The Money Mustache Community
General Discussion => Welcome and General Discussion => Topic started by: Yankuba on October 01, 2018, 11:10:29 AM
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Suze Orman was a guest on a financial podcast and spent a long time trashing FIRE. The show is here:
http://podcast.affordanything.com/153-hate-fire-movement-suze-orman/
Suze starts at around the 6 minute mark
I took notes on the first HALF so you don't have to listen:
Life happens - cancer, illness, death, accidents - $2 million when that happens is pennies
AI is coming - by 2030 we will have 25% unemployment. Tax brackets will increase to compensate for all the people not working and not paying taxes. Higher tax brackets mean you will keep a smaller % of your portfolio (e.g. 401k)
Healthy people today can live until 90, 95 or 100. long term care in the future will be $30k a month. Suze paid $250k a year for her mom.
Expenses increase over time, especially if you have kids.
Don't forget about inflation whacking away at your portfolio.
Markets can go down, dividends can drop to zero - a 4% withdrawal rate may be too high. Puerto Rico was paying 6% on its bonds before it defaulted.
FIRE before 50 is the biggest mistake you can make in a lifetime.
Need to invest as much as possible when you're young to get the biggest benefits of compounding.
A 3% withdrawal on a $3mil portfolio is fine without black swan events but she tells everyone to work as long as they can in an AREA THAT YOU LOVE.
Don't neglect disability insurance.
After 4-5 years of leisure and travel many people get bored.
Suze thinks it's fine to pursue FIRE in order to be a SAHP. But your child will go to school and get older and you need to fill those holes.
College costs will be $400k pretty soon - do you want to help your kids or not? Many parents choose to spend on their kids rather than retire. The students may not be able to borrow enough to pay for tuition and then the parents have to co-sign.
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I stopped listening at the 45 minute mark
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Thanks for the notes...it will save me time in not listening to it.
Those examples are crap IMO. And if I get board I will find something to do. A job does not define me...ggrrr this type of thing just is annoying...The world is falling apart, we have no control over our money, and if college costs end up being as high as she says then the entire world would have to adjust. Because if it is costs $400K for college then the wages once out of college will have to adjust. That is the most stupid thing I have ever seen. Yes college is expensive...dont study underwater basket weaving and you will be fine.
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She is telling everyone to work until 70. Some people won’t live that long. I have lost 3 friends between 59-67 all to cancer. They all did everything right diet and exercise included. You just don’t know when your time is up.
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This is depressingly hilarious.
"Am I out of touch? No, it is the children who are wrong."
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Blah blah blah. If she had nothing controversial to say to sensible advice, she’d be out of a job.
Regarding AI - sure, but everything will be cheaper in theory and the rich will still be paying the majority of taxes for this.
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Some people can never get past the mental barrier of not needing or wanting to work in the traditional sense. Orman is one of them.
Of all those points listed, most she either misinterprets/misunderstands (e.g. any x% withdraw strategy based on initial assets already factors in inflation, the line about puerto rico paying 6% before default...) or is predicated on fear (e.g. black swans, $2MM medical bills beyond health care). The most likely scenario is that we'll have more money than we started during our final years, so paying $250k/year for end of life care isn't an impossibility.
FIRE-ees, ought to do their due diligence.
Included in their costs should be should be some medical insurance, multiple layers of safety and some reasonable plans for how to deal with things when the SHTF.
But the alternative is just working forever, spending like a mindless drone and dying with an excess. How is that good advice either?
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AI is coming - by 2030 we will have 25% unemployment. Tax brackets will increase to compensate for all the people not working and not paying taxes. Higher tax brackets mean you will keep a smaller % of your portfolio (e.g. 401k)
This seems like a strikingly important reason to PURSUE FI as fast and as strongly as feasible for your individual circumstances.
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Bogleheads chime in here:
https://www.bogleheads.org/forum/viewtopic.php?p=4144044#p4144044
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Love the part about making sure you do something you love. That's really easy for someone who has a successful book series to say. The rest of us are out here working for people who we don't really respect doing things we don't really care for because we know it will produce a reliable income.
The point is to spend less so you can build up a big ball of investment income and then say FU to whatever it is you don't like about your current situation, get out of it, then transition to something you love. If you have to FIRE in order to do that (because the thing you really want to do is super risky), then fine. That's your way of solving your particular job dissatisfaction problem.
Nothing in life is 100% safe. But you're not getting out this thing alive anyway, so who the hell cares? Jump when you feel ready.
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Thanks for the notes...it will save me time in not listening to it.
Those examples are crap IMO. And if I get board I will find something to do. A job does not define me...ggrrr this type of thing just is annoying...The world is falling apart, we have no control over our money, and if college costs end up being as high as she says then the entire world would have to adjust. Because if it is costs $400K for college then the wages once out of college will have to adjust. That is the most stupid thing I have ever seen. Yes college is expensive...dont study underwater basket weaving and you will be fine.
Is it expensive though? Some schools of course are. But I feel like people seem to also include room and board when talking about how expensive college is, which isn't really a fair comparison, because if you decide not to go to school, you still need a place to live and food to eat to survive. The flagship university for my state's in-state tuition and fees is $9,130/yr. That's not cheap or free, but I wouldn't say it's expensive.
My alma mater is even cheaper. For in-state tuition and fees it's $6,368/yr. That's a 4 year degree for just over $25k.
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I posted in the duplicate thread originally, so repeating here where people are actually discussing the interview
AI is coming - by 2030 we will have 25% unemployment.
This particular bullet point would seem to make pursuing FIRE (or at least FI) as seriously and as rapidly as feasible for your individual circumstances MORE important rather than less.
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AI is coming - by 2030 we will have 25% unemployment. Tax brackets will increase to compensate for all the people not working and not paying taxes. Higher tax brackets mean you will keep a smaller % of your portfolio (e.g. 401k)
This seems like a strikingly important reason to PURSUE FI as fast and as strongly as feasible for your individual circumstances.
Right? I made it until about the 11 min mark, and then I gave up. What was her point about tax brackets going up? I mean, if in FIRE I'm going to be living off investments rather than income, those tax brackets won't apply to me in the same way. And most people pursuing FIRE are investing heavily in their 20s and 30s, so how exactly are they missing out on the benefits of compounding?
This sounds like someone who hasn't taken a lot of time to think about how people pursuing FIRE actually think about or plan for life expenses and is deeply threatened by the concept that people may not want to work until traditional retirement age to continue accumulating money.
Alternatively, Suze Orman may have already been replaced by automation and the concept of FIRE does not compute.
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I posted in the duplicate thread originally, so repeating here where people are actually discussing the interview
AI is coming - by 2030 we will have 25% unemployment.
This particular bullet point would seem to make pursuing FIRE (or at least FI) as seriously and as rapidly as feasible for your individual circumstances MORE important rather than less.
I completely agree. I've always thought like that. If AI takes over most jobs in the next 15-20 years, I want to be the owner of the companies that benefit from this, not an employee praying my job isn't next on the chopping block. How do you become an owner? Buy shares in these companies. What does that also move you towards? FIRE.
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If $2-3M isn't enough, doesn't that bode incredibly poorly for something like 90% of the population? If you can't retire on that, retirement as a concept is dead.
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(https://pics.me.me/chill-blinton-guess-ill-die-16200603.png)
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Suze died. This is actually a robot prepared to look and sound like her. See, AI is here. :)
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Skimming over this, I can just imagine the following conversations playing out
me, age 35: Ok Suze - I've saved my butt off, charted my expenses and I have a 4% WR and the ability to cut back and earn a little if the SHTF. I've got $1MM in assets and at most I need $40k/year to survive. Think it's ok for me to retire now?
Suze: Are you kidding? You can't retire on that! You might have 6 decades of life left and the biggest expenses are ahead. 4% is way too much to survive 50+ years, no matter what studies done years ago say.
me (age 40): Alright Suze - I've saved even more and the market has been good to me. I now have $1.3MM for a 3% WR. My plans include a high deductible health insurance plan. I can retire now, right?
Suze: Not even close! Inflation over 40 years could cut that amount by 70%! What are you going to do if a black swan lands on your portfolio, eat nothing but beans and rice? And your kids will be in college in another 8 years - you'll be completely bored without them, you'll have no purpose. You'll spend all day staring at your kitchen cabinets with nothing to do!
me (age 45): Yes! I got a promotion, sold my first home for a tidy profit and I've set up a 5 year bond latter. I've got nearly $2MM in investments for a 2% WR. Surely I can retire now??
Suze: A 5 year bond latter? Didn't you hear what happened to people who were holding Puerto Rico bonds? Poof! Up in smoke! And $2MM can be wiped out with one major illness, one week spent in the ICU. You don't want to be kicked out of the hospital when you are at your sickest, unable to work and without a penny to your name, do you?
me (age 55): I'm starting to approach 'normal' retirement age. My kids are long gone and I've got lots of hobbies I'd rather be doing than going to work daily. I stopped paying attention to my assets when they passed $3MM, and that was a few years ago. I'm going to give my 2-weeks notice next month.
Suze: Hold on a minute buster! People are living longer than ever, you can't call it quits now - 55 is the new 40! You're still over a decade away from getting SS and there's no guarantee the government won't take that away from you. What's more, if the next election goes poorly the new party might increase your taxes. Have you thought about taxes??
me (age 65): Why do I still listen to your show?! I just looked at my balance and I've got $8MM in the stock market and almost $400k in a bond latter I set up years ago. At this rate I could get a 0% return, live to be 100 and still have over $6MM in my vanguard account. My small efficient home within walking distance to downtown has also more than doubled in value, and at 65 it's still way bigger than I need. My two kids are traveling the world, having followed the advice in a blog called 'mr-money-mustache' when they were in college. Yale's booster club has me on speed-dial, and I never even went there.
Suze: ...just 5 more years and you can retire, and never have to work again!
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We in the FIRE movement have it all wrong. We have been getting our information from these crazy bloggers who give away their knowledge for free. You get what you pay for, right? I suggest we all run out and buy Suze Orman’s new book and tell our friends to buy it too. That way we are paying for information and you get what you pay for, right? Oh, and she’s gonna be on Opera tonight so obviously her way is the only prudent way to do things. Sigh....
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If you don't have a decamillion you are not gonna make it.
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Suze Orman has gotten a lot of press recently and seems to be a current darling for Money Magazine and AARP Magazine. I think she is full of it. I am 63 y/o and the last thing I want to be doing is trading precious hours of my life working for people who neither respect nor care about me, so I retired last Christmas. We are living on under $30,000 a year including SS and are not deprived one bit. We have a simple lifestyle and are content. I suppose if, like Suze, you need a boat and other trappings of wealth, you have a different story.
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So, I'm definitely just hate-listening at this point, but at around 24 min, she actually makes the case for frugality. She tells a story about her working for PG&E doing retirement planning, and she says that the people in lower wage jobs making $50-$60K were actually in better shape to retire than the executives who had millions of dollars in their retirement accounts and a pension doling out $13K a month. Why? Because those lower earning people had lower expenses and didn't have the overhead of expensive houses and everything else.
And . . . isn't that the whole damn point? You earn whatever you earn, but you avoid lifestyle inflation and continue to live as if you earned far less.
And she thinks $2 million is "pennies"? Not if you live like you're earning $60K a year.
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If $2-3M isn't enough, doesn't that bode incredibly poorly for something like 90% of the population? If you can't retire on that, retirement as a concept is dead.
More like 99.8%.
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Hmm, didn't she retire at 62?
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So, I'm definitely just hate-listening at this point, but at around 24 min, she actually makes the case for frugality. She tells a story about her working for PG&E doing retirement planning, and she says that the people in lower wage jobs making $50-$60K were actually in better shape to retire than the executives who had millions of dollars in their retirement accounts and a pension doling out $13K a month. Why? Because those lower earning people had lower expenses and didn't have the overhead of expensive houses and everything else.
And . . . isn't that the whole damn point? You earn whatever you earn, but you avoid lifestyle inflation and continue to live as if you earned far less.
And she thinks $2 million is "pennies"? Not if you live like you're earning $60K a year.
Also, she considers $50-60k/yr "lower wage jobs"? How about some perspective? That's literally median US household income.
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Ugh.
she keeps escalating into crazy-land.
"let's say you need $200k, $250k to live comfortably, then you have a sudden expense and now you need $350k. Now you need $10MM just to make that in interest."
"80k per year is just not enough. I personally think this is the biggest mistake you will ever make in your lifetime. I think it is just ridiculous. $80k may sound like a lot of money, but it's not. When you are 60 or 70 or 80 you will not want to live on $80k a year."
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Ugh.
she keeps escalating into crazy-land.
"let's say you need $200k, $250k to live comfortably, then you have a sudden expense and now you need $350k. Now you need $10MM just to make that in interest."
"80k per year is just not enough. I personally think this is the biggest mistake you will ever make in your lifetime. I think it is just ridiculous. $80k may sound like a lot of money, but it's not. When you are 60 or 70 or 80 you will not want to live on $80k a year."
How could anyone possibly live on 120% of the median household income?!
What she must think of all those middle class people earning a mere $120k, and still having to pay taxes and save money from such a paltry sum!!
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If everyone FIREs who is she going to preach to?
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I love a good point-by-point takedown:
Life happens - cancer, illness, death, accidents - $2 million when that happens is pennies Um, that's what insurance is for, right?
AI is coming - by 2030 we will have 25% unemployment. Tax brackets will increase to compensate for all the people not working and not paying taxes. Higher tax brackets mean you will keep a smaller % of your portfolio (e.g. 401k)Better to save up more now, then!
Healthy people today can live until 90, 95 or 100. long term care in the future will be $30k a month. Suze paid $250k a year for her mom. Hang on, are they healthy, or are they in long-term care? Does she mean healthy body but declining mental acuity? Ok, that one's real, but there are workarounds (have kids?).
Expenses increase over time, especially if you have kids.So you account for it. Also, expenses decline as the kids move out.
Don't forget about inflation whacking away at your portfolio.That's already priced into the 4% SWR.
Markets can go down, dividends can drop to zero - a 4% withdrawal rate may be too high. Puerto Rico was paying 6% on its bonds before it defaulted.The folks running PR don't exactly have a great track record. There's a reason they had to pay 6%. Markets can go down, correct. So can spending. And asset allocation can take out much of that sting.
FIRE before 50 is the biggest mistake you can make in a lifetime.Working until you croak doesn't sound like a picnic either.
Need to invest as much as possible when you're young to get the biggest benefits of compounding.Whoa, she got something right!
A 3% withdrawal on a $3mil portfolio is fine without black swan events but she tells everyone to work as long as they can in an AREA THAT YOU LOVE. If you love it, is it really work?
Don't neglect disability insurance.Fair enough.
After 4-5 years of leisure and travel many people get bored.Joke's on you--travel isn't a huge part of my ER plans. I have way too many other things I want to do that don't involve getting on a commercial airplane!
It's fine to pursue FIRE in order to be a SAHP. But your child will go to school and get older and you need to fill those holes. Holes? Do you mean pay for your kids' college? Nope. My kids are on their own there.
College costs will be $400k pretty soon - do you want to help your kids or not? Many parents choose to spend on their kids rather than retire. The students may not be able to borrow enough to pay for tuition and then the parents have to co-sign. Please define "soon." Also, please tell me where it costs $100k per year to go to school, and what you're spending all that money on, so I can steer my kids away from there.
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Most people I know in tech don’t make it to 70 to retire, unless they have an extremely specialized knowledge base or skill and are irreplaceable. Many, particularly high salaried folks, are pushed out, or if the company is kind, offered early retirement in their late 50s or early 60s. I am not looking to be FI in order to retire very yearly. I started too late for that. I am looking to FI in order to hedge against the likelihood that some younger millennial will be hired at 2/3 of my salary at a certain point.
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After 4-5 years of leisure and travel many people get bored.Joke's on you--travel isn't a huge part of my ER plans. I have way too many other things I want to do that don't involve getting on a commercial airplane!
Statistically, this may be true, but then you have options: go back to work, volunteer, start a new hobby, adopt...
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There's something about smoking pot online that I just don't find cool
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After 4-5 years of leisure and travel many people get bored.Joke's on you--travel isn't a huge part of my ER plans. I have way too many other things I want to do that don't involve getting on a commercial airplane!
Statistically, this may be true, but then you have options: go back to work, volunteer, start a new hobby, adopt...
Ya, no kidding.
Nope, better work FOREVER just in case I might get STATISTICALLY bored after 5 years of leisure and/or travel!!
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Most people I know in tech don’t make it to 70 to retire, unless they have an extremely specialized knowledge base or skill and are irreplaceable. Many, particularly high salaried folks, are pushed out, or if the company is kind, offered early retirement in their late 50s or early 60s.
Yea, unless you get/have your MS, in which case you can always teach. But you might not like it and the pay will be low, because no one will want to hire you full time (only adjunct) as they don't want to pay for all the ills of your advancing age!
I am not looking to be FI in order to retire very yearly. I started too late for that. I am looking to FI in order to hedge against the likelihood that some younger millennial will be hired at 2/3 of my salary at a certain point.
Me too, I have a plan to be FI (if not RE) by the time I'm 46. I just hope I make it that long. If I do, I may well keep working for another 1~9 years.
