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MJBuddy posted:In all of the cases their emergence is more than coincidence or spontaneous as well. The institutional and economic realities of the times were leading influences, rather than trailing. Child labor laws passed after child labor rates plummeted. Workers rights pass as workers rights expand due to low unemployment and high labor demand. 40 hour work weeks in the US became codified and common practice after two world wars gouged the labor force after being a major demand of labor groups for literally 200 years prior to that. So improvements largely come once they're, in a way, no longer specifically needed?
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Mar 7, 2015 01:52
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pac man frogs posted:So improvements largely come once they're, in a way, no longer specifically needed? The improvements themselves precede the policy, generally, or otherwise they were very clearly moving in that direction. The law itself isn't the improvement, but the benefits its addressing are.
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Mar 7, 2015 19:54
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MJBuddy posted:The improvements themselves precede the policy, generally, or otherwise they were very clearly moving in that direction. The law itself isn't the improvement, but the benefits its addressing are. That's probably how it should be. Law should generally proscribe the things almost everybody knows you shouldn't do. When the law is used to drive societal change, people just lose respect for the law.
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Mar 7, 2015 23:10
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Dwight Eisenhower posted:The U.S. has a unique talent for convincing poor people that they are just temporarily embarrassed rich people who should vote in the interests of rich people, so that they will have an even better ride when they get to the RichPersonVille. Radbot posted:Yes, this makes sense if you assume that similar amounts of hardship and sacrifice are necessary in both scenarios. I would disagree, as living on $16k seems much more difficult than living on $125k. Exactly. No matter how frugal you are, there is a bare minimum that you simply have to spend on food, rent, and utilities. Squatting and dumpster diving is not realistic. Even MMM spends like $25k a year, and his house is paid off. Anybody with a mortgage left to pay is gonna be bare minimum spending $30k a year. Rick Rickshaw posted:This is a man who hates his job. He loves simplicity. He's at his happiest when he's outside cutting down dead trees in his backyard. But he's pushing 40 and his belly is beginning to push outward. If he could cutback on some of his consumption and retire by 50, maybe he'd be able to save himself mentally and physically. That way he could spend less time at the office and more time outside with his kids. Sadly, I think his 40s are probably going to be tough on him, and he'll be working until 65, because they have to have their $700 camera and $400 Michael Kors watch. Yup, this is my main motivation behind trying to become FI by my 40s. I don't really like white collar work. I wanted to be a tradesman or a laborer when I was in high school, but I went to college because there's no stability and the pay is less than an engineer's after a few years (unless you chase around boomtowns, which gets old fast).
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Mar 8, 2015 02:30
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Hey Goons, So I will finally have my student debts paid off this eyar and need to get serious about retirement investing. I already set aside 4% of my gross and get 2% matched from work. I have tried those retirement calculators and I have no sense of what is "too much or "too little". Some say I need to save what look like impossible amounts. http://www.money-zine.com/calculators/retirement-calculators/early-retirement-calculator/ im 31, have 20k in assests, want to retire at 50, want 70k a year, 3% inflation, 7% returns, Says I need to save 4,865 a month? 2,382,636 total, How is anyone suppose to do that?
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Mar 8, 2015 05:18
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70k is a whole lot - equivalent to a low six figure salary. (Remember it's post-tax) If you have a decent six figure salary already it might not be unreasonable to save that but it's a big number for a lot of years. Depending on where you live, you can live quite well on a good bit less than that.
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Mar 8, 2015 05:39
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KingFisher posted:Hey Goons, Somehow learn to spend less than 95-120k/year. The rule of thumb around these parts is to take your expenses and multiply them by 20 or 25 and assume a 4-5% safe withdrawal rate to keep up with inflation. 70k is a very high spending rate into retirement for FI folks, and a couple million is not an extraordinary estimate of required savings given inflation over a few decades and a conservative withdrawal rate. So, if you bring your spending down to 45k, you'll "only" have to save 900-1100k. Spend only 25k/year and you only need 500-625k. And so on.
