Author Topic: A high paying job  (Read 6096 times)

Skyhigh

  • Bristles
  • ***
  • Posts: 404
A high paying job
« on: November 12, 2019, 03:50:30 PM »
I see a lot of discussion about frugality and articles about people who pay off 120K in student debt over 14 months and it seems to me that they are leaving out some important information. In order to be able to save a lot one must earn a lot. American’s commonly barely eek out an existence. There is no surplus income to conserve. No room in the budget to cut to a meaningful degree. In the common experience of this group it seems that the first step to achieving FIRE is a high paying career.

The second seems to be no children.

Skyhigh
« Last Edit: November 12, 2019, 03:53:43 PM by Skyhigh »

mathlete

  • Handlebar Stache
  • *****
  • Posts: 2070
Re: A high paying job
« Reply #1 on: November 12, 2019, 04:20:22 PM »
Yes.

The crux of most FIRE stories is that someone lived a comfortable, middle-class lifestyle while earning far greater that the middle income necessary to support it. Bonus points for marketing this as extreme financial discipline and make a few bucks while you're at it.

It's attractive to say that the math technically scales at any income. But there are hard limits to what most reasonable, first world people are willing to accept.

If I made tens of thousands less than I do, I certainly would not be pursuing FIRE. The lifestyle and experiences I'd have to lose wouldn't be worth it to get the high savings rate needed.

jim555

  • Magnum Stache
  • ******
  • Posts: 3235
Re: A high paying job
« Reply #2 on: November 12, 2019, 04:26:57 PM »
In the other thread OP was saying he gave up on retirement.  I still think you are a troll looking for a rise out of us.

Telecaster

  • Magnum Stache
  • ******
  • Posts: 3551
  • Location: Seattle, WA
Re: A high paying job
« Reply #3 on: November 12, 2019, 07:16:50 PM »
I see a lot of discussion about frugality and articles about people who pay off 120K in student debt over 14 months and it seems to me that they are leaving out some important information. In order to be able to save a lot one must earn a lot. American’s commonly barely eek out an existence. There is no surplus income to conserve. No room in the budget to cut to a meaningful degree. In the common experience of this group it seems that the first step to achieving FIRE is a high paying career.

The second seems to be no children.

Skyhigh

In that case, I recommend you get a high paying job and don't have kids. 

rantk81

  • Pencil Stache
  • ****
  • Posts: 905
  • Age: 42
  • Location: Chicago
Re: A high paying job
« Reply #4 on: November 14, 2019, 06:15:25 AM »
What is the point of this thread?  The OP mentions that he/she sees some posts about people who pay off debt, and mention that they must have high income and no kids?

So what?

@OP - Go do whatever you want.  Try to get a higher paying job, or not.  Try to pursue FIRE or not.  Do whatever.  The path to FIRE (or not FIRE) is different for everyone.  Instead of trying to compare your situation to others, why not focus on improving your situation if you aren't happy with it?

Metalcat

  • Senior Mustachian
  • ********
  • Posts: 17394
Re: A high paying job
« Reply #5 on: November 14, 2019, 06:34:05 AM »
OP-

Didn't *YOU* reach FIRE really young without a high income while raising kids??

DadJokes

  • Handlebar Stache
  • *****
  • Posts: 2360
Re: A high paying job
« Reply #6 on: November 14, 2019, 06:38:53 AM »
I guess it's not possible then. Let's pack it up- the FIRE thing was fun while it lasted.



Can everyone FIRE? No, and I don't think anyone worth taking serious claims that. MMM's blog is aimed at middle class spendypants, not low income individuals who struggle to get by. They're different groups with entirely different problems.

Metalcat

  • Senior Mustachian
  • ********
  • Posts: 17394
Re: A high paying job
« Reply #7 on: November 14, 2019, 07:13:58 AM »
I guess it's not possible then. Let's pack it up- the FIRE thing was fun while it lasted.



Can everyone FIRE? No, and I don't think anyone worth taking serious claims that. MMM's blog is aimed at middle class spendypants, not low income individuals who struggle to get by. They're different groups with entirely different problems.

Many in the ERE community disagree with you, and MMM himself has written several times about how Mustachianism is actually even more relevant for those with lower incomes.

The opposite of FIRE is not retiring at normal retirement age, the opposite of FIRE is mindless spending and letting that mindless spending dictate when/if you can retire.

So if someone can afford to retire at all, they can probably afford to retire earlier through more mindful spending and frugality.

Can everyone retire very young, while sustaining a "normal" middle class lifestyle, in any area of the world, at any level of income? Obviously not, but no one ever claimed that. Nor should FIRE be looked at through the automatic lense of sustaining a certain lifestyle. That may be the most common goal, but it's not a given for everyone.

Claiming that lower income people can't FIRE is nonsense. It is however, fair to say that for a lot of people on lower incomes that the lifestyle trade offs they would have to make to retire very early are often not considered worth it.

When people talk about how easy it is for high income people to achieve FIRE, what they're really saying is that it's far more comfortable for a high income person to voluntarily live at a socioeconomic lifestyle level far beneath the level they could afford to live at if they chose to spend the majority of their income and work much longer.

Whereas, it's far more uncomfortable for a lower income person to live at a significantly lower socioeconomic lifestyle level than working into their senior years would provide.

None of that means that lower income people should be less mindful of their spending than higher income people. It just means that each trade off to retire earlier may feel less worth it.

FIRE for high income people requires a return to a more "average" lifestyle, whereas FIRE for lower income people requires a departure from it.

bacchi

  • Walrus Stache
  • *******
  • Posts: 7056
Re: A high paying job
« Reply #8 on: November 14, 2019, 12:40:36 PM »
OP-

Didn't *YOU* reach FIRE really young without a high income while raising kids??

Poor performing career -- check
Minimalist lifestyle -- check
Built some FIRE income regardless -- check
Family -- check (though it's unclear if that was during or after FIRE)

I endured a poor performing career that forced me into a FIRE mentality early on in my life in order to survive. As a result, my career goals are largely unfulfilled. I spent my 20's and 30's living a minimalist lifestyle and perfected the art of living outside the rat race in order to keep my career dreams alive. Eventually, I built a business and real estate portfolio that sustain us  quite well.

