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> So there’s a lot missing from this blog post. I suspect maybe the author got lucky with some outlier investments, but that’s not something that can be conveye

> So there’s a lot missing from this blog post. I suspect maybe the author got lucky with some outlier investments, but that’s not something that can be conveyed in a “how to” blog post. Why do you think that? All the numbers work out. Even in your hypothetical scenario, investing 100k for 7 years, especially in the last 7 years, would easily bring you 1M total investments. > FIRE type wealth trajectories are possible, but this isn’t what it looks like. Working normally-paid jobs for 7 years and just living your normal life doesn’t get you there. This is exactly what FIRE is, and again, using numbers from your own post, which I think are reasonable, this is exactly what it looks like. 1M invested, 25k/yr expenses = 40 years with no gains in investments, people into FIRE usually assume 4% growth, so he would be even better off. If that isn't FIRE, I don't know what is.

marktangotango 5y ago
> would easily bring you 1M total investments. I think this is the disconnect with GP, $1M isn't what anyone can really call "wealthy" nowadays. Yes, it's a lot of money, but does not allow one to live what most people consider to be a rich lifestyle.
- jacobmischka 5y ago
  I absolutely can and will call $1M wealthy. Anyone who thinks it isn't is absolutely living in a bubble.
  - marktangotango 5y ago
    I once shared this outlook, but when one considers their own ideas about the lifestyle "wealthy" entails, and run some numbers, specifically determine the annual spend for that lifestyle, one will quickly realize the truth. A million can be blown in a year, or SWR'd (safe withdrawal rate) at $40k a year indefinitely. Can you retire on $40k a year? Would you want that level of income and lifestyle? Of course this depends on location and cost of living. I am referring to someone in the US. Edit: Specifically, does anyone (in the US) consider a $40k year income to qualify as "Wealthy"? Since that's what's being discussed here.
    - handrous 5y ago
      > Can you retire on $40k a year? Maybe in Europe. No, in the US. Not even close. Even with a paid-off house. Certainly not before "retirement age". Health care is the reason.
      - influx 5y ago
        Obamacare subsidies are based on income. You are likely getting subsidies at this level of income. Will it exist for the next 40 years, who knows?
        handrous 5y ago
        A couple years of serious illness for you or anyone you're responsible for (spouse, children) will still ruin your retirement plans, if you try to retire early on $40,000/yr in income. A "Silver" exchange plan, even if the premium were $0/m, would still expose you to so much financial risk ("max out-of-pocket") that you'd be rolling some not-very-friendly dice, trying to retire early.
        ac29 5y ago
        What is the max out of pocket number that you are seeing that is so financially ruinous? My out of pocket maximum is something like $7000/year. That would be painful on $40k/year, but we're talking about someone with a $1M nest egg, so unless you hit the maximum every single year, its not impossible to cover. Spending $47k/year for a couple years instead of $40k isnt going to financially ruin someone with $1M.
        handrous 5y ago
        My assumption is that a couple (say) would be running with pretty thin margins, even assuming no mortgage interest or rent and modest living, on $40,000 a year and a fairly low CoL area, so losing another $7k (that's per person, right, not the max-out-of-pocket for the whole plan? Or maybe your exchange plans are way better than ours) would be be very painful, at best. A forever-alone hermit living in a rural trailer park might be another story—there are definitely some circumstances I can imagine in which it might be kinda OK to try to retire before Social Security and Medicare kick in on $1m savings, but not ones that involve anything like a normal life. And sure, you may not be missing payments thanks to the $1m in the bank, but if you start eating that principle too early (=before you're 60ish years old, at a minimum) you might find yourself needing to get a job after being out of the work force for (say) 10 years and while possibly dealing with serious, chronic health problems. I'm not sure how disability works when you haven't worked for a few years due to retiring, and have six-plus figures in the bank still, but my guess would be "it doesn't", until you are, in fact, ruined.
  - Glyptodon 5y ago
    It's more free as in freedom than wealthy per say. You probably aren't going to go buy a Ferrari with $1 mil in the bank, but you also probably never worry about putting food on the table again. At least if we're talking wealthy in the "own a yacht" sort of sense.