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Mar 8, 2015 05:40
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KingFisher posted:So I will finally have my student debts paid off this eyar and need to get serious about retirement investing. Don't care what you make, if you can't save 10% of gross, you're going to die feeling poor. 15% for an entire lifetime will leave you doing well. 25% will have you either retiring early or like a king. You can keep on going from there...
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Mar 8, 2015 05:47
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KingFisher posted:Hey Goons, Most people don't retire at fifty and spend $70k a year (higher than the median household income) in retirement? How is this surprising to you?
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Mar 8, 2015 05:53
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BEHOLD: MY CAPE posted:Most people don't retire at fifty and spend $70k a year (higher than the median household income) in retirement? How is this surprising to you? I live in Seattle (like within the actual city) so 70k doesn't go very far, its only 5k over our median income. tuyop posted:Somehow learn to spend less than 95-120k/year. The rule of thumb around these parts is to take your expenses and multiply them by 20 or 25 and assume a 4-5% safe withdrawal rate to keep up with inflation. I actually live on far less most of my money has gone to paying down student debt and getting my mortgage on track. Thank you for the rule of thumb, let me apply that and see what I get.
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Mar 8, 2015 07:08
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The retirement calculators are spitting out numbers consistent with what I would expect. Outright retirement 15 years early isn't that easy to achieve unless you save a very high percentage. The two biggest changes you can make to your finances are working and paying a mortgage. Consider that what you have paid off the mortgage your expenses drop significantly. Now if you want to have a smaller target for your retirement savings consider working only 3 or 4 days a week until a later retirement date. Working enough to cover a number of expenses means that you won't draw down on your savings until a much later date.
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Mar 8, 2015 08:25
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KingFisher posted:I live in Seattle (like within the actual city) so 70k doesn't go very far, its only 5k over our median income.
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Mar 8, 2015 08:26
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Do people really pay off houses? I feel like most people I've met move every 6-10 years and take out a fresh 30yr every time. I'm pretty much refusing to move until this thing is paid off so I don't waste all of those years on the interest-prioritized payments. It's a plenty big house even if we have 3 kids so hopefully it works out. I feel bad almost, I am pretty sure my mom is only 5-8 years into a 30yr at age 55 because of this. She's been in the same house for 14 years but refied at some point and opted for full term again. Mortgages kinda scare the poo poo out of me now that I have one. ^^^^^^ To the point above, I can see the wife and I packing up and moving to the midwest when we retire, we'll be able to buy a really nice plot for 300k, where it's a modest detached suburban home here in AZ.
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Mar 8, 2015 08:36
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KingFisher posted:I live in Seattle (like within the actual city) so 70k doesn't go very far You're not trying. 36k/yr (net) will get you a pretty decent place in the city with pretty good room to spare. You just can't go out to eat more than once a week or so.
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Mar 8, 2015 09:40
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There is an obsession with the property ladder concept where people think they need to get a larger house as soon as the finance is available. That's all well and good but everyone should, in the worst case, time the mortgage to be paid off just in time for retirement. It is possible you may want to do that so that inflation destroys most of the value of the mortgage principal, but paying off early means you aren't at the mercy of interest rates and you free up cash flow.
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Mar 8, 2015 09:44
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Devian666 posted:There is an obsession with the property ladder concept where people think they need to get a larger house as soon as the finance is available. That's all well and good but everyone should, in the worst case, time the mortgage to be paid off just in time for retirement. It is possible you may want to do that so that inflation destroys most of the value of the mortgage principal, but paying off early means you aren't at the mercy of interest rates and you free up cash flow. What they're doing is leveraging their debt to boost their growth like every venture capital documentary they've ever seen has thaught them to do. However, what no one ever thaught them is that they can't just go bankrupt without far-reaching consequences like a firm can. They're hosed for life if their leveraging backfires.
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Mar 8, 2015 09:57
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Lack of investment diversity is a big risk pouring everything into a house. I've heard the story many times of a person being a millionaire in net worth but it's all in their house. There's also the other story of people selling their house or downsizing to have more money for retirement and they don't get the price they were expecting for their house.
