Author Topic: "A bi-weekly paycheck is an addiction"  (Read 3592 times)

FireLane

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"A bi-weekly paycheck is an addiction"
« on: February 11, 2021, 07:03:55 PM »
Some good thoughts in a Twitter thread by Nick Huber, starting here:

https://twitter.com/sweatystartup/status/1357394970148278274

I don't know the guy, but he identifies as a real-estate owner and an entrepreneur. He's identified the problem, and it seems like he's about 90% of the way to the FIRE mentality, except that he hasn't figured out the concept of living off passive investments. His comment about how a paycheck is an addiction hit home for me, since I'm struggling a bit with when to pull the plug:

Quote
Corporate america is a trap for anyone who wants to stop working prior to 60 yrs old.

They pay you just enough so the opportunity cost of doing something on your own isn’t worth it.

And more and more every year so the new $ is just enough to keep you.

They love it when you buy nicer houses, cars, things.

They hate it when you buy investment properties or assets.

Their goal is to keep you making money for them as long as possible.

By the time you’re 35 with two kids making $200k a year but spending $175k a year there is no way out.

They have you exactly where they want you.

And you’re 100% stuck.

How can you take any risk at all?

You have everything to lose and too much life overhead with any kind of side project.

And even the small sure bets are too risky to go after because of the dependency your employer has created.

A bi-weekly paycheck is an addiction.

You have to have it to pay for the things you have no time to enjoy.

There is no other way for you.

You blink and you’re 65. Rich. Unhealthy. No deep friendships.

And you’ve given up 50 hrs a week for 45 yrs to build for someone else.

Morning Glory

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Re: "A bi-weekly paycheck is an addiction"
« Reply #1 on: February 11, 2021, 07:34:15 PM »
The guy seems a bit conflicted. Love it how he normalizes making 200k and spending 175k. 90% of us could only dream of such numbers. Yes consumerism can be a trap but there are worse ones. The teen pregnancy trap. The drug addiction trap. The abusive relationship trap.

He forgot about the employer-based health insurance system. That's the real trap for those who make too much for public assistance. Even if you can avoid spending all your money, it's hard to afford health insurance on your own. It's hard to even change employers. I couldn't even take a week off between jobs because of stupid health insurance. How many small businesses aren't started for this reason?

 Why do you think they don't want us to have single payer? It would be the best thing for small business and farmers. Conservatives should love it. Are they that afraid that everyone would just quit? I am talking about the same big they as the twitter guy here. Who is the they and what do they want?

He also didn't mention the lack of community so prevalent in our culture. People just write each other off. Move away for jobs. Think it's weird to contact people after a certain amount of time has passed.  Isolate themselves because they are afraid to reach out or irritated that the other person doesn't make enough effort. Have an argument and just ghost each other. Hire professionals to care for their parents because being a caregiver is so fucking isolating. Our culture fucking sucks. No wonder people overwork and buy shit to distract themselves.
« Last Edit: February 11, 2021, 07:55:00 PM by Morning Glory »

Taran Wanderer

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Re: "A bi-weekly paycheck is an addiction"
« Reply #2 on: February 11, 2021, 09:55:17 PM »
There is a lot of truth to this.  The numbers are too high for most, but the rest resonates with me.  The other sh1tty thing is that there is very little loyalty show to employees by most large companies.  You run into a rough patch?  You’re out. We wish you well in your future endeavors. 

roomtempmayo

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Re: "A bi-weekly paycheck is an addiction"
« Reply #3 on: February 12, 2021, 08:00:15 AM »
The other sh1tty thing is that there is very little loyalty show to employees by most large companies.  You run into a rough patch?  You’re out. We wish you well in your future endeavors.

Yeah, he's on the right track, but he might be overly optimistic. 

Perhaps more likely is that after a few decades of hustling for the company to finance that $175k/yr lifestyle without anything to show for it, you get a pink slip at age 52 in an economic downturn.  You end up burned out, bitter, and never employed again at the same level while you limp toward a retirement that's diminished and receding.

bbqbonelesswing

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Re: "A bi-weekly paycheck is an addiction"
« Reply #4 on: February 12, 2021, 02:28:38 PM »
https://twitter.com/sweatystartup/status/1357398760058454016

Quote
It’s easy to say things like “don’t buy a bigger house or nicer car.”

