6 ms·

Do you ever think back and wonder if maybe you did make the right decision? After factoring in ~10x 15-20% jumps over 25 years, compounding interest and more m

by nickjj 4y ago

Do you ever think back and wonder if maybe you did make the right decision? After factoring in ~10x 15-20% jumps over 25 years, compounding interest and more maybe that translates to being 100% financially secure 10 years sooner. I didn't do the math but you get the idea. Basically is a temporary bad place or 2 for a year worth gaining 10 years of not having to work unless you wanted to?

readingnews 4y ago
This is a very serious thought. If I was _totally_ happy in my position and you told me you could increase my salary 50%, there is no way I would stay, simply based on the "wait up, this means in the long run this salary increase will take X years off my time waiting for retirement". There is no substitute for "I can retire at 60 instead of 70". Of course, OP said he was making 6 figures (an insane amount of money away from my position) so perhaps they are already planning to retire at 55...
- lentil_soup 4y ago
  > "I can retire at 60 instead of 70" It depends, what was my life like for those 60 years vs the 70? I'd love to be financially independent, but I don't want to spend 60yrs working on projects I hate always chasing the next promotion with only the promise of retiring early. It really depends on whether that increase comes at the expense of my work life balance or not
  - vanilla_nut 4y ago
    work/life balance and work satisfaction! I find a lot of the best compensation is bundled with unhealthy organizations with dysfunctional internal relationships. I’ve worked enough on projects and tasks I don’t believe in (or flat-out disagree with) that I know it’s not worth the stress and dissatisfaction. Of course, if you don’t find dysfunction stressful, or you don’t really enjoy working in your industry regardless, it’s worth it to max the comp. But I’m happiest with a balance of flexible work, passionate coworkers, little bureaucracy, and slightly less money than I could otherwise make.
  - treis 4y ago
    > It really depends on whether that increase comes at the expense of my work life balance or not Right, but the point is that apples to apples comparison you'll make a lot more money switching. There's no cost to work life balance or interesting projects or anything. It's 20%+ of your salary every year in exchange for dealing with interviewing and switching companies. It's a pretty fantastic deal.
- dmos62 4y ago
  > There is no substitute for "I can retire at 60 instead of 70". Would you choose 30 bad work years over 40 good work years?
  - mk89 4y ago
    I think the idea is to squeeze as much as you can now,... so that you can also leave something to your kids and possibly have a decent lifestyle when you're old. They are all valid points, unfortunately. Let's just remember some people have really bad really underpaid 40 years of work.
    - deleted 4y ago
      [deleted]
    - dmos62 4y ago
      > Let's just remember some people have really bad really underpaid 40 years of work. Good point. > I think the idea is to squeeze as much as you can now,... I really, really don't think that's healthy. Be unhappy now so you can be happy later is misguided, because you need to work on being happy now to be happy later: putting it off is self-destructive. I recommend "The Power of Having Fun" by Dave Crenshaw.
  - llampx 4y ago
    Jobs that pay more generally are worse than jobs that pay less? Given similar positions and industry, i.e. not jumping from being an engineer to sales. I've had better bosses and more respect at places that paid more.
- bovermyer 4y ago
  What about "retirement" makes you think it's the better state? All the "free time to do whatever you want?" A lot of retirees I've known ended up getting bored and going back to work, even if only part-time.
  - nickjj 4y ago
    I don't see retirement as not doing anything. I see it a synonym to being financially secure. It's being able to choose to do whatever you want.
  - chasd00 4y ago
    Also, a lot of people who spend their lives working very hard seem to die as soon as they stop.
  - antihero 4y ago
    What if you could spend your retirement travelling the world? How would you ever get bored. Same goes for people eh get rich and go insane.
    - bovermyer 4y ago
      I already travel the world and I'm not retired.
- cableshaft 4y ago
  Six figures isn't that insane for engineers in the US. Especially not for Silicon Valley. And $100k doesn't really go as far as it used to in the US, especially if you have a modest home, car, two dogs, a significant other, and you live somewhat near a city with tech jobs. I'm making a decent amount over $100k, my wife also makes good money, and yet we're way, way behind on where we're supposed to be in savings for a comfortable retirement at 67 (which is apparently 3x your annual salary at the age of 40), despite me boiling the frog in increasing how much we save for it the past few years (around 20% of my paycheck now, up from 8% a few years ago).
