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Thanks for writing this. Owning a place to live and couple rental properties makes one economically independent. Leaving a toxic workplace means loosing fancy c

by lnsru 2y ago

Thanks for writing this. Owning a place to live and couple rental properties makes one economically independent. Leaving a toxic workplace means loosing fancy car and canceling expensive vacation. Loosing job before that wealth threshold means homelessness and poverty.

dheera 2y ago
> Leaving a toxic workplace means loosing fancy car and canceling expensive vacation. > Loosing job before that wealth threshold means homelessness and poverty. No, it doesn't. Maybe don't borrow money and buy a fancy car and vacations you can't afford? Buy a normal car with cash and go on normal middle-class vacations? If you work in an mid-level engineer capacity at a FAANG or Nvidia in the Bay Area you can easily live on 1/3 of your take-home compensation (that's including a normal car, a couple economy-class vacations a year, and a modest apartment) and invest the rest in index funds. Within a few years of working, you would have banked enough to have a decade worth of expenses saved before you'll be homeless, and I'm sure you can find another job in that decade. I work at a big tech company, my (very normal) car cost me 1/10 of my annual take-home salary, I've never flown anything but economy class, and I save 60-75% of my take home pay and invest it. I can't afford rental properties or any of that, but I do have enough funds to last me several years at my current lifestyle. Back when I was at startups (including co-founding one), I was never able to save more than a few months' worth of emergency fund, and that was not good for my mental health. That's one of the reason I joined a big tech company for now -- to de-risk myself financially. Startups are financially FAR higher risk. You'll get 1/4 the pay that Nvidia gives you, the equity may end up being worth $0, and if it does end up being worth $0, you'll have missed out on the opportunity cost of being hired at any of the FAANG companies for whatever time you spent there. I'm not discouraging anyone from doing a startup, but it IS higher financial risk in every way.
- throwaway2037 2y ago
  Wow, 60-75% savings rate is incredible. > I can't afford rental properties or any of that Why not? Combine a 10% down payment and a bank loan. You can definitely afford it.
  - dheera 2y ago
    In my book, borrowing money to buy something I don't have the cash for does NOT mean I can afford it. Back in the days when I didn't have money to buy a car with cash, I just didn't buy a car and used a bike and public transit to get everywhere. I mean, maybe that's why I have a high savings rate.
    - throwaway2037 2y ago
      Do you also plan to buy your home with cash only? You will need to save for a long time. To me, loans can be used to judiciously add leverage to your financial profile. If 90% LTV (loan-to-value) is too high for your personal risk profile, then you can increase the down payment from 10% to 20 or 30%.
      - dheera 2y ago
        That's OK, I don't want to owe anyone money. I can quit my job with full peace of mind, that's what this whole thread is about. If and when I have money to buy a house, I'll just buy one. It's not that different from buying a fancy meal or a plane ticket. If I have the money I might buy it. If I don't, I don't think about it. I'm simple like that, and as a result, I have very few financial worries.

by lnsru 2y ago

dheera 2y ago

> Leaving a toxic workplace means loosing fancy car and canceling expensive vacation. > Loosing job before that wealth threshold means homelessness and poverty. No, it doesn't. Maybe don't borrow money and buy a fancy car and vacations you can't afford? Buy a normal car with cash and go on normal middle-class vacations? If you work in an mid-level engineer capacity at a FAANG or Nvidia in the Bay Area you can easily live on 1/3 of your take-home compensation (that's including a normal car, a couple economy-class vacations a year, and a modest apartment) and invest the rest in index funds. Within a few years of working, you would have banked enough to have a decade worth of expenses saved before you'll be homeless, and I'm sure you can find another job in that decade. I work at a big tech company, my (very normal) car cost me 1/10 of my annual take-home salary, I've never flown anything but economy class, and I save 60-75% of my take home pay and invest it. I can't afford rental properties or any of that, but I do have enough funds to last me several years at my current lifestyle. Back when I was at startups (including co-founding one), I was never able to save more than a few months' worth of emergency fund, and that was not good for my mental health. That's one of the reason I joined a big tech company for now -- to de-risk myself financially. Startups are financially FAR higher risk. You'll get 1/4 the pay that Nvidia gives you, the equity may end up being worth $0, and if it does end up being worth $0, you'll have missed out on the opportunity cost of being hired at any of the FAANG companies for whatever time you spent there. I'm not discouraging anyone from doing a startup, but it IS higher financial risk in every way.

throwaway2037 2y ago
Wow, 60-75% savings rate is incredible. > I can't afford rental properties or any of that Why not? Combine a 10% down payment and a bank loan. You can definitely afford it.
- dheera 2y ago
  In my book, borrowing money to buy something I don't have the cash for does NOT mean I can afford it. Back in the days when I didn't have money to buy a car with cash, I just didn't buy a car and used a bike and public transit to get everywhere. I mean, maybe that's why I have a high savings rate.
  - throwaway2037 2y ago
    Do you also plan to buy your home with cash only? You will need to save for a long time. To me, loans can be used to judiciously add leverage to your financial profile. If 90% LTV (loan-to-value) is too high for your personal risk profile, then you can increase the down payment from 10% to 20 or 30%.
    - dheera 2y ago
      That's OK, I don't want to owe anyone money. I can quit my job with full peace of mind, that's what this whole thread is about. If and when I have money to buy a house, I'll just buy one. It's not that different from buying a fancy meal or a plane ticket. If I have the money I might buy it. If I don't, I don't think about it. I'm simple like that, and as a result, I have very few financial worries.