9 ms·

Are you serious? $6m sounds like more than enough to retire on at any point for most people.

by vertr 14y ago

bengl3rt 14y ago
If you want to live like a 20-something for the rest of your life, sure. Your cost structure changes as you get older and have things like houses, spouses, cars, and children.
- tptacek 14y ago
  Do you have a house or kids? I do. The near-certainty that I could afford college, house payments, and a humane retirement would be an intense motivator for me. I'm not conservative by any means --- I work for a company I cofounded --- but I think it's easy to forget that adults like us live with a pretty fucking high cortisol load.
- vertr 14y ago
  If you have high expectations about the amount and 'quality' of your personal possessions, then sure. I'm sure most every one else can make due on that amount. I think with wise spending and decent investments I could easily make that amount last my entire life and have quite a bit to give away at the end.
- ianterrell 14y ago
  $6MM invested with a 6% return provides a $360k pa lifestyle just living off the interest. That seems like quite enough for houses, spouses (well—maybe spouse; alimony could eat into that quite a bit), cars, and children.
  - jaggederest 14y ago
    Zero risk return is way below 6% right now. I'm not sure where you're going to find anything like that. Berkshire Hathaway is willing to guarantee you a $205,000 annual income from that sum in an annuity, which is not a bad deal at all, but it's not 'never worry about money again', it's just a really nice salary, and would be substantially depleted in the case of any inflation at all.
    - ianterrell 14y ago
      No need to go zero risk when the investment starts in your 20s. But of course, yes, inflation. But of course, you can draw from principal as well—that's how retirement funds usually work. I'll put it another way: Maybe it's not 'never worry about money again'—people are prone to worrying, after all—but $6MM is more than the lifetime earnings of the vast majority of Americans. If you can't make it on more than what nearly everyone else will ever see in their entire lives, that's your problem.
    - drone 14y ago
      Right now 10-year T-Bills are pulling about 1.65, and inflation is having a nice bounce between 1.7 and 3. Let's even it out at 2 - either way, yes, you're losing money on ultra-low-risk investments. All you can hope for is to reduce the wages of inflation on your balance sheet. BH annuity is not a bad deal, but losing 2% of your income a year will sound tolerable until about year 5... =) If you retire mid-twenties on $5M, there's no way you'd make it through 70 on that, if you did nothing else active (read: risky) to increase your income.
      - ricardobeat 14y ago
        You want to spend 50 years on vacation?
        drone 14y ago
        I said nothing of the sort. Follow the thread UP, and you'll see it's the core of the conversation - as to whether one can live off of 6MM for the rest of your life. I call "ceasing working and living on the money you made previously" retirement, you can call it what you like.
      - smattiso 14y ago
        Let's assume your investments keep up with inflation but no more, which is very easy to do. Then essentially you are just living off of your principle. 5MM goes a long ways. 75k a year (in today's dollars) will last you 67 years. That's more than most people make. I'd take that.
- horsehead 14y ago
  Bullshit. I live on roughly $18k a year net. buy a house, maybe doubles or PERHAPS triples my housing allowance. Have a wife and kids and things, in total, probably triple. I don't think people understand how to not waste money any more.
  - jcc80 14y ago
    Does this mean you're not going to be buying the new disposable laptops from Apple? How will you live with yourself?
  - jroll 14y ago
    A modest house in the valley costs something like $500k. With a typical mortgage you can expect to pay about 1% of the total price ($5k). That's more than triple your total expenditures, let alone housing costs.
    - argv_empty 14y ago
      I assure you, it's quite possible to live an enjoyable life in a place that's much cheaper the valley.
  - kevinpet 14y ago
    I'd rather spend my time writing software then repairing my old socks. As a bonus, writing software makes me about 100x what repairing my old socks nets me per hour.
  - webwright 14y ago
    Where do you live? This is HUGELY dependent on geography. $18k a month in NYC, Seattle, SF, etc., is pretty painful. Add two kids, private school (unless you live in a great district), college educations, saving for retirement, summer camp, braces, health care for 4, housing for 4 in a good neighborhood, helping out your retired parents who might not have saved enough, etc., it stacks up pretty fast.
    - tptacek 14y ago
- mahyarm 14y ago
  Nope, you can do it with $500k in a Colorado suburb for example. This guy is a living example of it, with multiple kids, multiple cars, a house, furniture, etc: http://www.mrmoneymustache.com/ http://www.mrmoneymustache.com/
- randomdata 14y ago
  Most people will never make $6M in their lifetime. The average college graduate will make less than $3M when it is all said and done. If you can earn more, great. But the chances are exceedingly low to begin with.
deleted 14y ago
[deleted]
joshAg 14y ago
assuming losing 30% off the top for taxes, taking 3% of the principle every year for "salary" is $126k. That seems like more than enough for me, too.
- legutierr 14y ago
  I would think the tax rate would be lower, considering that a sale of shares is treated as capital gains. 15%?
  - joshAg 14y ago
    true. but that's only for long term. i have no idea what short term tax is, but i know it's also less than 30%. i was trying to overestimate taxes (so that the reported annual income, if anything, would be less than actual annual income) and use a nice round number so i didn't have to use a calculator.
    - legutierr 14y ago
      Long-term is holding the asset for a year or more. Short-term is treated as ordinary income.
      - joshAg 14y ago
        true, but what's the interest rate for short term cap gains? i know it's (15,30), but i can't rememeber if it's just 18% or something more like 25%. and since i am efficient (read: lazy :), i just overestimated to 30% instead of wikipedia-ing.