  - nawgz 5y ago
    > Anyone who thinks it isn't is absolutely living in a bubble I am, for example, a native of British Columbia. My home town, a humble one, now has an average home cost of $1M CAD. $1M will certainly not furnish retirement in any above-average Quality Of Life situation. "Wealthy" isn't living an average first-world lifestyle...
  - tunesmith 5y ago
    Consumer expenditures, "Average annual expenditures for all consumer units in 2020 were $61,334", according to BLS. Average isn't great, I wish they reported median, but anyway that's about 6% of a million, which is a pretty aggressive number.
  - robocat 5y ago
    $1M is certainly not wealthy in a first world country. For example it it is not enough to retire when older and live a moderate lifestyle in New Zealand. Firstly, you need to own an average home in the city you live in. Don’t move away from your friends. Don’t live in a dangerous suburb. I live in Christchurch where I was born, median house price: $693,000 (Wellington and Auckland are a lot more expensive). Secondly, you need residual income from investments. New Zealand pays superannuation to everyone that reaches retirement age*, but it is not enough to keep your home warm or go to a café every day. The figure I aim for is NZD2M. $1M buys a median home in a desirable suburb (7 suburbs in Christchurch have a median price over 1M), and $1M is left to invest. I am middle aged: the amount you need to aim for goes up drastically if: you are younger, you live in an expensive city, you live in an expensive country. NZD2M gets a comfortable retirement at present. It definitely doesn’t get a “wealthy” retirement (no holiday homes, no wealthy holidays, no flash yacht). * retirement age is currently 65, but is likely to be increased because that is unaffordable for the country as it currently is economically.
- FPGAhacker 5y ago
  This depends greatly on where you live.
- FpUser 5y ago
  You could get up to 10% on 1M investment annually (that is what my friend has). Sure he does not have private yacht but one can live quite comfy on 100K without lifting a finger and that is what he does.
  - Grustaf 5y ago
    If your friend can reliably generate 10% (not just in the current insane bull market) he should open a hedge fund.
    - FpUser 5y ago
      He had it for about 4 years I think. Also he does not manage the money. Somebody else does it for him.
      - PragmaticPulp 5y ago
        If your friend gave someone a million dollars and they promised to deliver $100K per year indefinitely, your friend is the victim of financial fraud.
        FpUser 5y ago
        Who said they've promised anything? He said that he was able go get about 10% in a last 3-4 years and that is all.
      - deleted 5y ago
        [deleted]
      - bcrosby95 5y ago
        Markets have been amazing the last 4 years. You can't use that short of a timeline to predict the next 40.
    - DeathArrow 5y ago
      I think that if you tracked S&P 500 since inception years you made about 10-11% year on average. https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp https://www.investopedia.com/ask/answers/042415/what-average...
- Mvandenbergh 5y ago
  Sure, I agree with you that even in a low cost, rural part of Italy (or the US) nobody is living like a tv rich guy on 25k-35k (probably what it would be safe to count on if you're young when you stop working). You're not flying private jets (or first class), not consuming the most expensive things, and you don't have an army of personal servants. But... the real, foundational difference between being rich and not is not any particular consumption choice but the way one relates to wage labour. The difference in the daily, weekly, and annual rhythms of my life and that of someone making 2-3x as much but with a similar ratio of housing costs to income, savings, etc. are broadly the same. Similarly, someone making half what I do, probably also with a house they're ok with in a ok-ish area which is paid for with a mortgage, has basically the same life I do. Certainly within the broad spectrum of global and historical experience our lives are almost identical and it takes people who are highly attuned to differences in consumption markers (which all humans are within their own societies) to spot them. The very poor and the very rich have different rhythms of life that put them outside of this mainstream but 75% of the population lives broadly similar lives. We all get up at some point in the morning five-ish days a week, timed to meet a regular or externally constrained schedule (even freelancers have to be available within certain hours). We have clients or bosses who we have to please in some way or another. Some of us have very good relationships with these people, maybe we run our own businesses and have substantial independence from clients or shareholders. Some of us on the end have a rigid relationship with a boss who sets an hourly schedule. We go on a thing called a "holiday" (or a "vacation" which is what I believe Americans call the thing they're not allowed to take). If we are lucky, this is to a warm/culturally interesting/snowy place and we do it two or three times a year. If we are less lucky we go on one a year. Our continued ability to live in our homes and eat is dependent on this way of living. The little labels on our possessions and how big they are vary, but imagine explaining the real differences to someone from 1,000 year ago. "This man wears wool clothes and goes to a place where he makes phone calls and does things on a glowing screen. This other man wears other similar looking clothes and he goes to a place where he makes phone calls and does other things on a glowing screen. Banker or call centre worker? The one that is high status can expect their boss to require them to work at a moment's notice in the middle of the night." Compare that to someone who has a potentially substantially lower level of consumption and no longer engages in wage labour for their sustenance needs. Whether they spend their day reading, staring at the clouds, swimming, or flying their private plane is less important than the difference between them and someone who has to work.