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@golden1 good point about tech career lifespan. That was one of the reasons I pursued this FIRE path as well. I felt like I couldn't keep up and would eventually have to go into management (yuck) or be passed up by younger, cheaper engineers. I felt it happening already at age 40. I probably could have continued until 50 but wasn't sure if I would live that long. The thing is, we may not live as long as we think. My dad died at 60 and my mother in her 70s is sick now with something terminal. They both led healthy lives but got rare diseases. There's no cheating death. It will come for us all at some point. If I need $250k a year to stay alive, and I don't have it, I'll just die like everyone will eventually.
Once you have enough to support your lifestyle withdrawing 3-4%, I think it's okay to pull the plug on your career. Especially if you hate your job.
There's so much to do other than expensive leisure travel. In the past year, I've met a lot of retired people who are really enjoying their lives. They go to free concerts, community gatherings, free seminars and classes. Money isn't the most important thing. More important is time, love and friendship, learning new skills, and experiencing new things (and much more you could all could add, I'm sure). Happiness can come from appreciating what you have and being grateful for it. Humans are incredibly adaptable and can find happiness and wonder in the simplest of situations. I find the most joy talking with friends and family, helping people who need it, eating simple homemade foods, walking in the sunshine, meditating, and learning new things.
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I actually made it to the end.
The last 10 minutes or so were particularly painful. Suze was just on a soapbox spouting fear while telling the listeners how great she was. Floods will come and take your rental properties away. Mold! Crime! Mudslides! Fires!
She kept referencing 'close friends' who had lost everything in this disaster or that disaster (sounds like a really good reason NOT to put all your NW in one vulnerable, uninsured asset). Somehow I doubt she's had so many close friends die in a handful of well-publicized disasters. The ever increasing sums of money Suze tossed around started getting comical - 'you're going to need $100k to fix the roof, you're going to get hit with a pole through the windshield and it won't be covered by insurance, you'd better believe you'll need $30k a month for end-of-life care, not just for a year but for 5, 8, 10 years".
Beating a dead horse she kept the fear-shtick up -- the tens of thousands of letters she got from people who had a couple million in the bank but were suddenly penniless and unemploy(able). The friends who retired in their 50s who apparently came to her a few decades asking "why did you ever let me retire" (to which she responded - I tried to convince you not to!). Of all the regrets most people have towards the end of hteir life, few seem to say "I wish I'd worked another decade".
There was an odd rant about student loans towrads the end too... somehow $50k/year for four years ($200k) in college expenses means you've got to have a few million$ more saved up or risk your children being saddled with debt forever. Hey, here's a thought - why not just 1) have your children choose a slightly less ridiculous school and 2) pay out of pocket with money you've budgeted ahead of time because this is among the most predictable of large future expenses?
Perhaps it was for shock-value, but the figures she kept tossing out as the 'minimum' you'd need for a leisurely lifestyle were often in the mid-6 figures. No person over 60 is legitimately happy on 'only' $80k/year, even with a paid off house (more than 4x our budget after the mortgage).
I actually liked how Paula Pant wrapped things up, giving a defense of FIRE concepts and saying how she thought Suze just didn't quite understand what it was all about.
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Healthy people today can live until 90, 95 or 100. long term care in the future will be $30k a month. Suze paid $250k a year for her mom.
We are a few months into long term care for my mother at an assisted living place. Her monthly costs are running right around $4000 a month. We looked into having someone come to the house and with 24/7 care the cost would have been about $7500 a month. Well below $250,000 a year. Thankfully my mother lived below her means, saved/invested her money, and has enough for several years of expenses.
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People born in the 1950's tend to have a high sense of paranoia after living through the Cuban Missile Crisis and Cold War. Lots of anxiety, pressure to be prepared, duck and cover to avoid nuclear disaster... I can see where Suze wants to have a large portfolio and insurance coverage to tackle personal doomsday scenarios. Plus as a point person for financial advice she's probably heard a ton of financial horror stories.
Her prophecy of an AI takeover leading to 25% unemployment by 2030 and all the other consequences is fun. Higher tax brackets due to people not paying into the system, Social Security and Medicare collapsing on 76 million baby boomers, floods washing away every real estate property on earth... *yawn* who's playing John Connor in the movie adaptation of this?
"Suze Slapdown on the FIRE movement" lol
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Healthy people today can live until 90, 95 or 100. long term care in the future will be $30k a month. Suze paid $250k a year for her mom.
We are a few months into long term care for my mother at an assisted living place. Her monthly costs are running right around $4000 a month. We looked into having someone come to the house and with 24/7 care the cost would have been about $7500 a month. Well below $250,000 a year. Thankfully my mother lived below her means, saved/invested her money, and has enough for several years of expenses.
All of her numbers show a blatant disconnect with middle-class or even upper-middle class expenses. I can't tell if its an intensional shtick (omg, $250k/year?? I'll live like a movie star!) or if she really is that out of touch with 99%+ of adults in the US.
her materialistic humble-bragging was pretty obnoxious. "I own an island! I fly in private jets wherever I want to go! It is at this point inconcievable for me to run out of money however I spend it!"
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I read in the Boggleheads thread that she actually said: "I would be skeptical about the folks in their 30s with a bare-bones portfolio; too much stuff can happen." I kinda agree with that. In your 30s, you're still VERY young to retire, and I don't agree with retiring super-early IF you don't have a super-solid portfolio. If you're doing it with -- to use her term -- a bare-bones portfolio, you're living closer to the edge than would be comfortable for me. If you're 30-something and care baaaarely retire, I'd say put in 5 more years to beef up the account and retire very well prepared in your late 30s /early 40s. Statistically, you still have plenty of years ahead of you, and you'd have a good buffer against those big emergencies and inflation.
Regardless, I cannot respect anyone who doesn't understand basic phonics; I mean, really, we teach those skills to kindergarteners. Her stupid name is spelled wrong.
If $2-3M isn't enough, doesn't that bode incredibly poorly for something like 90% of the population? If you can't retire on that, retirement as a concept is dead.
Hush! You're not supposed to think about that ... you'll find the flaws in her message!
So, I'm definitely just hate-listening at this point
I didn't know that term!
Statistically, this may be true, but then you have options: go back to work, volunteer, start a new hobby, adopt...
Yeah, key phrase being "you have options". Even if you opt to do something very like your job, you'd have the choice to do it part-time.
Of all the regrets most people have towards the end of hteir life, few seem to say "I wish I'd worked another decade".
I never like that argument. I strongly suspect plenty of people (probably not people on this board) reach the end of their lives and say, "I wish I were leaving my wife with a paid-off house" or "I wish I were leaving more for my young children's education" or similar thoughts. I don't think most of us are passionate about our work and will think of it on our deathbeds ... but I think loads of us are passionate about taking care of the people we love.
All of her numbers show a blatant disconnect with middle-class or even upper-middle class expenses. I can't tell if its an intensional shtick (omg, $250k/year?? I'll live like a movie star!) or if she really is that out of touch with 99%+ of adults in the US.
Yeah, and that disconnect is an ugly thing in a person who gives out financial advice.
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Of all the regrets most people have towards the end of hteir life, few seem to say "I wish I'd worked another decade".
I never like that argument. I strongly suspect plenty of people (probably not people on this board) reach the end of their lives and say, "I wish I were leaving my wife with a paid-off house" or "I wish I were leaving more for my young children's education" or similar thoughts. I don't think most of us are passionate about our work and will think of it on our deathbeds ... but I think loads of us are passionate about taking care of the people we love.
i'm sure some do, though I suspect the regrets are more about all the money they've wasted on things that didnt really give them joy vs. having wanted to spend more years in the work force. Of course this forum is doubtlessly not a representative sample, but the number of times Ive heard people express regret at not having spent more time being with the ones they loved and doing the things they liked far outnumber the people who wish they had worked years longer. but thats just my impression.
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I couldn't bear to listen. Thanks for posting the notes. "80k per year is just not enough"? We have a hard time spending $40k. I'd have to force myself to get extravagant to go beyond $40k and, the older I get, the less appealing *any item* becomes.
Suze fails to acknowledge that life expectancy in the US is actually going down, not up, so...
I guess Suze can't imagine just choosing not to spend that kind of money on medical care, or medical tourism. If I got sick enough that this overpriced "health care" system wanted $250k, I'd be overseas (like several friends have decided to do), getting whatever innovative treatment I need in a spa hotel for a fraction of the price. My best friend, as I type, is in Europe because the amazing immunotherapy that is radically shrinking her 14-year-old tumors is not even legal in the US, though it is throughout Europe and Asia. So, Suze, not sure I'd want to be here for all of that anyway, given the low quality and high cost.
I am my grandmother's full POA and legal guardian, and I manage all her care (in assisted living) and finances. In San Francisco proper, at mega fancy deluxe assisted living, her monthly outlay is $7,600 month. How on earth does Suze spend $250k/year on this? Almost all of this, by the way, is deductible as a medical expense, which really changes the total outlay and impact. Per the IRS, even rent in assisted living (not just the nursing care) is a deductible medical expense as long as one or both of two conditions are met: 1) the person is admitted as the result of an emergency incident (fall, etc.) or 2) the person has a chronic condition.
Stuff it, Suze.
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but she tells everyone to work as long as they can in an AREA THAT YOU LOVE.
Not sure who is going to pay me 500k a year to play video games and kiteboard... Shuffling TPS reports is pretty much all I know how to get ahead and there is very little to love in that, doing mundane tasks to make others much more profit then I cost is not something I can replicate on my own without MUCH more risk.
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She is telling everyone to work until 70. Some people won’t live that long. I have lost 3 friends between 59-67 all to cancer. They all did everything right diet and exercise included. You just don’t know when your time is up.
Indeed. It's also possible you just won't be able to work that long. My dad turns 70 next year. He retired at 65 and developed some fairly serious health problems about 18 months later. They aren't going to kill him, but they have required a lot of doctor's visits and I do think they would also have made doing his old job extremely difficult, maybe impossible. I'm sure he could still get some kind of job if he needed to, but his options might be limited. I certainly don't think working full time would be good for his health.
Quite a few of his friends have developed more serious health problems, and yes, some have also died. His younger sister recently got a lymphoma diagnosis.
Saying "work until you're 70" is, for a not insignificant number of people, the same as saying "work until you die". While all my grandparents did make it past 70 years of age, two of them were dead by 75, and then the others were 78 and 82. All but one had serious health problems by age 70 that severely impacted their quality of life (cancer, cancer, alzheimer's). So yeah, I don't think I can super realistically count on working until age 70.
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Hundreds of comments on Reddit
https://www.reddit.com/r/financialindependence/comments/9kfi7d/paula_pants_podcast_why_i_hate_the_fire_movement/
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Of all the regrets most people have towards the end of hteir life, few seem to say "I wish I'd worked another decade".
I never like that argument. I strongly suspect plenty of people (probably not people on this board) reach the end of their lives and say, "I wish I were leaving my wife with a paid-off house" or "I wish I were leaving more for my young children's education" or similar thoughts. I don't think most of us are passionate about our work and will think of it on our deathbeds ... but I think loads of us are passionate about taking care of the people we love.
i'm sure some do, though I suspect the regrets are more about all the money they've wasted on things that didnt really give them joy vs. having wanted to spend more years in the work force. Of course this forum is doubtlessly not a representative sample, but the number of times Ive heard people express regret at not having spent more time being with the ones they loved and doing the things they liked far outnumber the people who wish they had worked years longer. but thats just my impression.
This is what I've read about when people do surveys of regrets from the terminally ill. Most of the regrets revolve around either not spending enough time with family or not pursuing passions (at all or earlier or more vigorously). Those regrets seem easier to address is you manage to FIRE -- or at least hit FI -- in your 30s than if you don't.
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I did get bored so now teaching a online college class that I can do from anywhere. It’s fun! I tried volunteering but it came with some of the same issues as working.
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I take a little different viewpoint. She must have made a lot of money over the years telling people they were stupid with their money. Does she have enough to retire? If all that money hasn't made her happy,........well someone living on "only" $80,000 / year cannot be happy.
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I take a little different viewpoint. She must have made a lot of money over the years telling people they were stupid with their money. Does she have enough to retire? If all that money hasn't made her happy,........well someone living on "only" $80,000 / year cannot be happy.
And I thought I was happy now spending less than $20K/yr. I figured my FIRE budget of about $50K/yr would be enough to make me happy after I retire. But if I take Suzie's advice, I have to wait until I'm 70, have far more than $2M to give me well in excess of $80k/yr so that that I will be happy. It's a good thing I'm not taking her advice. Mehhh....
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This makes me sad. I used to watch her show. She was amazing when she would do her “can I afford it” call in segments. The answer was almost always no. One time a kid called in. She denied him and told him to open an IRA haha.
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I am my grandmother's full POA and legal guardian, and I manage all her care (in assisted living) and finances. In San Francisco proper, at mega fancy deluxe assisted living, her monthly outlay is $7,600 month. How on earth does Suze spend $250k/year on this?
She was probably flying the caregivers to her private island on her private jet.
(she bragged about living on a private island and flying on a private jet during the interview)
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"Do something you love" "Work in an area you love" ...etc
Yeah, there are things I love to do, and not a damn single one of them do I want to do for an employer as they have great track records of putting so much BS into something you love that you'll quickly hate going into the office to do it every day.
"College is going to cost $400K"
oddly enough, 3 of the UNC schools charge only $500 per semester for a full time student...and even NC state and UNC Charlotte aren't very expensive. Truly a clueless person.
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I have always found her obnoxious, but she brings up some logical points to consider, even if she is over the top and condescending, as usual.
1) Dont quit your job out of spite for the unfairness of the working world, at 30, just because you can. First consider the emotional and accomplishments benefits or working. + money, + accomplishments
2) Sandbag a bit, because life does have uncertainty. However, I would say there are many ways to achieve this, not just shitloads of money. Friends, family, life skills. Having a plan for " bad shit happens " is a good idea. Doesnt have to be money though, it can be life skills.
Dont buy her books....better free info out there. :-)
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When she says, "after 4 or 5 years, what are you going to do when you've done everything"...a recent thread on Bogleheads had overwhelmingly positive feedback on people enjoying their time in retirement and not having run out of things to do save for one or two out of 100 that stated they wished they had kept working longer because they were bored.
Sounds like she had a bucket list, retired - hit the list - and then ran out of things to do once the list was completed. AKA - she retired the wrong way, IMO (yeah, the hubris to claim that a multi decamillionaire doesn't know how to retire properly).
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Listening to this tonight...
rough quotes
"A safe FIRE amount would be in the millions. $350,000 a year after taxes. So you need ten million."
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I agree with Suze on that AI and robots are coming and that we can expect a large part of the population to be out of work. I also think that at that time some universal basic income will need to be introduced. That would only be beneficial for us who are FIRED by then.
Our backup system for if FIRE doesn't work out financially: do some form of paid work as much as we need to.
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While I understand the temptation to roll one's eyes at the irrational exuberance of those in their 20s*, and preaching some caution and sand-bagging is wise, her whole "2 million dollars is chump change and no one can live off 80K a year" is really insulting to vast swaths of her listeners. That's far more than most people will ever save and far more than a lot of people live on today. She's basically telling people that they're doomed to work in poverty until death.
What I've found, and I'm way younger than her, is that telling people they're being stupid and overly optimistic never works. Either they're right and you look like an idiot, or you're right and they'll find out on their own and have to deal with it.
The "do what you love" thing is a joke, and she's so obviously a baby-boomer - that's the generation that started that poisonous myth**. I love sitting around drinking lemonade or tea (depending on the season) and reading a good book. Who the hell is going to pay me for that??
*I don't do it, though, because I can clearly remember people doing it to me, and they ended up being wrong.
**Not the whole generation, just enough to make it stick.
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Reflecting a bit on that podcast, I wonder if Suze hasn't intentionally adopted a few of the 'shock/insult' techniques used so frequently by reality TV and bloggers to drive clicks. Hard for me to judge since she's only come across my radar in the last few years and I can't compare her now with who she was 15 or 20 years ago.
If so it's a shame - extreme statements do little to further knowledge and development. I like this community because, while the concept may seem extreme the methods are routed in math and historical simulations with a great deal of self-reliance and flexibility. It's optimism is that anyone can benefit and live a happier, healthier life, regardless of their current age or net worth. Telling people "you're going to be miserable if you *only* have $80k to live on, you need $200-300k a year to truly be happy and not worry" contradicts the overwhelming majority of retirees who would descibe their own retirement as 'comfortable'. Worse, it paints a false dichotomy over a frankly dystopian future.
Maybe that's all intentional on her part - describe everything in only the most extreme way imaginable and drive clicks that way.
Eitehr way - too bad. Certainly more people are going to take advice from this entertainer than probably should.
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I really think that there's misunderstanding everywhere. Suze represents those who look at the acronym "FIRE" and focus too much on the "RE" part while not believing the "FI" part. She's not wrong, but it's because the acronym is not very accurate.
A typical FIRE person around here hasn't retired at all. They have some income coming in outside of investments. Whether it's well managed tradelines or a part time job as a park ranger instead of a big 4 accountant or buying and selling crap on eBay. That's not the traditional "retired" which means your investments, pension, social security is it and you have no other income. My father in law who retired from working for the city is traditionally retired. He has not done a minute of paid work since retiring. That's retired.
So what do *I* call what most here do? I call it backpedaling. I also think that a lot who "FIRE" aren't really financially independent either. And I think that when health insurance premiums inch up enough or you find that tuition at a state school in YOUR state is not even close to the $10k a year you budgeted and some other expenses creep up more than you expected, then guess what? You're going back to work and were never really financially independent.
