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How I got wealthy without working too hard

amaca.substack.com

311–320 of 349 posts

Re: How I got wealthy without working too hard

#311

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Halifax is still livable/affordable as a remote dev-- far more affordable than places like NYC or SF. On remote engineer salary the increases in cost of living aren't so much the killer as the insane income tax is.

halifax is still livable if you get money from someplace that isn't halifax, but what does that say to the future of halifax? Who will provide all the services when they can't afford to live there on halifax incomes? What's the healthcare availability in NS compared to other provinces - Halifax healthcare was in crisis even before COVID. Just in October they announced that the child healthcare system was at capacity…

Welcome to the Bay Area, where the only people who can buy houses are those that can funnel the retirement funds of the world into their pockets.

The answer for us is that all the local service providers live far outside the core urban areas and have terrible commutes. Or they double or triple-up, multiple families per unit. As the area becomes increasingly unlivable for people that do the local gruntwork, a number of them leave the metro area. Those that stay have less competition, and so they start charging higher wages. Eventually the local economy equalizes at a much higher price point; local service workers find they make a livable wage again; globalized tech workers find that most of their income is eaten up by daycare, housecleaning, gardening, and restaurant meals out (to say nothing of housing); and the whole region settles into an uneasy truce, yet enjoys great geographic arbitrage opportunities over other regions. We can go make Halifax unaffordable and live like a king there, for example.

Re: How I got wealthy without working too hard

#312
post #291

Earlier quoted context omitted.

>It’s one of those tax tricks that works as long as nobody ever looks to closely at your tax returns, but if you’re caught you have to pay it back plus penalties. How is that a tax trick ? Pretty much anyone owning a company pays himself a tax minimum and extracts the rest through profits, etc.

You're required to pay a "reasonable salary". So if you pay yourself minimum wage, but collect $100+k in profit, you may get funny looks from the IRS. Rule of thumb I've heard is 50% wages 50% profit, up until $100k wages, beyond which you can really start milking the profit.

Yeah here we have a minimum director salary (which is basically median wage instead of minimum), after that everything is pulled out through profit.

Re: How I got wealthy without working too hard

#313

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> 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…

> Millions of people raise families on 40k/year in the United States. These are your fellow citizens. Perhaps you can ask them how they do it and whether they are "satisfied" with that level of income and lifestyle. I have. They are not satisfied. $40k Taxes - $5000/year. Monthly budget: $35k/12 = ~$2900/month Rent - $1200 Utilities (incl. tv + internet + phone + gas + elec) - $300 Car payment - $300 Car insurance -…

$40K was the starting salary for new college grads, just out of school... 25 years ago. To think anyone with real expenses, like raising a family, would be "satisfied" with this is simply not believable.

Re: How I got wealthy without working too hard

#314
post #104

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> 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.

Let me guess: your friend has only been investing for the past 10 to 12 years. The past 10 years were very good times. Yes, there were a couple rough patches (March 2020, anyone?), and years where things went nowhere (2014-2016?) but if you stayed the course, you were more than fine. If you literally did nothing except put your money in an S&P fund, reinvested all dividends, and waited, you'd be up 15% annually. It won't be like this forever...

Re: How I got wealthy without working too hard

#315
post #305

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> 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 withdr…

>"We have a hundred years of investment data in the United States that says this isn’t true." An average over extended period of time. Maybe my fried is lucky and it's only been 3-4 years of such return for him

The last 4 years have been outliers, and lucky for everyone (except those folks who sold at the bottom and moved to bonds in 2020.)

Re: How I got wealthy without working too hard

#316

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.

It's an obligatory warning, otherwise people (even here on HN) will decry your methods as mainly due to privilege, and irreproducible for the average perso.

Re: How I got wealthy without working too hard

#317
post #187

Earlier quoted context omitted.

> 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…

What are those expensive hobbies and luxuries? My hobbies cost about zero (making music, doing the occasional woodworking, reading, walking). Travel can be expensive but it can also be quite cheap and is very dispensable. Luxuries outside of travel (expensive hotels), I don't even know what they are. I'm sure it's not hard to spend as much money as you want on many different things; but you make it sound as if it was…

Having kids, while not a hobby, can certainly be expensive, and is probably the most obvious missing consideration here. It also makes a lot of other things less flexible, which tends to cost more money. (Want to go to a movie at night? Now there's a babysitter involved).

Kids aside, lots of things cost money. You like eating at nice restaurants? Money. Prefer to home cook nice meals? Great, equipment costs, therefore money. (And maybe ingredients).

Want to work out? Gym subscription or trainer = money. Buying your own home equipment = money. Want some form of cardio? Biking = buying a bike. Etc.

Nice clothes cost money. A nice TV costs money. Nice tech gear costs money. Etc.

And of course, travel costs a lot of money, depending on where you live.

There are obviously lots of other examples and hobbies. None of these are necessary. You can choose to be frugal with all of them, absolutely.

But - that's parent's point. Most people earning a relatively nice salary will naturally spend more money on nice stuff. That's partly because of natural tendencies to "use up" what we have, partly because of trying to be like other people, etc. But it's also partly because spending more money gives you nicer stuff / experiences, and people like them. And if you have the money, why not? There are reasons, but parent is right - you have to consciously choose to be different than normal and not spend money the way other people do when they can.

Re: How I got wealthy without working too hard

#318

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.

Not really. Good advice is often specific and actionable. People have to adapt it to their circumstances. OP included a warning to make it clear that this isn't a guarantee and to give specific circumstances in which his advice is sound.

What's the alternative? How else could you write an article that conveys the steps you took to achieve a goal, if not to write the steps you took?

Re: How I got wealthy without working too hard

#319
post #187

Earlier quoted context omitted.

What are those expensive hobbies and luxuries? My hobbies cost about zero (making music, doing the occasional woodworking, reading, walking). Travel can be expensive but it can also be quite cheap and is very dispensable. Luxuries outside of travel (expensive hotels), I don't even know what they are. I'm sure it's not hard to spend as much money as you want on many different things; but you make it sound as if it was…

WOODWORKING costs $0?!?!?! What??? How much have you spent on tools? Do you smoke a pipe and whittle on the front porch or something? You don't visit Rockler and buy tons of gear? Where do you get your wood, as that's not free either...

I bought tools 15 years ago and I don't use them that often, so they don't wear much, and never break. So now it's mostly free. Wood is quite cheap depending on what you do (and I'm not Nick Offerman).

Most projects cost less than €100-200 in materials and take 3 months, so that's around €50 per month on average. Not "free", technically, but not far from free.

Re: How I got wealthy without working too hard

#320
post #303
post #187

Earlier quoted context omitted.

What are those expensive hobbies and luxuries? My hobbies cost about zero (making music, doing the occasional woodworking, reading, walking). Travel can be expensive but it can also be quite cheap and is very dispensable. Luxuries outside of travel (expensive hotels), I don't even know what they are. I'm sure it's not hard to spend as much money as you want on many different things; but you make it sound as if it was…

Photography can be somewhat expensive.

I do a lot of photography. Photography can be extremely cheap. Current gear is of incredibly high quality; a camera can stay relevant for over 10 years and lenses, forever. If you buy a camera for about $1000 every 5 years that's $200/year, less than $20/month. And you can certainly buy cameras less often than that.

Then storage, software costs, while not exactly zero, are negligible.

Printing can be expensive if done well. But I've found, nobody cares about prints (except maybe the photographer).

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