MilesTeg

  • Handlebar Stache
  • *****
  • Posts: 1363
Re: A high paying job
« Reply #9 on: November 14, 2019, 12:50:03 PM »
I guess it's not possible then. Let's pack it up- the FIRE thing was fun while it lasted.



Can everyone FIRE? No, and I don't think anyone worth taking serious claims that. MMM's blog is aimed at middle class spendypants, not low income individuals who struggle to get by. They're different groups with entirely different problems.

Many in the ERE community disagree with you, and MMM himself has written several times about how Mustachianism is actually even more relevant for those with lower incomes.

The opposite of FIRE is not retiring at normal retirement age, the opposite of FIRE is mindless spending and letting that mindless spending dictate when/if you can retire.

So if someone can afford to retire at all, they can probably afford to retire earlier through more mindful spending and frugality.

Can everyone retire very young, while sustaining a "normal" middle class lifestyle, in any area of the world, at any level of income? Obviously not, but no one ever claimed that. Nor should FIRE be looked at through the automatic lense of sustaining a certain lifestyle. That may be the most common goal, but it's not a given for everyone.

Claiming that lower income people can't FIRE is nonsense. It is however, fair to say that for a lot of people on lower incomes that the lifestyle trade offs they would have to make to retire very early are often not considered worth it.

When people talk about how easy it is for high income people to achieve FIRE, what they're really saying is that it's far more comfortable for a high income person to voluntarily live at a socioeconomic lifestyle level far beneath the level they could afford to live at if they chose to spend the majority of their income and work much longer.

Whereas, it's far more uncomfortable for a lower income person to live at a significantly lower socioeconomic lifestyle level than working into their senior years would provide.

None of that means that lower income people should be less mindful of their spending than higher income people. It just means that each trade off to retire earlier may feel less worth it.

FIRE for high income people requires a return to a more "average" lifestyle, whereas FIRE for lower income people requires a departure from it.

For a high income person/family, frugality is a path toward the luxury of FIRE -- sometimes very early in life.

For a low income person/family, frugality is a necessity of survival.


Metalcat

  • Senior Mustachian
  • ********
  • Posts: 17394
Re: A high paying job
« Reply #10 on: November 14, 2019, 01:49:55 PM »

For a high income person/family, frugality is a path toward the luxury of FIRE -- sometimes very early in life.

For a low income person/family, frugality is a necessity of survival.

Yes, if someone makes so little income that they can never afford to retire no matter how frugal they are, then yeah, they can't afford to retire early.

Is that how we're defining low income?


MilesTeg

  • Handlebar Stache
  • *****
  • Posts: 1363
Re: A high paying job
« Reply #11 on: November 14, 2019, 02:07:40 PM »

For a high income person/family, frugality is a path toward the luxury of FIRE -- sometimes very early in life.

For a low income person/family, frugality is a necessity of survival.

Yes, if someone makes so little income that they can never afford to retire no matter how frugal they are, then yeah, they can't afford to retire early.

Is that how we're defining low income?

I wouldn't be quite that extreme, but families in the lowest quintile of income aren't going to retire in their 30s-50s barring crazy crap like 'living in a van down by the river'. Frugality at that income level is a necessity of existence not a tool for the luxury of FIRE.

Metalcat

  • Senior Mustachian
  • ********
  • Posts: 17394
Re: A high paying job
« Reply #12 on: November 14, 2019, 02:23:34 PM »

For a high income person/family, frugality is a path toward the luxury of FIRE -- sometimes very early in life.

For a low income person/family, frugality is a necessity of survival.

Yes, if someone makes so little income that they can never afford to retire no matter how frugal they are, then yeah, they can't afford to retire early.

Is that how we're defining low income?

I wouldn't be quite that extreme, but families in the lowest quintile of income aren't going to retire in their 30s-50s barring crazy crap like 'living in a van down by the river'. Frugality at that income level is a necessity of existence not a tool for the luxury of FIRE.

Well, I don't define early retirement as 30-50, so there's that.

Also, are you positing that low income households don't participate in wasteful spending?

mathlete

  • Handlebar Stache
  • *****
  • Posts: 2070
Re: A high paying job
« Reply #13 on: November 14, 2019, 02:48:06 PM »
For a high income person/family, frugality is a path toward the luxury of FIRE -- sometimes very early in life.

For a low income person/family, frugality is a necessity of survival.

Largely agree.

I know in some corners of the personal finance space, there are people who make like, $20K or something, and if they squint real hard, it looks to them like they only need $10K to survive and thrive. If this sort of person tries to do the FIRE thing, I think it will end poorly for them. I won't mince words about that.


mathlete

  • Handlebar Stache
  • *****
  • Posts: 2070
Re: A high paying job
« Reply #14 on: November 14, 2019, 03:11:21 PM »
As others have pointed out, OP definitely seems like a troll. But having basically grown up on the Internet, I can say that something that's been apart of every forum or community that I've joined, is an element of keeping up with (or down with) the Jones's.

For example, when I was a lot younger, I frequented a forum about the Disney Parks. There was this lady who become something of a celebrity for how she blogged about planning and executing her Disney Dream Wedding. Needless to say, it was a a really cool wedding, and she spared no detail when blogging about it. What florist they used, the photographer, which restaurants they ate at, etc. She made her wedding seem so cool and magical, that of course she got a bunch of people who wanted to do something similar. So she happily preached her gospel. Sharing her experiences and offering advice. Some people were loaded, like she was. Other people, not so much. But they worked themselves up into a froth on the idea of having this millionaire style wedding without realizing the obvious fact that it probably wasn't in the cards for them, as a middle or low income person.

This happens with PF too. But it's more pernicious because it seems like such a positive thing. How can frugality and a focus on fiscal responsibility be bad, after all? We even get militant about the fact that "the math works at every income level". But I think critical thinking reveals that this isn't for everyone. There are hard lower bounds to spending. And I think that for some people, giving up your peak earning years based on the assumption that you'll be happy on an absurdly low level of spending for the next 40, 50, 60 years is a bad idea.