Exceptions: Ok, so if your kids just graduated from college and your gubermint job includes a pension and 100% health care for life and your house is paid and you have $3MM in your 403b and you live on $50k a year........ok. You certainly are able to FIRE. But you're not the poster child 28 year old who is "burned out from working the cube farm for megacorp" who we hear from all to often. Cry me a river with your 6 years of actual work experience post college.
So is it bad to save a ton and to work towards early backpedaling? Of course not. But don't be stupid and assume things will just work out somehow. Figure it out. Every college in the country has a cost of attendance. That cost will continue to rise at something like double the rate of inflation. Plan for it. Health care ain't going to get cheaper. Expect those costs to rise as quickly as education. If you do a good plan and then throw in a fudge factor, just in case, you'll be fine. Not fine at 28, but maybe some older number (that you won't want to hear from me). My fudge factor is 2. Suze would probably approve of my plan although there's no F'ing way I'm working till 70.
Perhaps a "good" plan is in between a MMM FIRE monkey and Suze's preaching from the top of private island mountain.
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Ugh.
she keeps escalating into crazy-land.
"let's say you need $200k, $250k to live comfortably, then you have a sudden expense and now you need $350k. Now you need $10MM just to make that in interest."
"80k per year is just not enough. I personally think this is the biggest mistake you will ever make in your lifetime. I think it is just ridiculous. $80k may sound like a lot of money, but it's not. When you are 60 or 70 or 80 you will not want to live on $80k a year."
This is brutal. A little reminder about how great we have it here in the developed world -- global household median income is around $10k a year (https://news.gallup.com/poll/166211/worldwide-median-household-income-000.aspx ) . And median household income around where I live in Michigan is around $52k a year and people seem to be doing just fine.
There's some cognitive dissonance here between the approach of what is "enough" compared to living a life full of luxury and toys. Suze O. and Dave Ramsey both embrace the philosophy that if you have enough money you can buy happiness, compared to trying to find it without an exhorbitant amount of money. Or perhaps she's just hardcore fatFIRE.
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She's long been on record for saying she only has 10 percent of her net worth invested in mutual funds/stocks.
She's never raised children. Nothing wrong with that or any choice of lifestyle. But she has no firsthand experience of what it's like to plan/balance your time, career, and finances with kiddos.
She's always been the Denise Austin of Finance. Just as Denise has made a career of jumping from one fitness fad to another -- Denise's Step Aerobics, Pilates, Yoga, Core Training, etc. -- Suze has jumped from one financial trend to another. There's no core teachings to her philosophies. It's just selling Suze, just like it's Denise selling Denise. You might not like Dave Ramsey, but he's been preaching the same message for 25 years.
She said her net worth was $10 million in 2008 and $30 million today. Not disputing those numbers, but given her platform, likely income, and the fact she's never had dependents and claims Florida residency, it should be a helluva lot higher. Maybe if she had more than 10 percent in mutual funds.
In short, Suze has no credibility. I love Costco but wish they'd kick her tired snake oil act out of their magazine.
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I also think that a lot who "FIRE" aren't really financially independent either. .. Exceptions: Ok, so if your kids just graduated from college and your gubermint job includes a pension and 100% health care for life and your house is paid and you have $3MM in your 403b and you live on $50k a year........ok. You certainly are able to FIRE.
So to be clear, you're saying you think being truly financially independent requires a withdrawal rate of 1.67% (and this is in a situation where you have zero tuition obligations, and no risk of increased healthcare costs at any point in your life)?
If you do a good plan and then throw in a fudge factor, just in case, you'll be fine. Not fine at 28, but maybe some older number (that you won't want to hear from me). My fudge factor is 2. Suze would probably approve of my plan although there's no F'ing way I'm working till 70.
Perhaps a "good" plan is in between a MMM FIRE monkey and Suze's preaching from the top of private island mountain.
The problem with "fudge factors" is each time you add one, it rapidly becomes the conventional wisdon, and some then before you know it someone else comes along and says, "okay, that's the default, but let's double it (the already doubled number) just to be safe." Rinse and repeat as needed. I've seen it with business plans, grant budgets, and FIRE plans/budgets. Thats how you eventually end up with advice like "sure $3M is fine until a black swan event, so you better save a lot more just in case."
The typical FIREee has multiple sources of safety margin, starting with an incredibly conservative 4% withdrawal rate that leads to them accumulating dramatically more money than they could possibly need in the vast majority of possible outcomes, followed by significant potential for lifestyle flexibility in the face of adverse personal or national events, and then non-trivial chance that social security may still exist in some form by the time they reach traditional retirement age even though most of us (including me) are assuming it'll be gone completely "just to be safe."
None of those sources of safety individually provide complete assurance against unexpected personal or economic challenges, but with these and other individual specific margins of safety, the chance that something gets past all of them to the point where it causes the person in question significant financial distress is quite small.
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I really think that there's misunderstanding everywhere. Suze represents those who look at the acronym "FIRE" and focus too much on the "RE" part while not believing the "FI" part. She's not wrong, but it's because the acronym is not very accurate.
I think the only misunderstanding here is by Suze. Starting with her completely bonkers statements about how much one needs to be Financially Independent (FI) and never work again (Retired, potentially "Early"). The message she hammered over and over in this podcase is that $80k/year is not enough, in her opinion, to live a comfortable lifestyle. That's the first slop of hogwash. Then she tosses out $250k/year in spending as being 'reasonable' - only then to suggest that "unexpected events" might make it $350k/year. Now we've entered crazy-town. She ultimately suggests that $10MM is the minimum one could retire 'early' on if that person also had a paid off house and carried all sorts of insurance and preferably had yet more assets to draw from in the even of 'really bad things'. She went all hostile on young people who have rental income as a large source of their income.
A discussion about whether people who consider themselves FIREd can bring in additional income is besides the point. She is wrong because, at $2MM and a paid off house most people could never earn a single penny ('retired'), live an extremely comfortable life and die with far more money decades later. She's completely detached from most people's financial reality. As maizeman indicated, 4% already has a great deal of safety. At 3.5% no historical period has run out of money, and in the high 2.x% every scenario results in more money. At $2MM and a paid off house I'm financially better off than 80% of households. At $5MM (a figure she still balks at being far too little for people under 50) I can outspend most households earning $200k/year and only see my stache grow.
There's a fundamental disconnect here between what's needed for a comfortable lifestyle, the math required to sustain that in perpetuity, and Suze Orman. We don't need to consider side-gigs or consult with the IRP here; $2MM-5MM is sufficient for the vast majority of people to retire if they follow an incredibly basic plan.
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Ugh, Suze. Anything to get her name back in people's faces. I'd guess her Q Rating was plummeting and her ego couldn't handle fading into obscurity, so she chose this route to re-surface. Go away and stay gone please, Suze.
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How do you all survive without a private island? She is completely out of touch with reality.
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I love the chance to hear dissenting opinions. She brings up a lot of compelling points that I've heard other people make in less hyperbolic terms. Namely, that you spend more money as you age. And not just out of necessity, but out of comfort. It's easy to call myself a "badass" when I'm in my physical prime. I'm young and strong and I can deal with a lot of bullshit right now. I can volunteer to get bumped from a flight and hang out in an airport for six hours in order to get a crazy flight credit. I can climb six flights of stairs to an AirBnB and sleep basically on a glorified air mattress.
I don't know how I'll feel when I get older, though. My parents were good savers and frugal people when I was growing up, but they've become quite a bit "softer" and spendier with age. Personally, I think I'm even more frugal than they were, but maybe the same could happen to me. I have a very enduring memory of traveling to New York in my early 20s and meeting up with my parents at Penn Station. They had just come in from Newark and were going to check into their hotel in Manhattan. While going up the stairs at the station, I noticed my parents lagging behind, struggling to get their two heavy suitcases up the long flight of stairs. With boundless energy, I ran down the stairs, grabbed my mom's suitcase, and ran it up to the top. Then I ran back down, grabbed by dads, and did the same. Being one to travel out of a backpack, I wondered what they could possibly need from those suitcases.
But people get old. Sometimes they want and need comfort, or help. And you need to expend resources to get that comfort and help. Will I be the same guy at 50 that I am at 30? Almost certainly not. Something to think about.
Suze's doomsday comments can be rebutted with a pretty simple line of logic though. If people who live on middle income spending by drawing conservatively on a pile of money are screwed, what does that say about people who live on middle income spending by laboring? People who are FIRE are dramatically better off than most, and it takes an extremely "rich person" mindset not to fully appreciate that.
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Suze's doomsday comments can be rebutted with a pretty simple line of logic though. If people who live on middle income spending by drawing conservatively on a pile of money are screwed, what does that say about people who live on middle income spending by laboring? People who are FIRE are dramatically better off than most, and it takes an extremely "rich person" mindset not to fully appreciate that.
It's clear to her that those people do not get to retire early. They have to work until 70 until, even with ss, they hit financial ruin and die early, I presume?
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I think there are two things at play here.
1. Suze has made all of her money by selling financial advice and doom and gloom to people. Telling everybody it's possible to save 50% of your income from 20-35 and then retire doesn't fit into her sales pitch.
2. She keeps referencing all the people that reach out to her with insane life events that threw everything off. I'm sure that has happened, but people are way more likely to reach out to her for help when that happens than than to tell her...hey we were just fine. It's really just a form of confirmation bias.
Who really cares if she doesn't agree with it? Dave Ramsey doesn't agree with it either. Also keep in mind that just from hearing her talk, her version of retirement is a traditional version of retirement. Sitting on her private island, learning to sail, and traveling.
That's honestly my biggest issue with the term FIRE in the first place. Most people don't stop their careers in their mid 30s and literally never do anything else capable of returning them an income from then on. I think it's closer to a career change than a retirement. Whether that's switching from being a software developer to a blogger and/or speaker, or a lawyer to someone that offers their services for financial planning and budgeting for "FIRE". It's a career change in my opinion, not an actual retirement, like your 75 year old grandfather that does some gardening, goes to bingo, and watches his beloved Red Sox every evening.
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I love the chance to hear dissenting opinions. She brings up a lot of compelling points that I've heard other people make in less hyperbolic terms. Namely, that you spend more money as you age. And not just out of necessity, but out of comfort.
There are certainly many aspects of traditional retirement planning that don't apply as well to ER. For example, early retirement can vary dramatically based on the retiree's age and the presence or absence of children. Traditional retirement assumes that any children have already grown up and left home, and that a certain amount of work-related spending will go away. For those of us fortunate to live within a bikeable/walkable distance to work, and have a casual dress code, those savings wouldn't apply. It's really a tug of war between keeping things simple (and applicable to the widest audience) vs accounting for every individual circumstance (and the complexity that introduces).
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Most studies show that retirees spend considerably less than those who work. Less transportation costs, less food costs (due to not eating out as much for lunch), less clothing costs. The one cost that could obviously go up is healthcare.
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I love the chance to hear dissenting opinions. She brings up a lot of compelling points that I've heard other people make in less hyperbolic terms. Namely, that you spend more money as you age. And not just out of necessity, but out of comfort. It's easy to call myself a "badass" when I'm in my physical prime. I'm young and strong and I can deal with a lot of bullshit right now. I can volunteer to get bumped from a flight and hang out in an airport for six hours in order to get a crazy flight credit. I can climb six flights of stairs to an AirBnB and sleep basically on a glorified air mattress.
I don't know how I'll feel when I get older, though. My parents were good savers and frugal people when I was growing up, but they've become quite a bit "softer" and spendier with age. Personally, I think I'm even more frugal than they were, but maybe the same could happen to me. I have a very enduring memory of traveling to New York in my early 20s and meeting up with my parents at Penn Station. They had just come in from Newark and were going to check into their hotel in Manhattan. While going up the stairs at the station, I noticed my parents lagging behind, struggling to get their two heavy suitcases up the long flight of stairs. With boundless energy, I ran down the stairs, grabbed my mom's suitcase, and ran it up to the top. Then I ran back down, grabbed by dads, and did the same. Being one to travel out of a backpack, I wondered what they could possibly need from those suitcases.
But people get old. Sometimes they want and need comfort, or help. And you need to expend resources to get that comfort and help. Will I be the same guy at 50 that I am at 30? Almost certainly not. Something to think about.
You make a good point, and one way to see that is to look at the habits of younger mustachians with disabilities, who would have the physical issues more typical of the elderly, but with a mindset more typical of their generation.
For example, my husband has limited mobility due to a degenerative condition. On one hand, that means that we drive more than we'd like because he's not physically able to walk/bike as far as most can. We have to hire out DIY jobs that take more than one person, or rely on help from family/friends, where other couples can work together. We pay through the nose for medical care even with good insurance. We vacation in places with real beds because camping is simply not an activity he's physically capable of. We sometimes throw money at problems because dealing with disability is really draining, and we're lucky enough to be in a position to do so.
BUT, it's not all "anti-mustachian" behavior. (I'm using quotes because I don't think any of those things are outside of the spirit of mustachianism given the circumstances, but I will grant that for purists, they may be.) When both driving and sitting in a chair for an hour are intensely painful, but cooking is something you find relaxing, it's really easy to stay in and cook. When shopping is difficult, it's that much easier to make do with what you have. When cleaning is difficult, it's easier to make housing decisions for smaller spaces. (And if you think you'll eventually become incapable of climbing stairs, might as well get a small one-story house.)
I'm not saying that the second piece comes anywhere close to outweighing the first, but it does have an impact. And it may be different for others with different kinds of disabilities or lifestyles.
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The podcast is hard to listen to because like a lot of older people with big personalities, she tends to turn conversations into lectures that simply reinforce her own life experience. Criticisms that she is just selling what has made her rich also apply to most of the prominent FIRE gurus too though.
Suze was my first money guru. Her advice got me geeked on investing at 17 and 18 years old. And learning about FICO helped me get a house when I was 24. I've long stopped worshiping at the FICO altar, but I'll always be thankful for her. Suze, Dave Ramsey, MMM, they're all trying to sell you on something. But the good news is that even if it isn't 100% for you, there's enough broad advice in there that nearly anyone can benefit from listening to any of them. The key is to discount the advice you get by the profit motive of the person giving it. For that reason, I've tried to soften my criticism of Dave Ramsey over the years, despite never being a Ramsey Acolyte.
In this case, I discount most of the doom and gloom, but I'll gladly take the notion that bad and expensive things are on the horizon. And I'll especially take that FIRE short-circuits compounding, because it absolutely does.
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You make a good point, and one way to see that is to look at the habits of younger mustachians with disabilities, who would have the physical issues more typical of the elderly, but with a mindset more typical of their generation.
For example, my husband has limited mobility due to a degenerative condition. On one hand, that means that we drive more than we'd like because he's not physically able to walk/bike as far as most can. We have to hire out DIY jobs that take more than one person, or rely on help from family/friends, where other couples can work together. We pay through the nose for medical care even with good insurance. We vacation in places with real beds because camping is simply not an activity he's physically capable of. We sometimes throw money at problems because dealing with disability is really draining, and we're lucky enough to be in a position to do so.
BUT, it's not all "anti-mustachian" behavior. (I'm using quotes because I don't think any of those things are outside of the spirit of mustachianism given the circumstances, but I will grant that for purists, they may be.) When both driving and sitting in a chair for an hour are intensely painful, but cooking is something you find relaxing, it's really easy to stay in and cook. When shopping is difficult, it's that much easier to make do with what you have. When cleaning is difficult, it's easier to make housing decisions for smaller spaces. (And if you think you'll eventually become incapable of climbing stairs, might as well get a small one-story house.)
I'm not saying that the second piece comes anywhere close to outweighing the first, but it does have an impact. And it may be different for others with different kinds of disabilities or lifestyles.
Thanks for your very valuable perspective!!
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Most studies show that retirees spend considerably less than those who work. Less transportation costs, less food costs (due to not eating out as much for lunch), less clothing costs. The one cost that could obviously go up is healthcare.
Indeed. There is also good evidence that retirees total annual spending tends to decrease rather than increase in old age. Here is a good discussion of some of these studies over at kitches. https://www.kitces.com/blog/age-banding-by-basu-to-model-retirement-spending-needs-by-category/
This represents another one of those "margins of safety" already built in conventional FIRE calculations, as I don't know anyone who is figuring out how they need to save based on the assumption that their spending will decline over time, but the statistical evidence suggests that for many of us that will, in fact, ultimately be the case.
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Most studies show that retirees spend considerably less than those who work. Less transportation costs, less food costs (due to not eating out as much for lunch), less clothing costs. The one cost that could obviously go up is healthcare.
AARP has done a lot of research on this. In broad generalizations, people spend about as much for the first few years, and then their expenses drop by 20-25% and stay there until end-of-life care causes expenses to rocket back up. Increases in health care offset decreases in virtually every other category. It's actually the basis for the flawed advice "plan on spending about 80% of what you earn". From what limited information there is about early retirees the trends in spending seem to hold.
The caveat is of course that everyone's situation is different.
ETA: Looks like maizeman beat me to it ;-)
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Now that I think about it, it is kind of funny that her 'You can't possibly happy on $x" is so close to the amount that researchers say is indeed the cutoff for income/happiness correlation.
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"Do something you love" "Work in an area you love" ...etc
Yeah, there are things I love to do, and not a damn single one of them do I want to do for an employer as they have great track records of putting so much BS into something you love that you'll quickly hate going into the office to do it every day.
"College is going to cost $400K"
oddly enough, 3 of the UNC schools charge only $500 per semester for a full time student...and even NC state and UNC Charlotte aren't very expensive. Truly a clueless person.
Well, she's not necessarily wrong.
