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How to get rich without getting lucky

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Re: How to get rich without getting lucky

#461

Post by Jack000 »

tyrust wrote: post #445
Jack000 wrote: post #428

Earlier quoted context omitted.

I don't think that's the right way to look at the graph. It says that out of 100k 15-24 yr olds 74 died, and also out of 100k 85-1xx yr olds 13k died. This is purely a measure of death rates and doesn't take the age distribution into account. to get the probability of dying before 50 you have to look at the total number of deaths/pear, distributed by age: https://www.statcan.gc.ca/pub/91-209-x/2013001/article/11867..…

>It says that out of 100k 15-24 yr olds 74 died, and also out of 100k 85-1xx yr olds 13k died. Yes, which is why I took the sum of those numbers for ages 25 to 50. >the area under the curve for 0->50 looks about 1/10 of the overall, so I'd say the op is about right You're describing the conditional probability that, given you have died, you are under the age of 50.

what you're doing is (129+192+405)/100000 = 0.7%

this means that out of 100k 25-50 yr olds 726 died during 2016. This is the probability that you will die during this year, given that you are a 25-50 year old, which is different from the probability that you will die before the age of 50. (the prior number ignores the cumulative probability that you have died as a Given that all of us will die, the only question is the age at which we die. The conditional probability that, given you have died, you are under the age of 50 is exactly what we should be looking at.

Re: How to get rich without getting lucky

#462

Post by skookumchuck »

marketgod wrote: post #455
20years wrote: post #411

Earlier quoted context omitted.

This is a perfect example. I have had the same car for 6 years which I bought used and am hoping to squeeze another 5 out of it. Cars are one of those things I hate spending money on.

Don't forget to calculate the increasing maintenance cost, gas cost, and risk of using an older car.

If you buy an American car, the maintenance isn't so bad. The taxes are low on older cars, as well as insurance.

The risk is real, there's been excellent progress in crashworthiness.

Re: How to get rich without getting lucky

#463

Post by dpark »

notabee wrote: post #423
dpark wrote: post #274

Earlier quoted context omitted.

Long term investment isn’t speculation. That’s why we call it investment . Yeah, if you are dumping money into a bubble hoping to cash out at the top, you are taking a major risk. If you’re investing long term in an asset with literally centuries of history of growth, then you’re probably going to be okay. And realistically, what’s the alternative? I guess government bonds?

Long term investment is speculation if it's predicated on an economic system that requires infinitely increasing growth on a completely finite planet with diminishing resources and no clear guarantee that we can fix any overshoot by going interplanetary in a cost-efficient way, or that technology will always magically step in to create enough new efficiencies to further exploit the resources that are present.

I’m not sure how to formulate a response to this. It’s so utterly misplaced. This is like saying that investment isn’t possible because eventually entropy will consume the universe. Yes, in some sense this is true, but in a much more practical sense you should still be planning for your retirement.

Even if you believe that in your lifetime the human race will collapse under the strain we’re creating on the planet, investing is still the appropriate hedge for your doomsday “die in a catastrophe” plans. You can refuse to call it “investing”, but then you’re just arguing for a pointless definition that no one else really agrees with.

Re: How to get rich without getting lucky

#464

Post by muzz »

arielweisberg wrote: post #444
muzz wrote: post #282

Earlier quoted context omitted.

This is a very important point because taxes affect decisions around money. For example, the ability to contribute to a 401k plan can defer $18,500 a year from taxes per person (more if over age 50, and more if there is a company match). For someone with a $130k gross, the employer having a 401k plan or not could affect the choice of which job they choose.

Only per person if you are are dual or multiple income. For some asinine reason 401k limits are not only very low, but don't take into account how many people are going to depend on that 401k.

I should have said "per employee" not "per person" which could be misconstrued as "per household member".

As the other commenter pointed out, why do you think 401k limits are low?

Re: How to get rich without getting lucky

#465

Post by muzz »

0xfeba wrote: post #433
muzz wrote: post #419

Earlier quoted context omitted.

5 years is when maintenance and repairs start happening more regularly. Because these are labor intensive, if one lives in an area where labor is expensive, or if the opportunity cost of one's own labor/time is expensive, does this still make sense? Also, there are some really modern features like rear-view cameras, sonar, etc., which are pretty cheap in newer cars but almost impossible to find in older ones

5 years? Not really. Pretty much any Japanese car made in the last 20 years, and domestic in the last 8 should last 10 years; 100/150k before anything major is needed. But, to run the numbers, get a the total cost of ownership (car payment, interest, and non-warranty or whatever maintenance) for a new/virtually new car, divide it over a span of the expected months of ownership (say, 60, 120, 180 months). Do the same…

If it were true that nothing major was needed until 100k or 150k then car warranties would be of that length.

There are reasons why cars depreciate, amongst which are the fact that they need more money put into them over time.