PragmaticPulp 5y ago
> Why do you think that? All the numbers work out. Even in your hypothetical scenario, investing 100k for 7 years, especially in the last 7 years, would easily bring you 1M total investments. My point was that to show that the only way to get this to work out was to make everything work out perfectly, from getting the authors highest quoted day rate of $1000/day on every single day of every single contract from the start. You’d also have to live an aggressively non-wealthy lifestyle without any room for things like travel, hobbies, or luxuries. So yes, technically it can work out if the stars align, you can always get those high-paying contracts without fail, and you’re willing to live an aggressively frugal lifestyle taken to an extreme.
- ixacto 5y ago
  Get done with college at 22, work 7 years and retire at the age of 29. This is not impossible. Just most people don't want to do it, but it's totally available.
  - PaulDavisThe1st 5y ago
    You will be lucky to earn US$1000/day fresh out of college.
  - prirun 5y ago
    And "don't have kids". Children are a huge time & money suck. Not saying they don't have their rewards too, because they do, but they are also a huge cost.
- ghaff 5y ago
  Furthermore, I don't see any allowance for the time needed to get those contracts, take care of business stuff, etc. To say nothing of downtime when a perfectly-timed new contract just doesn't come along. Maybe it's possible in the current climate but it's not the norm.
- bambax 5y ago
  What are those expensive hobbies and luxuries? My hobbies cost about zero (making music, doing the occasional woodworking, reading, walking). Travel can be expensive but it can also be quite cheap and is very dispensable. Luxuries outside of travel (expensive hotels), I don't even know what they are. I'm sure it's not hard to spend as much money as you want on many different things; but you make it sound as if it was necessary. It really isn't.

marktangotango 5y ago

> would easily bring you 1M total investments. I think this is the disconnect with GP, $1M isn't what anyone can really call "wealthy" nowadays. Yes, it's a lot of money, but does not allow one to live what most people consider to be a rich lifestyle.

jacobmischka 5y ago
I absolutely can and will call $1M wealthy. Anyone who thinks it isn't is absolutely living in a bubble.
- marktangotango 5y ago
  I once shared this outlook, but when one considers their own ideas about the lifestyle "wealthy" entails, and run some numbers, specifically determine the annual spend for that lifestyle, one will quickly realize the truth. A million can be blown in a year, or SWR'd (safe withdrawal rate) at $40k a year indefinitely. Can you retire on $40k a year? Would you want that level of income and lifestyle? Of course this depends on location and cost of living. I am referring to someone in the US. Edit: Specifically, does anyone (in the US) consider a $40k year income to qualify as "Wealthy"? Since that's what's being discussed here.
  - handrous 5y ago
    > Can you retire on $40k a year? Maybe in Europe. No, in the US. Not even close. Even with a paid-off house. Certainly not before "retirement age". Health care is the reason.
    - influx 5y ago
      Obamacare subsidies are based on income. You are likely getting subsidies at this level of income. Will it exist for the next 40 years, who knows?