Pricing out the local state school and a pricey private school -
I started with cost for this year.
I added 5% each year to my starting years for my 2 kids.
State university, live at home: $152k kid 1, $200k kid 2.
State university, live on campus: $197k kid 1, $264k kid 2.
Pricey private school (Cal Tech, if you are curious):
Kid 1: $386k, Kid 2: $518k
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If $2-3M isn't enough, doesn't that bode incredibly poorly for something like 90% of the population? If you can't retire on that, retirement as a concept is dead.
This is an attitude that's gotten me through a lot of stressful hurdles in life, starting with high school. Even at that point I realized that academically I was in the top 10 if not 5%. If I walked out of a particularly difficult test, I knew that I would be fine, because either 80% of the class would have failed and I'd scrape by with a not so great 65, or some major scaling would have to happen.
Same thing here. Anyone with 7 figures in their 30s is probably in the financial 1%, even if they just maintain that via 4% and small supplemental income (which itself is a worse than average scenario) at 65 they may fall to the top financial 20%. If that guy is fucked, what about the rest of the people.
The one thing I do fear however is the popular 'eat the rich' mentality particularly in Canada as of late. It's largely been focused on income so far, but a big worry is for them to start to attack wealth in the form of either divs/cap gains tax credits, or the tax free cap gains on primary residence.
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If $2-3M isn't enough, doesn't that bode incredibly poorly for something like 90% of the population? If you can't retire on that, retirement as a concept is dead.
This is an attitude that's gotten me through a lot of stressful hurdles in life, starting with high school. Even at that point I realized that academically I was in the top 10 if not 5%. If I walked out of a particularly difficult test, I knew that I would be fine, because either 80% of the class would have failed and I'd scrape by with a not so great 65, or some major scaling would have to happen.
...
Every time I find myself feeling financially squeezed I think to myself: There are loads of other people who are getting by on life with less than we make and with more financial obligations.
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If $2-3M isn't enough, doesn't that bode incredibly poorly for something like 90% of the population? If you can't retire on that, retirement as a concept is dead.
This is an attitude that's gotten me through a lot of stressful hurdles in life, starting with high school. Even at that point I realized that academically I was in the top 10 if not 5%. If I walked out of a particularly difficult test, I knew that I would be fine, because either 80% of the class would have failed and I'd scrape by with a not so great 65, or some major scaling would have to happen.
...
Every time I find myself feeling financially squeezed I think to myself: There are loads of other people who are getting by on life with less than we make and with more financial obligations.
Yep, I always laugh at the number of times I hear/read "you can't get by on social security" when in fact a fairly large percentage do....I view all these folks as the psuedo-mustachians of the masses (i.e. people who all of the sudden learn to get by on a fraction of what they used to, its not sad they they are now living on 40% of what they used to make or I'd have to pity the folks on this site, its sad that they worked 50 years before doing so)
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I agree with Suze on that AI and robots are coming and that we can expect a large part of the population to be out of work.
People were saying this in the 1700s. And the 1800s. And... etc.
It's not going to happen. There will literally always be work for people who want to work, and probably work that needs to be done by people who don't really want to work either.
I also find it frustrating that people criticize the FIRE crowd, saying "what are you gonna do when you retire?" Well, I guess if you decide you want to do something, then you'll do something! Is this so outlandish?
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I also find it frustrating that people criticize the FIRE crowd, saying "what are you gonna do when you retire?" Well, I guess if you decide you want to do something, then you'll do something! Is this so outlandish?
This confuses me too. I don't go to work because I need something to do. I get that many people find meaning and get valuable social interactions from work, but those are not the only places those are available. If anything, I think our western society (and the US in particular) would be better off if we decoupled a person's value and identity with the job that they perform.
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This confuses me too. I don't go to work because I need something to do. I get that many people find meaning and get valuable social interactions from work, but those are not the only places those are available. If anything, I think our western society (and the US in particular) would be better off if we decoupled a person's value and identity with the job that they perform.
I hate it when a conversation begins with, "So, what do you do?"
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Suze certainly has her own opinions that are based are her own motivations and guesses about what is, what will be, and what is important. So you just have to take that in to account while listening to her, like anyone else for that matter.
I am glad she was out there on her soapbox when I officially started out in the "adult" working world 18 years ago.
What I got from her besides a deep sense of fear in my financial future was the simple idea that the more you spend now, they less you're gonna have later. Sure you can get a loan for that $30k car, but why not just get one that runs and save your money?
Along with the advice from my dad and a few books, it was good to have someone warning me about my financial future, and telling me in stark terms that I needed to have A LOT of money if I wanted to avoid living in a cardboard box at retirement.
I am getting within a few years of FIRE right now, and am less fearful. I wont have $3M as she suggests, nor will I be planning on working much when I do cross the Rubicon; but I am content that I have a good plan in place that is based on pretty sound historical metrics.
Take what is useful for you and disregard the rest... as long as you have a good argument for doing so.
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I agree with Suze on that AI and robots are coming and that we can expect a large part of the population to be out of work.
People were saying this in the 1700s. And the 1800s. And... etc.
It's not going to happen. There will literally always be work for people who want to work, and probably work that needs to be done by people who don't really want to work either.
There will probably always be work that needs to be done. That doesn't mean that the work that needs to be done and the people who need work with be able to match up.
We have shortages of a number of engineering and computer science specialties all across the country (not basic scriptling like most of us have had to learn how to do over the past decade, but serious computer science). We had those shortages right through the great recession when unemployment spiked. If you're the sort of person who is really good at artificial intelligence applications or designing or deploying industrial robots you're probably not going to have trouble finding work for some time to come. But only a subset of the population has brains that allow them to be really good at those types of work or the others that will be in high demand in coming decades. I'm certainly not one of them.
So if we do see the unemployment rate (and in particularly the super long unemployment rate) tick up in coming years, I predict it won't be because there are a shortage of job openings, but because there are more and more people who aren't able to find a job where their abilities and skillsets allow them to outperform a combination of automation and AI. But that's all the more reason for people to like me to pursue FI now, not a reason to shy away from it.
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I agree with Suze on that AI and robots are coming and that we can expect a large part of the population to be out of work.
People were saying this in the 1700s. And the 1800s. And... etc.
It's not going to happen. There will literally always be work for people who want to work, and probably work that needs to be done by people who don't really want to work either.
There will probably always be work that needs to be done. That doesn't mean that the work that needs to be done and the people who need work with be able to match up.
We have shortages of a number of engineering and computer science specialties all across the country (not basic scriptling like most of us have had to learn how to do over the past decade, but serious computer science). We had those shortages right through the great recession when unemployment spiked. If you're the sort of person who is really good at artificial intelligence applications or designing or deploying industrial robots you're probably not going to have trouble finding work for some time to come. But only a subset of the population has brains that allow them to be really good at those types of work or the others that will be in high demand in coming decades. I'm certainly not one of them.
So if we do see the unemployment rate (and in particularly the super long unemployment rate) tick up in coming years, I predict it won't be because there are a shortage of job openings, but because there are more and more people who aren't able to find a job where their abilities and skillsets allow them to outperform a combination of automation and AI. But that's all the more reason for people to like me to pursue FI now, not a reason to shy away from it.
One thing I've tried to wrap my head around with the whole robots-replacing-most-workers apocolypse is what this would actually mean for our ability to provide goods and services to people. Presently we tend to measure things in jobs, in wages, and in taxable revenue. But if robots became sophisticated enough to replace 80% of the current labor market, the total global productivity would increase, even as a big chunk of humans falls out of work.
The dooms-sayers point to this and say we'll have massive unemployment and untold millions starving because they earn no money. The optimists suggest a universal income (an idea I think sohuld be explored more). But where my brain gets stuck is that the food is still being grown, picked and distributed, roads are being built, factories are cranking out widgets - in short all that productivity is still happening, just without people. So... would the cost of everything just crater now that labor costs are near nil for most things? If that's the case could I have a similar lifestyle on less than half as much money?
what's the real outcome of large increases in productivity concurrent sizable decreases in labor?
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what's the real outcome of large increases in productivity concurrent sizable decreases in labor?
Look to the industrial and agricultural revolutions. People used to plant their own food, live on farms. The world urbanized in order to industrialize, and productivity skyrocketed. Phosphates, etc., made agriculture incredibly productive later on, and there's way more than enough food for everyone now. Incredible productivity gains.
People still work today. Just on different things.
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what's the real outcome of large increases in productivity concurrent sizable decreases in labor?
Well, for the past several decades, productivity has skyrocketed... But real median wages have pretty much stayed stagnant. The gains from increased productivity have largely been enjoyed by executive-level employees and by owners (e.g. shareholders.)
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So, basically Suze is telling me not to retire early because someday I will grow old and sick and have to pay insanely high medical bills. God that’s such a depressing outlook on life. I’m all for having a plan, saving a little more than enough, always being insured, etc. But damn she’s depressing. Hey, don’t you save money, retire and spend time hiking and enjoying life! You have to work your entire life and then spend that money so you can sit in a hospital bed!
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The dooms-sayers point to this and say we'll have massive unemployment and untold millions starving because they earn no money. The optimists suggest a universal income (an idea I think sohuld be explored more). But where my brain gets stuck is that the food is still being grown, picked and distributed, roads are being built, factories are cranking out widgets - in short all that productivity is still happening, just without people. So... would the cost of everything just crater now that labor costs are near nil for most things? If that's the case could I have a similar lifestyle on less than half as much money?
what's the real outcome of large increases in productivity concurrent sizable decreases in labor?
And that, I fear, is the million dollar question.
I agree that a society that was automated to the point where many folks simply couldn't find work where they'd have a big enough advantage over AI/robotics for someone to be willing to pay them is also a society that could afford to support large numbers of people who were not gainfully employed in a lifestyle that was better than extreme poverty (if perhaps not as nice a lifestyle as is currently enjoyed by the american middle class). But it's hard to see a feasible path how we get from where we are now to there.
That's why I see being FI as such a useful hedge against a highly automated future. Either the increase in AI/robotics means more and more of the total productivity of the economy goes to capital owners rather than labor (in which case I'm covered by owning enough capital to support myself), or we push through a UBI or something similar, which may be funded by high taxes on the capital gains/dividends going to owners of capital, but I won't have to be particularly worried about the impact of high taxes on my investments since I'll have the UBI as an alternative source of support. *shrug*
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So, basically Suze is telling me not to retire early because someday I will grow old and sick and have to pay insanely high medical bills. God that’s such a depressing outlook on life.
It's also unique to the USA. Want to retire without insane medical costs? Move to any developed country (where they have universal health care), or any developing country (where health care is still affordable), just not the US.
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So, basically Suze is telling me not to retire early because someday I will grow old and sick and have to pay insanely high medical bills. God that’s such a depressing outlook on life.
It's also unique to the USA. Want to retire without insane medical costs? Move to any developed country (where they have universal health care), or any developing country (where health care is still affordable), just not the US.
Her main concern seems to be long term care. Is LTC covered by public universal healthcare in most countries? I didn't think it was in Canada.
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Her main concern seems to be long term care. Is LTC covered by public universal healthcare in most countries? I didn't think it was in Canada.
I'm only familiar with the US (which has Medicaid) and the UK (which has a similar system) where you are required to spend down your own money before the government will pay for it. But even in the US if you are out of money your long term care will be covered. I assume that something like this is available in Canada? But if I run out of money for someone to physically take care of me, I'll let the state do it. I can't have much time or quality of life left at that point anyway.
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So, basically Suze is telling me not to retire early because someday I will grow old and sick and have to pay insanely high medical bills. God that’s such a depressing outlook on life. I’m all for having a plan, saving a little more than enough, always being insured, etc. But damn she’s depressing. Hey, don’t you save money, retire and spend time hiking and enjoying life! You have to work your entire life and then spend that money so you can sit in a hospital bed!
Hmmm.. work till 70 in constant misery so I can afford 1 year of extended life, sick in a hospital bed... OR work until 45, enjoy 25 years happiness, and buy a bullet for $10 (inflation) at 70 and get it over quick?... hmmm decisions decisions...
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I agree with Suze on that AI and robots are coming and that we can expect a large part of the population to be out of work.
People were saying this in the 1700s. And the 1800s. And... etc.
It's not going to happen. There will literally always be work for people who want to work, and probably work that needs to be done by people who don't really want to work either.
There will probably always be work that needs to be done. That doesn't mean that the work that needs to be done and the people who need work with be able to match up.
We have shortages of a number of engineering and computer science specialties all across the country (not basic scriptling like most of us have had to learn how to do over the past decade, but serious computer science). We had those shortages right through the great recession when unemployment spiked. If you're the sort of person who is really good at artificial intelligence applications or designing or deploying industrial robots you're probably not going to have trouble finding work for some time to come. But only a subset of the population has brains that allow them to be really good at those types of work or the others that will be in high demand in coming decades. I'm certainly not one of them.
So if we do see the unemployment rate (and in particularly the super long unemployment rate) tick up in coming years, I predict it won't be because there are a shortage of job openings, but because there are more and more people who aren't able to find a job where their abilities and skillsets allow them to outperform a combination of automation and AI. But that's all the more reason for people to like me to pursue FI now, not a reason to shy away from it.
One thing I've tried to wrap my head around with the whole robots-replacing-most-workers apocolypse is what this would actually mean for our ability to provide goods and services to people. Presently we tend to measure things in jobs, in wages, and in taxable revenue. But if robots became sophisticated enough to replace 80% of the current labor market, the total global productivity would increase, even as a big chunk of humans falls out of work.
The dooms-sayers point to this and say we'll have massive unemployment and untold millions starving because they earn no money. The optimists suggest a universal income (an idea I think sohuld be explored more). But where my brain gets stuck is that the food is still being grown, picked and distributed, roads are being built, factories are cranking out widgets - in short all that productivity is still happening, just without people. So... would the cost of everything just crater now that labor costs are near nil for most things? If that's the case could I have a similar lifestyle on less than half as much money?
what's the real outcome of large increases in productivity concurrent sizable decreases in labor?
I'm with the group that thinks the increased productivity and available labor will just mean better services for everyone. For example, automation will not eliminate chefs, they will just reduce drudgery of production tasks, so chefs can focus on infinitely more creative work. Perhaps every meal will be uniquely customized to the tastes of each patron, or like McDonalds is now doing with automation, hand delivered immediately to your car, because your orderd it while driving to the restaurant via your favorites in your app, charged automatically to your credit card, with one button, not while waiting in line at the drive up window. Even fast food employees wont need to fuss as much at the register, more time spent making quality food, more custonized food, more convenient locations with fewer staff, running it out to you at your car, and other conveniences, etc.
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And she thinks $2 million is "pennies"? Not if you live like you're earning $60K a year.
That just shows how detached she is from Main St. America.
She is a very wealthy women and lives that way,
she doesn't understand what it's like to live the way 80% of Americans live.
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The real question is whether those robots who automate all of the present jobs will find them as boring as the rest of us.
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So, basically Suze is telling me not to retire early because someday I will grow old and sick and have to pay insanely high medical bills. God that’s such a depressing outlook on life. I’m all for having a plan, saving a little more than enough, always being insured, etc. But damn she’s depressing. Hey, don’t you save money, retire and spend time hiking and enjoying life! You have to work your entire life and then spend that money so you can sit in a hospital bed!
Hmmm.. work till 70 in constant misery so I can afford 1 year of extended life, sick in a hospital bed... OR work until 45, enjoy 25 years happiness, and buy a bullet for $10 (inflation) at 70 and get it over quick?... hmmm decisions decisions...
Fuckin’ A, brother.
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Suze, Dave Ramsey, MMM, they're all trying to sell you on something.
Wow, I can't believe everyone let this pass. Do you really thing MMM is selling the same way the other two are? Where's his book? Where is his university? Where are his mega-millions?
@mathlete, I completely respect your opinion. Would you care to elaborate a little further?
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We retired at 58. 6 years later we are spending more money due to traveling, eating out, going to events, etc. Studies show this is normal and costs go down at 70 due to less travel. Among my friends and family that have stayed active and in good shape some have had health issues slow them down and others not at all. You just don’t know if that will be you or your loved ones. We do pay more for comfort sometimes. This summer we took our 3 dogs on a month long car trip over 4K miles. We stayed at motel 6. Many people wouldn’t do that. Actually they were pet friendly and clean. Some were big and some super small. Besides staying home with my kids and getting 4 college degrees I started my career late at 34 so 58 was reasonable. I still do some consulting because I love it.
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I am my grandmother's full POA and legal guardian, and I manage all her care (in assisted living) and finances. In San Francisco proper, at mega fancy deluxe assisted living, her monthly outlay is $7,600 month. How on earth does Suze spend $250k/year on this?
She was probably flying the caregivers to her private island on her private jet.
(she bragged about living on a private island and flying on a private jet during the interview)
I am in the same situation with my Mom, but she needs more care now. Assisted living with memory care was $5200/mo, but a skilled nursing room in the same complex is $15k/mo. Assuming Suze either hired private staff or a top notch place in Manhattan, I could easily see over $20k/mo.
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Nothing in life is 100% safe. But you're not getting out this thing alive anyway, so who the hell cares? Jump when you feel ready.
Absolutely. Suze Orman is just another part of the fear machine. She judges people because she doesn't like herself. To each their own.
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I listened to this podcast - and I was struck by how much she seemed to LOVE herself. IMO it seemed that there was ZERO humility on two accounts.
