal attacks but that certainly accomplished nothing as far as educating me (or anyone else) about your perspective. HackerNews can be a great place to learn from a diverse set of opinions. Nobody has the opportunity to see those opinions if they are getting downvoted to grey for bad community conduct. If you are new to this community, you may find you are more successful at communicating your perspectives if you do so respectfully.
- Retric 5y ago
  100k is a very high household income for areas with 1400 sqft sub 250k housing.
- phrogdriver 5y ago
  Growing up in the midwest prior to working FAANG in the Bay Area, this is my exact experience. With a graduate degree and making ridiculous money, I and my peers had no realistic path to homeownership on any reasonable time-scale in the Bay. Family members working HVAC, plumbing, electrician or other skilled blue-collar jobs in low-cost of living areas bought beautiful craftsman bungalows within walking distance to a decent school for $80K. Professionals with either no student debt or a few thousand from land-grant state university degree paid off in 5-7 years. This has knock-on effects to family formation and number of children. Many of my high school classmates had their first kid at 24-25 and have 3-5 kids now, versus Bay Area average of what seems like 1-2 starting in your late 30s. When you feel like you can finally afford it. I started making plans to leave as soon as I got there, it truly was "structurally hostile to families."
  - troupe 5y ago
    You make a very good point. People dramatically underestimate how much more you need to make in the Bay Area to have the same quality of life as living in low cost of living areas.
- imgabe 5y ago
  Also a millennial. Also bought my first house at 24. Sold it 6 years later for a loss of $90k. Timing is important. Not everyone was fortunate to buy at the beginning of a huge bull market and right after a historic crash in real estate prices. (Bought my house in 2006)
- sershe 5y ago
  Heh, I don't understand why you are getting downvoted (well I do, but it's not a charitable interpretation). Yep, totally agree - people are not entitled to buy a house wherever they want. At least before the money printer went brrrrr, housing prices as compared to income in the US (median) were one of the lowest among the developed countries. Even now, median house is $375k [1]. Get out of your bubble. And I say it from the position of someone who actually made this mistake - I bought in Seattle and regret it. A much better decision would have been to buy a cheaper, better house somewhere else. Still, I'm not going to be mad at people telling me this truth :) [1] https://fred.stlouisfed.org/series/MSPUS https://fred.stlouisfed.org/series/MSPUS
  - sershe 5y ago
    Lol, now I'm getting silently downvoted. Come on, tell me which specific statement from my post (or the GP post) is false, or non-factual and doesn't contribute to the discussion :D
Ericson2314 5y ago
When "and did not own a car and took public transit" is part of that story not against it, this country will be a lot better.
- syops 5y ago
  Too many people just don’t understand what car ownership costs. If we had decent public transportation a lot people currently at the margins would have their lives greatly improved. Far too many people are slaves to the debt servicing their cars and the costs of gas, insurance, and maintenance.
  - deleted 5y ago
    [deleted]
  - throwaway0a5e 5y ago
    Too many people don't understand how little car ownership can cost outside of HCOL metro areas and if you're willing to drive junk.
    - syops 5y ago
      I specifically talk about people at the margins. It costs an average of $5,000 per year to own a car. There aren’t enough junk cars for everyone to own one. Roughly $0.50 per mile driven. https://www.caranddriver.com/research/a31267529/cost-of-car-ownership/ https://www.caranddriver.com/research/a31267529/cost-of-car-...
      - throwaway0a5e 5y ago
        I didn't say there were enough for everybody to do it. If we want to talk about margins why are you quoting an average at me? Without an absolutely insane distribution $400/mo average has some pretty strong things about the bottom quintile.
        syops 5y ago
nonameiguess 5y ago
I know a lot of people who "retired" before 40. They joined the military and stayed in.
- justaguy88 5y ago
  How does that work out, mechanically, does the military provide a pension at 40? Is it just that you have very little costs when living on-base?
  - dylan604 5y ago
    20 year mark is key. Sign up when you're 18, do 20 years, you're now only 38 which is < 40. Edit: if you're super ambitious, you take the skills from your military specialization (pilot, nuke engineer, etc) to the civilian world and work another 20 years. you're now 58 which is still younger than the typical 65 for retirement, but now on 2 pensions or 1 gov't pension plus a really nice portfolio.
    - ipaddr 5y ago
      Does signing up at 50 work?
      - dylan604 5y ago
        depends on if we're in an entrenched shooting war on the ground needing frontline infrantry. usually, that type of service doesn't come with a sign-up bonus
      - peter303 5y ago