But that’s impossible for almost all of us. Me included.

Humans crave status and comfort and shiny things.

WTF is the point of making money if you aren’t going to spend it?

I think this forum is full of people who have proven this to be false.

This Twitter thread mostly strikes me as a guy drawn to shiny things and trying to make excuses for it, while raging at some idea of "the Man." Where is there any sense of personal responsibility here?

His comment about the 35 year old making $200k and being "100% stuck" is also strange and kind of makes me think he is divorced from reality. How is someone making $200k at 35 stuck? Many of us here could retire after just a few years with that kind of income.


YttriumNitrate

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Re: "A bi-weekly paycheck is an addiction"
« Reply #5 on: February 12, 2021, 02:41:54 PM »
His comment about the 35 year old making $200k and being "100% stuck" is also strange and kind of makes me think he is divorced from reality. How is someone making $200k at 35 stuck? Many of us here could retire after just a few years with that kind of income.

A big house payment, a few big car payments, hefty tax bills, two kids in private schools, two kids in expensive activities, pressure to go on expensive vacations, helping pay for less fortunate parents/siblings, religious donations, etc. I can see how someone making $200k with two kids could feel stuck. While there are certainly people on this forum who would slash out those things after they are already in place, those with the willpower to do so are in the small minority.

ixtap

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Re: "A bi-weekly paycheck is an addiction"
« Reply #6 on: February 12, 2021, 02:53:01 PM »
https://twitter.com/sweatystartup/status/1357398760058454016

Quote
It’s easy to say things like “don’t buy a bigger house or nicer car.”

But that’s impossible for almost all of us. Me included.

Humans crave status and comfort and shiny things.

WTF is the point of making money if you aren’t going to spend it?

I think this forum is full of people who have proven this to be false.

This Twitter thread mostly strikes me as a guy drawn to shiny things and trying to make excuses for it, while raging at some idea of "the Man." Where is there any sense of personal responsibility here?

His comment about the 35 year old making $200k and being "100% stuck" is also strange and kind of makes me think he is divorced from reality. How is someone making $200k at 35 stuck? Many of us here could retire after just a few years with that kind of income.

Some people don't want to admit that spending most of your income is a choice after some basics are met. The Man demands you buy the latest and greatest. Luckily, I have always been a bit of a hippy, willing to ignore The Man.

roomtempmayo

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Re: "A bi-weekly paycheck is an addiction"
« Reply #7 on: February 12, 2021, 03:19:29 PM »
https://twitter.com/sweatystartup/status/1357398760058454016

Quote
It’s easy to say things like “don’t buy a bigger house or nicer car.”

But that’s impossible for almost all of us. Me included.

Humans crave status and comfort and shiny things.

WTF is the point of making money if you aren’t going to spend it?

I think this forum is full of people who have proven this to be false.

This Twitter thread mostly strikes me as a guy drawn to shiny things and trying to make excuses for it, while raging at some idea of "the Man." Where is there any sense of personal responsibility here?

His comment about the 35 year old making $200k and being "100% stuck" is also strange and kind of makes me think he is divorced from reality. How is someone making $200k at 35 stuck? Many of us here could retire after just a few years with that kind of income.

Some people don't want to admit that spending most of your income is a choice after some basics are met. The Man demands you buy the latest and greatest. Luckily, I have always been a bit of a hippy, willing to ignore The Man.

It may be a choice, but it's not a fully free or individual choice once you're financing the lifestyle of your family.

I know lots of guys who make big bucks and spend them on a lifestyle that's mostly enjoyed by their wives and kids since they're mostly working.  How do you suppose it's going to go over if they unilaterally decide that the family's lifestyle is going to shrink from $200k/yr to $50k/yr?  Sure, it's a choice they could make, but the rest of the family is very likely to make their own choices in response.  The end result might be that they don't have much of a family left.