Metalcat

  • Senior Mustachian
  • ********
  • Posts: 17394
Re: A high paying job
« Reply #15 on: November 16, 2019, 08:01:26 AM »
As others have pointed out, OP definitely seems like a troll. But having basically grown up on the Internet, I can say that something that's been apart of every forum or community that I've joined, is an element of keeping up with (or down with) the Jones's.

For example, when I was a lot younger, I frequented a forum about the Disney Parks. There was this lady who become something of a celebrity for how she blogged about planning and executing her Disney Dream Wedding. Needless to say, it was a a really cool wedding, and she spared no detail when blogging about it. What florist they used, the photographer, which restaurants they ate at, etc. She made her wedding seem so cool and magical, that of course she got a bunch of people who wanted to do something similar. So she happily preached her gospel. Sharing her experiences and offering advice. Some people were loaded, like she was. Other people, not so much. But they worked themselves up into a froth on the idea of having this millionaire style wedding without realizing the obvious fact that it probably wasn't in the cards for them, as a middle or low income person.

This happens with PF too. But it's more pernicious because it seems like such a positive thing. How can frugality and a focus on fiscal responsibility be bad, after all? We even get militant about the fact that "the math works at every income level". But I think critical thinking reveals that this isn't for everyone. There are hard lower bounds to spending. And I think that for some people, giving up your peak earning years based on the assumption that you'll be happy on an absurdly low level of spending for the next 40, 50, 60 years is a bad idea.

Well yeah, we all know that retiring very early isn't for everyone.

I mean, even in this community, very very few people give up the bulk of their highest earning years. I read far more posters talk about retiring in their 50s and 60s than in their 40s.

There are a few prominent posters who retired in their 30s and 40s, but they're not nearly as common as those who will retire maybe 10ish years early, but just like the blogs, those impressive posters tend to be of note.

Just because the most notable and famous FIRE community members are the ones who retired young doesn't mean they're representative of the majority. 

It's the same way that the weight loss world is flooded with images of people who've lost enormous amounts of weight bringing them from obese down to visible abs, but very few actually live that reality.

Do people frequently get sucked into unrealistic fantasies? Of course they do. That will always happen, whether it be retiring at 30 on a low(er) income, or getting fixated on a Disney wedding they can't afford, or the university kids I mentor who are certain that they're going to become cardio thoracic surgeons even though they have a mediocre GPA but they aced one bio assignment.

People frequently underestimate the challenges of lofty goals, and they paradoxically overestimate a lot of risks. It's all really quite fascinating.

However, none of that takes away from the basic principles that less wasteful spending results in more financial freedom and more free time. That's inarguable.

Also, whenever someone invokes frugality among the poor as a given, I admit that I jump to the assumption that they haven't actually spent much time with poor people. I apologize if I'm wrong in this case.

I've spent my entire life around poor people, and the bigger problem is the inability to afford the basics of a safe and healthy life no matter how frugal they are. It's the inability to afford the desperately needed root canal, or the heat treatment for the bed bugs in their apartment, or the repair for their old car. I'm close to a number of people who own/have owned working class bars...their entire livelihood depends on people who have just enough cash flow to afford their services and not much else.

That's why it's important to be clear as to what we're talking about. If talking about people who struggle to sustain the basics of life, then yeah, discussion of frugality as a means to health and safety is not just unrealistic, it's utterly offensive.

However, if we're discussing "low income" within the paradigm of people who are able to sustain a safe and healthy lifestyle with some degree of margin, then yeah, retiring 30 years early may not result in the kind of lifestyle trade off they're willing to make. However, being mindfully careful about their spending may allow them to retire a solid 5 years early, or allow them to downshift at some point, which is no small feat.

I agree with you though, what all higher earners need to avoid is some bullshit self-indulgent nonsense attitude that because it's easy for us to make massive lifestyle trade offs that it's easy for everyone.

Every day at work I tell people that they need to spend $500-5000 to solve an unexpected problem that has a fair degree of urgency. Every day I see how that news affects different people so very differently. Every day I'm reminded of the level of privilege that comes with my high income because for me, that would be an annoyance, but for many, it's bone chillingly terrifying and utterly defeating.
« Last Edit: November 16, 2019, 08:03:10 AM by Malkynn »

bluebelle

  • Pencil Stache
  • ****
  • Posts: 645
  • Location: near north Ontario
Re: A high paying job
« Reply #16 on: November 16, 2019, 10:00:55 AM »
thanks @Malkynn
I know I sometimes get holier than tho and forget that many people don't have the luxury of just making good choices.....that there is a big difference between someone making a good wage and spending it all (and more) and someone that barely has enough for even the basics....when you're living so close to the line that you can't take advantage of a sale because there is no wiggle room in the grocery budget, that must be soul crushing.   I remind my husband regularly that we are 'lucky' that we have the 'privilege' to be able to make good money choices.   

ctuser1

  • Handlebar Stache
  • *****
  • Posts: 1741
Re: A high paying job
« Reply #17 on: November 16, 2019, 11:45:24 AM »
I don’t plan to really retire, maybe ever. At least not as long as my mind stays sharp enough for me to build cool stuff and solve difficult sounding problems by whipping up some cool code. I enjoy it enough that I will likely be an open source contributor of some sort if I am not working for money. So the RE part of FIRE is not relevant for me.

I’m also not quite low income (although I feel like that sometime in comparison to the hotshot investment bankers).

Had I been low income, my FI target would likely take longer to reach. But that would likely have made the mustache an frugality *more* important, not less!

Where it does become problematic is is when you start trying to keep up with the jones’ in any form or format. When someone else retires is likely not ver relevant to when you *should* retire. You can take other examples to show what is possible, but you should compete with yourself only.

I teach my daughter “if you are doing something better than you did yesterday, then you had a good day today; if you made no progress, then you wasted away and lost a day from your life.”

Compete with yourself, not others, and a lot of such perceived, made up problems will go away.

frugal_c

  • Bristles
  • ***
  • Posts: 300
Re: A high paying job
« Reply #18 on: November 16, 2019, 11:51:16 AM »
I don't want to disparage anyone's circumstance but I think that thrift is more important for lower income earners than anyone. 