        Usually not over 35 unless special circumstances such as active war or rare skill, e.g. doctor. Plenty of middle aged signed up for 911 war.
    - Pokepokalypse 5y ago
      The most marketable skills are going to be in logistics, or procurement. Then - the corps (corporations) come looking for you.
xibalba 5y ago
> He didn't splurge on excessive travel, electronics, cars, etc. lived a modest life. This, I think, is the biggest hurdle for most people. Everyone wants to be a millionaire, but few are willing to sacrifice the short term pleasures and status of their consumption. See also the infamous "avocado toast" debate, which, from my personal experience with fellow millennials, had a lot of merit as a criticism.
- cheriot 5y ago
  The working/middle classes are getting screwed by housing, childcare, education, and healthcare costs that are a greater proportion of income than past generations. Avacado toast is not the problem.
  - _carbyau_ 5y ago
    In Australia, I find the Childcare is interesting. Federal government subsidises childcare significantly, like 90%. But commercial real estate hunts out childcare providers like gold mines because you can't move your childcare to just any building. At a rough guess, $20 a day of almost every child placement is going to the landlord. edit:brevity
    - actually_a_dog 5y ago
      > you can't move your childcare to just any building. What do you mean by this?
      - nibles_and_bits 5y ago
        Presumably, the children need to be kept in some sort of detention center. We are talking about Australia a former penal colony after all. /s
        _carbyau_ 5y ago
        Well, the needs are similar even if the reason is different. Parents want to know their kids will not go wandering, so yeah, it very much is a "detention" centre in the sense the kids will be detained there until pickup. If you've ever been to a daycare centre... it pretty much is a prison. For little kids. With hopefully caring guardians and an exercise yard. :-P And if you've ever known a 2 year old, some of them can be little sociopaths at times.
OJFord 5y ago
> - He saved around +/- $30k every year, This is pretty pedantic I suppose, but I can't resist - I assume you mean ~ (roughly) $30k? (Or of course $30k ±x, if you somehow knew.) Saving plus or minus $30k a year is not much to brag about!
- lilsoso 5y ago
  In California a $100k salary results in the take home pay of a little more than $5k/month. So saving ~$30k/year is roughly equivalent to saving half of your take home pay of a $100k salary in California. That's pretty good. Please keep in mind that other people do things such as support a family or go on dates. They have expenses and may live in costly cities. Even on a salary of $200k a year that's decent.
  - OJFord 5y ago
    Of course it is, I said nothing to the contrary? > Saving plus or minus $30k a year is not much to brag about! I assume you're responding to that? Note the emphasis, as in original; the figure is ~insignificant~ err 'not important here'.
- tjs8rj 5y ago
  Why is this being downvoted other tha people not reading properly? Saving “+ / a $30k” means occasionally “saving negative $30k”. What was meant was “saving ~$30k”, which is impressive. Don’t use “+ / - $X” because it doesn’t mean what you think
IAmGraydon 5y ago
Not sure how that would work out. Contributing $30,000 per year to a fund that averages 8% per year for 20 years only gets you $1.4 million. If he lives to 80, this is only $35,000 per year, which will be next to nothing eventually due to inflation. If he left it in the market and drew 5% per year, he could get $70,000 per year, but that becomes extremely risky as you would have to draw during market downturns, which would quickly deplete the account. The problem with early retirement is how many years you still have left. It requires far more than a normal retirement. Everyone has their own standard of what is acceptable, but IMO a comfortable retirement at 40 requires somewhere in the neighborhood of $5 million. You could do with less if you want to eat ramen noodles for the next 40 years because you can’t really afford to enjoy retirement.
- revicon 5y ago
  Rule of thumb is withdrawing 4% per year is a safe rate that will weather market turmoil if your assets are returning market average rates. A $1.4M portfolio will allow for a safe $56,000 withdrawal per year.
  - typest 5y ago
    The problem is that a rule of thumb is about averages, not edge cases. For a really long retirement, you are going to hit a lot of edge cases. The 4% rule was based off the Trinity study, which looked at 30 year retirements and assumed the retiree would deplete their principal. It is not a safe basis for a long retirement.
    - buzzy_hacker 5y ago
      “ Notably, it appears that the safe withdrawal rate does not decline further as the time horizon extends beyond 40-45 years (given the limited research available); the 3.5% effectively forms a safe withdrawal rate floor, at least given the (US) data we have available.” https://www.kitces.com/blog/adjusting-safe-withdrawal-rates-to-the-retirees-time-horizon/ https://www.kitces.com/blog/adjusting-safe-withdrawal-rates-...
- 5y ago

