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The FIRE community and my own personal situation prove you very, very wrong. It's absolutely possible for a upper middle class family to retire in their 50s, ev
by glimshe 8mo ago
The FIRE community and my own personal situation prove you very, very wrong. It's absolutely possible for a upper middle class family to retire in their 50s, even in their 40s, if they live frugally.
- aprdm 8mo ago"Live frugally" , "FIRE" , "work in tech" All incompatible with 99% of the upper class, neither do they want to eat ramen to retire early. You're also one medical disaster away from being "very very wrong"
- mech998877 8mo ago90%+ chance the person you are replying to has health insurance that will cover them in case of medical disaster.
- glimshe 8mo agoI absolutely have health insurance, the most expensive available on my state. That doesn't protect me 100%, but what health insurance (including the ones available at most companies) does? People who have poor money management skills believe that FIRE=Ramen and no health insurance... In fact, it's about getting a 30K car (the one I bought new 3 years ago) instead a 70K car despite having the money.
- mattmanser 8mo ago99% of people have poor money management skills? It's statements like this that makes FIRE a fringe scene.
- scottyah 8mo agoyou're saying 99% of people think FIRE = ramen? I doubt that many even have heard of it
- raw_anon_1111 8mo agoAnd what happens when the Republican Party gut the ACA and you have a pre-existing condition. Do you know what life was like trying to get insurance with a pre-existing condition before 2012?
- scottyah 8mo agoThen they can just skip insurance. Most people don't need it, especially if they already have a lot of money (which is what FIRE means)
- raw_anon_1111 8mo agoObviously said by someone who is young and never had or knew anyone that had an expensive medical procedure like a friend who is 45 who I have known since 2003 and is a cancer survivor and now has to have open heart surgery
- scottyah 8mo agoI don't believe your friend is most people. I have quite a few who haven't been to a doctor in decades.
- raw_anon_1111 8mo agoBut do you want to take the chance that you will never have major medical expenses between the time you retire early and you are 65 and eligible for Medicare? How many of your friends are over 50?
- scottyah 8mo agoVery few, I am just saying that you can sign up when you think the risk hits your threshold. I'm mid 30s and wish I hadn't had to pay the last 10yrs. Honestly, until you have ids it's unlikely you'll use it and even less likely that you can't sign up for it before a major operation.
- heathrow83829 8mo agoi think you can get a pretty decent prius from 5k to 10k and a fantastic nearly brand new tesla model 3 for 17K. That's what i did. it was 8 years old, practically brand new, FSD prepaid included! it drives me to work and i only paid 17K for it!
- snake42 8mo agoFIRE doesn't depend on having a tech job. Its all about income to expense ratio. Planning for medical events is something that gets talked to death in these communities.
- raw_anon_1111 8mo agoHow do you plan for a potential quarter million dollar medical bills over a couple of years?
- deleted 8mo ago[deleted]
- snake42 8mo agoThe same way that an employed person would plan for this. Catastrophic insurance plans put a cap on how much your medical bills can be.
- raw_anon_1111 8mo agoAn employed person since the ACA hasn’t had to worry about lifetime caps… Oh and catastrophic insurance plans only have to cover pre-existing conditions since the ACA - which one party is actively trying to kill.
- Retric 8mo agoGood insurance is one aspect including long term disability coverage if you haven’t retired. That’s the thing medical expenses when young are unlikely enough insurance is a viable strategy. Long term it’s worthwhile to move to a country with a less expensive medical system. You can move basically anywhere in retirement and be better off.
- raw_anon_1111 8mo agoAgain like I have been saying, good insurance is predicated on the open market and ACA being around and not being killed by Republicans. Even if they don’t outright kill it, they are trying to put in a “death spiral” where only sick people use it and insurance companies don’t want to participate. LTC not discriminating against pre-existing conditions is also post ACA.
- jandrewrogers 8mo agoI know several people with normie jobs (not tech related or government) and normie lifestyles that saved up enough money to never need to work again by 50 while still maintaining their lifestyle. Most still work because they have no idea what to do with their time even though they don’t need to work anymore. You can easily derive that this is possible from the median household finance statistics published by BLS, never mind the upper class. It isn’t that hard if you care to do it.
- raw_anon_1111 8mo agoNo one is doubting that it is possible to save enough to retire by the time you’re 50 - as long as the ACA and the open market is viable.
- snayan 8mo agoJust leave the US, problem solved.
- raw_anon_1111 8mo agoI said in another reply, that’s actually a real Plan B. We are going to stay in Costa Rica for 5 weeks starting next week and my wife and I are both learning Spanish now. I’m at around an A2 CEFR level. I’ve already researched the residency requirements for both there and Panama
- infinite8s 8mo agoThere are definite costs to this in terms of continued US taxation as an expat, especially if there isn't a tax treaty in place.
- raw_anon_1111 8mo agoCosta Rica doesn’t tax foreign income. But logically it only makes sense to establish residence there if I am not working. CAJA - their healthcare system would be about the same price as my employer provided healthcare. I already don’t pay state tax living in Florida and I would pay federal tax either way.
- heathrow83829 8mo agoyou don't need to eat ramen. there are many cost effective options out there: oatmeal, beans, rice, you could grow your own fruits and vegetables, etc. and as for the medical disaster: heart attack and stroke are actually preventable with a plant based diet (keep your LDL under 80 and you'll vastly decrease your chance of a heart attack). i know a lot of people will hate on that, but those are the facts and any evidence based nutritionist can tell you this.
- hn_acc1 8mo agoHow do you prevent random accidents, cancer, etc?