      - handrous 5y ago
        A couple years of serious illness for you or anyone you're responsible for (spouse, children) will still ruin your retirement plans, if you try to retire early on $40,000/yr in income. A "Silver" exchange plan, even if the premium were $0/m, would still expose you to so much financial risk ("max out-of-pocket") that you'd be rolling some not-very-friendly dice, trying to retire early.
        ac29 5y ago
        What is the max out of pocket number that you are seeing that is so financially ruinous? My out of pocket maximum is something like $7000/year. That would be painful on $40k/year, but we're talking about someone with a $1M nest egg, so unless you hit the maximum every single year, its not impossible to cover. Spending $47k/year for a couple years instead of $40k isnt going to financially ruin someone with $1M.
        handrous 5y ago
        My assumption is that a couple (say) would be running with pretty thin margins, even assuming no mortgage interest or rent and modest living, on $40,000 a year and a fairly low CoL area, so losing another $7k (that's per person, right, not the max-out-of-pocket for the whole plan? Or maybe your exchange plans are way better than ours) would be be very painful, at best. A forever-alone hermit living in a rural trailer park might be another story—there are definitely some circumstances I can imagine in which it might be kinda OK to try to retire before Social Security and Medicare kick in on $1m savings, but not ones that involve anything like a normal life. And sure, you may not be missing payments thanks to the $1m in the bank, but if you start eating that principle too early (=before you're 60ish years old, at a minimum) you might find yourself needing to get a job after being out of the work force for (say) 10 years and while possibly dealing with serious, chronic health problems. I'm not sure how disability works when you haven't worked for a few years due to retiring, and have six-plus figures in the bank still, but my guess would be "it doesn't", until you are, in fact, ruined.
- Glyptodon 5y ago
  It's more free as in freedom than wealthy per say. You probably aren't going to go buy a Ferrari with $1 mil in the bank, but you also probably never worry about putting food on the table again. At least if we're talking wealthy in the "own a yacht" sort of sense.
- nawgz 5y ago
  > Anyone who thinks it isn't is absolutely living in a bubble I am, for example, a native of British Columbia. My home town, a humble one, now has an average home cost of $1M CAD. $1M will certainly not furnish retirement in any above-average Quality Of Life situation. "Wealthy" isn't living an average first-world lifestyle...
- tunesmith 5y ago
  Consumer expenditures, "Average annual expenditures for all consumer units in 2020 were $61,334", according to BLS. Average isn't great, I wish they reported median, but anyway that's about 6% of a million, which is a pretty aggressive number.
- robocat 5y ago
  $1M is certainly not wealthy in a first world country. For example it it is not enough to retire when older and live a moderate lifestyle in New Zealand. Firstly, you need to own an average home in the city you live in. Don’t move away from your friends. Don’t live in a dangerous suburb. I live in Christchurch where I was born, median house price: $693,000 (Wellington and Auckland are a lot more expensive). Secondly, you need residual income from investments. New Zealand pays superannuation to everyone that reaches retirement age*, but it is not enough to keep your home warm or go to a café every day. The figure I aim for is NZD2M. $1M buys a median home in a desirable suburb (7 suburbs in Christchurch have a median price over 1M), and $1M is left to invest. I am middle aged: the amount you need to aim for goes up drastically if: you are younger, you live in an expensive city, you live in an expensive country. NZD2M gets a comfortable retirement at present. It definitely doesn’t get a “wealthy” retirement (no holiday homes, no wealthy holidays, no flash yacht). * retirement age is currently 65, but is likely to be increased because that is unaffordable for the country as it currently is economically.
FPGAhacker 5y ago
This depends greatly on where you live.
FpUser 5y ago
You could get up to 10% on 1M investment annually (that is what my friend has). Sure he does not have private yacht but one can live quite comfy on 100K without lifting a finger and that is what he does.
- Grustaf 5y ago
  If your friend can reliably generate 10% (not just in the current insane bull market) he should open a hedge fund.
  - FpUser 5y ago
    He had it for about 4 years I think. Also he does not manage the money. Somebody else does it for him.
    - PragmaticPulp 5y ago
      If your friend gave someone a million dollars and they promised to deliver $100K per year indefinitely, your friend is the victim of financial fraud.
      - FpUser 5y ago
        Who said they've promised anything? He said that he was able go get about 10% in a last 3-4 years and that is all.
    - deleted 5y ago
      [deleted]
    - bcrosby95 5y ago
      Markets have been amazing the last 4 years. You can't use that short of a timeline to predict the next 40.