CountDrewku 5y ago

It's possible to live a very comfortable lifestyle and save a lot if you're not consumed by the idea that you need to live in SF or NY to enjoy your life. I always see these stories about how it's impossible for millenials to own a house etc. I bought my first house at 24 and sold it for 80k profit 5 years later, paid off my student loans. I'm on my second house now and it's appreciated considerably in the last few years. Both houses were below 250k with and over 1400 sqft. My wife and I have pretty modest incomes and only bring in about 100k a year together. While there are certainly things I would like to buy that I cannot afford I can buy most of the things I enjoy when I want to without having to worry and still save a lot for retirement.

vineyardmike 5y ago
> if you're not consumed by the idea that you need to live in SF or NY to enjoy your life And yet some people enjoy big cities more than they'd enjoy living in a small town and it is not a moral failing or a sign of stupidity or weakness. Many people enjoy the multiculturalism found in cities, and many immigrants or minorities feel out of place in small towns while major cities offer them the opportunity to connect with people like themselves. Obviously owning a big residence in a city will never be affordable but as a society we should ensure that people can affordably live where it makes sense for them.
- subsubzero 5y ago
  Why bring multiculturalism into it, or minorities feeling out of place? the parent comment never mentioned it, and I have been to small towns that were extremely welcoming to all groups. I agree with his statement, why live somewhere where housing is astronomically expensive, unless you enjoy it so much that living somewhere else would bring you sheer misery, be prepared to either rent forever or hustle your life away to afford that lifestyle.
  - mc32 5y ago
    Having a preference for multiculturalism is something mostly expressed in the west. People in Nigeria, Iran, Iraq, Peru, India, etc. Live just fine with it without it. They don’t feel inadequate living in a city or village that is monocultural. Neither is right or wrong. Cities develop over decades and they will have their unique histories. But seldom do people in other places say, oh my town is so monocultural, I wish it were a stew of cultures. No, mostly they are okay with their towns character. Interestingly besides Singapore, we have Beirut, Teheran, Khartoum, Baghdad which have lost multiculturalism over time, but those are mostly due to civil strife caused in part by the different cultures at violent odds with each other.
    - nemo 5y ago
      Really, I would suggest you read up about Peru. They're one of the more multicultural countries in the Americas, they've got multiculturalism enshrined in their constitution.
      - mc32 5y ago
        They have indigenous, mixed race, Japanese and others, that’s not in dispute. What I’m saying is I’m sure in the hinterlands the locals aren’t saying “oh, woe is us, we aren’t multicultural like those folks in Lima” Multiculturalism can be good, it can be neutral or like Beirut or Baghdad it can lead to violence. What I’m saying is most people overseas are totally okay with it, with few exceptions, but they don’t bemoan it’s absence.
coryrc 5y ago
> and sold it for 80k profit You seem to miss the issue.
frankbreetz 5y ago
Had you not bought the first house, would you be able to afford you current house on your salary? People who bought houses in the last 10 years were lucky enough to get in when the market was historically low. People currently shopping for there first house are not so lucky.
- CountDrewku 5y ago
  The market is always "low" in the areas I've lived in. That's my point. My brother also just but a very nice house for 180k. There are plenty of affordable places in this country. >People who bought houses in the last 10 years were lucky enough to get in when the market was historically low. You realize those same people also had to deal with a shitty job market and college loans to pay off as soon as they graduated right?
  - nate_meurer 5y ago
    > You realize those same people also had to deal with a shitty job market and college loans to pay off as soon as they graduated right? I think this is a good point that's worth repeating in these conversations. It's easy to forget in better times, but economic crashes are really scary. The financial crisis scared the shit out of me; my job situation was tenuous and our finances were shaky, but my wife and I took a big gamble and bought a foreclosed house at what turned out to be the bottom of market. It seems like an obvious choice in hindsight, but it could easily have gone very badly.
- ipaddr 5y ago
  Exactly.. I couldn't afford to buy before but for a brief window my salary allowed me to buy a home in the area of my city most people were choosing to avoid. I wouldn't qualify the following year and I would be very far off now as my salary did not rise at the same level. What I see smart young people doing is moving away from bigger cities. They get a decent house / lot compared to a condo in a bigger area. Every generation has to move further away (or make more than others) if a city is growing. You don't have to live in a growing city.. you could move to a declining area or a neutral area. There are advantages to living in a declining city.