Are you serious? $6m sounds like more than enough to retire on at any point for most people.

by vertr 14y ago

Are you serious? $6m sounds like more than enough to retire on at any point for most people.

If you want to live like a 20-something for the rest of your life, sure. Your cost structure changes as you get older and have things like houses, spouses, cars, and children.

tptacek 14y ago
Do you have a house or kids? I do. The near-certainty that I could afford college, house payments, and a humane retirement would be an intense motivator for me. I'm not conservative by any means --- I work for a company I cofounded --- but I think it's easy to forget that adults like us live with a pretty fucking high cortisol load.
vertr 14y ago
If you have high expectations about the amount and 'quality' of your personal possessions, then sure. I'm sure most every one else can make due on that amount. I think with wise spending and decent investments I could easily make that amount last my entire life and have quite a bit to give away at the end.
ianterrell 14y ago
$6MM invested with a 6% return provides a $360k pa lifestyle just living off the interest. That seems like quite enough for houses, spouses (well—maybe spouse; alimony could eat into that quite a bit), cars, and children.
- jaggederest 14y ago
  Zero risk return is way below 6% right now. I'm not sure where you're going to find anything like that. Berkshire Hathaway is willing to guarantee you a $205,000 annual income from that sum in an annuity, which is not a bad deal at all, but it's not 'never worry about money again', it's just a really nice salary, and would be substantially depleted in the case of any inflation at all.
  - ianterrell 14y ago
    No need to go zero risk when the investment starts in your 20s. But of course, yes, inflation. But of course, you can draw from principal as well—that's how retirement funds usually work. I'll put it another way: Maybe it's not 'never worry about money again'—people are prone to worrying, after all—but $6MM is more than the lifetime earnings of the vast majority of Americans. If you can't make it on more than what nearly everyone else will ever see in their entire lives, that's your problem.
  - drone 14y ago
    Right now 10-year T-Bills are pulling about 1.65, and inflation is having a nice bounce between 1.7 and 3. Let's even it out at 2 - either way, yes, you're losing money on ultra-low-risk investments. All you can hope for is to reduce the wages of inflation on your balance sheet. BH annuity is not a bad deal, but losing 2% of your income a year will sound tolerable until about year 5... =) If you retire mid-twenties on $5M, there's no way you'd make it through 70 on that, if you did nothing else active (read: risky) to increase your income.
    - ricardobeat 14y ago
      You want to spend 50 years on vacation?
      - drone 14y ago
        I said nothing of the sort. Follow the thread UP, and you'll see it's the core of the conversation - as to whether one can live off of 6MM for the rest of your life. I call "ceasing working and living on the money you made previously" retirement, you can call it what you like.
    - smattiso 14y ago
      Let's assume your investments keep up with inflation but no more, which is very easy to do. Then essentially you are just living off of your principle. 5MM goes a long ways. 75k a year (in today's dollars) will last you 67 years. That's more than most people make. I'd take that.
horsehead 14y ago
Bullshit. I live on roughly $18k a year net. buy a house, maybe doubles or PERHAPS triples my housing allowance. Have a wife and kids and things, in total, probably triple. I don't think people understand how to not waste money any more.
- jcc80 14y ago
  Does this mean you're not going to be buying the new disposable laptops from Apple? How will you live with yourself?
- jroll 14y ago
  A modest house in the valley costs something like $500k. With a typical mortgage you can expect to pay about 1% of the total price ($5k). That's more than triple your total expenditures, let alone housing costs.
  - argv_empty 14y ago
    I assure you, it's quite possible to live an enjoyable life in a place that's much cheaper the valley.
- kevinpet 14y ago
  I'd rather spend my time writing software then repairing my old socks. As a bonus, writing software makes me about 100x what repairing my old socks nets me per hour.
- webwright 14y ago
  Where do you live? This is HUGELY dependent on geography. $18k a month in NYC, Seattle, SF, etc., is pretty painful. Add two kids, private school (unless you live in a great district), college educations, saving for retirement, summer camp, braces, health care for 4, housing for 4 in a good neighborhood, helping out your retired parents who might not have saved enough, etc., it stacks up pretty fast.
  - tptacek 14y ago
mahyarm 14y ago
Nope, you can do it with $500k in a Colorado suburb for example. This guy is a living example of it, with multiple kids, multiple cars, a house, furniture, etc: http://www.mrmoneymustache.com/ http://www.mrmoneymustache.com/
randomdata 14y ago
Most people will never make $6M in their lifetime. The average college graduate will make less than $3M when it is all said and done. If you can earn more, great. But the chances are exceedingly low to begin with.

deleted 14y ago

[deleted]

joshAg 14y ago

assuming losing 30% off the top for taxes, taking 3% of the principle every year for "salary" is $126k. That seems like more than enough for me, too.

legutierr 14y ago
I would think the tax rate would be lower, considering that a sale of shares is treated as capital gains. 15%?
- joshAg 14y ago
  true. but that's only for long term. i have no idea what short term tax is, but i know it's also less than 30%. i was trying to overestimate taxes (so that the reported annual income, if anything, would be less than actual annual income) and use a nice round number so i didn't have to use a calculator.
  - legutierr 14y ago
    Long-term is holding the asset for a year or more. Short-term is treated as ordinary income.
    - joshAg 14y ago
      true, but what's the interest rate for short term cap gains? i know it's (15,30), but i can't rememeber if it's just 18% or something more like 25%. and since i am efficient (read: lazy :), i just overestimated to 30% instead of wikipedia-ing.