CNN used this person as an example of retiring early with $2.1M but...

[brianmanahan]

Wow. So they have $2m and they only plan to spend $60k a year? I make about that and I'm broker than broke. And I live in a cheap city.

i live in a cheap city and spend like 25$k-30$k per year. nobody to take care of but me though.

What's the point in working so hard for so many years and just live a modest lifestyle?

i'm doing it because i'd rather work a lot less years than live a lot fancier lifestyle. i grew up without a lot of money so don't mind living like that.

 

[MongGrel]

If I were making 200K a year I'd live in the same place I am atm myself.

It would have been paid off long ago and the bathrooms and kitchen remodeled and would have a lot more saved ore or less.

The wife and I combined were making about 100K a year at one point I guess, with out student loan type of things.

Still have a bit saved up, but not that much of course.

 

[Mai72]

Have you ever read the 4 hour workweek by Timothy Ferris?

In the book he describes the new rich (NR) as people who visit places like Thailand or Brazil for months on end. They leverage the strong US currency by visiting countries that are very inexpensive to live. $50k is going to go much further in Thailand then it is in states like CA for instance. Tim was also against deferred living which is what most people do. This is when you work for the next 40 years so you make it to the golden age of retirement. So, you can finally start living. But, what happens if you never make it to 62? Also, why not start living now when you're young. The older you get the greater chance that you may not be able to do everything you wanted when you retire.

The other thought is you want to create as much passive income as possible so you can spend time on more important things like adventure and family. Most people trade time for money. This is how we generate our incomes. But, wouldn't it be great if we didn't have to trade that much time for money. That we could generate money passively.

Anyway, I like this interactive video on the 4 hour workweek.

https://www.youtube.com/watch?v=j3TeLsaKzAM

 

[brianmanahan]

If I were making 200K a year I'd live in the same place I am atm myself.

yep exactly! i like where i live enough that i dont feel the need to spend any more. plus moving all my stuff would be a pain.

 

[PowerEngineer]

so he made $200k/yr.

Not really.

He saved at least 25% of his income, putting away as much as $50,000 annually in a good year.

A good year might be one in which he put aside 25% of his $120,000 regular salary ($30,000) and also added all of a generous $20,000 Christmas bonus to his retirement.

It might be more accurate to conclude that he saved his $2.1M nest egg over a 30-year career during which he never earned as much as $200k/year. (And given the cost of living in the Bay Area while he was doing it, that's pretty impressive.)

just gotta go looking for jobs with pensions. they are not that hard to find.

Jobs with benefits that include traditional pensions are getting harder and harder to find. Really almost impossible outside of government employment.

 

[Mai72]

If I were making 200K a year I'd live in the same place I am atm myself.

It would have been paid off long ago and the bathrooms and kitchen remodeled and would have a lot more saved ore or less.

The wife and I combined were making about 100K a year at one point I guess, with out student loan type of things.

Still have a bit saved up, but not that much of course.

The problem is when most people start making more money, their spending habits start matching their incomes. So, instead of one car they may have 2-3. Instead of a Honda they may buy a Mercedes. Instead of living in a $200k home they may buy a $500-700 house.

The book that changed my life when it came to finances is The Richest Man in Babylon. The first concept they teach you is to pay yourself first. Put 10% of your weekly/bi-weekly pay into a separate account. The key is to not touch it. In 10 years you might want to take part of it out and find a better return and so fourth. Most people fail to even do this one simple thing. In my case I've been able to put away a decent amount of money doing just this one thing. Also, it's never too late to start.

 

[Jeff7]

Or you've got a few shows talking about people struggling to have enough for retirement. The shots of the inside of their huge homes show lots of fancy furniture, souvenirs from traveling, multiple TVs, a lavish bathroom, and so on.
As in, "As a family of four, it can be tough getting by on $150k/year."

That's cool retiring with money and all but what, are you gonna travel the world and have fun at 70 years old?

My grandmother's 86.
She went to Japan a year or two ago, and has been to more countries than I've been to states, all of which were visited after she retired.


An outlier case though, for sure.

The problem is when most people start making more money, their spending habits start matching their incomes. So, instead of one car they may have 2-3. Instead of a Honda they may buy a Mercedes. Instead of living in a $200k home they may buy a $500-700 house.

The book that changed my life when it came to finances is The Richest Man in Babylon. The first concept they teach you is to pay yourself first. Put 10% of your weekly/bi-weekly pay into a separate account. The key is to not touch it. In 10 years you might want to take part of it out and find a better return and so fourth. Most people fail to even do this one simple thing. In my case I've been able to put away a decent amount of money doing just this one thing. Also, it's never too late to start.

Yeah, it does seem to happen that way too often.

Even once out of college with a decent job, some of my college spending habits remained. It really does make money keep itself readily available if you don't spend the hell out of it as soon as it shows up.

 

[Hugo Drax]

That's cool retiring with money and all but what, are you gonna travel the world and have fun at 70 years old?

No you retire at 50. :biggrin:

Waiting till 70 is stupid.

 

[MongGrel]

I'm 54 so I guess I missed that boat.