nonameiguess 5y ago
Not that this is entirely wrong in principle, but it sounds like you got into the market for a house right around 2009. "Happen to enter the market at the exact bottom of a historic crash" isn't exactly a strategy. It's just luck.
- UncleMeat 5y ago
  I think it will be fascinating to watch the FIRE movement and the broader trading communities through the next crash. It is easy to feel like a genius when the market is going up 30% in a year.
  - voidfunc 5y ago
    Im not sure what you expect to see with FIRE? Ill just keep investing through the down-cycle. Dollar cost averaging baby!
    - UncleMeat 5y ago
      I expect a fair number of people who think they've got the guts for this to panic. But more I expect the proliferation of advice to shrink.
    - imtringued 5y ago
      There are always people on the margin. Those who barely get by with FIRE will be the ones to go.
  - EEREPRESENT 5y ago
    why? fire participants are disciplined so they will just invest as usual. what do u expect to see?
- CountDrewku 5y ago
  Oh you mean the same time I graduated into a shitty job market with thousands in college loans? No, I made smart decisions about purchasing a house in a good low col area and fixed it up. Honestly, this whole idea that anyone who's achieved some success is just down to luck is pretty disheartening. Do you think this is a good approach to improving your life? I don't see any advantage to thinking this way.
zehaeva 5y ago
I don't want to poopoo on your point about you and your wife having "pretty modest incomes" at about 100k together. However the median household income is only $68k a year[0]. That is 50% of households in the US earned less than 68k/year. You're actually in the top 30%[1] of US households if your income is about 100k together. I wouldn't call that modest by any stretch of the imagination. [0] https://www.census.gov/library/publications/2020/demo/p60-270.html https://www.census.gov/library/publications/2020/demo/p60-27... [1] https://www.ibisworld.com/us/bed/households-earning-more-than-100-000/35/ https://www.ibisworld.com/us/bed/households-earning-more-tha...
- dcolkitt 5y ago
  The median income is brought down by two factors: 1) people completely out of the workforce (the labor force non-participation rate is nearly 40%), and 2) single-earner households. Neither of these are relevant to what we'd expect to be "reasonable" or "modest" for a married, employed couple. $100k/year for two full-time workers is $25/hour. This is a pretty reasonable wage for someone with a modicum of stability and employment consistency. For example Bank of America tellers now start at $20/hour and move to $25 in a few years.[1] [1]https://www.usatoday.com/story/money/2021/05/18/bank-america-raise-hourly-minimum-wage-2025/5152077001/ https://www.usatoday.com/story/money/2021/05/18/bank-america...
  - zehaeva 5y ago
    I hate to be the person to quibble about the semantics of words but when one says the word modest one doesn't usually imagine a situation that is more than 70% of all others. I agree, it's a reasonable expectation that two people working should have a lifestyle that something like 100k/year would support. That being reasonable doesn't change the fact that it's still more than what 70% of other situations get, regardless of how those situations came about. If you want to compare that on an individual level then it's still not modest. The median Individual income is only 36k/year. Even on an individual level they're still doing better than 70% of the population on that level. Yes, it's possible to be comfortable and live a nice life no in NYC or SF. But let's not delude ourselves into thinking that just because it's reasonable to expect that level of income for a household, that it's modest, or even the norm.
deleted 5y ago
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mustacheemperor 5y ago
You bought your first house at the absolute bottom of the real estate market following a global crash, sold it at a profit, and bought another house during what continues to be a rapidly appreciating market. Would a 24 year old today in the same financial position you were in at 24 be able to afford that same first house? You applying this personal anecdote as some kind of geometric proof that living outside a major city is a pathway to simple financial independence is to me a bold-print example of how the very same people who had to fight their way up the ladder of success will promptly become oblivious to the fact that the rungs are becoming further and further apart every year, advising those behind them that "climbing it isn't that difficult, just try as hard as I did."
- CountDrewku 5y ago