It's a whole lot easier to never inflate your lifestyle in the first place than it is to dial it back, especially when there's a spouse and kids involved.

Metalcat

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Re: "A bi-weekly paycheck is an addiction"
« Reply #8 on: February 12, 2021, 04:30:52 PM »
https://twitter.com/sweatystartup/status/1357398760058454016

Quote
It’s easy to say things like “don’t buy a bigger house or nicer car.”

But that’s impossible for almost all of us. Me included.

Humans crave status and comfort and shiny things.

WTF is the point of making money if you aren’t going to spend it?

I think this forum is full of people who have proven this to be false.

This Twitter thread mostly strikes me as a guy drawn to shiny things and trying to make excuses for it, while raging at some idea of "the Man." Where is there any sense of personal responsibility here?

His comment about the 35 year old making $200k and being "100% stuck" is also strange and kind of makes me think he is divorced from reality. How is someone making $200k at 35 stuck? Many of us here could retire after just a few years with that kind of income.

They are stuck though, because they mistake cash flow for wealth. They don't actually have any money, they have good cash flow. So they borrow against their projected future cash flow and then end up quite legitimately stuck.

I see it all the time with the medical professionals I advise. My position is always that they aren't actually rich until they have money. Until then, they're just broke punks with good cash flow.

As for status, comfort and shiny things, he's not wrong. However, he's made a foundational logical error that all of those things require money to obtain.

Really though, we get to decide for ourselves what type of status we seek, what comfort means, and what kind of shiny things we care about.

You're just a consumer sucker if you think status comes from spending more, and that comfort and shiny things have to be expensive.

Some of us are very rich in status, comfort, and shiny things without spending much.

BlueMR2

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Re: "A bi-weekly paycheck is an addiction"
« Reply #9 on: February 12, 2021, 04:33:22 PM »
I'm feeling it like an addiction myself.  Made our retirement numbers which were very conservative to begin with.  Still not retired.  "What if?"  "Ooooh, approaching another big milestone", etc.  Can't seem to walk away even though work is in the pretty unhealthy range now.  I always assumed I was addicted to the rush of walking into chaos every day and trying to calm it.  It may be the addiction to the weekly pay though instead.

Metalcat

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Re: "A bi-weekly paycheck is an addiction"
« Reply #10 on: February 12, 2021, 05:20:20 PM »
I'm feeling it like an addiction myself.  Made our retirement numbers which were very conservative to begin with.  Still not retired.  "What if?"  "Ooooh, approaching another big milestone", etc.  Can't seem to walk away even though work is in the pretty unhealthy range now.  I always assumed I was addicted to the rush of walking into chaos every day and trying to calm it.  It may be the addiction to the weekly pay though instead.

Most people have an aversion to change and will rationalize a million nonsense excuses to keep doing what they're doing, even if they know it's awful.

Don't give too much credence to the reasons you give yourself to keep doing something.

rmorris50

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Re: "A bi-weekly paycheck is an addiction"
« Reply #11 on: February 12, 2021, 07:22:59 PM »
Also, the way savings is set up and encouraged in this country makes it harder to leave your job. You can “lock” away lots of money into retirement accounts and products that discourage touching it until some magical retirement date. But hey, wanna touch it early? Gotta break on of those eggs and maybe even a penalty.


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FireLane

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Re: "A bi-weekly paycheck is an addiction"
« Reply #12 on: February 13, 2021, 09:49:19 AM »
I'm feeling it like an addiction myself.  Made our retirement numbers which were very conservative to begin with.  Still not retired.  "What if?"  "Ooooh, approaching another big milestone", etc.  Can't seem to walk away even though work is in the pretty unhealthy range now.  I always assumed I was addicted to the rush of walking into chaos every day and trying to calm it.  It may be the addiction to the weekly pay though instead.

Most people have an aversion to change and will rationalize a million nonsense excuses to keep doing what they're doing, even if they know it's awful.

Don't give too much credence to the reasons you give yourself to keep doing something.

