Early Retirement / Financial Independence
#1
Since Churros asked nicely ( https://www.swooptheworld.com/forum/show...6#pid35656 ), here's what I found from the old forum, from someone else ;-)

Quote:I've become location-independent through the boring and slow way - by saving and investing - ever since I started working. Not everyone can do this, nor will everyone want to do this - but if you, for whatever reason, are better suited to a plan simpler (but slower) than, say, starting an on-line business - then you might be able to shamelessly copy what I'm doing.

The key and main difference between my saving and investing and typical saving and investing can be summed up as: the Mr. Money Mustache method. He and others like him have been mentioned on the forum before, but not in great detail, so I'll sum up the method here (the real value-add).

In the first part, his path to retirement is to save 25 times your annual spending, and invest it in low-cost funds that track the S&P 500 and its ex-US equivalent. So, for a monthly budget of $1,500 (what Roosh and others mention is needed for Eastern Europe), you need to save and invest $450,000 ($1,500 x 12 x 25). Once that number is reached, you can live off the returns (so no transition to bonds, unlike typical retirements - he has a post detailing the math about how this is actually quite safe).

Now hopefully $450,000 is a big number for you (unless you're reading this just for fun), but the second, more important, and hopefully uplifting part of the Mr. Money Mustache method, is also the simplest, but the toughest: cut your spending (it's probably harder to increase your earning to the same effect). Just like actually lifting heavy-ass weights for bodybuilding, this is the part about early retirement where the work is done and the quitters quit (sometimes rightfully so).

You'll have to be the judge as to which spending gets cut and which spending is necessary for your short and long-term Game, but start with the big ticket items and move down (in an extreme example, if you're in Poosy Hell where an awesome but expensive pad is useless because there are literally no girls around [Bakken oil field maybe?], you'll have to ask yourself if the awesome pad is worth it).

Be merciless with useless costs though - for example, I drive a boring car that's 10+ years old because it's cheap and my dates never see it (due to my location). In contrast, my typical outfit costs $300, since girls see that (but I only have a few items, and I bought specific styles and colors for multi-season mixing, matching, and long-term durability).

Google Mr. Money Mustache before asking any questions about his method - I only meant to summarize, not copy/paste his blog, which he's been writing for several years.
If you haven't met anyone, I'll assume you're lying (h/t to Teedub from the old forum)
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#2
This is awesome, it's well worth reading Mr. Money Mustache and Early Retirement Extreme to get a good overview of this approach. It can be very easy to get stressed out by trying to save every single dollar you have. When you're trying to figure out what your goals are this can be a really fine line to walk.
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#3
I love the idea and the planning for early retirement, but I think a lot of these guys drastically underestimate how much money they'll need long term.

$1,500 a month above for example might be enough to live a frugal lifestyle in your 20s/30s, right now, in second world places like parts of Eastern Europe/Latin America/SE-Asia. But as you get older you're going to want to live a more expensive, nicer lifestyle as is only natural. And if you decide to have a family life costs will increase massively. And even those two aside, as these places get wealthier their living costs are going to go up rapidly. I'd fear at that income level you'll just get more and more limited in your lifestyle and geographic options as the developing world catches up in costs to the first world.

I also think committing to a lifestyle/income that completely rules out the possibility of living anywhere in the first world (as an income of $1500 a month would do) is hugely short sighted. I absolutely love to travel, and have lived on multiple continents, but I can't see myself retiring/raising a family anywhere but Western Europe. Just because the quality of life is so high - its safe, its well run, theres no extreme weather, the food is great, my family and friends I've known for decades are there etc... all things that get more and more important as you get older and want to settle down. My bullshit/incompetence/general developing world tolerance goes down with every year of getting older.

If you were in a financial position with say triple that ($4,500 a month income) that would change things completely mind you. But achieving savings of $1.4mn (as his maths would suggest) would be far far harder to do.
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#4
Following on from what Zatara said, I think it's worth pointing out that retiring early is much harder outside of the USA. Compared to Western Europe, not only are US salaries much much higher (as an example, the median software engineer salaries are 40% higher in the USA than UK), but pretty much every single state has far lower tax rates.

This combination of higher taxes and lower wages makes the whole concept of FIRE outside the USA very difficult and borderline impossible to achieve when working for an employer (unless you're happy to live on a pauper's salary). The only real way out is of course starting a business, but given the high levels of income tax following the relatively low payment of corporation tax (compared to USA), early retirement is still a challenge.