  No I bought a house in a low col area and worked. I have many more "anecdotes" from almost everyone I grew up with living in similar circumstances if you'd like to hear them. Pretty amazing that you somehow left out the fact that the while the market was low the job market was also bad and made it pretty difficult to pay off student loans. Somehow that doesn't factor in to your assessment though. >Would a 24 year old today in the same financial position you were in at 24 be able to afford that same first house? Yes and my brother just did that. Not bad for a musician that makes money of doing lessons and weekend gigs. According to you though I guess he should be wallowing helplessly in a gutter hoping someone else will come by and pull him out? I grew up in a midwestern farmhouse with no central AC or heat. We had one bathroom the size of a closet for 5 people. Sorry but I kinda don't care about you whining you can't make it due to some external force always making you a victim. I'm not sure what is with people like you but you always seem pissed off when you hear people are able to be self-sustaining. Must be an exhausting to live in constant victim-hood. What do you want? Someone else to pay for all of your stuff? Why should the rest of the country have to do that for you?
  - mustacheemperor 5y ago
    Okay, after reading that reply I will respectfully bow out after this reply, rather than try to force a rational conversation into an emotionally driven one. For your information I do work very hard and afford a comfortable life, but feel great empathy for the people for whom working hard is not enough to achieve basic comforts. I did not grow up in as challenging an environment so maybe I am overinclined to that empathy, because I feel lucky my own pathway up the ladder was aided by privileges others are not afforded. But that is not relevant to the original point, it is just the reply I feel obliged to make in response to your attack on my character. I didn't say I want anything for myself in my original reply. Broadly, I want equal opportunity for all. It was harder to get a job to repay loans in 2009 than today, but in the last 12 years college tuitions have continued to balloon while college graduate earning power continues to drop relative to the size of loans. I do not particularly understand or appreciate your decision to season your explanation with personal attacks but that certainly accomplished nothing as far as educating me (or anyone else) about your perspective. HackerNews can be a great place to learn from a diverse set of opinions. Nobody has the opportunity to see those opinions if they are getting downvoted to grey for bad community conduct. If you are new to this community, you may find you are more successful at communicating your perspectives if you do so respectfully.
Retric 5y ago
100k is a very high household income for areas with 1400 sqft sub 250k housing.
phrogdriver 5y ago
Growing up in the midwest prior to working FAANG in the Bay Area, this is my exact experience. With a graduate degree and making ridiculous money, I and my peers had no realistic path to homeownership on any reasonable time-scale in the Bay. Family members working HVAC, plumbing, electrician or other skilled blue-collar jobs in low-cost of living areas bought beautiful craftsman bungalows within walking distance to a decent school for $80K. Professionals with either no student debt or a few thousand from land-grant state university degree paid off in 5-7 years. This has knock-on effects to family formation and number of children. Many of my high school classmates had their first kid at 24-25 and have 3-5 kids now, versus Bay Area average of what seems like 1-2 starting in your late 30s. When you feel like you can finally afford it. I started making plans to leave as soon as I got there, it truly was "structurally hostile to families."
- troupe 5y ago
  You make a very good point. People dramatically underestimate how much more you need to make in the Bay Area to have the same quality of life as living in low cost of living areas.
imgabe 5y ago
Also a millennial. Also bought my first house at 24. Sold it 6 years later for a loss of $90k. Timing is important. Not everyone was fortunate to buy at the beginning of a huge bull market and right after a historic crash in real estate prices. (Bought my house in 2006)
sershe 5y ago
Heh, I don't understand why you are getting downvoted (well I do, but it's not a charitable interpretation). Yep, totally agree - people are not entitled to buy a house wherever they want. At least before the money printer went brrrrr, housing prices as compared to income in the US (median) were one of the lowest among the developed countries. Even now, median house is $375k [1]. Get out of your bubble. And I say it from the position of someone who actually made this mistake - I bought in Seattle and regret it. A much better decision would have been to buy a cheaper, better house somewhere else. Still, I'm not going to be mad at people telling me this truth :) [1] https://fred.stlouisfed.org/series/MSPUS https://fred.stlouisfed.org/series/MSPUS
- sershe 5y ago
  Lol, now I'm getting silently downvoted. Come on, tell me which specific statement from my post (or the GP post) is false, or non-factual and doesn't contribute to the discussion :D