This is good advice. I posted this because I feel the same way. The security of a steady paycheck is a hard thing to give up, although I know I objectively don't need the money anymore.

Personally, I have the opposite problem to @BlueMR2: my job isn't awful. I'm well paid for a relatively low amount of time and stress, and that makes it harder to take the leap, because there's no compelling reason pushing me out the door. Change aversion is a good explanation. I have to work harder on overcoming that.

zolotiyeruki

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Re: "A bi-weekly paycheck is an addiction"
« Reply #13 on: February 18, 2021, 07:58:09 AM »
Does it bother anyone else when the author uses the term "they" when referring to a corporation, and ascribe emotions to it?

Is it to your employer's benefit for your to be financially dependent on them?  Maybe.  Unhappy employees tend to also be less productive.  They may be willing to put up with worse conditions, including lower pay, but that doesn't universally lead to greater profitability.

The goal of a company is to maximize profit, generally speaking.  That doesn't mean "you making money for them as long as possible."  It means "you making as much money for them as possible."  There's an important distinction there.  An employee whose net profitability is 1% of his paycheck isn't exactly a high performer.

To categorically state that "Corporate america is a trap for anyone who wants to stop working prior to 60 yrs old" is to deny the existence of personal choice and accountability.  It's only a trap if you choose to fall into it.  The corporation did not force you to buy that McMansion, or finance the $70,000 pickup truck, or buy a $1400 cell phone with a $100/mo plan, or pick up Starbucks every day on the way to work, or buy tailored and monogrammed dress shirts.

"There is no solution here for most folks, and it’s a shame."  Absolutely NOT TRUE.  The solution is to step off the hedonic treadmill, stop mindlessly spending money, and take the time to evaluate what actually makes you happy.

I agree, though, that employer-sponsored/non-portable health insurance inhibits mobility.  I understand the motivations behind the origins of the tax break, but IMO it's high time to extend that tax break beyond just employers.

Bloop Bloop Reloaded

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Re: "A bi-weekly paycheck is an addiction"
« Reply #14 on: February 18, 2021, 11:05:06 PM »
I just wonder where self-employed and contractors fit into this oversimplification.

I'm a lawyer (sole trader/contractor) with lots of lawyer friends (who are now entering partnership) and doctor friends (mix of employees and sole traders). Most high earning professionals who earn the "$200k" USD figure being bandied about could easily strike out on their own either as a partner or a sole trader. To blame the hedonic treadmill on "corporate America" is silly.

Tinker

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Re: "A bi-weekly paycheck is an addiction"
« Reply #15 on: February 19, 2021, 12:46:18 AM »
I think it was Nassim Taleb... paraphrasing, "the three most harmful addictions are heroin, carbohydrates and a monthly salary"

Obviously he too is outrageously rich, but I believe the sentiment holds truth and is applicable down all the way to schmucks like me who still need an income to make it to a ripe old age.

MoustacheDArgent

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Re: "A bi-weekly paycheck is an addiction"
« Reply #16 on: March 11, 2021, 11:24:00 PM »
He may not have the same attitude towards saving money as MMM, but don't write this guy off.  He's teaching a lot of people how to start their own businesses and quit jobs they hate. 

I worked for years at jobs I hated because I needed the paycheck and finally figured out a way to make money on my own and quit my job.   I've listened to his podcast and he's the real deal.  He talks about businesses that don't require a lot of capital, are highly likely to succeed, and don't have a lot of competition.   They are mostly boring businesses, but they are ones that make money.

roomtempmayo

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Re: "A bi-weekly paycheck is an addiction"
« Reply #17 on: March 12, 2021, 10:10:42 AM »
I've listened to his podcast and he's the real deal.  He talks about businesses that don't require a lot of capital, are highly likely to succeed, and don't have a lot of competition.   They are mostly boring businesses, but they are ones that make money.

I just followed him, and I'll check out his podcast.

I'm always interested in these unglamorous businesses with low barriers to entry that hardly anyone thinks of doing.

The golf cart rentals in Florida are a perfect example.