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Mar 8, 2015 11:14
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Completely different topic: wireless I'm moving back to the states in the next year and was wondering if anyone here has experience with Ting wireless. We have two lines, I use a ton of data traveling for work while my wife uses almost exclusively wifi. We talk mostly over Google Hangouts but have rare months of 500+ minutes depending on family. Both of us have Nexus5's so we can use either the CDMA or GSM services. Just looking at their rates our usage would put us at less than $80 even on a heavy usage month, which is still way below what even t-mobile can offer. Is there some downside to Ting that I'm not seeing?
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Mar 8, 2015 12:10
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KingFisher posted:I live in Seattle (like within the actual city) so 70k doesn't go very far, its only 5k over our median income. I live on ~50k after taxes in Manhattan, I'm guessing you can do it in Seattle unless I've been greatly misled. I eat out for most meals and am frugal other than that and rent. Obviously our lives are different, if you want advice on budgets, I'm sure people here would be happy to help.
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Mar 8, 2015 12:24
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BossRighteous posted:Do people really pay off houses? My husband and I are 33 and we are like 6 months away from paying off our primary residence. For people interested in FI, killing your monthly housing costs is a huge boost.
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Mar 8, 2015 13:25
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We are taking a slightly longer view on the house. Aiming at purchase to paid off of 10-15 years. Since we can only guess (probably badly) at the financial climate over a typical mortgage period its hard to make the correct choice. With some reasonable assumptions about return and inflation and our expected fi date its fairly even split between paying it off asap and then saving all the housing money or splitting it down and investing x% and paying the mortgage down with the rest. We went with the later option to give us more of a chance if either returns or inflation go mental one way or the other. Basic diversification I guess.
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Mar 8, 2015 13:56
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I'm just going to rent forever. Or live in a yurt. You know. 
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Mar 8, 2015 14:26
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KingFisher posted:Hey Goons, I don't know how much you are paying towards your student loans a year, but saving 6% of your income is not gonna let you retire early. With that said here are some things you can do to get what you want: 1. Make more money and don't change lifestyle. Money now is much more important than money in 10 years. 2. Make sure your investments are low fee and relatively aggressive. 3. Get married to someone with income similar or higher than yours. A couple can save a lot of money living together (over 2x single living expenses). 4. Get a roommate and bank the rent 5. Spend less money now 6. Readjust your retirement goals, and remember to factor in social security to your plan. 7. Minimize taxes now - i.e. learn all about taxes and how to lower the amount you pay in smart ways
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Mar 8, 2015 16:28
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Droo posted:I don't know how much you are paying towards your student loans a year, but saving 6% of your income is not gonna let you retire early. With that said here are some things you can do to get what you want: lol yeah, point 3. marry someone who makes more money than you is a time honored method of financial independence indeed
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Mar 8, 2015 16:58
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KingFisher posted:I live in Seattle (like within the actual city) so 70k doesn't go very far, its only 5k over our median income. Right, and most people who are retired need and spend less money than they did while working because they 1. aren't saving for retirement anymore obviously and 2. usually aren't raising children 3. often have housing paid off 4. are collecting some kind of supplementary retirement income such as SS or pensions. So you want an above median retirement income which translates to a far above median retirement lifestyle, and you want it at age 50 which is more than a decade earlier than most people retire, which are the signficant challenges in your proposition.
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Mar 8, 2015 17:02
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BEHOLD: MY CAPE posted:lol yeah, point 3. marry someone who makes more money than you is a time honored method of financial independence indeed Haters gonna hate, but gold digging probably has an astronomical ROI.
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Mar 8, 2015 17:35
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Geizkragen posted:Is there some downside to Ting that I'm not seeing? Ting is fine if your phone supports it and you're a light user. Ting is also on the sprint network which is...okay. The new hotness right now is Cricket which if you remember used to be a poo poo prepaid company but they were bought by AT&T, so now their service is AT&T's with a $35/mo per person price tag. There's a thread about prepaid carriers here that can help you out, but people have been jumping to cricket in droves. I'm currently on TMO and pay $50/mo for less service, so I may switch over soon too. http://forums.somethingawful.com/showthread.php?threadid=3652174 Related utilities talk, if you have cable tv or cable internet, make sure you're calling/threatening to cancel annually to get the promo rate. Definitely an industry where it doesnt pay to be a long standing customer. My guess though is none of you pay for cable TV anymore and its just for internet, but $10-20 bucks a month is a couple six packs I'd rather spend on myself.