Ericson2314 5y ago

When "and did not own a car and took public transit" is part of that story not against it, this country will be a lot better.

syops 5y ago
Too many people just don’t understand what car ownership costs. If we had decent public transportation a lot people currently at the margins would have their lives greatly improved. Far too many people are slaves to the debt servicing their cars and the costs of gas, insurance, and maintenance.
- deleted 5y ago
  [deleted]
- throwaway0a5e 5y ago
  Too many people don't understand how little car ownership can cost outside of HCOL metro areas and if you're willing to drive junk.
  - syops 5y ago
    I specifically talk about people at the margins. It costs an average of $5,000 per year to own a car. There aren’t enough junk cars for everyone to own one. Roughly $0.50 per mile driven. https://www.caranddriver.com/research/a31267529/cost-of-car-ownership/ https://www.caranddriver.com/research/a31267529/cost-of-car-...
    - throwaway0a5e 5y ago
      I didn't say there were enough for everybody to do it. If we want to talk about margins why are you quoting an average at me? Without an absolutely insane distribution $400/mo average has some pretty strong things about the bottom quintile.
      - syops 5y ago

nonameiguess 5y ago

I know a lot of people who "retired" before 40. They joined the military and stayed in.

justaguy88 5y ago
How does that work out, mechanically, does the military provide a pension at 40? Is it just that you have very little costs when living on-base?
- dylan604 5y ago
  20 year mark is key. Sign up when you're 18, do 20 years, you're now only 38 which is < 40. Edit: if you're super ambitious, you take the skills from your military specialization (pilot, nuke engineer, etc) to the civilian world and work another 20 years. you're now 58 which is still younger than the typical 65 for retirement, but now on 2 pensions or 1 gov't pension plus a really nice portfolio.
  - ipaddr 5y ago
    Does signing up at 50 work?
    - dylan604 5y ago
      depends on if we're in an entrenched shooting war on the ground needing frontline infrantry. usually, that type of service doesn't come with a sign-up bonus
    - peter303 5y ago
      Usually not over 35 unless special circumstances such as active war or rare skill, e.g. doctor. Plenty of middle aged signed up for 911 war.
  - Pokepokalypse 5y ago
    The most marketable skills are going to be in logistics, or procurement. Then - the corps (corporations) come looking for you.

xibalba 5y ago

> He didn't splurge on excessive travel, electronics, cars, etc. lived a modest life. This, I think, is the biggest hurdle for most people. Everyone wants to be a millionaire, but few are willing to sacrifice the short term pleasures and status of their consumption. See also the infamous "avocado toast" debate, which, from my personal experience with fellow millennials, had a lot of merit as a criticism.