Re: How to get rich without getting lucky

#466

Post by fnbr »

ConfusedDog wrote: post #388
stcredzero wrote: post #331

Specific knowledge is knowledge that you cannot be trained for. If society can train you, it can train someone else, and replace you. If there is market value in a skill or knowledge, the market will find the people who can be trained in it, then train them. Perhaps a talent is required to be competitive. Corollary: Beware of fields which have artificial gatekeeping. They are in a disadvantageous market. Become the b…

Which fields have artificial gatekeeping? Do you have any examples? I'm not familiar with the term and couldn't find it online...

Investment banking is one, another is corporate law. It's incredibly difficult to get a job in either field without a degree from a top school, with top grades. Google hires lots of people with degrees from state schools (or without degrees!). That's not the case at, say, McKinsey. Neither job inherently requires a degree from a top school, but it's almost a prerequisite to get the job.

Re: How to get rich without getting lucky

#467

Post by tyrust »

Jack000 wrote: post #461
tyrust wrote: post #445

Earlier quoted context omitted.

>It says that out of 100k 15-24 yr olds 74 died, and also out of 100k 85-1xx yr olds 13k died. Yes, which is why I took the sum of those numbers for ages 25 to 50. >the area under the curve for 0->50 looks about 1/10 of the overall, so I'd say the op is about right You're describing the conditional probability that, given you have died, you are under the age of 50.

what you're doing is (129+192+405)/100000 = 0.7% this means that out of 100k 25-50 yr olds 726 died during 2016. This is the probability that you will die during this year, given that you are a 25-50 year old, which is different from the probability that you will die before the age of 50. (the prior number ignores the cumulative probability that you have died as a Given that all of us will die, the only question is t…

>the prior number ignores the cumulative probability that you have died as a Ah you're right about that. Looks like I'm probably way off. This random thing google turned up [0] says that a 25 y/o male has like a ~70% chance to make it to 50!

>Given that all of us will die

Something doesn't feel right about this, but I can't figure out what. I'll let it simmer and assume you're correct in the meantime.

[0] - http://flowingdata.com/2015/09/23/years-you-have-left-to-liv...

Re: How to get rich without getting lucky

#468

Post by 0xfeba »

muzz wrote: post #465
0xfeba wrote: post #433

Earlier quoted context omitted.

5 years? Not really. Pretty much any Japanese car made in the last 20 years, and domestic in the last 8 should last 10 years; 100/150k before anything major is needed. But, to run the numbers, get a the total cost of ownership (car payment, interest, and non-warranty or whatever maintenance) for a new/virtually new car, divide it over a span of the expected months of ownership (say, 60, 120, 180 months). Do the same…

If it were true that nothing major was needed until 100k or 150k then car warranties would be of that length. There are reasons why cars depreciate, amongst which are the fact that they need more money put into them over time.

They are? Most powertrain warranties are 100k nowadays. Recent cars have unlimited miles/10+ year corrosion warranties as well.

Yes, you're taking more risk with a used car. But I have multiple cars, and am a mechanic so it doesn't bother me.

Re: How to get rich without getting lucky

#469

Post by oliwarner »

melling wrote: post #365
oliwarner wrote: post #355

Earlier quoted context omitted.

Buffet?! Sure . He's both from an influential family and was a prodigy for business. He's also been very lucky. If you think you can course-correct your life to rival a Buffet just by the power of these self-help articles, you're a fantasist. I'm not telling anybody to do anything. Just opining my view that outright happiness is not a hard state to reach. One can be content with very little. When your goal in life is…

No one said you need to rival Buffett. You added that. He was simply provided as an example of an extremely successful person who is living life on his own terms.

So you're just pointing out that one of the richest men on the planet is happy?

What were you saying about noise?

FWIW, I was trying to make a legitimate counterpoint here and the votes suggest it wasn't as unwelcome as you suggest, but whatever. Thanks for your contribution.

Re: How to get rich without getting lucky

#470

Post by Jack000 »

tyrust wrote: post #467
Jack000 wrote: post #461

Earlier quoted context omitted.

what you're doing is (129+192+405)/100000 = 0.7% this means that out of 100k 25-50 yr olds 726 died during 2016. This is the probability that you will die during this year, given that you are a 25-50 year old, which is different from the probability that you will die before the age of 50. (the prior number ignores the cumulative probability that you have died as a Given that all of us will die, the only question is t…

>the prior number ignores the cumulative probability that you have died as a Ah you're right about that. Looks like I'm probably way off. This random thing google turned up [0] says that a 25 y/o male has like a ~70% chance to make it to 50! >Given that all of us will die Something doesn't feel right about this, but I can't figure out what. I'll let it simmer and assume you're correct in the meantime. [0] - http://fl…

yeah, the probability of death depends on a ton of priors so assuming the distribution is uniform is not quite right either.

just intuitively though, a probability of .7% for dying before 50 seems way too low

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