The above dilemma is something I've been thinking about a lot recently. Achieving FIRE would be fantastic, but at what cost would it come? I run a small business in addition to the day job and I'm no longer sure if it's worth it to keep on going. While I may eventually hit my financial goals, it's likely this could take several years if not a decade or two because of the high taxes. Are the inevitable sacrifices to my personal life worth a potential payout which may never actually come? Or is it best to just hang up my boots and work in a tolerable career, which allows me to pursue hobbies, see friends, women etc.? This is something I ponder everyday and I can't seem to figure it out.
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#5
(08-17-2020, 12:38 AM)Wintermute Wrote: This is awesome, it's well worth reading Mr. Money Mustache and Early Retirement Extreme to get a good overview of this approach. It can be very easy to get stressed out by trying to save every single dollar you have. When you're trying to figure out what your goals are this can be a really fine line to walk.

I don't think that Mr Money Moustache touched on this (because he's a bit of an SJW faggot) but you probably have to have a bit more discipline and motivation than the average person and IQ enough to see the big picture/end goal.  He's clearly full of shit when he doesn't acknowledge the impact of quantitative easing on the financial markets but the general lifestyle choices he recommends are sound.
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#6
@Reynard this is true, the European income levels and tax rates do make it much harder to achieve true financial independence here. But the flip side of it is they do give a much, much better work/life balance. The number of people even in America who achieve true financial independence is absolutely tiny. Its not far off aspiring to be a professional athlete, odds-wise. But the number of people who benefit from the better working conditions for everyone in Europe (at the cost of the higher taxes/lower wages) is essentially everyone, so it probably is a worthwhile trade-off overall.

A couple years after uni I was living and working in the US. I then moved back to Europe from the US doing essentially the same job. I went from working 50~ hours a week in the US, and taking only 2 weeks leave a year, to working 38 hours a week in Europe and taking 7 weeks vacation leave and 1 week paid sick leave every year. I took a pay cut of about 25%, and do pay more tax here, but thats such a worthwhile trade-off. I still earn a healthy wage that lets me live a good lifestyle, but the difference here is I can actually have a balanced life outside of work with time for friends/family/relationships and fitness. And I can still do a serious amount of travel every year, even while staying in full time employment.

Its a move I recommend to every American currently trying to decide between financial comfort in wage slavery versus freedom and poverty as a location independent nomad type. Working in a decent job in Western Europe really does seem to me the best middle way of achieving both financial security and a reasonable work/life balance.
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#7
I agree, life in Europe is true quality life centered around friends and not just work
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#8
Nope, not everybody dreams about working 40 hours/ week with a mid level salary until 70yo, surrounded by lazy and entitled people who think the government owes them everything and who constantly think about their next vacations, have no ambition and where PC is the norm, this is a slow death for me and I worked in several countries in Western Europe and Scandinavia.

If you are not that good in your job, aren’t ambitious, Are kind of lazy, risk averse and want to fit in then yes Europe is for you. The UK is often shitted on down here but it is one of the most business friendly countries, let’s see how the Brexit change things mid term.
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#9
Brexit is great for UK, read, when i said i love Europe, nope, not the fucking stupid EU, there is more to it. Germany is great to make a quick buck or two but live in the EU is Italy, Spain and Greece, live outside EU Europe is great too in the Balkans
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#10
Yeah I know what you mean, my post wasn’t against you (or anybody else), I am just balancing perspectives here, Europe is no paradise, it all comes down to what each person is seeking.

I am working hard to increase my capital and need to get a plan to generate passive income and gtfo of  western Europe, I don’t wanna be a broke digital nomad, I am too old for that shit and I believe the older you get the more dough you need to have on the side.
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#11
Lino, you are on the right track to make it, great for you
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#12
Lino, you're spot on mate about Western Europe. The only thing people care about is their next holidays and the end of the day and the daily gossip. I would be a better fit in the States I guess, I love their hustle culture and it's more an honest system in my opinion. I mean, in Western Europe, why would you want to become an entrepreneur? Mommy got a secure government job and daddy got a bookkeeping at a multinational and we can have 2 times holidays in a year, one winter holiday and 1 summer holiday And they make 45k net together with free healthy care and free education.Everybody happy right? It's super boring and monotonous life here, the only people I see smiling here are third world hustlers from Africa, Arab countries or latino's. People are just bored outta their mind here.

But to get rich here, it's another story.
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#13
It's always important to improve your financial literacy and do more planning for the future. However, there are a few pitfalls depending on how you execute your own version of FIRE.

