4 ms·

Software development pays incredibly well by the standards of the average American. You can spend that money on lifestyle inflation, or you can save/invest it a

Software development pays incredibly well by the standards of the average American. You can spend that money on lifestyle inflation, or you can save/invest it and buy yourself an enormous amount of financial freedom. Whether you call that "being independently wealthy" is a matter of semantics.

est31 4y ago
Yeah there is a lot of space between "has savings for 8-12 months" and "is independently wealthy, i.e. can live off interest of their own savings". Former is extremely easy to achieve if you can save significant portions of your salary. If you can save 30%, you can achieve it after 3 years. Latter takes a bit longer.
- ummonk 4y ago
  Less than 3 years, since your expenses are only 70% of your salary.
  - est31 4y ago
    Good point, I've just calculated it and you'll need 2 years and 4 months to save one year's expenses that make up 70% of your salary, at a saving rate of 30%.
    - klipt 4y ago
      But then inflation...
- 300bps 4y ago
  Yeah there is a lot of space between "has savings for 8-12 months" I think there is a mentality difference here. I have savings that would easily last me 10 years of not working. But... that's kind of my plan. I will be retiring some day. I don't want to use up even a dime of that money by not working in my prime earning years.
  - VBprogrammer 4y ago
    The other side of that coin is that saving for a post work life (particularly at normal retirement age) is a good way of spending all of your life working hard for a retirement which never comes. There is something to be said for spreading those retirement years across your lifetime rather than saving them all up for the end. Different of course if you have a plan to retire at 45 or something.
  - rootusrootus 4y ago
    A good friend of mine spent his life being pretty frugal. Saved up a nice chunk of change, too -- his wife is also a software developer, they both made good money. Got cancer early last year and was dead 10 months later. 55 years old. Ugh. Not saying you should run out and spend your nest egg. On the other hand, I'd be reluctant to suffer too much during my prime working years scrimping and saving for a retirement that might actually not happen. I'd rather have jobs I really enjoy, and frankly, if I enjoy the work well enough why would I retire? Just take longer and longer vacations and work part time. So I'm willing to use a bit of my saved up funds when necessary to get out of a work environment that is unpleasant.
    - ryandrake 4y ago
      Sorry about your friend. My wife also had a friend in the same boat. Made it to 59 and heart attack. Statistically they are outliers, though. For every one of those cases there are probably 10 that make it long past a normal retirement age and 2 that make it beyond 90 years or so. Given the choice, I’d rather be prepared for a 30 year retirement and unluckily die early than be prepared for a 5 year retirement and live to see 90, eating dog food.
      - VBprogrammer 4y ago
        You can live a long time with a very low quality of life. It's not just dying that the concern. I don't think we're really talking here about not having enough money to survive in retirement, we're saving to have the dream retirement later.
      - 4y ago
- sokoloff 4y ago
  https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/ https://www.mrmoneymustache.com/2012/01/13/the-shockingly-si... is a great article for those interested in the topic of high savings percentages.
  - jxhdkdhdks 4y ago
    never mind that anyone following mr money mustache advice to date, would be under water and strugling more than people that just saved in safer assets all that while.
    - sokoloff 4y ago
      Not if you’ve been following that advice for more than 3 years. The broad market is around the same price as 18 months ago.
      - icedchai 4y ago
        Yup. I'm basically back to early 2021 levels, still up almost 60% since things bottomed out in March/April 2020. The big drops seem concerning in the short term, but if you look at it over the long term... well... I'm not too worried.
- brailsafe 4y ago
  I've always had an extremely tenous grasp on consistently being employed, and know getting fired is just around the corner. Therefore, saving about 6-12 months of expenses is first step, then I'm allowed to start spending more than $100/m or whatever here and there on stuff. I usually end up needing that savings because getting a new job can easily take that long, and so by the beginning of age 30 this year I was back in the negative and almost homeless again with no real assets. That strategy keeps lifestyle inflation way down
  - hcrean 4y ago
    Are you choosing the right environments to work in? What do you find is the reason for instability in employment?
    - brailsafe 4y ago
      Variety of reasons, burnout, management style changing or expectations changing in a way that I can't keep up, I guess those are the usual ones and they're closely related. Most companies also just arbitrarily pick 2 week agile sprints with daily stand-ups, often increasing the amount of meetings as time goes on, and this is usually where things start going downward for me. There also tends to be a decrease in autonomy to get my work done over time, which helps me feel like shit on a daily basis, and so it starts a negative spiral. In one case I was doing reasonably well with my software dev tasks for a while, but then they assigned me to periodic customer support, and I said up front that's not something I'll be good at. At the same time, my manager tried to increase the oversight of my work, because I was getting slower at it. So I'd wake up every waiting for my manager to "check-in" on me like a child, eventually getting to the point where I couldn't bring myself to get anything done and just resented my existence. I'm in an ok spot now, for now, but who's to say how it'll be by January. All I want is a place I can do good work for, for a reasonable salary, but it's been very difficult to find.
      - inadequatespace 4y ago
        Damn, I’ve been there — at least in the situation where the manager concludes that micromanaging will somehow make the managee more effective, rather than in the very best case, hamstring it by bottlenecking on them and in the average case, deeply humiliate by trying to make the managee do things exactly the way they would (but be worse at it, because the managee is not them and could have their own different, personalized, effective work style).
- userulluipeste 4y ago
  There's a lot of range of what constitutes "independently wealthy, i.e. can live off interest of their own savings" when one gets there. Say, you may live a single life of relative leisure for the rest of your days, but if you plan to start a family and have kids (with all it implies) - nope, you'll still have to get back to work! Or want to live large and not have to worry that much about material side of life (i.e. when money is just for keeping score)? Well, you'd better find out ways to make most of your current financial independence to get there, which in itself is work (although just investment related kind, but still).