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Mar 8, 2015 18:23
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Cast_No_Shadow posted:We are taking a slightly longer view on the house. Aiming at purchase to paid off of 10-15 years. Since we can only guess (probably badly) at the financial climate over a typical mortgage period its hard to make the correct choice. With some reasonable assumptions about return and inflation and our expected fi date its fairly even split between paying it off asap and then saving all the housing money or splitting it down and investing x% and paying the mortgage down with the rest. It's a tough decision that I wrestle with. Amortised but flat line interest versus compounding growth which increases at an exponential rate. I did check to see how bad mortgage repayments are over the life of the mortgage. Between the first 8-12 years you pay a very large portion of the interest is paid and only in that time span does the decrease in the interest portion of the payment take off. I believe it's somewhere around year 21 where you pay 50% principal and 50% interest (half paid off). So people refinancing for the full 30 year term are just gifting money to the bank.
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Mar 8, 2015 20:31
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Xoidanor posted:What they're doing is leveraging their debt to boost their growth like every venture capital documentary they've ever seen has thaught them to do. However, what no one ever thaught them is that they can't just go bankrupt without far-reaching consequences like a firm can. They're hosed for life if their leveraging backfires. Foreclosure/bankruptcy does not gently caress you "for life."
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Mar 8, 2015 20:36
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Series DD Funding posted:Foreclosure/bankruptcy does not gently caress you "for life." Yeah, only student loans can do that.
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Mar 8, 2015 20:57
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Devian666 posted:I did check to see how bad mortgage repayments are over the life of the mortgage. Between the first 8-12 years you pay a very large portion of the interest is paid and only in that time span does the decrease in the interest portion of the payment take off. Interest on our first mortgage was so bad*, that for every 1,000 USD extra we paid on the first month's payment, it literally saved us 2,000 USD in interest over the course of the loan. *Right after the crash in Iceland, only one lender, very unfavorable terms that we have since refinanced out of.
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Mar 8, 2015 21:09
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Series DD Funding posted:Foreclosure/bankruptcy does not gently caress you "for life." If it happens to you at age 50+ it will in most countries, or at the very least it will over here.  In Sweden you're literally not allowed to have assets worth any significant sum if you want to partake in the primary welfare system. I mean I guess you'd recover eventually but it would literally be more lenient to just let them spend that time in prison and not lose any chance of ever recovering financially. We're talking decades lost here. There are still thousands living with millions of krona in debt since the real estate crash in the early 90's. MiddleOne fucked around with this message at 21:29 on Mar 8, 2015 |
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Mar 8, 2015 21:20
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poopinmymouth posted:Interest on our first mortgage was so bad*, that for every 1,000 USD extra we paid on the first month's payment, it literally saved us 2,000 USD in interest over the course of the loan. That wasn't unusual as the interest rates were high everywhere. Late 2007 through 2008 the official cash rate for the RBNZ was 8-8.5% so trying to get a good rate wasn't really possible. e: I visit my old boss who has gone to 3 days a week of work and the rest making artwork. I visited him and he got a mortgage which paid a flat rate of principal plus the interest. A good way to pay a mortgage but his initial payments were punishing. I don't think they do those type of mortgages anymore as they aren't as profitable for banks. Devian666 fucked around with this message at 22:19 on Mar 8, 2015 |
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Mar 8, 2015 22:17
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BossRighteous posted:Do people really pay off houses? I feel like most people I've met move every 6-10 years and take out a fresh 30yr every time. Well most people don't pay off houses but most people have more credit card debt than they have retirement savings. Don't be most people.
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Mar 8, 2015 22:42
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Nail Rat posted:Well most people don't pay off houses but most people have more credit card debt than they have retirement savings. Don't be most people. This really underlines what's seen in the bad with money thread. Got a big pile of debt and plan to buy a house in the next year with no deposit, then have a giant mortgage for the rest of their life. Then throw on 2 trucks, a boat and dog equity. The only thing that would make it worse is if it was the 1920's and people bought shares on margin borrowing 90% of the cost.