First I found that I was listening like I was gawking at a car wreck - incredulous that someone would publicly speak in such a manner. I have over $100M, I was welcomed with Open Arms back to NBC - they love me, I live on a private island, I am the best at Finance. If I didn't know it was Orman I would swear it was Trump.
Second, I found it surprising there was no care by Orman to ask what FIRE was, what it means to others.
It will be interesting to find out the reactions to her over the Webs .
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She's the worst. I can't stand her. I remember back in 1999 or 2000 she fancied herself a stockpicker. She even had a show kind of like that clown Jim Cramer until her ratings tanked because she was even worse at picking stocks than HE was.
Then she restyled herself as a sort of lesbian Dave Ramsey. How anyone can't listen to her anooying voice is beyond me.
MOD EDIT: What did this add?
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Am I missing something?
My health insurance policy has an out-of-pocket max of $4,000 per year for my family. How can a "medical disaster" cost me $300,000?
Even if I need a helicopter ride, and 100 days in the ICU with 10 surgeries, shouldn't I still only have to pay $4,000? Isn't that the point of insurance?
Am I missing something (serious)? Under what circumstance would I be on the hook for $300k in medical bills?
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Am I missing something?
My health insurance policy has an out-of-pocket max of $4,000 per year for my family. How can a "medical disaster" cost me $300,000?
Even if I need a helicopter ride, and 100 days in the ICU with 10 surgeries, shouldn't I still only have to pay $4,000? Isn't that the point of insurance?
Am I missing something (serious)? Under what circumstance would I be on the hook for $300k in medical bills?
You would only be 'on the hook' if your insurance did not cover the care needed. This is very rare but does occasionally happen. As other posters have pointed out, there are other, better options should one be faced with this dilemma, like medical-tourism.
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Am I missing something?
My health insurance policy has an out-of-pocket max of $4,000 per year for my family. How can a "medical disaster" cost me $300,000?
Even if I need a helicopter ride, and 100 days in the ICU with 10 surgeries, shouldn't I still only have to pay $4,000? Isn't that the point of insurance?
Am I missing something (serious)? Under what circumstance would I be on the hook for $300k in medical bills?
In some states, in some situations you might have to worry about "balance billing" for things like a helicopter ride if the helicopter provider is outside of your insurance network. That said, even in those cases you can usually negotiate them down and settle for far less than they originally bill you for.
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How do you all survive without a private island? She is completely out of touch with reality.
What she really needs is her own private Idaho.
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Two interesting snippets from the Wikipedia article on Suze Orman (https://en.wikipedia.org/wiki/Suze_Orman):
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While she has proven herself a wealth of information about credit and very general financial issues, Orman's understanding of comprehensive financial planning has been questioned by many in the industry. Senior MarketWatch columnist Chuck Jaffe, for example, states that Orman "scores very high on the personality index, but very low on the knowledge and understanding of the complex issues that face a lot of her audience. She's giving generic, simple solutions to people's most difficult problems, and judging from her [own personal investment] portfolio she's taking them on a path she really hasn't traveled herself."
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In 2012, Orman introduced a prepaid debit card, backed by Bancorp Bank, aimed at budget-challenged consumers. In personal appearances, she claimed the card would contribute to improving the cardholder's FICO score, even though only one credit agency – TransUnion – had reviewed the proposal and had agreed only to "examine data from [the] cards". The website for the debit card claimed, "I am proud to say that the Approved card is the first prepaid card in history to share information with TransUnion, a major credit bureau."[29] Two years later, the program was quietly ended.
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Suze, Dave Ramsey, MMM, they're all trying to sell you on something.
Wow, I can't believe everyone let this pass. Do you really thing MMM is selling the same way the other two are? Where's his book? Where is his university? Where are his mega-millions?
@mathlete, I completely respect your opinion. Would you care to elaborate a little further?
Maybe MMM is not trying to sell you the same things (like a book) but of course he is selling you something. If you think he is not, you are very naïve. I have no doubt he gets paid by the products he "recommends". He has this blog to make money, not out of the goodness of his heart.
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In some states, in some situations you might have to worry about "balance billing" for things like a helicopter ride if the helicopter provider is outside of your insurance network. That said, even in those cases you can usually negotiate them down and settle for far less than they originally bill you for.
You would only be 'on the hook' if your insurance did not cover the care needed. This is very rare but does occasionally happen. As other posters have pointed out, there are other, better options should one be faced with this dilemma, like medical-tourism.
Thanks team!
Seems like a very unlikely scenario that I shouldn't be "planning" for (who plans for a helicopter ride that is out of network... dumb.)
Thank you!
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Suze, Dave Ramsey, MMM, they're all trying to sell you on something.
Wow, I can't believe everyone let this pass. Do you really thing MMM is selling the same way the other two are? Where's his book? Where is his university? Where are his mega-millions?
@mathlete, I completely respect your opinion. Would you care to elaborate a little further?
Maybe MMM is not trying to sell you the same things (like a book) but of course he is selling you something. If you think he is not, you are very naïve. I have no doubt he gets paid by the products he "recommends". He has this blog to make money, not out of the goodness of his heart.
Not sure I agree with that. There was a blog post a while back about how MMM walked away from something like $10K/month in advertising income from a credit card company, because the CC company wanted MMM to censor certain four-letter-words from his blog posts. He decided it was better to just stop participating with that advertising campaign. If MMM was all about the money, this would most certainly not have happened.
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She brings up a lot of compelling points that I've heard other people make in less hyperbolic terms. Namely, that you spend more money as you age.
This simply isn't true. All prevailing evidence I've seen suggests we spend far less as we age, with the exception the unfortunate ones who have serious medical problems.
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Suze, Dave Ramsey, MMM, they're all trying to sell you on something.
Wow, I can't believe everyone let this pass. Do you really thing MMM is selling the same way the other two are? Where's his book? Where is his university? Where are his mega-millions?
@mathlete, I completely respect your opinion. Would you care to elaborate a little further?
Maybe MMM is not trying to sell you the same things (like a book) but of course he is selling you something. If you think he is not, you are very naïve. I have no doubt he gets paid by the products he "recommends". He has this blog to make money, not out of the goodness of his heart.
Not sure I agree with that. There was a blog post a while back about how MMM walked away from something like $10K/month in advertising income from a credit card company, because the CC company wanted MMM to censor certain four-letter-words from his blog posts. He decided it was better to just stop participating with that advertising campaign. If MMM was all about the money, this would most certainly not have happened.
rantk81 is correct. Another huge difference is though MMM may have a few small, clearly disclosed links on his blog, I don't have to buy anything to participate in Mustachianism to the highest degree I desire. If you can't see the distinction @SKL-HOU, you may want to reconsider tossing around the word "naive" quite so blithely.
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She is telling everyone to work until 70. Some people won’t live that long. I have lost 3 friends between 59-67 all to cancer. They all did everything right diet and exercise included. You just don’t know when your time is up.
Sorry for your losses. I've also lost 3 friends to cancer recently -- all in their 30s and took good care of themselves. To me, that's more reason to retire early -- not less.
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AI is coming - by 2030 we will have 25% unemployment. Tax brackets will increase to compensate for all the people not working and not paying taxes. Higher tax brackets mean you will keep a smaller % of your portfolio (e.g. 401k)
This is an incredibly pessimistic view of technological progress, and nothing in the entirety of human history suggests it has any basis in reality.
In every other instance in human history, technological advances lead to greater efficiency, economic advances, societal advances, and frequently improved employment conditions. While some jobs may not exist in the future because of AI, many other jobs are likely to be created, some of which do not exist today, while others will be changed or expanded by AI.
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She is telling everyone to work until 70. Some people won’t live that long. I have lost 3 friends between 59-67 all to cancer. They all did everything right diet and exercise included. You just don’t know when your time is up.
Sorry for your losses. I've also lost 3 friends to cancer recently -- all in their 30s and took good care of themselves. To me, that's more reason to retire early -- not less.
We were already frugal, already saving, but what got my husband interested in listening to optimization and retirement vs extended sabbatical was a colleague having a heart attack at his desk in his late 30s.
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If $2-3M isn't enough, doesn't that bode incredibly poorly for something like 90% of the population? If you can't retire on that, retirement as a concept is dead.
Yup. And her goal is to scare the 90% into buying her BS.
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In some states, in some situations you might have to worry about "balance billing" for things like a helicopter ride if the helicopter provider is outside of your insurance network. That said, even in those cases you can usually negotiate them down and settle for far less than they originally bill you for.
You would only be 'on the hook' if your insurance did not cover the care needed. This is very rare but does occasionally happen. As other posters have pointed out, there are other, better options should one be faced with this dilemma, like medical-tourism.
Thanks team!
Seems like a very unlikely scenario that I shouldn't be "planning" for (who plans for a helicopter ride that is out of network... dumb.)
Thank you!
Ehhh...my husband works in insurance and is dealing with a case like this right now. The couple had a toddler medi-vaced from state X (their state) to state Y (which has the best hospital for the disease), and they *thought* it was covered because of the emergency. However, the insurance company decided it wasn't 'medically necessary,' (they can do this on basically any procedure they want to, even if the doctors say otherwise - not just helicopter rides) and so now they're getting a $300K bill.
Out of pocket maximum doesn't mean maximum at all. A lot of plans have exclusions in the fine print that one might not realize or expect.
ETA: Not that I'm agreeing with Orman. Medical tourism is exactly how I would handle that sort of issue myself, I'm just saying it's more common than you might expect for bills to exceed the OOP max, and in the throes of an emergency, it may be hard to check your coverage before making the decision to act.
OK, but would still being employed change that at all? Like, is there coverage that an employee would have that a FIRE'd person would not?
I ask because shit happens, sure, but i don't know how an employee would be better handled to deal with the $300k helicopter ride (for arguments sake, not always a helicopter as you say) than a FIRE'd person? the FIRE'd person would just need to go back to work for xYears to pay for the $300k expense, just like an already employed person would have to work for xYears longer to pay for it?
Right?
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In some states, in some situations you might have to worry about "balance billing" for things like a helicopter ride if the helicopter provider is outside of your insurance network. That said, even in those cases you can usually negotiate them down and settle for far less than they originally bill you for.
You would only be 'on the hook' if your insurance did not cover the care needed. This is very rare but does occasionally happen. As other posters have pointed out, there are other, better options should one be faced with this dilemma, like medical-tourism.
Thanks team!
Seems like a very unlikely scenario that I shouldn't be "planning" for (who plans for a helicopter ride that is out of network... dumb.)
Thank you!
https://abcnews.go.com/Health/doctor-56000-bill-air-ambulance-ride-accident-atv/story?id=58125900
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In some states, in some situations you might have to worry about "balance billing" for things like a helicopter ride if the helicopter provider is outside of your insurance network. That said, even in those cases you can usually negotiate them down and settle for far less than they originally bill you for.
You would only be 'on the hook' if your insurance did not cover the care needed. This is very rare but does occasionally happen. As other posters have pointed out, there are other, better options should one be faced with this dilemma, like medical-tourism.
Thanks team!
Seems like a very unlikely scenario that I shouldn't be "planning" for (who plans for a helicopter ride that is out of network... dumb.)
Thank you!
https://abcnews.go.com/Health/doctor-56000-bill-air-ambulance-ride-accident-atv/story?id=58125900
Well, at least it's nice to know that a helicopter flight is "only" $11,000 not $300,000....
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We're veering rapidly OT, but I work in remote areas and consequentially we are all required to have medical evacuation insurance in addition to our employer-sponsored health care. We recently had a colleague who had to be medivaced out and the helicopter cost was in the mid 5-figures (and that was from a pretty remote area).
Evac & medical transport insurance is a couple hundred per person per year. If you're really concerned about emergency medical transportation bankrupting you in FIRE it's not hard (or costly) to insure against; pad your 'stache by another 5-10k and you can afford to tack-on all sorts of extremely unlikely but potentially very expensive medical costs. Or you can accept that the likelihood you'll need helicopter transport in your life is a tiny fraction of 1%, and that a healthy portfolio could take a $44,600 hit and still keep chugging along just fine.
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Sooze is something else, for sure.
I can't buy-in to planning for the improbable though. That's a pretty poor viewpoint in life.
Who wants to be a Doomsday survivor anyway? Would it really be that great to 'win' in that scenario??
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This reminds me of one of Jim Gaffigan’s jokes. His wife begs him to eat healthier and gives the reason that he needs to be around to walk his daughter down the aisle someday. He then jokes that’s an awful reason to be motivated. Something like, “Hey, don’t you die! There’s going to be a huge insanely expensive and awkward party that you have to pay for in the future!”
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https://www.marketwatch.com/story/the-biggest-financial-mistake-you-could-ever-make-according-to-suze-orman-2018-10-02
^ We're all just a part of generating clickbait, traffic for websites, impressions, views... somehow it turns into revenue for Paula, Suze and MarketWatch which funds the cycle.
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Lol oook OMG..... Anyone else not really sure what her argument is? I mean aside from the long term disability insurance, that might be a valid claim. But the rest is a big circular argument. She gives the impression that there is never enough money to be made, ever. There appears to be a HUGE disconnect between her and the middle and lower class.
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I think we can safely ignore Suze’s warnings and advice. We should all be saving for early retirement because even if you want to work until you are 70, most employers don’t want 70 year old employees. You’ll be too weak and brittle for anything physically demanding. You’ll probably have a hard time understanding technology by the time you are 70 too. The sharpest 70 year olds I have met are still baffled by computers, smartphones, and the internet. I’d like to think I will be able to learn new technology at that age, but I’m sure something will be created that young people grok immediately with minimal effort that will completely stimey me.
I’d rather have a nice nest egg that lets me walk away from work in my 40’s than be sweating it until social security and Medicare are available.
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My guess is that what she really hates about the FIRE movement is that the advice given by those pushing FIRE contradicts her advice and is hurting her bottom line.
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I think we can safely ignore Suze’s warnings and advice. We should all be saving for early retirement because even if you want to work until you are 70, most employers don’t want 70 year old employees. You’ll be too weak and brittle for anything physically demanding. You’ll probably have a hard time understanding technology by the time you are 70 too. The sharpest 70 year olds I have met are still baffled by computers, smartphones, and the internet. I’d like to think I will be able to learn new technology at that age, but I’m sure something will be created that young people grok immediately with minimal effort that will completely stimey me.
I’d rather have a nice nest egg that lets me walk away from work in my 40’s than be sweating it until social security and Medicare are available.
You only know feeble, feeble minded 70 somethings? Both sides of my family, and most of their friends, must be pretty blessed. Statistically, I think that age group can go either way , but to not know any who are sharp seems like an awfully limited social circle.
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maybe she hate fire because she's 67 and still working.
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In some states, in some situations you might have to worry about "balance billing" for things like a helicopter ride if the helicopter provider is outside of your insurance network. That said, even in those cases you can usually negotiate them down and settle for far less than they originally bill you for.
You would only be 'on the hook' if your insurance did not cover the care needed. This is very rare but does occasionally happen. As other posters have pointed out, there are other, better options should one be faced with this dilemma, like medical-tourism.
Thanks team!
Seems like a very unlikely scenario that I shouldn't be "planning" for (who plans for a helicopter ride that is out of network... dumb.)
Thank you!
https://abcnews.go.com/Health/doctor-56000-bill-air-ambulance-ride-accident-atv/story?id=58125900
Well, at least it's nice to know that a helicopter flight is "only" $11,000 not $300,000....
We have an MMM memeber that had to deal with an emergency Helicopter flight bill.
https://forum.mrmoneymustache.com/post-fire/large-air-ambulance-bill-post-retirement/
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I think we can safely ignore Suze’s warnings and advice. We should all be saving for early retirement because even if you want to work until you are 70, most employers don’t want 70 year old employees. You’ll be too weak and brittle for anything physically demanding. You’ll probably have a hard time understanding technology by the time you are 70 too. The sharpest 70 year olds I have met are still baffled by computers, smartphones, and the internet. I’d like to think I will be able to learn new technology at that age, but I’m sure something will be created that young people grok immediately with minimal effort that will completely stimey me.
I’d rather have a nice nest egg that lets me walk away from work in my 40’s than be sweating it until social security and Medicare are available.
You only know feeble, feeble minded 70 somethings? Both sides of my family, and most of their friends, must be pretty blessed. Statistically, I think that age group can go either way , but to not know any who are sharp seems like an awfully limited social circle.
Feeble minded is not the phrase I would use, but they are not comfortable using technology unless they have step by step instructions. If anything goes slightly off script, like an unexpected dialog window or message, they usually cannot figure it out on their own. I’m not saying there aren’t competent septuagenarian computer users, but I haven’t met any in person.
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Yeah, I think this isn't a feeble mind issue, it's a growing-up-with-that-kind-of-technology issue. I remember being a kid when computers were relatively new and with no formal training I could easily figure out how to solve problems and make the computer do weird new things that my parents (who would have been in their 30s at the time) couldn't. Now the generation that grow up with computers from the time they were small children is in their 30s and 40s and even 50s, so the stereotype of the child/teenage computer wiz isn't nearly as common anymore (think the children who figure out how to restart the electric fences and door locks in Jurassic Park, or the teenager on SeaQuest who was just there to magically solve computer problems).
The next time the way we interact with the world and do our jobs changes as radically as the change caused by personal computers, I fully expect to be on the other side of that divide.
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Back in the 90s I joined a ham radio club, computers were already a big thing in that community, which
was mostly 50, 60 and 70 year olds. Most of the members were very computer literate. I have breakfast a couple times a week with several of them, two of them in their upper 70s continue to stay updated and can out do me any day on computer use, program installation, programing Excel, etc.