I have seen where people with minimum wage jobs get stuck and one of the limitations is .. money.  Where I live, there are quite a few jobs that will pay $18-20/hour if you can just take an 8-12 week course.   These jobs are paying around double the minimum wage, it is clearly a good decision from a financial perspective.  Some people just don't have the finances to cover the expenses + course cost, but we are not talking crazy money.

I can't help thinking that if they went hard on frugality, they could eventually save up enough.  Even $100 a month, will eventually cover it.  Yes it's a sacrifice but in comparison to a life at half the wage? 

Another one is the down-payment for a house.  This isn't an option in many housing markets, I will admit that, but if you are willing to move there are places where you can buy a condo for around $100k.  If you can save up $5-10k for a down payment and get a room-mate that would dramatically change someone's finances over time.  If you can do nothing other than that, then at least you will at some point have a paid for place.

mathlete

  • Handlebar Stache
  • *****
  • Posts: 2070
Re: A high paying job
« Reply #19 on: November 16, 2019, 11:55:27 AM »
As others have pointed out, OP definitely seems like a troll. But having basically grown up on the Internet, I can say that something that's been apart of every forum or community that I've joined, is an element of keeping up with (or down with) the Jones's.

For example, when I was a lot younger, I frequented a forum about the Disney Parks. There was this lady who become something of a celebrity for how she blogged about planning and executing her Disney Dream Wedding. Needless to say, it was a a really cool wedding, and she spared no detail when blogging about it. What florist they used, the photographer, which restaurants they ate at, etc. She made her wedding seem so cool and magical, that of course she got a bunch of people who wanted to do something similar. So she happily preached her gospel. Sharing her experiences and offering advice. Some people were loaded, like she was. Other people, not so much. But they worked themselves up into a froth on the idea of having this millionaire style wedding without realizing the obvious fact that it probably wasn't in the cards for them, as a middle or low income person.

This happens with PF too. But it's more pernicious because it seems like such a positive thing. How can frugality and a focus on fiscal responsibility be bad, after all? We even get militant about the fact that "the math works at every income level". But I think critical thinking reveals that this isn't for everyone. There are hard lower bounds to spending. And I think that for some people, giving up your peak earning years based on the assumption that you'll be happy on an absurdly low level of spending for the next 40, 50, 60 years is a bad idea.

Well yeah, we all know that retiring very early isn't for everyone.

I mean, even in this community, very very few people give up the bulk of their highest earning years. I read far more posters talk about retiring in their 50s and 60s than in their 40s.

There are a few prominent posters who retired in their 30s and 40s, but they're not nearly as common as those who will retire maybe 10ish years early, but just like the blogs, those impressive posters tend to be of note.

Just because the most notable and famous FIRE community members are the ones who retired young doesn't mean they're representative of the majority. 

It's the same way that the weight loss world is flooded with images of people who've lost enormous amounts of weight bringing them from obese down to visible abs, but very few actually live that reality.

Do people frequently get sucked into unrealistic fantasies? Of course they do. That will always happen, whether it be retiring at 30 on a low(er) income, or getting fixated on a Disney wedding they can't afford, or the university kids I mentor who are certain that they're going to become cardio thoracic surgeons even though they have a mediocre GPA but they aced one bio assignment.

People frequently underestimate the challenges of lofty goals, and they paradoxically overestimate a lot of risks. It's all really quite fascinating.

However, none of that takes away from the basic principles that less wasteful spending results in more financial freedom and more free time. That's inarguable.

Also, whenever someone invokes frugality among the poor as a given, I admit that I jump to the assumption that they haven't actually spent much time with poor people. I apologize if I'm wrong in this case.

I've spent my entire life around poor people, and the bigger problem is the inability to afford the basics of a safe and healthy life no matter how frugal they are. It's the inability to afford the desperately needed root canal, or the heat treatment for the bed bugs in their apartment, or the repair for their old car. I'm close to a number of people who own/have owned working class bars...their entire livelihood depends on people who have just enough cash flow to afford their services and not much else.

That's why it's important to be clear as to what we're talking about. If talking about people who struggle to sustain the basics of life, then yeah, discussion of frugality as a means to health and safety is not just unrealistic, it's utterly offensive.

However, if we're discussing "low income" within the paradigm of people who are able to sustain a safe and healthy lifestyle with some degree of margin, then yeah, retiring 30 years early may not result in the kind of lifestyle trade off they're willing to make. However, being mindfully careful about their spending may allow them to retire a solid 5 years early, or allow them to downshift at some point, which is no small feat.

I agree with you though, what all higher earners need to avoid is some bullshit self-indulgent nonsense attitude that because it's easy for us to make massive lifestyle trade offs that it's easy for everyone.

Every day at work I tell people that they need to spend $500-5000 to solve an unexpected problem that has a fair degree of urgency. Every day I see how that news affects different people so very differently. Every day I'm reminded of the level of privilege that comes with my high income because for me, that would be an annoyance, but for many, it's bone chillingly terrifying and utterly defeating.

Really really really good post. Thank you for this.

bluebelle

  • Pencil Stache
  • ****
  • Posts: 645
  • Location: near north Ontario
Re: A high paying job
« Reply #20 on: November 16, 2019, 12:28:54 PM »
I don't want to disparage anyone's circumstance but I think that thrift is more important for lower income earners than anyone. 

I have seen where people with minimum wage jobs get stuck and one of the limitations is .. money.  Where I live, there are quite a few jobs that will pay $18-20/hour if you can just take an 8-12 week course.   These jobs are paying around double the minimum wage, it is clearly a good decision from a financial perspective.  Some people just don't have the finances to cover the expenses + course cost, but we are not talking crazy money.

I can't help thinking that if they went hard on frugality, they could eventually save up enough.  Even $100 a month, will eventually cover it.  Yes it's a sacrifice but in comparison to a life at half the wage? 

