6 ms·

One of the projects I want to do is to map living expenses, inflation and life expectancy to know exactly how much money is "enough". My problem is that we forg

One of the projects I want to do is to map living expenses, inflation and life expectancy to know exactly how much money is "enough". My problem is that we forget that we tomorrow should be more valuable to us than today and by the time we get this realization, we might have lost many years (of adulthood).

monsterix 13y ago
> One of the projects I want to do is to map living expenses, inflation and life expectancy to know exactly how much money is "enough". There you go: http://www.nileshtrivedi.com/2012/07/10/how-much-is-enough.html http://www.nileshtrivedi.com/2012/07/10/how-much-is-enough.h...
- gchokov 13y ago
  Or, just create a blank web page with black font saying "it's never going to be enough, give this thought up". Reminds me of another saying that software development time is never enough, except when you have hard borders and deadlines with the right priorities and vision - it will take exactly that time. Getting more money loosens the borders - you buy better houses, better cars, have bigger family, make bigger investments..and you need more to support that.
  - sokoloff 13y ago
    That's true to a point for everyone: that having more money from a low starting point primarily increases lifestyle. But as you add more and more money, I think that most people reach a turning point where "enough really is enough" and their worries about money truly diminish, but that lifestyle stops increasing. As I've grown in my own career, for sure my lifestyle increased. I literally subsisted on Ramen and $2 frozen pizzas in my first startup. Then as I achieved more income, I added a convertible, then a 401-k, then a new SUV (worst decision to that point), then a first house, then maxing out 401-k, then an airplane, then a classic Mustang, then a city apartment because my house was too far away and I got tired of the constant commute, then moved to a house in the city, then had 2 wonderful kids, then added 529s (college savings plans), then a bigger airplane, then... All of those things, except the 401k and 529s, also came with additional expenses in time and money. (Technically, those 2 did as well, but in an immaterial way compared to orchestrating the maintenance on a house, classic car or airplane.) However, I can also see that increases in income from here won't go towards (current) lifestyle inflation, as we have "enough" now. That could be because I'm older and wiser now, rather than a natural knee in the lifestyle vs income curve, but I'm inclined to think it's a natural knee. For very few people does that knee hit before $100K/yr in a major US city. I'd guess that for a great many people, it doesn't hit until after $250K/yr, which is why people for shorthand say that it doesn't exist. If you'd like to challenge yourself to bring that knee closer to the left side of the graph for yourself, I recommend Mr Money Moustache, Len Penzo and JLCollinsNH as bloggers who write extensively (and well) about this topic. Quick Googling will find them all. I believe that getting to the right side of that knee, where you can stop worrying about money, is worth so much more mentally and emotionally than any amount of lifestyle inflation (beyond the basics of food and shelter). So, whether you can manage to increase your income to pass to the right of the knee, or move the knee to the left of your income, either way you'll be happier than a new car, new house, splendid vacations or 100 great dinners out.
    - cm2012 13y ago
      The two major studies I've seen on this topic have both said that the magic number is actually 60-75000 a year. After that happiness plateaus. I would source you but I'm on mobile.
    - dasil003 13y ago
      I actively worry about this and I'm skeptical of your thesis that people will naturally reach a point of "enough really is enough". Even in your own story you are saying that you have enough now, but up until this point your expenses have grown to meet your income. The same is true for me, and I worry that it will always be so. I tend to believe that the majority of people will continue to grow with their income to very high numbers. I don't see the majority of people making $1M/year living a comfortable $250k/year lifestyle and investing/donating the rest. Some yes, but certainly nowhere near 50%.
    - sliverstorm 13y ago
      Airplanes must be cheaper than I thought, if a classic car and a city apartment comes after an airplane.
      - sokoloff 13y ago
        Well, I was in my 20s working for a hedge fund, and caught the aviation bug BAD, so don't read much into that prioritization other than, "I had money burning a hole in my pocket and all the sense of a 20-something..." :) You can buy a functional single-engine airplane for $30-50K. $50K even gets you into something that I'd consider pretty nice for an entry level airplane. They go way, way up from there, of course...
vanderZwan 13y ago
Based on the following research, I guess $75K? http://www.npr.org/blogs/money/2010/09/07/129703291/new-study-high-incomes-don-t-bring-you-happiness http://www.npr.org/blogs/money/2010/09/07/129703291/new-stud...
- Casseres 13y ago
  That's per year and doesn't keep up with inflation. To have financial independence, you need enough money so that $75k or whatever annual number you want is derived from the earnings of whatever your your sizable chunk of money is invested in.
  - sliverstorm 13y ago
    What does financial independence have to do with that number? The article is about "happiness" and "enough". Fuck-you money is not required for either of those things.
    - Casseres 13y ago
      The theme of this discussion is about freedom. That includes not having to rely on an external source of spending money, yearly income, "fuck-you" money, or whatever you want to call it. This is also known as financial independence. The $75k per year has to come from somewhere. If it's not interest from an investment or some other automatic payout, then you are not free because you have to work at making sure you always get that $75k a year to be happy. In paraschopra's comment about calculating how much is enough, he mentioned life expectancy. That tells me is isn't just considering an annual amount of money to be happy, but a greater amount from which the annual money comes from.
      - sliverstorm 13y ago
        Ah, you are right, I missed the part about life expectancy. Of course, the $75k number is based on working individuals- I expect the number will be completely different for non-working individuals. People who are not working both do not enjoy the same life-satisfaction that can be had from rewarding employment, and do not suffer the stresses of that employment, so who knows where the balance of happiness lies. Perhaps if we are talking about someone who is not working for their money, there is no such thing as "enough", as they have no happiness "cost" to simply having more money (as they do not need to work for it)?
jacques_chester 13y ago
Find an actuary. This is what they do for a living.