They are my goto when I need computer help.
The computer I'm using was built with the exact components one of the 70 years olds decided to use when he built his computer. I need to talk him into building a later version, this one is just a weeks shy of it 9th birthday.
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I think we can safely ignore Suze’s warnings and advice. We should all be saving for early retirement because even if you want to work until you are 70, most employers don’t want 70 year old employees. You’ll be too weak and brittle for anything physically demanding. You’ll probably have a hard time understanding technology by the time you are 70 too. The sharpest 70 year olds I have met are still baffled by computers, smartphones, and the internet. I’d like to think I will be able to learn new technology at that age, but I’m sure something will be created that young people grok immediately with minimal effort that will completely stimey me.
I’d rather have a nice nest egg that lets me walk away from work in my 40’s than be sweating it until social security and Medicare are available.
You only know feeble, feeble minded 70 somethings? Both sides of my family, and most of their friends, must be pretty blessed. Statistically, I think that age group can go either way , but to not know any who are sharp seems like an awfully limited social circle.
Feeble minded is not the phrase I would use, but they are not comfortable using technology unless they have step by step instructions. If anything goes slightly off script, like an unexpected dialog window or message, they usually cannot figure it out on their own. I’m not saying there aren’t competent septuagenarian computer users, but I haven’t met any in person.
I just happen to think that you either have a limited social circle of that age group or you are only noticing the problems. I happen to know 90 year olds who do just fine, since it is mostly a question of critical thinking and curiosity.
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Sooze doesn't need the money but she still has a huge ego to fill.
Telling a group that has better-than-average financial acumen that they are wrong! would probably sate that ego fairly well.
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I am 64 and am not afraid of technology. Most of my friends are savvy in this regard. 6 years ago I taught myself a computer program because I was teaching a online college class and needed to learn it. Recently I am doing consulting in my field and had to learn their computer billing system with no issues. Btw my field is human services and not computer related. I am still working part time because I enjoy it.
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Yeah, I think this isn't a feeble mind issue, it's a growing-up-with-that-kind-of-technology issue. I remember being a kid when computers were relatively new and with no formal training I could easily figure out how to solve problems and make the computer do weird new things that my parents (who would have been in their 30s at the time) couldn't. Now the generation that grow up with computers from the time they were small children is in their 30s and 40s and even 50s, so the stereotype of the child/teenage computer wiz isn't nearly as common anymore (think the children who figure out how to restart the electric fences and door locks in Jurassic Park, or the teenager on SeaQuest who was just there to magically solve computer problems).
The next time the way we interact with the world and do our jobs changes as radically as the change caused by personal computers, I fully expect to be on the other side of that divide.
At least in terms of computer literacy, the peak intuitive competency demographic seems to have aged. It's now roughly 25-45. I'm an IT manager at a small company and there have been some 22 year old college grads we've hired recently that seem to barely know how to use a computer. They might not know what drives (H:, S:, R:) are, some barely seem to know what files are, and one called the Windows desktop her "home screen." >_>
I'm only 27 myself, so things have changed a lot very quickly. Smartphones only took off in late high school for me (graduated in 2009), but for people where that happened five years earlier, in middle school, they've had much less of a need to use computers over smartphones/tablets as default in their personal lives. It's fucking weird.
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She has some points, but I doubt she has really researched the FIRE movement deeply. She probably thinks that people want to continue to live on an amount that is similar to their former salary. She also has good points about healthcare and sickness, but I doubt many FIRE retirees go broke from health expenses, because they thought about that going into it. Finally, you know - we can always go back to work if it doesnt work out!
Quite honestly, I imagine there are quite a few millenials who also don't understand it. They just dont want to work a 9-5 but are not willing to give up the latest Iphone or other expensive habits.
There is no way I would contemplate working full time in a stressful job until 70 when my life expectancy as a man is 76. Suze points out that people are living to 95-100, but you know what? If I get to age 97 somehow and run out of money I will consider myself blessed and take my chances!
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Suze, Dave Ramsey, MMM, they're all trying to sell you on something.
Wow, I can't believe everyone let this pass. Do you really thing MMM is selling the same way the other two are? Where's his book? Where is his university? Where are his mega-millions?
@mathlete, I completely respect your opinion. Would you care to elaborate a little further?
He sells advertising on his website. Is it the "same" as the other two? Yes and no. They all give financial advice. They all profit from it by selling things while they do it. Two of them are a lot louder, more famous, are a lot more obnoxious with their sales pitches, and probably make a lot more money than the third.
I'm sure you know who is who. ;)
MMM's blog is actually one of the few remaining, readable websites on the Internet, though. So much of the Internet is bogged down with horrible native advertising and affiliate links. It makes me miss the Internet of yore. He deserves a lot of credit for that because I'm sure he could be making so much more off this website than he is.
My point was just that the guy (and other bloggers) makes a lot of money by selling stuff while advising about FIRE. You can discount their advice in the same way that people in here discount Suze's advice.
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Suze, Dave Ramsey, MMM, they're all trying to sell you on something.
Wow, I can't believe everyone let this pass. Do you really thing MMM is selling the same way the other two are? Where's his book? Where is his university? Where are his mega-millions?
@mathlete, I completely respect your opinion. Would you care to elaborate a little further?
He sells advertising on his website. Is it the "same" as the other two? Yes and no. They all give financial advice. They all profit from it by selling things while they do it. Two of them are a lot louder, more famous, are a lot more obnoxious with their sales pitches, and probably make a lot more money than the third.
I'm sure you know who is who. ;)
MMM's blog is actually one of the few remaining, readable websites on the Internet, though. So much of the Internet is bogged down with horrible native advertising and affiliate links. It makes me miss the Internet of yore. He deserves a lot of credit for that because I'm sure he could be making so much more off this website than he is.
My point was just that the guy (and other bloggers) makes a lot of money by selling stuff while advising about FIRE. You can discount their advice in the same way that people in here discount Suze's advice.
So whose advice do you discount or not and why?
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So whose advice do you discount or not and why?
Mine. I am unimpeachable and incorruptible.
...just kidding.
Everyone's. Discount Suze's claim that you'll never be happy if you retire unless you have an 8 figure net worth because she probably can't wrap her head around not living such a posh lifestyle anymore. Discount some of what the FIRE community says because they have a vested interest and making FIRE broadly appealing.
No one is 100% correct about everything. I'm pretty critical of a lot of what Suze said in the podcast. It was cringey listening to her hijack the podcast and turn it into one of her TV show segments. But I understand the criticisms she is making in broad terms. I think it is a mistake to look at a blogger's bare bones spending that may or may not give the full picture of what a cool life they lead, multiply by 25, and think that financial security is having $700K.
Not everyone in the FIRE community is doing that. I'm certainly not. But I think some people are, and I full expect them to get burned when the other shoe drops (LTC hits, we end this historically long bull market run, etc.)
When that happens, Suze Orman will proclaim that she was right. But we'll know that she was only kind of half right.
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I'm not sure I have ever liked Orman. Frankly, she needs to keep people 'engaged' so they keep buying her books, attending her lectures, etc... The longer people work/save the longer she can collect. :-)
Frankly, *all* these 'financial gurus', etc...sell is common sense.
SNL says it best : https://www.nbc.com/saturday-night-live/video/dont-buy-stuff/n12020
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i'm sure some do, though I suspect the regrets are more about all the money they've wasted on things that didnt really give them joy vs. having wanted to spend more years in the work force. Of course this forum is doubtlessly not a representative sample, but the number of times Ive heard people express regret at not having spent more time being with the ones they loved and doing the things they liked far outnumber the people who wish they had worked years longer. but thats just my impression.
This is what I've read about when people do surveys of regrets from the terminally ill. Most of the regrets revolve around either not spending enough time with family or not pursuing passions (at all or earlier or more vigorously). Those regrets seem easier to address is you manage to FIRE -- or at least hit FI -- in your 30s than if you don't.
You've missed my point, but so what?
Dont buy her books....better free info out there. :-)
I don't think her books are bad -- for those who are new to frugality -- but I'd say don't read ONLY her books. In fact, I'd say don't read ONLY any one author; rather, read as much as you can from different viewpoints. You're not going to agree with everything anyone says, but every author is going to give you SOMETHING valuable -- even if it's just a slightly different take on something you already knew.
maybe she hate fire because she's 67 and still working.
In all honesty, if I could have a job rehashing the same financial advice in new books ... occasionally giving a speech or appearing on TV, I might not be too anxious to retire! Sounds like easy and profitable work.
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Lol oook OMG..... Anyone else not really sure what her argument is? I mean aside from the long term disability insurance, that might be a valid claim. But the rest is a big circular argument. She gives the impression that there is never enough money to be made, ever. There appears to be a HUGE disconnect between her and the middle and lower class.
Longterm disability costs me like $100 a year... That is so cheap not even sure why she brings that up as something to worry about other then just get it. My state also pays it if you cannot work, I have known 45 year old's on it, though it pays a lot less (social security levels).
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Do something you love, huh?
I still haven't figured out how to get paid to read anything of my choosing for 8 hours a day.
Librarian is the closest you can come, and I do all reading on my off hours, on my own time and own dime.
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I first ready Suze's books in the early 2000s. I was already saving at the time, but I'd give her some credit for helping keep me on track.
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In some states, in some situations you might have to worry about "balance billing" for things like a helicopter ride if the helicopter provider is outside of your insurance network. That said, even in those cases you can usually negotiate them down and settle for far less than they originally bill you for.
You would only be 'on the hook' if your insurance did not cover the care needed. This is very rare but does occasionally happen. As other posters have pointed out, there are other, better options should one be faced with this dilemma, like medical-tourism.
Thanks team!
Seems like a very unlikely scenario that I shouldn't be "planning" for (who plans for a helicopter ride that is out of network... dumb.)
Thank you!
Oddly enough, I just watched a video where someone was involved in a pretty bad accident and had to get helicopter transport. The insurance company refused to cover the costs and the Helicopter company's stance was something along the lines of "Medicaid and Medicare pay us so little that when someone with a decent income needs our services we charge them a crap ton to make up for our shortfall". A separate "expert" said the problem was too many helicopter services exist so they are each taking a small piece of the total number of trips forcing them to have higher costs and you can't really ask ahead of time how much is that flight going to cost me.
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I see Paula Pant just released a followup episode to her Orman interview. (http://podcast.affordanything.com/154-youll-need-at-least-10-million-to-retire-early-says-suze-orman/) If you don't know her stuff already, expect a pro-FIRE response.
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totally agree with your exit plan S. We would never retire if we had to pay for long term care for 2 people. Ugh!
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MMM has just officially weighed in with his own October post.
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MMM has just officially weighed in with his own October post.
It's like they're all working together to churn up some activity :P /conspiracy
http://www.mrmoneymustache.com/2018/10/05/the-fire-movement/
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So whose advice do you discount or not and why?
Mine. I am unimpeachable and incorruptible.
...just kidding.
Everyone's. Discount Suze's claim that you'll never be happy if you retire unless you have an 8 figure net worth because she probably can't wrap her head around not living such a posh lifestyle anymore. Discount some of what the FIRE community says because they have a vested interest and making FIRE broadly appealing.
No one is 100% correct about everything. I'm pretty critical of a lot of what Suze said in the podcast. It was cringey listening to her hijack the podcast and turn it into one of her TV show segments. But I understand the criticisms she is making in broad terms. I think it is a mistake to look at a blogger's bare bones spending that may or may not give the full picture of what a cool life they lead, multiply by 25, and think that financial security is having $700K.
Not everyone in the FIRE community is doing that. I'm certainly not. But I think some people are, and I full expect them to get burned when the other shoe drops (LTC hits, we end this historically long bull market run, etc.)
When that happens, Suze Orman will proclaim that she was right. But we'll know that she was only kind of half right.
I don't disagree with your viewpoint. I also default to skepticism in all things.
At the same time , I am extremely math/statistics biased. Yes, there is risk in everything and 99%+ confidence is...1% uncertain.
However, we all bet whenever we make any decision.
From what I've read in these forums, most people are running the numbers and going with fairly high confidence scenarios.
I'm not sure how much additional effort (ie work) is worth moving from 95 to 99 to 99.9 to 99.99. As Suze points out, if you are truly happy working, you may as well aim for 99.999999+. I think MMM would agree with that too.
Everyone has to pick their line and pull the ripcord. The alternative is no RE....which has its own confidence problems as the chance of death increases.
Anyway, after thinking about it, I like some of Suze's points if only to ensure I've accounted for them or am comfortable ignoring them altogether.
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In every other instance in human history, technological advances lead to greater efficiency, economic advances, societal advances, and frequently improved employment conditions. While some jobs may not exist in the future because of AI, many other jobs are likely to be created, some of which do not exist today, while others will be changed or expanded by AI.
It's already happening.
In developed countries, we've outsourced a lot of our factory jobs and they've been replaced with service jobs. In the past ~10 years, there have been more and more "luxury" service jobs, which are jobs doing things that people used to do by themselves. For example, instacart because who wants to go to an actual grocery store to get your own groceries? Or any food delivery service because walking down the street to get a burger is too much time and effort. Just use UberEats.
In fact, it could create more opportunities to become FI for those willing to do things themselves and who avoid the trendiest option (.e.g., the latest flagship phone).
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https://www.marketwatch.com/story/the-biggest-financial-mistake-you-could-ever-make-according-to-suze-orman-2018-10-02
^ We're all just a part of generating clickbait, traffic for websites, impressions, views... somehow it turns into revenue for Paula, Suze and MarketWatch which funds the cycle.
Solution: Install adblock and, if you really want to avoid ads, noscript. Deny google analytics and google syndication.
I recently used a computer without adblock and holy-shit what a mess regular sites are. An annoying top ad blaring away, a side ad or 3 waiting for their chance, and anytime you search for something (a crawl space vent, in this case), an ad follows you around. It's like a carnival with lights and neon and barkers all over the place.
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Been thinking about this all day at work.
I actually completely agree. I don't think that 500k or even a 1million in your 30s and never working again is a good idea and I wouldn't encourage anyone to do it. Dave Ramsey said a similiar thing, where he mentioned that he does not believe in financial independance.
But I DO believe that the path most FIRE people take is the right one and something a lot more of us should be doing.
Well some people I think.
Rejecting materialism. Not keeping up with the joneses. Looking to spend more time doing what you love. And working to gain freedom are what life is about. And I think that is awesome. And a lot of us are working toward that end.
But I do think it is a bit misguided to retire and just do nothing. I think that would not be a fulfilling existance, and eventually one would change careers and pursue work that is more fullfilling albeit more risky.
Think, what if instead of working in an office as an accountant you could be a massager for fashion models, a business ceo, or an island caretaker? There are lots of things in the world to do and ways to contribute. Saying that you just won't for some reason is I don't think is good.
I also am not a fan of some of the tricks people use to retire without gaining value. Things like churning or financing while investing. I think that, in the case of a calamity, they will compound and make your life so so so much worse. And also if you think about the idea behind it. It is trying to gain value by doing nothing, using a simple mathemetical trick that is often thought to be clever. IT isn't. It just adds to risk. And when shit happens it will be much worse.
So yeah. I believe in the Fire movement but for me it is more financial freedom not financial independance . I don't want to be independant. I want to be a part and take part in the world. But under my own terms.
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But I do think it is a bit misguided to retire and just do nothing. I think that would not be a fulfilling existance,
Oh, it's totally fulfilling. Playing video games, playing board games, reading, laying around with the cats -- it's like college all over again. One can even choose to take a class and hang out at a coffee shop. During the day! When others are in an "all hands" meeting and snoozing through another power point! (Talk about not adding value....)
I also am not a fan of some of the tricks people use to retire without gaining value. Things like churning or financing while investing. I think that, in the case of a calamity, they will compound and make your life so so so much worse. And also if you think about the idea behind it. It is trying to gain value by doing nothing, using a simple mathemetical trick that is often thought to be clever. IT isn't. It just adds to risk. And when shit happens it will be much worse.
How could churning make things worse when SHTF? Get a card, put spend on it, reap the bonus, and sock-drawer said card. Cash from the bank account goes to payoff the card, as it normally does. The difference is that one earns 60,000 miles for $3000 and the other earns 3000 miles for $3000. If the market nose dives, the cash is still there. ???
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But I do think it is a bit misguided to retire and just do nothing. I think that would not be a fulfilling existance,
Oh, it's totally fulfilling. Playing video games, playing board games, reading, laying around with the cats -- it's like college all over again. One can even choose to take a class and hang out at a coffee shop. During the day! When others are in an "all hands" meeting and snoozing through another power point! (Talk about not adding value....)
I love doing all of those things, but they get boring after a while. Not working you are just sort of "existing" not participating in any kind of community. Not building a community. Nothing. There is no challenge. No reasoning. I'd rather not.
Further, not every job is dry. You could sell balloons. You could have a youtube channel making ASMR videos. You could make sailboat sails. Just do something. I mean if you think about it all of teh FIRE people that brought us into this concept are themselves bloggers. I'm not saying you need to make a LOT of money, but if you are doing anything meaningful that others are enjoying, you will make something. And when it is high quality, no reason not to get paid.
How could churning make things worse when SHTF? Get a card, put spend on it, reap the bonus, and sock-drawer said card. Cash from the bank account goes to payoff the card, as it normally does. The difference is that one earns 60,000 miles for $3000 and the other earns 3000 miles for $3000. If the market nose dives, the cash is still there. ???