Avoid the following:

- obsessing over lowering expenses rather than increasing income
- extrapolating your current life situation into expected future spending without adding a large buffer (i.e. increased health care costs)
- assumimg equity market or real estate returns will continue to average the same amount as they did over the last 10, 20, or 30 years
- avoiding social or lifestyle opportunities that can build your network or create lifetime memories simply becuase of the higher, non-essential costs
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#14
(08-18-2020, 10:58 AM)zatara Wrote: @Reynard this is true, the European income levels and tax rates do make it much harder to achieve true financial independence here. But the flip side of it is they do give a much, much better work/life balance. The number of people even in America who achieve true financial independence is absolutely tiny. Its not far off aspiring to be a professional athlete, odds-wise. But the number of people who benefit from the better working conditions for everyone in Europe (at the cost of the higher taxes/lower wages) is essentially everyone, so it probably is a worthwhile trade-off overall.

A couple years after uni I was living and working in the US. I then moved back to Europe from the US doing essentially the same job. I went from working 50~ hours a week in the US, and taking only 2 weeks leave a year, to working 38 hours a week in Europe and taking 7 weeks vacation leave and 1 week paid sick leave every year. I took a pay cut of about 25%, and do pay more tax here, but thats such a worthwhile trade-off. I still earn a healthy wage that lets me live a good lifestyle, but the difference here is I can actually have a balanced life outside of work with time for friends/family/relationships and fitness. And I can still do a serious amount of travel every year, even while staying in full time employment.

Its a move I recommend to every American currently trying to decide between financial comfort in wage slavery versus freedom and poverty as a location independent nomad type. Working in a decent job in Western Europe really does seem to me the best middle way of achieving both financial security and a reasonable work/life balance.

You're painting with a broad brush here. 

Most of Europe is living at home til near age 40 with zero career prospects. They're not even reproducing.

Only a handful of west/north euro countries have the cushy safety net you describe and who knows how long that will last with Europe's demographic issues. 

It's very plausible for an American to get a 40-45 hour /week job in a trade and buy their own home shortly out of highschool. Millenials/gen z think that work is beneath them so they compete for "cool" slave wage gigs in the big cities. But Europeans by in large don't even have that option. The wage/property value ratio is horrendous. And that's even before taxes are considered. 

A lot of good stuff about Europe. But any American with a decent resume is going to take a pay/lifestyle hit moving there.

But sure if you're content with mediocrity, have no ambition, and just want to clock in your 40 hours until your next vacay it's probably the best spot.
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#15
Some points:

- Most cost increases beyond inflation either happen gradually (such as a POTENTIALLY closing cost gap between West and East) and/or can be planned for (such as POTENTIALLY having a family or wanting to spend more as you get older).

- Going back to some line of work or active investing is an option in most cases. Sure, your income may not initially be as high as if you'd worked your entire life, but chances are, if you're diligent enough to do early retirement, you're diligent enough to make this option work for you.

- As another poster pointed out, the West being safe and such is a political matter of debate. But there's almost no denying around here that it has the worst girls, on average.

- As an American, I can tell you that the reason most Americans will never get anywhere close to early retirement is because they CHOOSE to live beyond their means. The laziness that shows up on their waistlines also shows up on their financial statements.

- The reason to focus more on controlling expenses than increasing personal revenue (which is still important) is because for most folks, doing something like not eating out every meal is easier than earning more to cover it.

- The 4% withdrawal rule is quite safe: https://www.mrmoneymustache.com/2012/05/...etirement/

- QE does inflate markets, but if you want the best returns, where else are you going to go? Inflation slowly erodes cash, while gold and maybe crypto are primarily just hedges against inflation.
If you haven't met anyone, I'll assume you're lying (h/t to Teedub from the old forum)
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#16
(08-18-2020, 09:04 PM)floridaman Wrote: You're painting with a broad brush here. 

Most of Europe is living at home til near age 40 with zero career prospects. They're not even reproducing.

Only a handful of west/north euro countries have the cushy safety net you describe and who knows how long that will last with Europe's demographic issues. 

It's very plausible for an American to get a 40-45 hour /week job in a trade and buy their own home shortly out of highschool. Millenials/gen z think that work is beneath them so they compete for "cool" slave wage gigs in the big cities. But Europeans by in large don't even have that option. The wage/property value ratio is horrendous. And that's even before taxes are considered. 

A lot of good stuff about Europe. But any American with a decent resume is going to take a pay/lifestyle hit moving there.