- kyaghmour 4y ago
  Take this with a grain of salt: Retirement is a scam. I, for one, plan to stay away from it as long as I possibly can. My body will retire its own self when it's done.
lbotos 4y ago
I wrote this a few weeks ago, but the answer is always "what are you optimizing for?" If you hate work for whatever reason and you want out of the system faster? Yes, stack dollars and exit. That may require sacrifice and "bad gigs" but that could enable the exit. If you find your work engaging and rewarding? Why would you optimize to exit? (Queue the lawyers/doctors/etc that work into their 80s for the love of it.) Tech has brutal ageism but the point still stands -- figure out what you are optimizing for, and your answer will be clear. (OP sounds like they have found the secret that money isn't everything, and happiness is rewarding and they are optimizing for that.)
- lotsofpulp 4y ago
  > If you find your work engaging and rewarding? Why would you optimize to exit? To mitigate the risk of losing the ability to earn income. You can always choose not to work or work a lower paying job after you attain financial security. I feel like the risks are especially high of losing ability to earn sufficient income between ages 50 to 65 such that you are able to afford healthcare expenses to carry you until you qualify for Medicare (at age 65). So my goal is to earn everything I need to before then.
  - imtringued 4y ago
    >To mitigate the risk of losing the ability to earn income. https://m.youtube.com/watch?v=EKd6WURBqOY https://m.youtube.com/watch?v=EKd6WURBqOY
  - galdosdi 4y ago
    The older I get the more aware I become of the risk that I can't possibly assume the ability to make a living the way I currently do will stay around indefinitely. I could become disabled at any time, or the world or industry could change. If you look across different professions in different countries across different times, you see that a profession that is very lucrative in one time period often isn't anymore in a subsequent one, or in another nearby society. These things come and go. There was a time when becoming an airline pilot or factory worker were lucrative options in the USA. There are a lot of good reasons to guess that the good times will continue for the time being, but you're kidding yourself if you think it's a certainty.
UncleMeat 4y ago
Is 10x 20% jumps actually remotely reasonable? After you've swapped enough times it starts to look worrisome on resumes since people see no single role for more than 2 years. And the most effective jumps are when you also get title increases, but that stops working quite quickly and companies tend to prefer promoting to leadership positions rather than external hires leveling up. 1.2^10 is also a 620% pay increase. From my starting comp this would put me at like 1.5M, which is an extremely unusual pay level.
- tomrod 4y ago
  Not very many people start with a 250k starting comp. Typically about 1/5th to 1/3rd of that.
  - UncleMeat 4y ago
    But this is a critical observation. The thing that increases pay is not switching jobs, but working at companies that pay in different tiers.
    - tomrod 4y ago
      I didn't gather that from your first comment, only that you didn't believe the distribution could increase by 620%. Which, when you start in the top ~7% of individual income in the US, is probably true for income (wealth as a whole is another matter).[0] [0] https://www.investopedia.com/personal-finance/how-much-income-puts-you-top-1-5-10/ https://www.investopedia.com/personal-finance/how-much-incom...
      - UncleMeat 4y ago
        The key thing I'm trying to get across here is that it isn't the hopping that brings this sort of increase, it is simply working at one of the very high paying companies in a high paying region. Zero hops, one hop, and seven hops can all get you there. Telling people to focus on the seven hops is misleading, IMO.
- 4y ago
JKCalhoun 4y ago
Why stop there though? Every one of us can look back at an ill-timed home purchase/sale, and ill-timed stock purchase/sale. Stressing about would-have-beens is unfortunately easy to do, the ability to appreciate the present is much more difficult.
asoneth 4y ago
For me it is a balance. I had opportunities to earn significantly more (~3x) but it was work I despised and I'm not sure I would be happy right now if I was retired but my life's work felt like a net negative. On the flip side, I had opportunities to work in organizations doing fascinating and world-changing work for low salary (~1/4x) and I've learned that I am not happy when money is a constant source of stress. Maximizing happiness for me means finding the right balance between having a positive impact and making enough money. (I'm not sure I've struck the right balance, but that is my mental model.)

