How I got wealthy without working too hard • Hacker News Board

Re: How I got wealthy without working too hard

#141

Post by azemetre » Thu, Nov 18, 2021, 5:20 PM UTC

antisthenes wrote: post #122

marktangotango wrote: post #110

Earlier quoted context omitted.

I once shared this outlook, but when one considers their own ideas about the lifestyle "wealthy" entails, and run some numbers, specifically determine the annual spend for that lifestyle, one will quickly realize the truth. A million can be blown in a year, or SWR'd (safe withdrawal rate) at $40k a year indefinitely. Can you retire on $40k a year? Would you want that level of income and lifestyle? Of course this depe…

> I once shared this outlook, but when one considers their own ideas about the lifestyle "wealthy" entails, and run some numbers, specifically determine the annual spend for that lifestyle, one will quickly realize the truth. In other words, at some point you underwent lifestyle inflation and didn't realize it. And now you're unwilling to give it up. > Of course this depends on location and cost of living. I am refer…

Just adding to your point:

Not only do millions of people raise families on $40k, they also do so while still living in NYC, SF, Seattle, and other expensive cities.

Re: How I got wealthy without working too hard

#142

Post by hackingforfun » Thu, Nov 18, 2021, 5:21 PM UTC

UncleMeat wrote: post #96

echelon wrote: post #19

Earlier quoted context omitted.

If it was stocks, you would diversify more by sector according to your risk, but in general ~10% in a broad asset class seems fine. I don't think we would question 10% of net worth in real estate.

But crypto doesn't function like a broad asset class, at least not for very long. Is there are future where there are 10,000 different cryptocurrencies? I don't see it. I think even crypto bulls believe that most coins will go to zero at some point. You don't get the same benefits of diversification in crypto as you do with equities.

I don't think most coins will go to zero at some point, some will, but most is too broad.

I also don't see any reason why new coins wouldn't keep getting created. Basically, what's been happening will continue. This is what I see.

You can diversify in crypto, but you have to educate yourself and pick and choose. For example, you could diversify into payment systems, metaverse tokens, smart contract platforms, oracles, prediction markets, cross-chain interoperability, DeFi, NFTs, etc. There aren't as well defined categories as in equities, but there are some ways to categorize them.

Are there equivalent protections like in equities? No. Is crypto as mature of a market? No. Is crypto high risk? Yes. However, cryptocurriences, or at least specific ones, like Bitcoin, are increasingly being considered an asset class [1].

[1] https://www.nasdaq.com/articles/jp-morgan-wealth-ceo-says-cl...

Re: How I got wealthy without working too hard

#143

Post by ghaff » Thu, Nov 18, 2021, 5:21 PM UTC

PragmaticPulp wrote: post #129

stagger87 wrote: post #70

Earlier quoted context omitted.

> So there’s a lot missing from this blog post. I suspect maybe the author got lucky with some outlier investments, but that’s not something that can be conveyed in a “how to” blog post. Why do you think that? All the numbers work out. Even in your hypothetical scenario, investing 100k for 7 years, especially in the last 7 years, would easily bring you 1M total investments. > FIRE type wealth trajectories are possibl…

> Why do you think that? All the numbers work out. Even in your hypothetical scenario, investing 100k for 7 years, especially in the last 7 years, would easily bring you 1M total investments. My point was that to show that the only way to get this to work out was to make everything work out perfectly, from getting the authors highest quoted day rate of $1000/day on every single day of every single contract from the s…

Furthermore, I don't see any allowance for the time needed to get those contracts, take care of business stuff, etc. To say nothing of downtime when a perfectly-timed new contract just doesn't come along. Maybe it's possible in the current climate but it's not the norm.

Re: How I got wealthy without working too hard

#144

Post by PragmaticPulp » Thu, Nov 18, 2021, 5:21 PM UTC

FpUser wrote: post #104

marktangotango wrote: post #78

Earlier quoted context omitted.

> would easily bring you 1M total investments. I think this is the disconnect with GP, $1M isn't what anyone can really call "wealthy" nowadays. Yes, it's a lot of money, but does not allow one to live what most people consider to be a rich lifestyle.

You could get up to 10% on 1M investment annually (that is what my friend has). Sure he does not have private yacht but one can live quite comfy on 100K without lifting a finger and that is what he does.

> You could get up to 10% on 1M investment annually (that is what my friend has)

We have a hundred years of investment data in the United States that says this isn’t true.

A 10% withdrawal rate will lead to portfolio failure 50% of the time after about 14 years. You can calculate using historical data here: https://engaging-data.com/will-money-last-retire-early/

There are mountains of research showing the safe withdrawal rate for retirement is around 3.5-4%. A million dollars gets you $40K per year at most, not $100K per year.

