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Early-Retirement Update

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Re: Early-Retirement Update

#311

Post by smabie »

jsdalton wrote: post #38
xwdv wrote: post #25

Earlier quoted context omitted.

No, financial independence is what matters in a world where returns on capital will greatly outperform returns on labor.

Out of curiosity where are you finding high returns on capital today? I just don’t see them. (As an engineer, conversely, I see very high returns on my labor.)

A simplification, but returns in an efficient market are synthetic: i.e you can target what kind of returns you want wrt volatility.

But speaking a little more concretely, markets have been on a tear: stocks, crypto, bonds, whatever.

Re: Early-Retirement Update

#312

Post by smnrchrds »

blobbers wrote: post #295
sidlls wrote: post #9

I always get a kick out of people who think they’re financially independent with such a small stash. Outside some regions with relatively extreme living conditions (e.g. undeveloped and underdeveloped countries), the amount he retired with was never going to be enough to sustain even minor shocks and last the rest of his life. He had a minor shock (breakup) and a major shock (health condition) and realized this error…

If he had emigrated to Canada, he gets a 30% boost in currency and his medical bills drop to closer to $0. 1.2M is more than most people earn in a lifetime, so seems he should be set up for leanFIRE. That said, the article seemed pretty hilarious. I think this guy might be a little bit unobservant. The cracks form early but he insists that he's blissfully happy. It seems like he didn't really know his partner that we…

You cannot immigrate to Canada if you have a medical condition that is deemed expensive. Also, even without health issues, immigrating to Canada is far from trivial and not something many can do.

Re: Early-Retirement Update

#313

Post by tick_tock_tick »

TuringNYC wrote: post #279
tick_tock_tick wrote: post #223

Earlier quoted context omitted.

A covered call by definition means you own 100 shares for every contract you sell. Even if you own some of that stock on margin you are not increasing your risk by selling the calls.

The parent was referring to OTM call selling, not covered calls only. Covered calls are pretty low-risk. Selling OTM calls includes selling puts, which is not low-risk unless you're unlevered (everything covered by cash.)

The top parent suggested

> sell OTM options against his stocks

I don't see where you get the impression they were ever talking about selling uncovered calls. Selling out of the money calls has nothing to do with selling puts. As yes selling cash secured puts even with some leverage is considered very safe. Here is a fund that does just that.

https://www.nb.com/en/us/products/mutual-funds/us-equity-ind...

Re: Early-Retirement Update

#314

Post by kyteland »

eloff wrote: post #297
alexashka wrote: post #197

Earlier quoted context omitted.

I get it. It's all explained by one simple fact: the average IQ is 100. In today's society, how many activities are there for 100 IQ people to engage in? Are there animals to take care of? Is there land? Is there community to partake in? Are there things that need to be done by 100 IQ people? When you build society optimizing for young people to work 8 hour days or giant factories and supply chains doing everything e…

Apart from the fact that average IW has been rising dramatically, I guess your not a Forest Gump fan. I think 100 IQ people are more capable than you realize - but it comes down to their attitude.

Nitpick: Average IQ cannot increase by definition. The median IQ value is defined to be 100 IQ points and one standard deviation in either direction is defined to be 15 IQ points. It's normally distributed so median==average as well. People overall can become more intelligent and the average IQ value will still be 100.

Re: Early-Retirement Update

#315

Post by madaxe_again »

CryingSofa wrote: post #260
tartoran wrote: post #241

Earlier quoted context omitted.

I don't see FIRE as literal retirement but as 'taking the bull by the horns' in terms of doing what you really are passionate about without having to worry you'd end up old and destitute. If I could FIRE I'd still do software development but I wouldn't do boring digital plumbing work and go through corporate cringe culture. And no, right now I could not do that because I have responsibilities that need me to slave aw…

This is mostly nitpicking: What you describe is the idea of FI (financial independence), no RE (retire early). In my impression, this is actually what by far the most FIRE-achievers turn into sooner or later (well-known examples: chooseFI, mad fientist, MMM). Or maybe the retired ones don't talk about it on the internet...

They generally have better things to do than blog about financial strategies, yes.