I've said this a bunch of times. Churning adds risk. Lets say a big life calamity happens. If you have 20 credit cards, you are ever so much more likely to utilize them when you are emotional and not properly thinking straight. This is compounded if you have it in your head that you are using them to avoid dipping into your investments. I'm not saying it can't be done. I'm not saying some people don't do it for a long time without any issues.
It just changes the probability of how things could happen. And it is important to respect that. Remember you messing up with your credit cards are what the credit card companies want and have literally engineered everything about them to take advantage of. From their marketing to their legal terms . They are waiting for you to make a mistake.
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But I do think it is a bit misguided to retire and just do nothing. I think that would not be a fulfilling existance,
Oh, it's totally fulfilling. Playing video games, playing board games, reading, laying around with the cats -- it's like college all over again. One can even choose to take a class and hang out at a coffee shop. During the day! When others are in an "all hands" meeting and snoozing through another power point! (Talk about not adding value....)
I love doing all of those things, but they get boring after a while. Not working you are just sort of "existing" not participating in any kind of community. Not building a community. Nothing. There is no challenge. No reasoning. I'd rather not.
Whaaaa? Some of those video games are totally a challenge. And have you tried to outnap a cat? Very difficult.
Further, not every job is dry. You could sell balloons. You could have a youtube channel making ASMR videos. You could make sailboat sails. Just do something. I mean if you think about it all of teh FIRE people that brought us into this concept are themselves bloggers. I'm not saying you need to make a LOT of money, but if you are doing anything meaningful that others are enjoying, you will make something. And when it is high quality, no reason not to get paid.
Ha, that doesn't really recommend blogging to me. In fact, it's a sign that some of those bloggers may not actually be FIRE and *ahem* need income from blogging. Perception is reality and all.
Besides, why do we always have to "do something?" What's wrong with just "existing?"
How could churning make things worse when SHTF? Get a card, put spend on it, reap the bonus, and sock-drawer said card. Cash from the bank account goes to payoff the card, as it normally does. The difference is that one earns 60,000 miles for $3000 and the other earns 3000 miles for $3000. If the market nose dives, the cash is still there. ???
I've said this a bunch of times. Churning adds risk. Lets say a big life calamity happens. If you have 20 credit cards, you are ever so much more likely to utilize them when you are emotional and not properly thinking straight.
I think those people would do that regardless, with or without 20 cards. Churners use spreadsheets and aren't the type of people who will go off their rocker and buy a lot of shit when their dog gets hit by a car or when a parent is diagnosed with cancer. Of course, I don't know that many churners. Maybe others use shopping as an emotional blanket.
I have known people who cashed out their 401ks and traveled after losing a job in 2008 (oops -- bad timing) but they weren't churners. They performed that task just fine with 3 cards.
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I don't think that 500k or even a 1million in your 30s and never working again is a good idea and I wouldn't encourage anyone to do it.
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But I do think it is a bit misguided to retire and just do nothing. I think that would not be a fulfilling existance, and eventually one would change careers and pursue work that is more fullfilling albeit more risky.
So it sounds like you think anyone who FIREs who shouldn't will ultimately decide that life has gotten boring and find some more fulfilling work. If you are indeed right, then what's to worry about when it comes to folks aiming to FIRE in their 30s? If you're wrong, they're happily existing, as bacchi describes. And if you're right, then FIREing is the transition that allows them to move from work that burns them out to work that gives their life meaning.
Either way, sounds a lot better to at least try FIRE young than to not.
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I think both my ideas are hypthesis's, since we are all different.
I think it is hard to truly know what we all want in life and life takes twists and turns.
I guess the thing that worries me is I see a growing sentiment of people seeking fire as a way out of the boredome of their jobs. But I wonder if maybe FIRE isn't some silver bullet. Maybe the issue is the root of the problem of not living a life with enough fulfillment, and that won't necessarily change if you can live off of 500k. And that 500k isn't as secure as those would have you believe.
With that said. I'm nto saying we should all give up. Rather the opposite is true, for the path of FIRE is an awesome one. IT is not giving into consumerism, and earning money for freedom. That is awesome and something to strive for. But we shouldn't let freedom seperate us from others.
Like look at MMM himself. Once he FIREd' he started a community, gave speaking stores, managed his blog and started a coworking space. That is AWESOME. That is getting connected with others. And that is still working. Now he says he is retired and that is fine too.
Now some parts of Suzie Orman's rant I disagree with. Lke if you are fire, you know you are frugal. You probably will not do things like pay for your kids school or get a big house. Not if you can not afford it. That is what gets me. People say things such as "How can you possibly fire when saving is so hard." And that is one thing this community has got down. We help each other spend less and earn more, and that is great. We prove that the whole, "You can't get ahead in life." Victim mentality is BS. And I love that.
But I don't want us thinking we are somehow special or smarter because of this. That is not something I am a fan of . It is not as compassionate and will draw people away.
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Fear sells. Suze Orman is a sales person. She is selling her books.
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Been thinking about this all day at work.
I actually completely agree. I don't think that 500k or even a 1million in your 30s and never working again is a good idea and I wouldn't encourage anyone to do it.
Many here aren't looking to FIRE in their 30's, they're looking to their 40's or 50's or more.
When I FIRE, my plan is to NEVER work again within 12 months after FIREing if not immediately depending on how it plays out with my job.
I wouldn't worry too much about what other people think is best for their FIRE plans. And being "financially independent" doesn't mean you are isolating yourself from society.
I used to watch Suzie's show quite a few years ago but can't say I ever learned anything of value from her. She's off the deep end about this topic - totally outside of her league. I think she was correct only on things which are obvious to almost everyone else already, like save as much as you can while you're young and working. Duh!
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I think it is hard to truly know what we all want in life and life takes twists and turns.
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People say things such as "How can you possibly fire when saving is so hard." And that is one thing this community has got down...
But I don't want us thinking we are somehow special or smarter because of this. That is not something I am a fan of . It is not as compassionate and will draw people away.
Well...maybe not smarter, but certainly a little special in a way in the ability to do what is hard, uncomfortable and unconventional.
It may be a simple path, but it isn't an easy path for many people.
Just like it is easy for someone to claim that it is simple to lose weight and get fit and no one is special for being able to do that. However, clearly it is hard to lose weight and get fit as it takes work and changes come on incrementally over a long period of time when everyone would much rather find a silver bullet to get there in a week (or 6 weeks or 90 days).
Does the fact of very few people in the USA having reached FI indicate that it *is* hard and you may be a little special to put yourself through the hard parts to get there? Perhaps it is only my own biases which cause me to think that way as I had to reform my entire world view, change my habits, change my thinking, and adjust my life in my mid-30s.
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Like look at MMM himself. Once he FIREd' he started a community, gave speaking stores, managed his blog and started a coworking space. That is AWESOME. That is getting connected with others. And that is still working. Now he says he is retired and that is fine too.
But I don't think MMM quit is job planning to start a blog or build a co-working space. And if he hadn't retired without specific plans (or at least not the plans that he ended up acting on), none of those great things would have happened.
So I think it is completely okay for people to plan to FIRE without any plans to do productive things afterwards if they don't want to. If it turns out they do feel bored or unfulfilled, they can always find productive things to do with their time. And if it turns out they are completely happy continuing to simply exist, then by definition the problem you're concerned about doesn't exist in their particular case.
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Well planning is the key. In fact that is something very interesting if you think about it. Going FIRE takes planning, preparation, and discipline. It changes you and your behaviour. More and more, I am learning that money is about behaviour. And behaviour takes time to change. Habits take months or years to form and when they do they stick with you.
So this is why i think it is kind of weird to frugally save and work hard and then suddenly change. I think that could result in a lifestyle that is unfullfilling. Esp. if you worked hard to get to that point. I also think if you are miserable at your job and you are FIRING to change that it probably won't. Probably there are other reasons to change.
In fact this is the crux. I don't think the idea is that FIRE is some goal that, when it happens, will change our lives. I think it is the process. Part of the process is growth and improving. And that should continue to happen, even after FIRE.
I should say. I'm all for saving, rejecting consumerism, and having a high savings rate. I think Suze would agree with that. And I say that if you are down to work hard while doing this, there should be no reason to not continue working. Once you have a lot saved, instead of just quitting look to find work that is more fullfilling. I think that is a pathway to living a life that is beyond your wildest dreams.
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Well planning is the key. In fact that is something very interesting if you think about it. Going FIRE takes planning, preparation, and discipline. It changes you and your behaviour. More and more, I am learning that money is about behaviour. And behaviour takes time to change. Habits take months or years to form and when they do they stick with you.
So this is why i think it is kind of weird to frugally save and work hard and then suddenly change. I think that could result in a lifestyle that is unfullfilling. Esp. if you worked hard to get to that point. I also think if you are miserable at your job and you are FIRING to change that it probably won't. Probably there are other reasons to change.
So I now understand your view to be that people who FIRE and don't have a plan to do something else productive right away likely won't ever seek out other work but just continue to exist. <-- this is a very useful term bacchi!
That's a perfectly valid position to take. It just seems to contradict your statement from an earlier post.
But I do think it is a bit misguided to retire and just do nothing. I think that would not be a fulfilling existance, and eventually one would change careers and pursue work that is more fullfilling albeit more risky.
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I suggest that most of us here have a huge advantage over Suze Orman,
we can live happily on $50,000 a year, I suspect she would be miserable.
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And I say that if you are down to work hard while doing this, there should be no reason to not continue working. Once you have a lot saved, instead of just quitting look to find work that is more fullfilling. I think that is a pathway to living a life that is beyond your wildest dreams.
To hell with that. My current work is plenty fulfilling. But, I rather spend my retirement years actually retired and doing what I want to be doing (many things), not to continue working until I'm 70 or beyond! I couldn't care less what Suzie thinks.
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I mean we are all different right. While you can look at statistics of what happens to people, it is hard to know feelings.
This is why I say listen to those that are older and wiser. When I do a LOT of them say that a life with no work isn't as fulfilling. This is why so many rich people still work even though they need to. They could be wrong, but i still say to listen and consider.
Personally if I am able to FIRE, and I think I will. That will be when my career. Begins! I'll do fashion shoots, see if I could get back into physics research, do educational shit, do car shit. Maybe philantrophy. There is so much I want ot try that is different from my current career. But what I do now is both giving me a skillset that I think is super valuable and in an industry that I believe to be promising. Also they pay well. So there is that. I mean part of me wants to stay with my company or my industry and see if I could eventually become a VP or CTO or something. If that happens, hell yeah I'm working till I'm 60 or 70!
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I mean we are all different right. While you can look at statistics of what happens to people, it is hard to know feelings.
This is why I say listen to those that are older and wiser. When I do a LOT of them say that a life with no work isn't as fulfilling. This is why so many rich people still work even though they need to. They could be wrong, but i still say to listen and consider.
Personally if I am able to FIRE, and I think I will. That will be when my career. Begins! I'll do fashion shoots, see if I could get back into physics research, do educational shit, do car shit. Maybe philantrophy. There is so much I want ot try that is different from my current career. But what I do now is both giving me a skillset that I think is super valuable and in an industry that I believe to be promising. Also they pay well. So there is that. I mean part of me wants to stay with my company or my industry and see if I could eventually become a VP or CTO or something. If that happens, hell yeah I'm working till I'm 60 or 70!
I think the misunderstanding here is over what constitutes work.
You say you would do "fashion shoots, see if I could get back into physics research, do educational shit, do car shit. Maybe philantrophy". To me that sounds like you would indulge in your hobbies rather than "work" in the traditional sense of the word. I mean doing "educational shit" and "car shit" at least doesn't sound like you have a plan to make a contribution to society is some sort of truly worthwhile way with those things unless I'm missing something.
So it seems to me that you think people should pursue something they are truly interested in rather than just lay around doing "nothing". I tend to agree with you on that however I wont discount the possibility that someone else might be truly interested in "just existing" and find that pursuit to be all they require to be happy.
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I mean we are all different right. While you can look at statistics of what happens to people, it is hard to know feelings.
This is why I say listen to those that are older and wiser.
Alright. My own philosophy is somewhat different, which is that, given that each of us is so different advice from individual older folks won't necessarily apply to each person. Once you are FI, if just existing sounds appealing to a person, I think there is very little downside to trying it for a while.
Either they will discover it isn't for them, and they can then go and do something else without having that yearning for the peace of just being without any obligations or expectations or schedules.
Or they will discover that for their personal circumstances and mindset just existing brings them a great deal of joy, in which case it will be really good that they at least gave it a shot.
Either way, if just existing sounds appealing to an individual, I see very little risk of harm from having them try it to see how happens, and the potential for significant unhappiness (either yearning for something they don't have, even if having it wouldn't make them happy, or failing to pursue a path which would have made them happy) from counseling them against doing so.
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I mean we are all different right. While you can look at statistics of what happens to people, it is hard to know feelings.
This is why I say listen to those that are older and wiser. When I do a LOT of them say that a life with no work isn't as fulfilling. This is why so many rich people still work even though they need to. They could be wrong, but i still say to listen and consider.
Personally if I am able to FIRE, and I think I will. That will be when my career. Begins! I'll do fashion shoots, see if I could get back into physics research, do educational shit, do car shit. Maybe philantrophy. There is so much I want ot try that is different from my current career. But what I do now is both giving me a skillset that I think is super valuable and in an industry that I believe to be promising. Also they pay well. So there is that. I mean part of me wants to stay with my company or my industry and see if I could eventually become a VP or CTO or something. If that happens, hell yeah I'm working till I'm 60 or 70!
I think the misunderstanding here is over what constitutes work.
You say you would do "fashion shoots, see if I could get back into physics research, do educational shit, do car shit. Maybe philantrophy". To me that sounds like you would indulge in your hobbies rather than "work" in the traditional sense of the word. I mean doing "educational shit" and "car shit" at least doesn't sound like you have a plan to make a contribution to society is some sort of truly worthwhile way with those things unless I'm missing something.
So it seems to me that you think people should pursue something they are truly interested in rather than just lay around doing "nothing". I tend to agree with you on that however I wont discount the possibility that someone else might be truly interested in "just existing" and find that pursuit to be all they require to be happy.
I have always wanted to start a fashion label. that would constitute creating a business, selling clothing, doing shoots with instagram models, doing shoots myself All of this is hella work.
Physics Research would potentially be self funded but i could apply for grants. Might go back to grad school. The thing is I practically do math research my current job, so I sort of scratch that itch already.
There are so many ways to go with education. Inspirational work. Online videos. Tutoring. This could run the gamut of borline volunterring toward setting up programs that would require grant money, crowdfunding, or other sorts of investing.
And car things I'm not sure. I am really into tuner cars and subarus especially. But that is an EXPENSIVE hobby. However there is a lot of work to be done here. I have a friend that installs body kits, another that sells wheels, many friends do shoots with instagram models. Another has a fashion label. I have friends that change peoples' oil. Some fix breaks and install lighting fixture. Gosh there is so much you could do here and so many ways of making money. The interesting thing about cars is you get tuned into a community and just find out what people want.
I think if you are part of a community and you just listen and put yourself out there you will find plenty of ways of helping people well enough to make them pay for you.
And that is what I think that being FIRE could help you do. Just get connected, and help others.
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I have always wanted to start a fashion label. that would constitute creating a business, selling clothing, doing shoots with instagram models, doing shoots myself All of this is hella work.
Physics Research would potentially be self funded but i could apply for grants. Might go back to grad school. The thing is I practically do math research my current job, so I sort of scratch that itch already.
There are so many ways to go with education. Inspirational work. Online videos. Tutoring. This could run the gamut of borline volunterring toward setting up programs that would require grant money, crowdfunding, or other sorts of investing.
And car things I'm not sure. I am really into tuner cars and subarus especially. But that is an EXPENSIVE hobby. However there is a lot of work to be done here. I have a friend that installs body kits, another that sells wheels, many friends do shoots with instagram models. Another has a fashion label. I have friends that change peoples' oil. Some fix breaks and install lighting fixture. Gosh there is so much you could do here and so many ways of making money. The interesting thing about cars is you get tuned into a community and just find out what people want.
I think if you are part of a community and you just listen and put yourself out there you will find plenty of ways of helping people well enough to make them pay for you.
And that is what I think that being FIRE could help you do. Just get connected, and help others.
Any and all of that you could be doing right now. No need to FIRE for it. Start a business, become a car salesman, mechanic, painter, etc or go teach physics. I'm sure you could find a way to be paid for any of those. So if that's what you want to do, I don't really see what it has to do with FIRE or why you would need to FIRE before doing any of it.
In fact, if you are not willing to do any of it now, then it seems to me they are really just passions of yours that you would like to monetize at some point without having to rely on them to pay your expenses. There is nothing wrong with that but I still think it is where the misunderstanding comes in. Your interest is to be actively pursing what you are passionate about. Some other people might be just as passionate about taking it easy and "just existing".
And as another poster mentioned, if they find, as you suggest they will, that just existing is not fulfilling then they will be free to purse any other interest they like. There is no point for them to assume what works for others is what will absolutely definitely work for them and therefore they should rush to fill their days with what others in society deem to be fulfilling and worthwhile.
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Yeah I am considering doing some of those things but they would be risky compared to my current job. And even then. My current work is fulfilling on its own right. I think for work it is a combination of risk, reward, and enjoyment you need to balance. And right now where I am is that. It allows me to consistant save without worry enough so that in the future I would feel pursuing something else if I feel like it. Really my whole thing was just an exercise to point out that almost anything that serves others can be monetized if you work at it. And I think that is behind what Suzie was talking about. Work and, instead of seeking to retire retire, take steps to
I dunno man. Just working hard at a job you are so unpassionate about you want to leave immediately and then doing nothing. That just sounds like an uninspiring way of living. But hey if that is truly what people want who am I to say otherwise. REally I am here to learn more about saving than anything.