Anyone expecting to live off of $100K/year with only $1m invested is in trouble in about a decade, even if they could get a mythical reliable 10% return.

Note that due to inflation and downturns, you cannot withdraw an amount equal to the interest you earn. You have to withdraw significantly less than the interest you accumulate.

Re: How I got wealthy without working too hard

#145

Post by ukoki » Thu, Nov 18, 2021, 5:21 PM UTC

To add another data point: I'm a contractor in the London charging day rates from 300 GBP (in the beginning) to 1100 GBP (today) over the past eight years. Net worth has just crept into the seven-figure GBP range with profits being mostly invested in global equities ETFs.

Re: How I got wealthy without working too hard

#146

Post by rootusrootus » Thu, Nov 18, 2021, 5:23 PM UTC

wavefunction wrote: post #67

shiftpgdn wrote: post #29

Earlier quoted context omitted.

The biggest reality check in my life was working at an engineering firm with a bunch of near retirement baby boomers with no children. They all came across ass listless, unhappy, and living a life with no greater purpose. It was unquestionably one of the ugliest things I have ever seen. As you get older and friends drift and pass away family is one of the most important things in life. I know anti-natalism is hip rig…

Life has whatever purpose you give to it. That's it.

Yes, but is fundamentally true that humans don't really have any other reason for existence than to make more humans. So it makes sense that it's the easy button for manufacturing purpose.

Re: How I got wealthy without working too hard

#147

Post by papito » Thu, Nov 18, 2021, 5:24 PM UTC

wonderwonder wrote: post #135

spaetzleesser wrote: post #81

Earlier quoted context omitted.

An 8% return is far from guaranteed over a 7 year interval. There are plenty of inertvals where you would be in the negative. A lot of people are forgetting that we have been riding a gigantic stock market bubble over the last 12 years. This won’t last.

Sure, but its done on average 9% the last 10 years and if you just invested in an S&p 500 etf you would have made a little over 13%. There are definitely down times but even if you started investing in January 2007 to ensure you caught the worst of the 2008 recession and just kept investing monthly for 7 years, your returns would be on average 12%. Of course all things end but historically and including now it works.…

The alternative is winning the birth lottery and sitting on so much real estate that the market doesn't really matter - it's just another source of more risky income.

Re: How I got wealthy without working too hard

#148

Post by stickfigure » Thu, Nov 18, 2021, 5:24 PM UTC

PragmaticPulp wrote: post #106

softfalcon wrote: post #93

Earlier quoted context omitted.

I mean, even the author agrees with you. They start their story with this: > Preamble: I'm extremely lucky. If we live in a Simulation and life is just a Video Game, mine was started on difficulty level “Very Easy”: I was born in a developed country in the 80s (Italy), with access to fresh water, very good carbohydrates and a decent education system. So what you're going to read is 99% luck and 1% planets alignment.…

That’s quite a cop-out for a blog post that contains a lot of specific, actionable steps.

Most people reading this paragraph start with the same luck coefficient.

(Not all, so no need to add your personal story here. But most.)

Re: How I got wealthy without working too hard

#149

Post by amelius » Thu, Nov 18, 2021, 5:24 PM UTC

go_elmo wrote: post #30

jjulius wrote: post #8

>Preamble: I'm extremely lucky. ... So what you're going to read is 99% luck and 1% planets alignment. I mean, that's pretty much it and he states it up front. If that's the crux, then why write about this other than to brag?

Thats just being humble. Most successful people think its that way because they are special and worked hard. Wrong. Most people work hard, its the LUCK many underestimate. Being aware of this is healthy in so many ways, especially socially.

Veritasium has a nice video about that:

"Is Success Luck or Hard Work?"

https://www.youtube.com/watch?v=3LopI4YeC4I

Re: How I got wealthy without working too hard

#150

Post by missedthecue » Thu, Nov 18, 2021, 5:24 PM UTC

csdvrx wrote: post #124

b20000 wrote: post #54

Earlier quoted context omitted.

i have the impression the max contracting rate is 175/hr. when you ask for more, “HR says they never seen such high rates”… that doesn’t leave you with much in california. and i think that once you move to a cheaper place you cannot demand that rate. so how can you increase your rate as a software engineering contractor?

> “HR says they never seen such high rates” The company isn't desperate enough! When SHTF, other concerns take precedence. Like if they have a deadline they can't hold, or a problem that has been messed up before. > so how can you increase your rate as a software engineering contractor? Increase steadily every year, to select companies that value your rare skillset. If you are asked at inconvenient times, practice su…

You can get higher rates, but not for extended periods of time, or as a reliable income. Only for a short time as you advise/solve an emergency issue. The highest hourly rate I've ever seen was in London for a very specific banking tax issue that only existed briefly. It was the equivalent of $7500 an hour.