est31 4y ago

Yeah there is a lot of space between "has savings for 8-12 months" and "is independently wealthy, i.e. can live off interest of their own savings". Former is extremely easy to achieve if you can save significant portions of your salary. If you can save 30%, you can achieve it after 3 years. Latter takes a bit longer.

ummonk 4y ago
Less than 3 years, since your expenses are only 70% of your salary.
- est31 4y ago
  Good point, I've just calculated it and you'll need 2 years and 4 months to save one year's expenses that make up 70% of your salary, at a saving rate of 30%.
  - klipt 4y ago
    But then inflation...
300bps 4y ago
Yeah there is a lot of space between "has savings for 8-12 months" I think there is a mentality difference here. I have savings that would easily last me 10 years of not working. But... that's kind of my plan. I will be retiring some day. I don't want to use up even a dime of that money by not working in my prime earning years.
- VBprogrammer 4y ago
  The other side of that coin is that saving for a post work life (particularly at normal retirement age) is a good way of spending all of your life working hard for a retirement which never comes. There is something to be said for spreading those retirement years across your lifetime rather than saving them all up for the end. Different of course if you have a plan to retire at 45 or something.
- rootusrootus 4y ago
  A good friend of mine spent his life being pretty frugal. Saved up a nice chunk of change, too -- his wife is also a software developer, they both made good money. Got cancer early last year and was dead 10 months later. 55 years old. Ugh. Not saying you should run out and spend your nest egg. On the other hand, I'd be reluctant to suffer too much during my prime working years scrimping and saving for a retirement that might actually not happen. I'd rather have jobs I really enjoy, and frankly, if I enjoy the work well enough why would I retire? Just take longer and longer vacations and work part time. So I'm willing to use a bit of my saved up funds when necessary to get out of a work environment that is unpleasant.
  - ryandrake 4y ago
    Sorry about your friend. My wife also had a friend in the same boat. Made it to 59 and heart attack. Statistically they are outliers, though. For every one of those cases there are probably 10 that make it long past a normal retirement age and 2 that make it beyond 90 years or so. Given the choice, I’d rather be prepared for a 30 year retirement and unluckily die early than be prepared for a 5 year retirement and live to see 90, eating dog food.
    - VBprogrammer 4y ago
      You can live a long time with a very low quality of life. It's not just dying that the concern. I don't think we're really talking here about not having enough money to survive in retirement, we're saving to have the dream retirement later.
    - 4y ago
sokoloff 4y ago
https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/ https://www.mrmoneymustache.com/2012/01/13/the-shockingly-si... is a great article for those interested in the topic of high savings percentages.
- jxhdkdhdks 4y ago
  never mind that anyone following mr money mustache advice to date, would be under water and strugling more than people that just saved in safer assets all that while.
  - sokoloff 4y ago
    Not if you’ve been following that advice for more than 3 years. The broad market is around the same price as 18 months ago.
    - icedchai 4y ago
      Yup. I'm basically back to early 2021 levels, still up almost 60% since things bottomed out in March/April 2020. The big drops seem concerning in the short term, but if you look at it over the long term... well... I'm not too worried.
brailsafe 4y ago
I've always had an extremely tenous grasp on consistently being employed, and know getting fired is just around the corner. Therefore, saving about 6-12 months of expenses is first step, then I'm allowed to start spending more than $100/m or whatever here and there on stuff. I usually end up needing that savings because getting a new job can easily take that long, and so by the beginning of age 30 this year I was back in the negative and almost homeless again with no real assets. That strategy keeps lifestyle inflation way down
- hcrean 4y ago
  Are you choosing the right environments to work in? What do you find is the reason for instability in employment?
  - brailsafe 4y ago
    Variety of reasons, burnout, management style changing or expectations changing in a way that I can't keep up, I guess those are the usual ones and they're closely related. Most companies also just arbitrarily pick 2 week agile sprints with daily stand-ups, often increasing the amount of meetings as time goes on, and this is usually where things start going downward for me. There also tends to be a decrease in autonomy to get my work done over time, which helps me feel like shit on a daily basis, and so it starts a negative spiral. In one case I was doing reasonably well with my software dev tasks for a while, but then they assigned me to periodic customer support, and I said up front that's not something I'll be good at. At the same time, my manager tried to increase the oversight of my work, because I was getting slower at it. So I'd wake up every waiting for my manager to "check-in" on me like a child, eventually getting to the point where I couldn't bring myself to get anything done and just resented my existence. I'm in an ok spot now, for now, but who's to say how it'll be by January. All I want is a place I can do good work for, for a reasonable salary, but it's been very difficult to find.
    - inadequatespace 4y ago
      Damn, I’ve been there — at least in the situation where the manager concludes that micromanaging will somehow make the managee more effective, rather than in the very best case, hamstring it by bottlenecking on them and in the average case, deeply humiliate by trying to make the managee do things exactly the way they would (but be worse at it, because the managee is not them and could have their own different, personalized, effective work style).
userulluipeste 4y ago
There's a lot of range of what constitutes "independently wealthy, i.e. can live off interest of their own savings" when one gets there. Say, you may live a single life of relative leisure for the rest of your days, but if you plan to start a family and have kids (with all it implies) - nope, you'll still have to get back to work! Or want to live large and not have to worry that much about material side of life (i.e. when money is just for keeping score)? Well, you'd better find out ways to make most of your current financial independence to get there, which in itself is work (although just investment related kind, but still).