monsterix 13y ago

> One of the projects I want to do is to map living expenses, inflation and life expectancy to know exactly how much money is "enough". There you go: http://www.nileshtrivedi.com/2012/07/10/how-much-is-enough.html http://www.nileshtrivedi.com/2012/07/10/how-much-is-enough.h...

gchokov 13y ago
Or, just create a blank web page with black font saying "it's never going to be enough, give this thought up". Reminds me of another saying that software development time is never enough, except when you have hard borders and deadlines with the right priorities and vision - it will take exactly that time. Getting more money loosens the borders - you buy better houses, better cars, have bigger family, make bigger investments..and you need more to support that.
- sokoloff 13y ago
  That's true to a point for everyone: that having more money from a low starting point primarily increases lifestyle. But as you add more and more money, I think that most people reach a turning point where "enough really is enough" and their worries about money truly diminish, but that lifestyle stops increasing. As I've grown in my own career, for sure my lifestyle increased. I literally subsisted on Ramen and $2 frozen pizzas in my first startup. Then as I achieved more income, I added a convertible, then a 401-k, then a new SUV (worst decision to that point), then a first house, then maxing out 401-k, then an airplane, then a classic Mustang, then a city apartment because my house was too far away and I got tired of the constant commute, then moved to a house in the city, then had 2 wonderful kids, then added 529s (college savings plans), then a bigger airplane, then... All of those things, except the 401k and 529s, also came with additional expenses in time and money. (Technically, those 2 did as well, but in an immaterial way compared to orchestrating the maintenance on a house, classic car or airplane.) However, I can also see that increases in income from here won't go towards (current) lifestyle inflation, as we have "enough" now. That could be because I'm older and wiser now, rather than a natural knee in the lifestyle vs income curve, but I'm inclined to think it's a natural knee. For very few people does that knee hit before $100K/yr in a major US city. I'd guess that for a great many people, it doesn't hit until after $250K/yr, which is why people for shorthand say that it doesn't exist. If you'd like to challenge yourself to bring that knee closer to the left side of the graph for yourself, I recommend Mr Money Moustache, Len Penzo and JLCollinsNH as bloggers who write extensively (and well) about this topic. Quick Googling will find them all. I believe that getting to the right side of that knee, where you can stop worrying about money, is worth so much more mentally and emotionally than any amount of lifestyle inflation (beyond the basics of food and shelter). So, whether you can manage to increase your income to pass to the right of the knee, or move the knee to the left of your income, either way you'll be happier than a new car, new house, splendid vacations or 100 great dinners out.
  - cm2012 13y ago
    The two major studies I've seen on this topic have both said that the magic number is actually 60-75000 a year. After that happiness plateaus. I would source you but I'm on mobile.
  - dasil003 13y ago
    I actively worry about this and I'm skeptical of your thesis that people will naturally reach a point of "enough really is enough". Even in your own story you are saying that you have enough now, but up until this point your expenses have grown to meet your income. The same is true for me, and I worry that it will always be so. I tend to believe that the majority of people will continue to grow with their income to very high numbers. I don't see the majority of people making $1M/year living a comfortable $250k/year lifestyle and investing/donating the rest. Some yes, but certainly nowhere near 50%.
  - sliverstorm 13y ago
    Airplanes must be cheaper than I thought, if a classic car and a city apartment comes after an airplane.
    - sokoloff 13y ago
      Well, I was in my 20s working for a hedge fund, and caught the aviation bug BAD, so don't read much into that prioritization other than, "I had money burning a hole in my pocket and all the sense of a 20-something..." :) You can buy a functional single-engine airplane for $30-50K. $50K even gets you into something that I'd consider pretty nice for an entry level airplane. They go way, way up from there, of course...

vanderZwan 13y ago

Based on the following research, I guess $75K? http://www.npr.org/blogs/money/2010/09/07/129703291/new-study-high-incomes-don-t-bring-you-happiness http://www.npr.org/blogs/money/2010/09/07/129703291/new-stud...

Casseres 13y ago
That's per year and doesn't keep up with inflation. To have financial independence, you need enough money so that $75k or whatever annual number you want is derived from the earnings of whatever your your sizable chunk of money is invested in.
- sliverstorm 13y ago
  What does financial independence have to do with that number? The article is about "happiness" and "enough". Fuck-you money is not required for either of those things.
  - Casseres 13y ago
    The theme of this discussion is about freedom. That includes not having to rely on an external source of spending money, yearly income, "fuck-you" money, or whatever you want to call it. This is also known as financial independence. The $75k per year has to come from somewhere. If it's not interest from an investment or some other automatic payout, then you are not free because you have to work at making sure you always get that $75k a year to be happy. In paraschopra's comment about calculating how much is enough, he mentioned life expectancy. That tells me is isn't just considering an annual amount of money to be happy, but a greater amount from which the annual money comes from.
    - sliverstorm 13y ago
      Ah, you are right, I missed the part about life expectancy. Of course, the $75k number is based on working individuals- I expect the number will be completely different for non-working individuals. People who are not working both do not enjoy the same life-satisfaction that can be had from rewarding employment, and do not suffer the stresses of that employment, so who knows where the balance of happiness lies. Perhaps if we are talking about someone who is not working for their money, there is no such thing as "enough", as they have no happiness "cost" to simply having more money (as they do not need to work for it)?

jacques_chester 13y ago

Find an actuary. This is what they do for a living.