by nickjj 4y ago

readingnews 4y ago

This is a very serious thought. If I was _totally_ happy in my position and you told me you could increase my salary 50%, there is no way I would stay, simply based on the "wait up, this means in the long run this salary increase will take X years off my time waiting for retirement". There is no substitute for "I can retire at 60 instead of 70". Of course, OP said he was making 6 figures (an insane amount of money away from my position) so perhaps they are already planning to retire at 55...

lentil_soup 4y ago
> "I can retire at 60 instead of 70" It depends, what was my life like for those 60 years vs the 70? I'd love to be financially independent, but I don't want to spend 60yrs working on projects I hate always chasing the next promotion with only the promise of retiring early. It really depends on whether that increase comes at the expense of my work life balance or not
- vanilla_nut 4y ago
  work/life balance and work satisfaction! I find a lot of the best compensation is bundled with unhealthy organizations with dysfunctional internal relationships. I’ve worked enough on projects and tasks I don’t believe in (or flat-out disagree with) that I know it’s not worth the stress and dissatisfaction. Of course, if you don’t find dysfunction stressful, or you don’t really enjoy working in your industry regardless, it’s worth it to max the comp. But I’m happiest with a balance of flexible work, passionate coworkers, little bureaucracy, and slightly less money than I could otherwise make.
- treis 4y ago
  > It really depends on whether that increase comes at the expense of my work life balance or not Right, but the point is that apples to apples comparison you'll make a lot more money switching. There's no cost to work life balance or interesting projects or anything. It's 20%+ of your salary every year in exchange for dealing with interviewing and switching companies. It's a pretty fantastic deal.
dmos62 4y ago
> There is no substitute for "I can retire at 60 instead of 70". Would you choose 30 bad work years over 40 good work years?
- mk89 4y ago
  I think the idea is to squeeze as much as you can now,... so that you can also leave something to your kids and possibly have a decent lifestyle when you're old. They are all valid points, unfortunately. Let's just remember some people have really bad really underpaid 40 years of work.
  - deleted 4y ago
    [deleted]
  - dmos62 4y ago
    > Let's just remember some people have really bad really underpaid 40 years of work. Good point. > I think the idea is to squeeze as much as you can now,... I really, really don't think that's healthy. Be unhappy now so you can be happy later is misguided, because you need to work on being happy now to be happy later: putting it off is self-destructive. I recommend "The Power of Having Fun" by Dave Crenshaw.
- llampx 4y ago
  Jobs that pay more generally are worse than jobs that pay less? Given similar positions and industry, i.e. not jumping from being an engineer to sales. I've had better bosses and more respect at places that paid more.
bovermyer 4y ago
What about "retirement" makes you think it's the better state? All the "free time to do whatever you want?" A lot of retirees I've known ended up getting bored and going back to work, even if only part-time.
- nickjj 4y ago
  I don't see retirement as not doing anything. I see it a synonym to being financially secure. It's being able to choose to do whatever you want.
- chasd00 4y ago
  Also, a lot of people who spend their lives working very hard seem to die as soon as they stop.
- antihero 4y ago
  What if you could spend your retirement travelling the world? How would you ever get bored. Same goes for people eh get rich and go insane.
  - bovermyer 4y ago
    I already travel the world and I'm not retired.
cableshaft 4y ago
Six figures isn't that insane for engineers in the US. Especially not for Silicon Valley. And $100k doesn't really go as far as it used to in the US, especially if you have a modest home, car, two dogs, a significant other, and you live somewhat near a city with tech jobs. I'm making a decent amount over $100k, my wife also makes good money, and yet we're way, way behind on where we're supposed to be in savings for a comfortable retirement at 67 (which is apparently 3x your annual salary at the age of 40), despite me boiling the frog in increasing how much we save for it the past few years (around 20% of my paycheck now, up from 8% a few years ago).
kyaghmour 4y ago
Take this with a grain of salt: Retirement is a scam. I, for one, plan to stay away from it as long as I possibly can. My body will retire its own self when it's done.