- solatic 8mo agoA lot of people are often surprised at how non-frugal their lifestyles are. I'm not suggesting that people living on $50k/year aren't already frugal, but yeah, there's definitely people who take out car loans, take out mortgages for the full amount they were approved for, and all sorts of random things like buying chicken parts instead of whole chickens, buying small grocery store containers instead of bulk pricing for shelf-stable items, keeping your speed down to save gas, etc. You really just need to build an innate understanding that the hedonic treadmill doesn't make you happier long-term and develop a resolution to get your expenses down and stay disciplined about it.
- raw_anon_1111 8mo agoBut also you see people asking why can’t someone making the median wage - $75K a year - max out there 401K at $23500 and their HSA at $8300, etc
- solatic 8mo agoThere are three things you can do with your money - save it (e.g. investments), give it away (e.g. charity), or spend it (e.g. housing, vacations). Whether or not somebody's investment strategy (i.e. saving) is optimal for their income level has nothing to do with the frugality of their lifestyle (i.e. spending).
- raw_anon_1111 8mo agoSo you are saying when I first graduated from college in 1996 I should have been able to max out my 401K - then it was $10K I believe. I was making $22K. If the median income is $70k a year, after taxes they should be able to save $23500 a year and have an HSA compatible healthcare plan and max out their HSA?
- solatic 8mo agoI have no idea how you got that from my comment. How much you make, how much you save, how much you spend, and how much you give away are all independent, and neither is it a zero-sum pie (for example, sometimes investments go down in value, and sometimes the line between giving away and spending is blurry). To answer your question directly, $70k income is independent of the cost of living in high cost of living cities (like NYC or SF) vs. low cost of living areas. If you make $70k/year in NYC, no you don't have the spare income to max out 401k/HSA. If you make $70k/year working for Walmart in Bentonville, Arkansas, then yeah, I expect that you ought to be able to max them out.
- raw_anon_1111 8mo agoAnd health insurance as soon as the ACA is gutted and you have a pre existing condition? Sure I could retire to Costa Rica or Panama. One of those are a plan B and we will be in CR for six weeks and we are both learning Spanish - I am. decent at it. I bet you also your idea of upper middle class is not statistically valid. https://dqydj.com/household-income-percentile-calculator/ https://dqydj.com/household-income-percentile-calculator/
- glimshe 8mo agoI didn't get where I am by taking random bets, but I'll say you'd lose your money here.
- raw_anon_1111 8mo agoWere you around and trying to get health insurance before 2012? I was. The startup I worked for shut down and while I had a well paying contract lined up literally the next week, I couldn’t get health insurance at any price because of a pre-existing condition even though at the time, I was a part time fitness instructor and I had just gotten through running my first (and last) two half marathons. If you are betting on the stability of the US health care system outside of employer funded health care, that is a monumentally stupid bet with one party actively trying to kill the ACA.
- Jach 8mo agoSo what did you do? Clearly you didn't die. Did you just have no insurance for the week before the new job started, or what? This also happened to you while you were working and slightly between jobs. So it's not really a FIRE concern if the concern is the US messing up the health care system even more in that it would effect everyone whether working or not. Generally speaking, an answer to mitigating a lot of types of risk with a FIRE model is: you just go back to work for a while. This is easier the younger you are. Edit: Also I thought COBRA would have been a more recent thing but it was Regan era. So did you not have employer-sponsored coverage with the startup?
- carlosjobim 8mo agoThanks for living frugally. Since you now have some spare money, I decided it's time for a rent increase. And a tax increase.
- bjourne 8mo agoStatistics! Can a person below the median income afford to retire early? The answer is a resounding no. Can a person the top 10th percentile (upper middle class) afford to retire early? Yes.
- raw_anon_1111 8mo agohttps://dqydj.com/household-income-percentile-calculator/ https://dqydj.com/household-income-percentile-calculator/ So the top 10% is a household income of $250K and most of those couples didn’t reach that until their 40s. They aren’t making $225K as an L5 at 25 years old like a former intern/new grad I mentored when I was at BigTech Most software developers won’t even see above $160K inflation adjusted during their career. Most work in second tier cities in the “enterprise”z.
- deleted 8mo ago[deleted]
- mathgladiator 8mo agoThis guy did it: https://www.mrmoneymustache.com/ https://www.mrmoneymustache.com/ on like $65K IIRC The problem is, at core, fear. Fear of taking responsibility for your life.
- raw_anon_1111 8mo agoSo exactly how do you “take care” of your insurance if the ACA goes kaput? “Thoughts and Prayers” until you are 65?
- mathgladiator 8mo agoI pay cash for everything right now since ACA plans are terrible... BUT, I am also one of those nut jobs that only eats meat and it is amazing. But, most people can't even begin to imagine giving up carbs as they are junkies.
- mathgladiator 8mo agoI retired on my 40th birthday, and it is AWESOME. The thing is... no one has anything that I want to buy. I don't mean this in an elitist way, but more of a monk way. Like, I don't understand status and keeping up with people.
- snayan 8mo agoThis is the way. Like good meals, but I don't really understand the allure of owning a bunch of things. The ego, when left to it's own devices, is a hell of a drug.
- mathgladiator 8mo agoEgo is truly wild. I had one last bastion of ego that echoes a bit. It was my ability to code the machine. Im that guy that really loves to code. It fills me with joy in ways that I cant describe. It was the only status I really had... until AI. AI has freed me. I am free to fully enjoy life as a nut case. Its fantastic as im living a second childhood right now.
- snayan 8mo agoBeautiful man, love it. Enjoy :) Yeah, I have a pet theory that I give about a 0.01% chance of coming to fruition... Next couple decades, AI, etc is going to force humanity to confront it's sense of self and priorities and wake up. A man can dream lol.
- mathgladiator 8mo agoI think it will come sooner than that especially if AI doubles in capability every 4-5 months.