Another one is the down-payment for a house.  This isn't an option in many housing markets, I will admit that, but if you are willing to move there are places where you can buy a condo for around $100k.  If you can save up $5-10k for a down payment and get a room-mate that would dramatically change someone's finances over time.  If you can do nothing other than that, then at least you will at some point have a paid for place.

think about how hard it is to save when not only can't  you stock up on things when they're on sale, but you're buying the smaller quantity because that's all you can afford......think about it - your budget is so tight that you're buying the 4 pk of toilet paper, not 4 packages of the 60 roll pack when it's on sale for a smoking deal....extrapolate that.

frugal_c

  • Bristles
  • ***
  • Posts: 300
Re: A high paying job
« Reply #21 on: November 17, 2019, 09:10:57 AM »
It's not easy but i have done it.  It would depend on where you are of course.  I am in Canada and minimum wage is over $10/hr.  If you work full-time that's $1600 a month and you will net about $1400.  You can rent a room in a decent place for $500 / month if you look around, $200 groceries, $100 transport, $400 everything else.  It is tight but you are ahead $200 / month.

I lived on minimum wage in summers while I went to school.  In my case I worked 48 hours a week,  and actually saved up about $2.5k over summer.  I had no support from family other than a supper once or twice a month.  I just found it really boring and certainly it was a sacrifice.  The trick is to be focused on improving your situation. If I was looking at doing that for the rest of my life, I definitely couldn't handle it.

There are also things like student loans to help you out, between that and savings you can get some type of education, even just a short course to get an above minimum wage job and bootstrap yourself.

Not easy, but in many cases do-able.  I think the biggest issue is lack of financial literacy.  A lot of people who get trapped in these jobs just feel like they have no way out and don't seem to understand their options.
« Last Edit: November 17, 2019, 09:14:36 AM by frugal_c »

LWYRUP

  • Handlebar Stache
  • *****
  • Posts: 1059
Re: A high paying job
« Reply #22 on: November 17, 2019, 09:27:45 AM »
I see a lot of discussion about frugality and articles about people who pay off 120K in student debt over 14 months and it seems to me that they are leaving out some important information. In order to be able to save a lot one must earn a lot. American’s commonly barely eek out an existence. There is no surplus income to conserve. No room in the budget to cut to a meaningful degree. In the common experience of this group it seems that the first step to achieving FIRE is a high paying career.

The second seems to be no children.

Skyhigh

Yes.  I have noticed the most common path to FIRE is:

1.  Grow up in a middle / upper middle class household.
2.  Get a high quality education (frequently with some support from #1).
3.  Get a high paying job.
4.  Live like a bohemian ("starving artist") despite high income.
5.  Don't have children.

Not exactly a sustainable model for our civilization as a whole.  That being said, the principles here can help anyone at any stage of life gain more financial resilience and have more options.  But some people here can be a bit myopic when judging others' lifestyles without fully appreciating all the ingredients that went into their success. 

Villanelle

  • Walrus Stache
  • *******
  • Posts: 6657
Re: A high paying job
« Reply #23 on: November 17, 2019, 10:32:51 AM »
I see a lot of discussion about frugality and articles about people who pay off 120K in student debt over 14 months and it seems to me that they are leaving out some important information. In order to be able to save a lot one must earn a lot. American’s commonly barely eek out an existence. There is no surplus income to conserve. No room in the budget to cut to a meaningful degree. In the common experience of this group it seems that the first step to achieving FIRE is a high paying career.

The second seems to be no children.

Skyhigh

Yes.  I have noticed the most common path to FIRE is:

1.  Grow up in a middle / upper middle class household.
2.  Get a high quality education (frequently with some support from #1).
3.  Get a high paying job.
4.  Live like a bohemian ("starving artist") despite high income.
5.  Don't have children.

Not exactly a sustainable model for our civilization as a whole.  That being said, the principles here can help anyone at any stage of life gain more financial resilience and have more options.  But some people here can be a bit myopic when judging others' lifestyles without fully appreciating all the ingredients that went into their success.

I generally like your list, but I'd say that the path to FIRE generally has at least 3 of the 5.  All 5 are definitely not necessary, and we have plenty of posters here (and MMM himself) that show that.  (MMM and a son, after all.)

While my husband likely will only retire medium "E"  because he wants to keep working, we essentially reached FI in our early 40s.  I had 1, 2 to some extent (a decent university, but certainly not one of any cache or prestige whatsoever; a state school that most people outside the state have never heard of), and 5.  Husband had sort-of 1 (lower middle class, probably), 2, medium 3 (Depending on how one defines "well-paying"; it eventually got into the $100s), and 5.


nancyfrank232

  • Stubble
  • **
  • Posts: 225
Re: A high paying job
« Reply #24 on: November 17, 2019, 04:51:28 PM »
In the common experience of this group it seems that the first step to achieving FIRE is a high paying career.

The second seems to be no children.

+1

I agree with this

It’s definitely a lot easier to achieve FI with a high household income, delayed or no children, and LBYM

DadJokes

  • Handlebar Stache
  • *****
  • Posts: 2360
Re: A high paying job
« Reply #25 on: November 18, 2019, 06:45:19 AM »
[snip]

Also, whenever someone invokes frugality among the poor as a given, I admit that I jump to the assumption that they haven't actually spent much time with poor people. I apologize if I'm wrong in this case.

[/snip]

This line really stuck out to me, and I think people in these forums are very quick to assume that lower income people are spending as efficiently as they can.

In our state, residents get two free years of community college. It's paid for by the lottery. People play the lottery so much that they are paying for associates degrees. A study found that people in the bottom 20% of income spent the most on lottery tickets, averaging over $400/year. Other studies have shown that lower income people are more likely to be smokers. So there is definitely waste in spending.

Frugality for middle to high income earners means being able to retire 10+ years early. Frugality for low income earners could mean actually retiring on time and not being completely dependent on Social Security and Medicare for retirement.

Metalcat

  • Senior Mustachian
  • ********
  • Posts: 17394
Re: A high paying job
« Reply #26 on: November 18, 2019, 06:59:28 AM »
[snip]

Also, whenever someone invokes frugality among the poor as a given, I admit that I jump to the assumption that they haven't actually spent much time with poor people. I apologize if I'm wrong in this case.

[/snip]

This line really stuck out to me, and I think people in these forums are very quick to assume that lower income people are spending as efficiently as they can.

In our state, residents get two free years of community college. It's paid for by the lottery. People play the lottery so much that they are paying for associates degrees. A study found that people in the bottom 20% of income spent the most on lottery tickets, averaging over $400/year. Other studies have shown that lower income people are more likely to be smokers. So there is definitely waste in spending.