lbotos 4y ago

I wrote this a few weeks ago, but the answer is always "what are you optimizing for?" If you hate work for whatever reason and you want out of the system faster? Yes, stack dollars and exit. That may require sacrifice and "bad gigs" but that could enable the exit. If you find your work engaging and rewarding? Why would you optimize to exit? (Queue the lawyers/doctors/etc that work into their 80s for the love of it.) Tech has brutal ageism but the point still stands -- figure out what you are optimizing for, and your answer will be clear. (OP sounds like they have found the secret that money isn't everything, and happiness is rewarding and they are optimizing for that.)

lotsofpulp 4y ago
> If you find your work engaging and rewarding? Why would you optimize to exit? To mitigate the risk of losing the ability to earn income. You can always choose not to work or work a lower paying job after you attain financial security. I feel like the risks are especially high of losing ability to earn sufficient income between ages 50 to 65 such that you are able to afford healthcare expenses to carry you until you qualify for Medicare (at age 65). So my goal is to earn everything I need to before then.
- imtringued 4y ago
  >To mitigate the risk of losing the ability to earn income. https://m.youtube.com/watch?v=EKd6WURBqOY https://m.youtube.com/watch?v=EKd6WURBqOY
- galdosdi 4y ago
  The older I get the more aware I become of the risk that I can't possibly assume the ability to make a living the way I currently do will stay around indefinitely. I could become disabled at any time, or the world or industry could change. If you look across different professions in different countries across different times, you see that a profession that is very lucrative in one time period often isn't anymore in a subsequent one, or in another nearby society. These things come and go. There was a time when becoming an airline pilot or factory worker were lucrative options in the USA. There are a lot of good reasons to guess that the good times will continue for the time being, but you're kidding yourself if you think it's a certainty.

UncleMeat 4y ago

Is 10x 20% jumps actually remotely reasonable? After you've swapped enough times it starts to look worrisome on resumes since people see no single role for more than 2 years. And the most effective jumps are when you also get title increases, but that stops working quite quickly and companies tend to prefer promoting to leadership positions rather than external hires leveling up. 1.2^10 is also a 620% pay increase. From my starting comp this would put me at like 1.5M, which is an extremely unusual pay level.

tomrod 4y ago
Not very many people start with a 250k starting comp. Typically about 1/5th to 1/3rd of that.
- UncleMeat 4y ago
  But this is a critical observation. The thing that increases pay is not switching jobs, but working at companies that pay in different tiers.
  - tomrod 4y ago
    I didn't gather that from your first comment, only that you didn't believe the distribution could increase by 620%. Which, when you start in the top ~7% of individual income in the US, is probably true for income (wealth as a whole is another matter).[0] [0] https://www.investopedia.com/personal-finance/how-much-income-puts-you-top-1-5-10/ https://www.investopedia.com/personal-finance/how-much-incom...
    - UncleMeat 4y ago
      The key thing I'm trying to get across here is that it isn't the hopping that brings this sort of increase, it is simply working at one of the very high paying companies in a high paying region. Zero hops, one hop, and seven hops can all get you there. Telling people to focus on the seven hops is misleading, IMO.
4y ago

JKCalhoun 4y ago

Why stop there though? Every one of us can look back at an ill-timed home purchase/sale, and ill-timed stock purchase/sale. Stressing about would-have-beens is unfortunately easy to do, the ability to appreciate the present is much more difficult.

asoneth 4y ago

For me it is a balance. I had opportunities to earn significantly more (~3x) but it was work I despised and I'm not sure I would be happy right now if I was retired but my life's work felt like a net negative. On the flip side, I had opportunities to work in organizations doing fascinating and world-changing work for low salary (~1/4x) and I've learned that I am not happy when money is a constant source of stress. Maximizing happiness for me means finding the right balance between having a positive impact and making enough money. (I'm not sure I've struck the right balance, but that is my mental model.)