cheriot 5y ago
The working/middle classes are getting screwed by housing, childcare, education, and healthcare costs that are a greater proportion of income than past generations. Avacado toast is not the problem.
- _carbyau_ 5y ago
  In Australia, I find the Childcare is interesting. Federal government subsidises childcare significantly, like 90%. But commercial real estate hunts out childcare providers like gold mines because you can't move your childcare to just any building. At a rough guess, $20 a day of almost every child placement is going to the landlord. edit:brevity
  - actually_a_dog 5y ago
    > you can't move your childcare to just any building. What do you mean by this?
    - nibles_and_bits 5y ago
      Presumably, the children need to be kept in some sort of detention center. We are talking about Australia a former penal colony after all. /s
      - _carbyau_ 5y ago
        Well, the needs are similar even if the reason is different. Parents want to know their kids will not go wandering, so yeah, it very much is a "detention" centre in the sense the kids will be detained there until pickup. If you've ever been to a daycare centre... it pretty much is a prison. For little kids. With hopefully caring guardians and an exercise yard. :-P And if you've ever known a 2 year old, some of them can be little sociopaths at times.

OJFord 5y ago

> - He saved around +/- $30k every year, This is pretty pedantic I suppose, but I can't resist - I assume you mean ~ (roughly) $30k? (Or of course $30k ±x, if you somehow knew.) Saving plus or minus $30k a year is not much to brag about!

lilsoso 5y ago
In California a $100k salary results in the take home pay of a little more than $5k/month. So saving ~$30k/year is roughly equivalent to saving half of your take home pay of a $100k salary in California. That's pretty good. Please keep in mind that other people do things such as support a family or go on dates. They have expenses and may live in costly cities. Even on a salary of $200k a year that's decent.
- OJFord 5y ago
  Of course it is, I said nothing to the contrary? > Saving plus or minus $30k a year is not much to brag about! I assume you're responding to that? Note the emphasis, as in original; the figure is ~insignificant~ err 'not important here'.
tjs8rj 5y ago
Why is this being downvoted other tha people not reading properly? Saving “+ / a $30k” means occasionally “saving negative $30k”. What was meant was “saving ~$30k”, which is impressive. Don’t use “+ / - $X” because it doesn’t mean what you think

IAmGraydon 5y ago

Not sure how that would work out. Contributing $30,000 per year to a fund that averages 8% per year for 20 years only gets you $1.4 million. If he lives to 80, this is only $35,000 per year, which will be next to nothing eventually due to inflation. If he left it in the market and drew 5% per year, he could get $70,000 per year, but that becomes extremely risky as you would have to draw during market downturns, which would quickly deplete the account. The problem with early retirement is how many years you still have left. It requires far more than a normal retirement. Everyone has their own standard of what is acceptable, but IMO a comfortable retirement at 40 requires somewhere in the neighborhood of $5 million. You could do with less if you want to eat ramen noodles for the next 40 years because you can’t really afford to enjoy retirement.

revicon 5y ago
Rule of thumb is withdrawing 4% per year is a safe rate that will weather market turmoil if your assets are returning market average rates. A $1.4M portfolio will allow for a safe $56,000 withdrawal per year.
- typest 5y ago
  The problem is that a rule of thumb is about averages, not edge cases. For a really long retirement, you are going to hit a lot of edge cases. The 4% rule was based off the Trinity study, which looked at 30 year retirements and assumed the retiree would deplete their principal. It is not a safe basis for a long retirement.
  - buzzy_hacker 5y ago
    “ Notably, it appears that the safe withdrawal rate does not decline further as the time horizon extends beyond 40-45 years (given the limited research available); the 3.5% effectively forms a safe withdrawal rate floor, at least given the (US) data we have available.” https://www.kitces.com/blog/adjusting-safe-withdrawal-rates-to-the-retirees-time-horizon/ https://www.kitces.com/blog/adjusting-safe-withdrawal-rates-...
5y ago