Frugality for middle to high income earners means being able to retire 10+ years early. Frugality for low income earners could mean actually retiring on time and not being completely dependent on Social Security and Medicare for retirement.

Thaaaaat really wasn't my point.
In my previous post I established the importance of distinguishing what populations we're actually talking about when we say "low income", as I specifically mean people on the low end of earning enough to afford a safe and healthy life.

Frugality can very much aide a low income household, but it does sweet fuck all for a poor household.

thesis

  • Bristles
  • ***
  • Posts: 407
Re: A high paying job
« Reply #27 on: November 18, 2019, 08:45:29 AM »
I tend to be a little disappointed when I see success stories that are predominantly written by people who have chosen never to have kids. It's hard to know what my FI future looks like when I eventually do want kids. At the same time, it makes perfect sense that you may need to work while raising kids because costs are so variable during that time. So maybe you can't retire on $600k with kids, who the f* cares? Once your kids move out and become established, if you've let your money grow (or maybe even if you haven't), you might be able to retire then. FI is not some all-or-nothing philosophy, that's why we see all sorts of weird variations. A person can have $0 and be a complete whiner, or they can have $100k and still have a long way to go before reaching FI, whatever that looks like for them. The point is to take control of your decisions and be strategic to improve your life and work toward your goals. Just because you can't crush it like some in the popular super-young retirees club doesn't mean you can't glean value from this movement for your own life.

DadJokes

  • Handlebar Stache
  • *****
  • Posts: 2360
Re: A high paying job
« Reply #28 on: November 18, 2019, 08:59:14 AM »
I tend to be a little disappointed when I see success stories that are predominantly written by people who have chosen never to have kids. It's hard to know what my FI future looks like when I eventually do want kids. At the same time, it makes perfect sense that you may need to work while raising kids because costs are so variable during that time. So maybe you can't retire on $600k with kids, who the f* cares? Once your kids move out and become established, if you've let your money grow (or maybe even if you haven't), you might be able to retire then. FI is not some all-or-nothing philosophy, that's why we see all sorts of weird variations. A person can have $0 and be a complete whiner, or they can have $100k and still have a long way to go before reaching FI, whatever that looks like for them. The point is to take control of your decisions and be strategic to improve your life and work toward your goals. Just because you can't crush it like some in the popular super-young retirees club doesn't mean you can't glean value from this movement for your own life.

He doesn't have a blog to follow, but one of the co-hosts of the Choose FI podcast, Brad Barrett, retired in his 30s with 2 young children. Both he and his wife are CPAs, so I'm sure income wasn't an issue. MMM himself has a child too. I think there are plenty who have children, but they don't spend a lot of time talking about that side of things.

thesis

  • Bristles
  • ***
  • Posts: 407
Re: A high paying job
« Reply #29 on: November 18, 2019, 09:03:06 AM »
He doesn't have a blog to follow, but one of the co-hosts of the Choose FI podcast, Brad Barrett, retired in his 30s with 2 young children. Both he and his wife are CPAs, so I'm sure income wasn't an issue. MMM himself has a child too. I think there are plenty who have children, but they don't spend a lot of time talking about that side of things.

There are some good examples out there, but there tend to be far fewer of them. I plan to fully hunt those stories down when I reach that point in life :)

GodlessCommie

  • Pencil Stache
  • ****
  • Posts: 969
  • Location: NoVA
Re: A high paying job
« Reply #30 on: November 19, 2019, 10:07:42 AM »
I'm more than a bit uneasy about higher earners judging habits of low earners or people in poverty, be it smoking or lottery. None of us chose what environment to be born in and grow up in, and that environment plays a huge part in forming our habits. Is it possible to break out of it? Absolutely. But we know, statistically, that most people will not be able to. That these vicious cycles, once started, are very hard to interrupt.

We shouldn't use our past to excuse our own inaction or sub-optimal actions. It's good to treat yourself with a healthy dose of mustachian face-punching. But this approach should not be applied to people whose shoes we never walk in.

Wolfpack Mustachian

  • Handlebar Stache
  • *****
  • Posts: 1866
Re: A high paying job
« Reply #31 on: November 19, 2019, 10:43:55 AM »
I'm more than a bit uneasy about higher earners judging habits of low earners or people in poverty, be it smoking or lottery. None of us chose what environment to be born in and grow up in, and that environment plays a huge part in forming our habits. Is it possible to break out of it? Absolutely. But we know, statistically, that most people will not be able to. That these vicious cycles, once started, are very hard to interrupt.

We shouldn't use our past to excuse our own inaction or sub-optimal actions. It's good to treat yourself with a healthy dose of mustachian face-punching. But this approach should not be applied to people whose shoes we never walk in.

There is a certain amount of empathy that is lost in these situations, for sure. However, there is also a certain amount of frustration on the other side, because the implication is that many poor people have no waste when in fact they do, as was mentioned, through lottery tickets, smoking, etc. The thing is, there are reasons for that, though, that need to be talked about and hopefully addressed. There is decision fatigue, generational poverty and ignorance of other options, etc. These are big issues, but they're clouded in part because people act like anyone who declares there's waste by poor people is hating on poor people. Yes, some of it is that they can't buy 20 pack toilet paper verses 4 pack because they don't have enough money to buy in bulk and many other things. There's also legitimate waste that's a non negligible part of it in almost all situations. Both sides need to realize that the other side has a point.

obstinate

  • Handlebar Stache
  • *****
  • Posts: 1147
Re: A high paying job
« Reply #32 on: November 19, 2019, 01:20:49 PM »
I'm more than a bit uneasy about higher earners judging habits of low earners or people in poverty, be it smoking or lottery. None of us chose what environment to be born in and grow up in, and that environment plays a huge part in forming our habits. Is it possible to break out of it? Absolutely. But we know, statistically, that most people will not be able to. That these vicious cycles, once started, are very hard to interrupt.

We shouldn't use our past to excuse our own inaction or sub-optimal actions. It's good to treat yourself with a healthy dose of mustachian face-punching. But this approach should not be applied to people whose shoes we never walk in.
Depends on what goal you want to accomplish. If you're talking with someone who is complaining of poverty, and is a profligate spender, does it matter than you've never walked in their shoes? Causes have effects. If you spend more money than you make, you will not save. That's the result, nothing more and nothing less.