  - DeathArrow 5y ago
    I think that if you tracked S&P 500 since inception years you made about 10-11% year on average. https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp https://www.investopedia.com/ask/answers/042415/what-average...
Mvandenbergh 5y ago
Sure, I agree with you that even in a low cost, rural part of Italy (or the US) nobody is living like a tv rich guy on 25k-35k (probably what it would be safe to count on if you're young when you stop working). You're not flying private jets (or first class), not consuming the most expensive things, and you don't have an army of personal servants. But... the real, foundational difference between being rich and not is not any particular consumption choice but the way one relates to wage labour. The difference in the daily, weekly, and annual rhythms of my life and that of someone making 2-3x as much but with a similar ratio of housing costs to income, savings, etc. are broadly the same. Similarly, someone making half what I do, probably also with a house they're ok with in a ok-ish area which is paid for with a mortgage, has basically the same life I do. Certainly within the broad spectrum of global and historical experience our lives are almost identical and it takes people who are highly attuned to differences in consumption markers (which all humans are within their own societies) to spot them. The very poor and the very rich have different rhythms of life that put them outside of this mainstream but 75% of the population lives broadly similar lives. We all get up at some point in the morning five-ish days a week, timed to meet a regular or externally constrained schedule (even freelancers have to be available within certain hours). We have clients or bosses who we have to please in some way or another. Some of us have very good relationships with these people, maybe we run our own businesses and have substantial independence from clients or shareholders. Some of us on the end have a rigid relationship with a boss who sets an hourly schedule. We go on a thing called a "holiday" (or a "vacation" which is what I believe Americans call the thing they're not allowed to take). If we are lucky, this is to a warm/culturally interesting/snowy place and we do it two or three times a year. If we are less lucky we go on one a year. Our continued ability to live in our homes and eat is dependent on this way of living. The little labels on our possessions and how big they are vary, but imagine explaining the real differences to someone from 1,000 year ago. "This man wears wool clothes and goes to a place where he makes phone calls and does things on a glowing screen. This other man wears other similar looking clothes and he goes to a place where he makes phone calls and does other things on a glowing screen. Banker or call centre worker? The one that is high status can expect their boss to require them to work at a moment's notice in the middle of the night." Compare that to someone who has a potentially substantially lower level of consumption and no longer engages in wage labour for their sustenance needs. Whether they spend their day reading, staring at the clouds, swimming, or flying their private plane is less important than the difference between them and someone who has to work.

PragmaticPulp 5y ago

> Why do you think that? All the numbers work out. Even in your hypothetical scenario, investing 100k for 7 years, especially in the last 7 years, would easily bring you 1M total investments. My point was that to show that the only way to get this to work out was to make everything work out perfectly, from getting the authors highest quoted day rate of $1000/day on every single day of every single contract from the start. You’d also have to live an aggressively non-wealthy lifestyle without any room for things like travel, hobbies, or luxuries. So yes, technically it can work out if the stars align, you can always get those high-paying contracts without fail, and you’re willing to live an aggressively frugal lifestyle taken to an extreme.

ixacto 5y ago
Get done with college at 22, work 7 years and retire at the age of 29. This is not impossible. Just most people don't want to do it, but it's totally available.
- PaulDavisThe1st 5y ago
  You will be lucky to earn US$1000/day fresh out of college.
- prirun 5y ago
  And "don't have kids". Children are a huge time & money suck. Not saying they don't have their rewards too, because they do, but they are also a huge cost.
ghaff 5y ago
Furthermore, I don't see any allowance for the time needed to get those contracts, take care of business stuff, etc. To say nothing of downtime when a perfectly-timed new contract just doesn't come along. Maybe it's possible in the current climate but it's not the norm.
bambax 5y ago
What are those expensive hobbies and luxuries? My hobbies cost about zero (making music, doing the occasional woodworking, reading, walking). Travel can be expensive but it can also be quite cheap and is very dispensable. Luxuries outside of travel (expensive hotels), I don't even know what they are. I'm sure it's not hard to spend as much money as you want on many different things; but you make it sound as if it was necessary. It really isn't.