I’m 37, nearly five years out of the game, and I’m busy, every single day. My time is fully absorbed in building up a homestead, and my list of projects is many, many years long yet, and as diverse as shredded encyclopaedia.

I can’t see myself running out of things to do before I myself run out. I occasionally tell people snippets of what I’m up to here or on Twitter, and people ask if I have a YouTube or a blog. I don’t have time. Or inclination, to be honest. I do this for me.

Re: Early-Retirement Update

#316

Post by flowerlad »

Health insurance is the reason I am still working. Sure, you can buy insurance in the individual market, but it is not comparable. Take a look at the provider network.

Even if you buy the best insurance available in the individual market the provider network is likely to local whereas employer-provided insurance will have a nationwide network. If you get a rare disease for which the best experts are in another state you'll regret buying insurance off of the individual market.

Re: Early-Retirement Update

#317

Post by _carbyau_ »

GordonS wrote: post #137
eagsalazar2 wrote: post #120

Earlier quoted context omitted.

Not just FIRE people, but 99% of all retirees at any age end up doing nothing of note with their time. But, and I think you aren't saying otherwise, this is also true of everyone who still has to work, while they are working. Your job is just the thing you have to do (if you are lucky you actually enjoy it). Bottom line, most people don't actually have a purpose or strong passions in their lives. Being retired young…

> Not just FIRE people, but 99% of all retirees at any age end up doing nothing of note with their time. If you spend some years just chilling and and are actually happy, then sure, why not. But there are so many retired people who do nothing, and are not happy. For example, my mother, my mother and father in law, my other father in law, my grandmother - all retired, and all do absolutely nothing but watch TV and moa…

I think it is depression. And once you are depressed, it is hard to find activation energy.

Plenty of depressed people will tell you about friends being frustrated at them "not snapping out of it".

Re: Early-Retirement Update

#318

Post by tasuki »

silicon2401 wrote: post #204
dimmke wrote: post #102

Earlier quoted context omitted.

I've had friends with trust funds, who just seem to dither around in life. "Making music" they never release. Picking up little "pass the time" jobs. And these are people that aren't living "leanFIRE" It seems like such a nihilistic way to live. You're just floating along the stream of life. Things worked out for you, but you have no further passion or inclination to improve the world? No problems you could set yours…

> "Making music" they never release. Picking up little "pass the time" jobs. And these are people that aren't living "leanFIRE" > It seems like such a nihilistic way to live. You're just floating along the stream of life. Things worked out for you, but you have no further passion or inclination to improve the world? No problems you could set yourself to solving? You seem to assume or take for granted that releasing m…

So, castle or farm? You can't just handwave this question away so easily! Would you hire people to take care of the castle or farm for you? I hear both are quite a lot of work! How exactly would you be spending your time, apart from making music?

Re: Early-Retirement Update

#319

Post by 6gvONxR4sf7o »

PragmaticPulp wrote: post #68

I had to quit reading any FIRE (financial independence, early retirement) blogs because they were full of people headed down this same path: Extreme frugality, bare minimum savings, assuming their lifestyle would never change and nothing would ever go wrong. Retiring at 30 sounds great, but no one's life goes exactly to plan for next the 30-40 years until traditional retirement age. People change, expectations evolve…

Lean-FIRE reminds me of the startup world's "ramen profitable."

Re: Early-Retirement Update

#320

Post by neogodless »

TheCoelacanth wrote: post #305
neogodless wrote: post #274

Earlier quoted context omitted.

This isn't really accurate, though. In most cases there is a large margin of error built into the 4% "safe withdrawal rate" - and that is that the investments "on average" do much better than 4% (easily 5-7% after inflation, in many cases much higher) and that you end up with much more than what you need to withdraw 4%. The notable exception is called a "sequence of returns risk" (SORR) where either something bad hap…

> In most cases there is a large margin of error built into the 4% "safe withdrawal rate" I don't think that's the case if you're retiring early. The 4% withdrawal rate was based on a 30 year retirement. You need to go a bit lower if you want to have minimal risk of running out of money for a much longer horizon.

https://engaging-data.com/will-money-last-retire-early/

You're more likely to die than run out of money!

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