It almost goes without saying that the less you make, the less room you have to maneuver, and the more frugality as a virtue must give way to frugality as a bare necessity. It's also completely fair to say that rich people should not pass moral judgment on a poor person incapable of controlling their spending. We also should not pat ourselves on the back too hard when we do well and retire early, since of course we have had a significant leg up in that race.

But I draw the line at silently accepting the assertion that some goals are impossible to meet, when there are examples of people meeting them, and not only be heroic effort. If someone complains of being unable to save on $100k, it doesn't matter if I make $700k, I'm going to feel free to challenge that claim.

mathlete

  • Handlebar Stache
  • *****
  • Posts: 2070
Re: A high paying job
« Reply #33 on: November 20, 2019, 02:46:12 PM »
There is a certain amount of empathy that is lost in these situations, for sure. However, there is also a certain amount of frustration on the other side, because the implication is that many poor people have no waste when in fact they do, as was mentioned, through lottery tickets, smoking, etc. The thing is, there are reasons for that, though, that need to be talked about and hopefully addressed. There is decision fatigue, generational poverty and ignorance of other options, etc. These are big issues, but they're clouded in part because people act like anyone who declares there's waste by poor people is hating on poor people. Yes, some of it is that they can't buy 20 pack toilet paper verses 4 pack because they don't have enough money to buy in bulk and many other things. There's also legitimate waste that's a non negligible part of it in almost all situations. Both sides need to realize that the other side has a point.

A couple of things;

While smoking and lottery tickets certainly don't help, neither of these are why poor people are poor. If anything, I'd say that it's more likely that poverty drives tobacco use than the other way around.

And rich people waste money too. Even the really frugal ones. If I buy a video game on a lark, and don't really end up playing it, that's as wasteful as two cartons of cigarettes, or 60 lottery tickets. If I don't do my meal prep on Sunday, I probably won't do it at all. That means five lunches eating out for $10 a piece. Or 50 lottery tickets. I "waste" money like that all the time. I also have a six figure income, which covers up a lot of my wasteful spending, and yields me an over 50% savings ratio.

In general, poor people waste money, and rich people waste more money, but have larger margins for error. We should all encourage each other to reduce waste where possible, but when speaking to a broad audience, asking poor people to do something that virtually no one else in the world has figured out (eliminate waste) hardly seems worth it when there are huge, institutional barriers to discuss.

If you're talking to your chain smoking cousin who is $15K in credit card debt, by all means, bring the hammer down. But with a broad audience, I don't think every day waste is relevant to why poor people are poor and rich people are not.

If someone complains of being unable to save on $100k, it doesn't matter if I make $700k, I'm going to feel free to challenge that claim.

I think that in many ways, $700K and $100K are less materially different than say, $100K and $35K.

Both $100K and $700K easily clear most survival and happiness thresholds that researchers throw around.

Wolfpack Mustachian

  • Handlebar Stache
  • *****
  • Posts: 1866
Re: A high paying job
« Reply #34 on: November 20, 2019, 08:20:58 PM »
There is a certain amount of empathy that is lost in these situations, for sure. However, there is also a certain amount of frustration on the other side, because the implication is that many poor people have no waste when in fact they do, as was mentioned, through lottery tickets, smoking, etc. The thing is, there are reasons for that, though, that need to be talked about and hopefully addressed. There is decision fatigue, generational poverty and ignorance of other options, etc. These are big issues, but they're clouded in part because people act like anyone who declares there's waste by poor people is hating on poor people. Yes, some of it is that they can't buy 20 pack toilet paper verses 4 pack because they don't have enough money to buy in bulk and many other things. There's also legitimate waste that's a non negligible part of it in almost all situations. Both sides need to realize that the other side has a point.

A couple of things;

While smoking and lottery tickets certainly don't help, neither of these are why poor people are poor. If anything, I'd say that it's more likely that poverty drives tobacco use than the other way around.

And rich people waste money too. Even the really frugal ones. If I buy a video game on a lark, and don't really end up playing it, that's as wasteful as two cartons of cigarettes, or 60 lottery tickets. If I don't do my meal prep on Sunday, I probably won't do it at all. That means five lunches eating out for $10 a piece. Or 50 lottery tickets. I "waste" money like that all the time. I also have a six figure income, which covers up a lot of my wasteful spending, and yields me an over 50% savings ratio.

In general, poor people waste money, and rich people waste more money, but have larger margins for error. We should all encourage each other to reduce waste where possible, but when speaking to a broad audience, asking poor people to do something that virtually no one else in the world has figured out (eliminate waste) hardly seems worth it when there are huge, institutional barriers to discuss.

If you're talking to your chain smoking cousin who is $15K in credit card debt, by all means, bring the hammer down. But with a broad audience, I don't think every day waste is relevant to why poor people are poor and rich people are not.

I don't think we disagree much. Rich people certainly waste and waste more than poor people. Does waste by poor people cause poverty? That's a huge question beyond my ability to answer, and I would think that either of our comments on it would be speculation. Waste and poor money habits certainly help perpetuate poverty. The issue I am trying to bring up is it's very frustrating trying to have an intellectually honest discussion of the topic when you are criticized as uncaring for asserting that yes, in almost every situation there is financial waste and poor monetary practices that could be improved. It's frustrating not just for accuracy but because the whole thing is a big circle. As you said, poverty itself can cause some of those habits, but the habits then go on to continue to cause poverty. If blind ourselves to the fact that it's not just food deserts, inability to purchase in bulk, etc. that contributes to poverty, we do a disservice to an important topic.

Zikoris

  • Magnum Stache
  • ******
  • Posts: 4536
  • Age: 37
  • Location: Vancouver, BC
  • Vancouverstachian
Re: A high paying job
« Reply #35 on: November 20, 2019, 09:45:26 PM »
I don't think the bad habits necessarily cause poverty, but I definitely think fixing them could really help a person in poverty get into a better place. For example, if a person couldn't afford to buy bulk dry goods, if they could free up $50-$100 a month to put towards that, it would buy an awful lot of beans and rice. Then you get a bit of a snowball effect. With lower grocery costs, you have more money to put towards the next thing, whether it's building up some sort of emergency fund, or improving some other aspect of your life.

