FIRE (Financial Independence Retire Early)
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Weekly Discussion: 11 December 2023
- earlyretirementnow.com We're All Millionaires! (on average) - Early Retirement Now
The average households net worth has been rallying. We are now all millionaires, on average. I take a deep-dive into the data.
I like looking at ERN's articles from time to time because they cover so much that I'm all but guaranteed to learn something.
This article is about how, despite the wealth inequality figures, the US is still doing okay when it comes to wealth accumulation. Here are some of my personal highlights from the article:
> If I want to put a positive spin on the unpleasant wealth inequality stats in the U.S., I would again point to the net worth chart by age group: Some of our inequality is due to the natural wealth accumulation lifecycle. For example, within my age group (45-49), the wealth Gini coefficient is lower: 0.769. Americans are very good at building assets, thanks to their entrepreneurial spirit and generous tax incentives, like tax-advantaged retirement plans and capital gains deferral.
And later:
> It’s also worth pointing out that the Gini coefficient decreased in 2022 and now stands at the lowest level since 2007, though still far above the Gini in the 1990s.
And this is an interesting alternative to some of the rhetoric I'm seeing about the eroding middle class:
> If we compare the wealth distribution in 1989 with 2022, most percentiles gained ground. True, the 1%, 5%, and 10% lowest percentile had negative to zero net worth figures. The 1% poorest got deeper into debt. But the middle class is getting richer, albeit modestly slower.
There's a lot here, and my takeaway is that FIRE should continue to be a possibility to the middle class and above. It's not a weird phenomenon that only a lucky few were positioned correctly to achieve, but conditions remain good if you want to put in the work to love below your means and invest consistently.
Anyway, I like looking at graphs and deep analysis like this. Please share your thoughts.
- www.theearthawaits.com The Earth Awaits
The Earth Awaits calculates your cost of living around the world according to your lifestyle, family, and housing needs!
I was doing a little EOY accounting, and I wanted to see where I could afford to retire to with my current amount of investments. I searched a bit, but couldn't find anything good, and then I remembered the old /r/financialindependence sidebar.
Since I happen to be a mod, I went ahead and abused my mod powers and added it to the community info here. My wife is from another country, and we're not yet to the point where we could retire there, but we're surprisingly close, so I now have a new milestone to shoot for.
I don't know the methodology they use here, or how often it's updated, but I think it's fun to look around at options.
I remember another site that simply gave a list of countries in order from cheapest to most expensive and you'd enter your current assets and figure out where you could go. I thought it was a lot of fun to see what "upgrades" an extra year or two of working would get me, but I didn't bookmark it. If anyone can find something like that, please post it.
Anyone considering going expat? If so, does this resource seem accurate? Do you have others you like better?
- www.financialsamurai.com How I'd Invest $250,000 Cash In Today's Market
A bear market provides opportunity. For those of you with cash, specifically $250,000 in cash, here's how I'd invest it today.
| Age | 2022 Net Worth (Median) USD$| |---------|----------------| Less than 35|$39,040 35-44|$135,300 45-54|$246,700 55-64|$364,267 65-74|$410,000 75 or older|$334,700
Source:
https://www.federalreserve.gov/econres/scf/dataviz/scf/chart/
cross-posted from: https://lemm.ee/post/10563312 >Of all generational cohorts, older millennials are most likely to generate enough income to retire comfortably, according to the latest Vanguard Retirement Readiness report. > > Specifically, millennials aged 37-41 have the greatest chance of landing a comfortable retirement.
Hi I DCA into an ETF. I have about 11K invested and according to Degiro I have a profit of almost 700. How should I calculate my profit? Do I get 6,3 yearly? Over the 4 years I've been investing? If it's over 4 years that seems rather low?
- • 100%knowledge.insead.edu Fulfilment and the FIRE Movement: The Realities of Life After Early Retirement
Individuals who achieve financial independence seek greater purpose and meaningful work to enrich their lives.
I really enjoyed this article about what happens post-FIRE and the secret to staying fulfilled when you don't have a career/specific goals to work towards.
> The quest for financial independence is not a fixed endpoint. Rather, it is an ever-evolving journey that involves acknowledging the dynamic nature of one’s identity, financial situation and place in society. This holistic approach, encompassing personal values, goals and ongoing growth, is key to ensuring a fulfilling and empowered life.
An issue I always have with early retirement is whether it is morally acceptable. When retiring early from a skilled profession you are depriving society of a big contribution you could have given, that was also expected and invested in by society. Utilising a power dynamic by having more money and knowledge to capitalise on other people exacerbates this issue.
How are you dealing with this? Are you of the mindset that you do not owe anything to society? That it is completely fair, as you earned that money and there is a perfect market that trades all aspects in a meritocratic fashion (e.g., delayed consumption should be gratified this hard)? Or that you were not just lucky to have the talents to earn so much money?
Hi all, I see lots of subscribers in this community. What stage of FIRE are you guys in? curious about the demographic in here.
- Neither FI nor RE
- FI but not RE
- FIRE'd
- ?
I am in the first category, working towards FI for seven years now and recently reached 100K NW. Unfortunately I live in very HCOL area so I still have long ways to go 🥲
I'm using the good ol' Excel spreadsheet to track expenses, income, NW, etc. Are there any other tools or apps that you guys found useful?
Also shoutout to my fellow spreadsheet power users 😎
Would be cool to hear from those who have and how you got started. Were there any pitfalls or things you would have done differently?
Many people around me are saying US based index funds is enough coverage to FIRE but I want to know if it's worth diversifying even more, maybe 10-20%?