 

[TheVrolok]

I think I'd be uncomfortable retiring at 58 with only 2.1 to go for 2 people.

Edit: Well, I guess it depends on their lifestyle. If they live really cheap and don't travel (or do it on the cheap) it should work.

 

[Linux23]

i waste all of my income on hookers and blow.

 

[brianmanahan]

I think I'd be uncomfortable retiring at 58 with only 2.1 to go for 2 people.

Edit: Well, I guess it depends on their lifestyle. If they live really cheap and don't travel (or do it on the cheap) it should work.

%3 of 2.1$M is 63$k - that's pretty darn good considering SS and medicare will kick in within the decade, and there won't be any more SS or medicare tax.

 

[Dr. Detroit]

http://www.mrmoneymustache.com/

Or just do that.

I really hate this douchebag and his rampant drone like followers.

Guy is a complete tool for his holier than thou attitude.

 

[Kaido]

i just live like i did when i was right out of college. cheap apartment, cheap food, cheap fun, cheap everything. and ATOT is free!

Wait what now?

 

[Kaido]

I really hate this douchebag and his rampant drone like followers.

Guy is a complete tool for his holier than thou attitude.

Note that it is important to separate agendas from information. Good information can be delivered with an offensive subtext. The couple in the OP chose a different path from being super thrifty, but they also aren't publishing a useful blog either. Plus, drama = clickbait. Works like a champ on Youtube...post something controversial & people can't help but comment on it; the people who have opposing viewpoints are the ones who keep playing your ads over & over again and putting dollars in your Google Ads account

 

[brianmanahan]

and ATOT is free!

Wait what now?

yeah, you don't actually need to paypal perknose 20$ every month... but if you want to keep doing that to get those "special lifer privileges", by all means continue

 

[Jeffg010]

Have you ever read the 4 hour workweek by Timothy Ferris?

In the book he describes the new rich (NR) as people who visit places like Thailand or Brazil for months on end. They leverage the strong US currency by visiting countries that are very inexpensive to live. $50k is going to go much further in Thailand then it is in states like CA for instance. Tim was also against deferred living which is what most people do. This is when you work for the next 40 years so you make it to the golden age of retirement. So, you can finally start living. But, what happens if you never make it to 62? Also, why not start living now when you're young. The older you get the greater chance that you may not be able to do everything you wanted when you retire.

The other thought is you want to create as much passive income as possible so you can spend time on more important things like adventure and family. Most people trade time for money. This is how we generate our incomes. But, wouldn't it be great if we didn't have to trade that much time for money. That we could generate money passively.

Anyway, I like this interactive video on the 4 hour workweek.

https://www.youtube.com/watch?v=j3TeLsaKzAM

The whole Thailand thing is very intriguing to me but the current rate of US dollars to 1 Thai Baht equals 0.029 US Dollar. It has been dropping so much by the time I retire it is not going to be an advantage anymore. 2 years ago you could have got 34 baht for a dollar.

 

[Red Storm]

I don't understand the people who slave away their youth and wait until they're 60+ to start enjoying life and going on cool vacations. I want to do all the awesome shit in the prime of my life, not as a senior citizen.

 

[jlee]

I really hate this douchebag and his rampant drone like followers.

Guy is a complete tool for his holier than thou attitude.

Meh, he might be a douchebag but the math is right.

 

[jlee]

The whole Thailand thing is very intriguing to me but the current rate of US dollars to 1 Thai Baht equals 0.029 US Dollar. It has been dropping so much by the time I retire it is not going to be an advantage anymore. 2 years ago you could have got 34 baht for a dollar.

At $0.029 per Baht you can get 34 baht for 99 cents.

 

[brianmanahan]

Meh, he might be a d*****bag but the math is right.

yeah i'm not a fan of his style either, but this chart that he made on "how much you save & how long till you can retire" was an eye-opener for me

 

[purbeast0]

I don't understand the people who slave away their youth and wait until they're 60+ to start enjoying life and going on cool vacations. I want to do all the awesome shit in the prime of my life, not as a senior citizen.

the story of ATOT.

 

[overst33r]

I don't understand the people who slave away their youth and wait until they're 60+ to start enjoying life and going on cool vacations. I want to do all the awesome shit in the prime of my life, not as a senior citizen.

You can do both with a decent income as evidenced by the chart above. Save and spend proportionally to the things you value. As with most things, balance is the key.

 

[dank69]

ATOT, if we all chip in i think we can do this!

For every dollar you guys raise to pay him to leave, I'll match it with a dollar to pay him to stay.

 

[WackyDan]

200K a year does make things a lot easier of course

Certainly... Problem is people think that 200k is a lot of money. It is, but it isn't like working 4 50k jobs... The more you make the less the net.

I make close to that. I live in a VERY modest house we bought when I was making only $60k a year. We buy Fords/Chevy's.. The biggest difference for me since I started making six figures is that I have money in the bank for emergencies, our vehicles are paid off in 3 vs 5 years, and my retirement savings have actually accumulated something. I know a lot of peers making roughly in my range living in houses that cost 4-5x what mine cost driving BMW's Acuras, etc... And they don't even have a 529 plan for their kids... Because what they own - owns them.