But sure if you're content with mediocrity, have no ambition, and just want to clock in your 40 hours until your next vacay it's probably the best spot.

Have you lived and worked in comparable roles in both the US and Europe so that you can make a first hand, qualified observation on this?

Because almost everything you've said is nonsense that isn't backed up by the actual statistics. ie the average age Western Europeans leave their parental home is 21 in Sweden, 23 in Belgium, 23 in Germany..etc. Not exactly 40. [1]

Or how the US is currently ranked a lowly 43rd in home ownership rates in the world. Below Romania, Slovakia, Croatia, Lithuania, Hungary, Poland, Bulgaria, Estonia, Lativa, Malta, Spain, Czechia, Slovenia, Portugal, Greece, Cyprus, Italy, Finland, Luxembourg, Belgium, Sweden, Ireland, and the Netherlands... ie 23 of 27 members of the EU. So Europeans are, actually, far more likely to buy their own home than Americans.[2]

etc

I also didn't mention a social security net once in my post - thats a strawman of your own creation. The free university, free healthcare etc are obviously nice benefits to living in Western Europe. And they are present in any Western European country that an American would likely consider moving to while still of working age. But for most middle class men in their 20s/30s/40 (ie this forum) they really shouldn't be a pull factor - anyone here is very unlikely to actually need to use the social safety net, one would hope.

The US has a hell of a lot going for it as a country to live in. Its probably the best place in the world to be in the top 5% of society. Taxes are low, land is cheap, living costs are low, its mostly safe, and its by and large not too polluted. Its one of the best countries in the world to set up your own business. But anyone whos lived and worked in both Europe and the US, or even somewhere like Australia and the US, will tell you America in 2020 is just not a good place to be a middle, or god forbid working class, worker. Workers rights, and work/life balance, are just horrendous across the board.

People need to be realistic about their prospects: if you've got a great business idea/business plan, you should absolutely stay in the US and give it a shot. Or if you're from a very wealthy family where working is less necessary. But if you're currently facing the prospect of 40 years of a middle class job in the US, with very few holidays, and very little time off in general, its worth considering other options. Location independence is one, relocating to Europe is simply another.

[1]https://ec.europa.eu/eurostat/web/produc...20180515-1
[2]https://en.wikipedia.org/wiki/List_of_co...rship_rate
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#17
Your OP said nothing about Western Europe specifically.

Also those homeownership stats are misleading as it includes many former soviet states where properties were basically just up for grabs.

My point still stands. Any high school grad can get into a well-paid trade and buy a home after a couple years. Would be pretty hard to pull that off in most of Europe.
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#18
My original post, that you quoted, literally specifically states Western Europe:

(08-18-2020, 10:58 AM)zatara Wrote: Its a move I recommend to every American currently trying to decide between financial comfort in wage slavery versus freedom and poverty as a location independent nomad type. Working in a decent job in Western Europe really does seem to me the best middle way of achieving both financial security and a reasonable work/life balance.

And only 3 of those 23 EU states with higher home ownership rates than the US are former Soviet states.

So no, your point doesn't stand in any way. You should probably actually go experience other countries, or at the very least read data about them, before you post very easily disproven nonsense.
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#19
Quote:Working in a decent job in Western Europe really does seem to me the best middle way of achieving both financial security and a reasonable work/life balance.

That option is closed off to almost all Americans. A few people have a coveted skill and can get hired or transferred to a position in Europe. And a few people marry Europeans. What about the rest of us?
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#20
(08-19-2020, 02:07 PM)zatara Wrote: My original post, that you quoted, literally specifically states Western Europe:

(08-18-2020, 10:58 AM)zatara Wrote: Its a move I recommend to every American currently trying to decide between financial comfort in wage slavery versus freedom and poverty as a location independent nomad type. Working in a decent job in Western Europe really does seem to me the best middle way of achieving both financial security and a reasonable work/life balance.

And only 3 of those 23 EU states with higher home ownership rates than the US are former Soviet states.

So no, your point doesn't stand in any way. You should probably actually go experience other countries, or at the very least read data about them, before you post very easily disproven nonsense.

Ok, former soviet states and countries behind the iron curtain if you're going to get autistic about it. Most of the countries you listed.

My point about trade gigs here is 100% valid and obviously something you know nothing about. 

Frankly your posts read like a guy who couldn't handle the meritocratic work culture here and tuck tailed back to Europe where you can clock in until retirement without ever having added to the bottom line of a company. That's perfectly fine by the way. Not everybody is cut out for a competitive work place.
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