I think there are INCREDIBLY few people who genuinely have no fat in their budget that they could cut. That would be like, someone who literally ate nothing but beans, rice, and cabbage, dumpster dived every single thing they owned, had six roommates, no vices at all, and still just broke even. I've certainly never met anyone who fit that description.

ctuser1

  • Handlebar Stache
  • *****
  • Posts: 1741
Re: A high paying job
« Reply #36 on: November 21, 2019, 04:41:27 AM »
When an individual is the focus of discussion, his or her bad habits are very much a fair game for discussion.

Why?

An individual, with great effort if necessary, can likely change them, unless there is some psychological disability going on. So, ripping someone a new one in a case study is absolutely correct and often warranted - whether the receiver is rich/poor/whatever.

When a population is the focus of discussion, then the "bad habits of such and such people" is NOT a fair game for discussion.

Why?

It is not because of political correctness, but because of how the math and reality of aggregates work!! The tools that can likely fix bad habits for "an individual" is useless in the aggregate. Assuming you had "reeducation camps", you can try to train and fix 5 (or 50 or 500) individuals with great effort and cost of money and their rights/liberty, but an equal number will come in to take their place because such is wasteful human nature driven likely by genetics.

Just last year I had a professional disagreement with a colleague who, I believe, was not acting with the utmost integrity in terms of meeting his commitments I was dependent on. I remember myself saying in a very angry tone "that was not what we agreed on, you are obfuscating here to cover up that you are not meeting your deadlines" in a big conference call. THAT, is completely par for the course in the ultra-aggressive work culture of NYC. This dude was not white. So if I referred to that and said, "like all <insert ethnicity here> you are obfuscating here to cover up that you are not meeting your deadlines" then I would justifiably be accused of having crossed an ethical line and most probably fired from my job. His individual failings are fair game. Any real or perceived communal traits are not!!

It's the same thing with "poor people are poor because they waste so much", as if the social class the commenter belongs to does not waste!!

mathlete

  • Handlebar Stache
  • *****
  • Posts: 2070
Re: A high paying job
« Reply #37 on: November 21, 2019, 09:57:05 AM »
I don't think we disagree much. Rich people certainly waste and waste more than poor people. Does waste by poor people cause poverty? That's a huge question beyond my ability to answer, and I would think that either of our comments on it would be speculation. Waste and poor money habits certainly help perpetuate poverty. The issue I am trying to bring up is it's very frustrating trying to have an intellectually honest discussion of the topic when you are criticized as uncaring for asserting that yes, in almost every situation there is financial waste and poor monetary practices that could be improved. It's frustrating not just for accuracy but because the whole thing is a big circle. As you said, poverty itself can cause some of those habits, but the habits then go on to continue to cause poverty. If blind ourselves to the fact that it's not just food deserts, inability to purchase in bulk, etc. that contributes to poverty, we do a disservice to an important topic.

I feel you. I didn't mean to characterize you as uncaring and I'm sorry if that's how it came across. I'm probably too easily frustrated by that kind of talk because in broader circles (in the media/beyond this forum) I think the wastefulness of the poor is often brought up disingenuously in order to suck air away from what I perceive as the real problems.

But thriftiness can help everyone. And we need to be able to discuss it at all levels of income. You're right. 

mathlete

  • Handlebar Stache
  • *****
  • Posts: 2070
Re: A high paying job
« Reply #38 on: November 21, 2019, 10:00:32 AM »
When an individual is the focus of discussion, his or her bad habits are very much a fair game for discussion.

An individual, with great effort if necessary, can likely change them, unless there is some psychological disability going on. So, ripping someone a new one in a case study is absolutely correct and often warranted - whether the receiver is rich/poor/whatever.

When a population is the focus of discussion, then the "bad habits of such and such people" is NOT a fair game for discussion.

You pretty much nailed it IMO.

Wolfpack Mustachian

  • Handlebar Stache
  • *****
  • Posts: 1866
Re: A high paying job
« Reply #39 on: November 21, 2019, 10:37:42 AM »
I don't think we disagree much. Rich people certainly waste and waste more than poor people. Does waste by poor people cause poverty? That's a huge question beyond my ability to answer, and I would think that either of our comments on it would be speculation. Waste and poor money habits certainly help perpetuate poverty. The issue I am trying to bring up is it's very frustrating trying to have an intellectually honest discussion of the topic when you are criticized as uncaring for asserting that yes, in almost every situation there is financial waste and poor monetary practices that could be improved. It's frustrating not just for accuracy but because the whole thing is a big circle. As you said, poverty itself can cause some of those habits, but the habits then go on to continue to cause poverty. If blind ourselves to the fact that it's not just food deserts, inability to purchase in bulk, etc. that contributes to poverty, we do a disservice to an important topic.

I feel you. I didn't mean to characterize you as uncaring and I'm sorry if that's how it came across. I'm probably too easily frustrated by that kind of talk because in broader circles (in the media/beyond this forum) I think the wastefulness of the poor is often brought up disingenuously in order to suck air away from what I perceive as the real problems.

But thriftiness can help everyone. And we need to be able to discuss it at all levels of income. You're right.

Oh no, it didn't come across that at all, but thank you. I have just had other conversations where it has. It's so hard because everybody posting here has almost certainly been privileged in one significant way or the other, so we don't (or I'll say for myself, I don't) fully understand what it's like to be in true poverty, and yet we do have legitimate ways that we can help people in almost any circumstance.


Wolfpack Mustachian

  • Handlebar Stache
  • *****
  • Posts: 1866
Re: A high paying job
« Reply #40 on: November 21, 2019, 10:37:54 AM »
When an individual is the focus of discussion, his or her bad habits are very much a fair game for discussion.

An individual, with great effort if necessary, can likely change them, unless there is some psychological disability going on. So, ripping someone a new one in a case study is absolutely correct and often warranted - whether the receiver is rich/poor/whatever.

When a population is the focus of discussion, then the "bad habits of such and such people" is NOT a fair game for discussion.

You pretty much nailed it IMO.

This perspective makes a lot of sense to me, as well.