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Mar 9, 2015 00:08
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What's the FI consensus on renting vs buying? Could it ever make sense to rent forever (assuming of course you invest the cash flow you would save from buying/maintaining a house/apartment). Seems like it could make sense in high-property prices and high-property taxes areas like NYC metro. Buying a home just seems like a never-ending money pit to me unless you happen to be very handy (which I am not).
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Mar 9, 2015 00:26
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There was a debate over all the pros and cons of renting versus buying. There was a level of consensus of it depends on your circumstances. You are correct that metro areas are expensive and in fact may be out of reach financially for most people. Renting makes sense as you are paying an expense that allows you to move when you want, and the landlord fixes the things that crap out. If you can afford to buy it can be good provided you can cope with mortgage interest rate increases and repairs. Although I'll condition mortgages on what I stated above in that you should be heading towards paying it off so you don't have to make any payments during retirement or earlier. A mortgage is just another type of rent expense but it has the benefit that the amount of interest you pay decreases over time. e: On the invest and rent versus mortgage it is worth thinking about. If you want a good interest rate for a mortgage you need a 20% deposit. You could instead earn money with the same amount invested and still pay rent. It's a valid question to consider the value of tying up so much money in a single asset unless you can get decent tax write offs and potentially leverage some of the secured borrow versus investments. Note that on the leverage side of things it shouldn't be so much that you risk losing your house like many people did in every crash of the markets. Devian666 fucked around with this message at 00:41 on Mar 9, 2015 |
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Mar 9, 2015 00:34
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Swingline posted:What's the FI consensus on renting vs buying? Could it ever make sense to rent forever (assuming of course you invest the cash flow you would save from buying/maintaining a house/apartment). Seems like it could make sense in high-property prices and high-property taxes areas like NYC metro. Buying a home just seems like a never-ending money pit to me unless you happen to be very handy (which I am not). It's an interesting debate. Someone posted this awhile back: quote:My pal James Altucher calls homeownership a part of The American Religion, so I know I’m treading dangerous ground here. But before you get out the tar and feathers, let’s do a little thought experiment together. tl;dr: Buying a house and paying it down aggressively as an investment will mean that you're extremely exposed to geographic risks with dubious returns - your home and your job will be tied to the fortunes of the area where you live and work. If you end up with a portfolio of 1mil, and a house that's 400k, then 40% of your portfolio + your earning power are tied to Bumfuck, Wherever, earning a return that's on par with a balanced portfolio. Edit: A friend of mine, whose household income is about 110k gross, bought a 350k house last year, 0% down, and remodelled the basement into a rental suite. It cost him 25k and he figures it adds about 35k to the value of the home. So he's up like 10k. But oil just bottomed out and now nobody is buying poo poo in this city, and he just got word from the army that he has to move in September! Meanwhile, my wife and I, who have a slightly higher income, have invested and saved aggressively in that time and made about 20% returns in the last 18 months, so we're up like 8k. But if we don't like the weather there are no obstacles keeping us here, not to mention a crazy remodelling project eating up our time for pursuing qualifications and enjoyment. I prefer it our way. A house is not an investment, it's just a place to live that has benefits and risks. tuyop fucked around with this message at 02:11 on Mar 9, 2015 |
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Mar 9, 2015 02:02
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Devian666 posted:If you want a good interest rate for a mortgage you need a 20% deposit. Not true in the United States at present; when I closed my last mortgage in 2014 there was a quarter point spread from 5%->10% down and no spread from 10%->20%
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Mar 9, 2015 03:51
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tuyop posted:It's an interesting debate. Someone posted this awhile back: Right, the last point you make is very important though - the alternative to buying a house is not investing the money in vanguard total index funds, it's renting with all of its uniquely crappy downsides. Very few people can easily opt out of the housing market in the long term so it's endlessly disingenuous to compare a house purchase to an equity investment portfolio.
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Mar 9, 2015 03:57
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