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I dunno man. Just working hard at a job you are so unpassionate about you want to leave immediately and then doing nothing. That just sounds like an uninspiring way of living.
Who says they want to "do nothing?" I think even the previous poster mentioned playing video games and the challenge of outnapping cats. But, there are plenty of things people are interested in doing after FIREing that don't involve continuing to work.
https://forum.mrmoneymustache.com/welcome-to-the-forum/what-do-you-plan-to-do-in-fire/
https://forum.mrmoneymustache.com/welcome-to-the-forum/i-am-afraid-i-will-be-bored-when-i-fire/
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I dunno man. Just working hard at a job you are so unpassionate about you want to leave immediately and then doing nothing. That just sounds like an uninspiring way of living. But hey if that is truly what people want who am I to say otherwise.
If you cannot even imagine finding a joyful like in anything other than some kind of work, that sounds like a constrained and colorless life to me.
But if it is truly what you yourself want, I'm certainly not going to question your expertise as the person who knows the most about what does and does not bring joy to you specifically (as is no doubt clear, I do disagree with some of the generalizations you feel apply to all of us participating in the FIRE movement as a whole).
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I dunno man. Just working hard at a job you are so unpassionate about you want to leave immediately and then doing nothing. That just sounds like an uninspiring way of living. But hey if that is truly what people want who am I to say otherwise.
If you cannot even imagine finding a joyful like in anything other than some kind of work, that sounds like a constrained and colorless life to me.
But if it is truly what you yourself want, I'm certainly not going to question your expertise as the person who knows the most about what does and does not bring joy to you specifically (as is no doubt clear, I do disagree with some of the generalizations you feel apply to all of us participating in the FIRE movement as a whole).
Actually rather the opposite. I thought most people in the fire community actually did plan on doing some sort of work afterward.
I see it this way. By working you are serving others. And that connects you to them. So to not do something means you are sort of isolated. And that is what I think can drive peopel to madness. Just staying at home all day and not really participating in the world. I also think that the number of ways you can participate is unlimited and varied and that is different from being isolated. I mean you can say you just play video games and watch tv, but that is still participating. Albeit in a passive and. And that is easy to do. There isn't any challenge to it. We did it all growing up, after work, and on weekends.
I mean what turned me on to FIRE was how MMM stated that he still blogs (and makes money doing so), builds things, supports his wife's business, and eventually started a makerspace. That is awesome and i am so in line with that redefinition of retirement. I think orman would probably just state that he is really working though.
But I do see everyone here as being on different walks of life. Like i think the shared experience is our high savings rates but what we plan on doing once we get there spans a gamut.
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yeah you are right.
I guess suzie got to me. Also i read shiller's book and it made me super suspicious of the market. Here ill give this thing a chance again and look more into what a lot of you guys are doing.
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I had a really hard time following Suzie’s points on that interview, and I really wish Paula would have pushed back more. Or at least encouraged her to form a coherent argument.
I agree that what people who RE do with their time is irrelevant to the discussion on FIRE because what may or may not be good for one retiree may or may not work for another.
There are some risks to FIRE that I don’t think get enough consideration. The first one being access to good, affordable heath insurance. The ACA has helped with that, but it’s in life support and it’s future is unknown. If you have any sort of assets you don’t want to spend one second uninsured. People seem to forget that MMM has a bit of a golden parachute in that he is a Canadian citizen. If the shit really hits the fan health wise I would think he could go back and obtain access to the Canadian health system.
The second issue to FIRE as I see it is the needs of your children or future children. I have experienced with my kids that what I spend on them can change a good bit from year to year and it makes planning the FIRE budget a bit difficult. I’m not okay with telling them I cannot pay for orthodontics, or music lessons, tutors, or college tuition because I chose to stop working.
That being said, I am so tired at nearly 41 of showing up in the office each day. Of losing 10 hours of my time five days a week to someone else. I love the work, I find it meaningful, but with >$2M in assets, it’s not enough. But, we’ve got to solve the first two issues before both of us can take the leap. And that’s where I think Suzie May have had some decent points (that she failed to explain well)
As far as the so called “lean-FIRE” movement, I don’t believe that is truly FIRE. It’s a sabbatical or a career change, it’s not FIRE.
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People seem to forget that MMM has a bit of a golden parachute in that he is a Canadian citizen. If the shit really hits the fan health wise I would think he could go back and obtain access to the Canadian health system.
If he moved to BC for example he would have to pay out of pocket for 6 months for any medical treatment. After that point he'd be able to buy BC health insurance assuming he's allowed to live here. If he has Canadian citizenship that wouldn't be a problem. So if you get a really bad diagnosis you'd have to either get no treatment for 6 months or pay for it yourself until you were eligible for coverage. Health coverage is Canada is for doctor or hospital visits. There is a lot you have to pay for out of pocket still unless you have supplementary insurance.
OTOH MMM has multi-millions of $$ that keep growing every year so presumably he can buy the fanciest health insurance plan in the US anytime he wants. As long as he can't be denied coverage high premiums wouldn't really phase him.
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I dunno man. Just working hard at a job you are so unpassionate about you want to leave immediately and then doing nothing.
Doing nothing? What are you talking about? Have you even read the journals of FIREd folks on this forum? I don't see one person that's "doing nothing". The fact that they are not earning money running on the hamster wheel for the economy like a good little brainwashed robot doesn't equate their lives and actions with "nothing" as if only work has worth and value.
Not being able to imagine a life that has value beyond work is sad.
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The American attitude about work is puzzling. No work = bum = worthless = scourge on society. I think it stems from the "Protestant work ethic" that has been ingrained into people.
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I think we can safely ignore Suze’s warnings and advice. We should all be saving for early retirement because even if you want to work until you are 70, most employers don’t want 70 year old employees. You’ll be too weak and brittle for anything physically demanding. You’ll probably have a hard time understanding technology by the time you are 70 too. The sharpest 70 year olds I have met are still baffled by computers, smartphones, and the internet. I’d like to think I will be able to learn new technology at that age, but I’m sure something will be created that young people grok immediately with minimal effort that will completely stimey me.
I’d rather have a nice nest egg that lets me walk away from work in my 40’s than be sweating it until social security and Medicare are available.
You only know feeble, feeble minded 70 somethings? Both sides of my family, and most of their friends, must be pretty blessed. Statistically, I think that age group can go either way , but to not know any who are sharp seems like an awfully limited social circle.
Feeble minded is not the phrase I would use, but they are not comfortable using technology unless they have step by step instructions. If anything goes slightly off script, like an unexpected dialog window or message, they usually cannot figure it out on their own. I’m not saying there aren’t competent septuagenarian computer users, but I haven’t met any in person.
Using my personal anecdote of my parents. While defiantly not feeble minded they have completely admitted that they can no longer do all of the things physically that they could do at age 67 or that they can still do something physically but they must take longer breaks. Also they have gotten hurt in the past 5 years vs not before. My father for instance tore the tendon connecting his hamstring to his knee while tripping over a rock in his yard. Would his tendon have torn 5 years earlier in the same instances likely not. FWIW both of my parents have been active all their lives.
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yeah you are right.
I guess suzie got to me. Also i read shiller's book and it made me super suspicious of the market. Here ill give this thing a chance again and look more into what a lot of you guys are doing.
Thank you for being willing to reevaluation your position, shinn497.
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The American attitude about work is puzzling. No work = bum = worthless = scourge on society. I think it stems from the "Protestant work ethic" that has been ingrained into people.
It also comes from the idea that "We" may be paying the bills for that person, their spouse and /or their children. There is an assumed Societal responsibility to take care of your own. It also comes from the idea that I "have" to work and don't like it. Why should the person in question be allowed his freedom? And,.....sometimes folks who don't work and live under bridges and such smell bad.
Not too puzzling.
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As far as the so called “lean-FIRE” movement, I don’t believe that is truly FIRE. It’s a sabbatical or a career change, it’s not FIRE.
True lean-FIRE just means keeping expenses very low, not that you have to ever work again. It's still FIRE.
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As far as the so called “lean-FIRE” movement, I don’t believe that is truly FIRE. It’s a sabbatical or a career change, it’s not FIRE.
True lean-FIRE just means keeping expenses very low, not that you have to ever work again. It's still FIRE.
Fair enough, but I question if most people can truly maintain that level of spending. Lots of sacrifice. And this is where I think crazy Suzie might have a valid point. If you lean FIRE and some crazy thing happens that forces you to dip into your principle, how can you keep going without working? And if that happens after you’ve sat out of the work world for ten years, what do you do?
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Fair enough, but I question if most people can truly maintain that level of spending. Lots of sacrifice. And this is where I think crazy Suzie might have a valid point. If you lean FIRE and some crazy thing happens that forces you to dip into your principle, how can you keep going without working? And if that happens after you’ve sat out of the work world for ten years, what do you do?
I would be considered lean FIRE and I don't feel like it is a sacrifice to spend low. Worst case situation you make adjustments if you have to, even if that means going back to work. I can't see spending years more at work to cover every possible bad situation.
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As far as the so called “lean-FIRE” movement, I don’t believe that is truly FIRE. It’s a sabbatical or a career change, it’s not FIRE.
True lean-FIRE just means keeping expenses very low, not that you have to ever work again. It's still FIRE.
Fair enough, but I question if most people can truly maintain that level of spending. Lots of sacrifice.
Where do you personally think the spending threshold is between lean-FIRE and regular FIRE?
One of the key realizations people (eventually) get from reading about FIRE is that a lot of their usual spending isn't actually doing anything to increase their happiness, even though they thought it was. Once you achieve that realization, the amount of money you need to avoid feeling like you're having to sacrifice at all drops dramatically.
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Fair enough, but I question if most people can truly maintain that level of spending. Lots of sacrifice. And this is where I think crazy Suzie might have a valid point. If you lean FIRE and some crazy thing happens that forces you to dip into your principle, how can you keep going without working? And if that happens after you’ve sat out of the work world for ten years, what do you do?
I would be considered lean FIRE and I don't feel like it is a sacrifice to spend low. Worst case situation you make adjustments if you have to, even if that means going back to work. I can't see spending years more at work to cover every possible bad situation.
I think there can be a point somewhere in between. It’s obviously different for everyone’s unique situation.
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Thanks for the notes...it will save me time in not listening to it.
Those examples are crap IMO. And if I get board I will find something to do. A job does not define me...ggrrr this type of thing just is annoying...The world is falling apart, we have no control over our money, and if college costs end up being as high as she says then the entire world would have to adjust. Because if it is costs $400K for college then the wages once out of college will have to adjust. That is the most stupid thing I have ever seen. Yes college is expensive...dont study underwater basket weaving and you will be fine.
This is a very good point that often gets overlooked. Expenses associated with room & board is often more than tuition. Saving for tuition for a state school really isn't that big of a deal. Tuition + books should be 35K to 40K for 4 years for many state schools. If you do 2 years of community college you are talking 25K total.
Is it expensive though? Some schools of course are. But I feel like people seem to also include room and board when talking about how expensive college is, which isn't really a fair comparison, because if you decide not to go to school, you still need a place to live and food to eat to survive. The flagship university for my state's in-state tuition and fees is $9,130/yr. That's not cheap or free, but I wouldn't say it's expensive.
My alma mater is even cheaper. For in-state tuition and fees it's $6,368/yr. That's a 4 year degree for just over $25k.
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yeah you are right.
I guess suzie got to me. Also i read shiller's book and it made me super suspicious of the market. Here ill give this thing a chance again and look more into what a lot of you guys are doing.
Thank you for being willing to reevaluation your position, shinn497.
I mean I just want to look into others.
Tbh I have always been on the fence on if or how i want to FIRE or not. Even learning about MMM I never had the idea that retirement is sitting on a beach somewhere.
I do know I want to save and infvest as much as possible for the next 15 years and way more than the normal person. So there is that.
The suzie orman thing is just making me think that I will probably still want ot have an income or even consider just going into entrepreneurship sooner. I mean I would so be willing to work into my 80s for the right job!
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As far as the so called “lean-FIRE” movement, I don’t believe that is truly FIRE. It’s a sabbatical or a career change, it’s not FIRE.
True lean-FIRE just means keeping expenses very low, not that you have to ever work again. It's still FIRE.
Fair enough, but I question if most people can truly maintain that level of spending. Lots of sacrifice. And this is where I think crazy Suzie might have a valid point. If you lean FIRE and some crazy thing happens that forces you to dip into your principle, how can you keep going without working? And if that happens after you’ve sat out of the work world for ten years, what do you do?
I was just doing the math. It looks like a reasonable lean-FIRE SWR for me would be 1.5% SWR of my current stash. That would give me a few hundred dollars on average per month over barebones expenses for discretionary spending. That would actually be a bit of an increase in my spending vs. the last decade of my total spending, so I should be able to sustain that if I wanted. Of course, I'm not planning to lean-FIRE, so I plan to use a SWR closer to 4%.
I mean I would so be willing to work into my 80s for the right job!
That's not something you normally read from members on this forum.
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Tbh I have always been on the fence on if or how i want to FIRE or not. Even learning about MMM I never had the idea that retirement is sitting on a beach somewhere.
I do know I want to save and infvest as much as possible for the next 15 years and way more than the normal person. So there is that.
The suzie orman thing is just making me think that I will probably still want ot have an income or even consider just going into entrepreneurship sooner. I mean I would so be willing to work into my 80s for the right job!
Any there is nothing wrong with that if that's how you would like to spend your life.
What I objected to was your position that A) no one would enjoy a life of simply existing, even if that means spending it sitting on a beach somewhere B) despite the fact that you were arguing no one would enjoy such a lifestyle, you also didn't think it make sense for people who thought they might enjoy such a lifestyle to try it and find out for themselves one way or another.
If, after reconsidering, you find that you still want to advocate for that two part position, I'd be happy to will feel obligated to continue to respectfully disagree and continue to point out the inherent contradiction.
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Tbh I have always been on the fence on if or how i want to FIRE or not. Even learning about MMM I never had the idea that retirement is sitting on a beach somewhere.
We should each be making our "own version of FIRE". I don't get hung up too much on what other people consider to be FIRE for them. I may get hung up on one person telling another person to take their definition and shove it...nothing I see here - just something I pushed back against as absurdity on Bogleheads.
I do know I want to save and infvest as much as possible for the next 15 years and way more than the normal person. So there is that.
A good goal for anyone to have, in my personal opinion - regardless with what one plans to do after achieving FI
The suzie orman thing is just making me think that I will probably still want ot have an income or even consider just going into entrepreneurship sooner. I mean I would so be willing to work into my 80s for the right job!
We don't always get to have that choice. Luckily, you are wise enough to save enough money such that whether or not you get to persist as you plan, you'll be okay. TOO MANY PEOPLE TODAY think "I'll just work until I die, screw all that saving noise"...
Here is the thing, I have a big software project I can't wait to start and I'm slowly building up learning of the specific tools I need. However, I'll never go back into another software job ever again due to past bad experiences. Now, if I were FI today, I'd quit my job in a heartbeat and spend a good 2-6 hrs a day 3-4 days a week on my personal software project and I will likely never ever charge any money for it if I decide to "release it" into the wilds. I'd much rather put it out on an open source platform, but I certainly don't want to be beholden to someone else's release schedules, red tape, SOPs, stupid business requirements that don't even translate into proper software requirements and someone else telling me that they don't want to add features or allow proper testing because they'd rather have a half baked piece of crap put out for revenue when I'm not even finished with the damn product. When I FI, I don't currently plan to have a Boss ever again (that means no employer and no customer either).
How will I have social circles? There are many, many meetups for many types of interests. I may even try to prod some of my friends along a little faster to the point of FI.
I don't need titles, I shouldn't need money (spouse wants to be at 2x LEAN FIRE), and I'm pretty sure I'll be just fine that way.
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Looks like an interesting thread, so PTF. Everyone is entitled to their own opinions, but it does help to understand their perspective. Suze is uber rich PF oldschool, I'm sure to her anyone that ER's in their prime with 5 million or less seems crazy to her since they could be making millions more and those 5 million or less is chump change. She sees life through her own lens and her life has worked out fine doling out conservative advice. I'd have been shocked (and impressed with her mental flexibility) if she had considered the possibility that FIRE might be sensible and possibly even rational. But then again, I've never had much respect for Suze Orman's opinions and she has never added anything new to my PF learning.
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Yeah she totally doesn't get the nuance of the FIRE community. She totally went off on how horrible the idea is then came back and basically said all the things we do LOL. And completely out to lunch on what things costs or how on earth the majority of people make by in the world.
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Looks like an interesting thread, so PTF. Everyone is entitled to their own opinions, but it does help to understand their perspective. Suze is uber rich PF oldschool, I'm sure to her anyone that ER's in their prime with 5 million or less seems crazy to her since they could be making millions more and those 5 million or less is chump change. She sees life through her own lens and her life has worked out fine doling out conservative advice. I'd have been shocked (and impressed with her mental flexibility) if she had considered the possibility that FIRE might be sensible and possibly even rational. But then again, I've never had much respect for Suze Orman's opinions and she has never added anything new to my PF learning.
I get that it is her experience and perspective, but surely she has seen enough financial data and research to know that most people will never EARN $5 million dollars IN THEIR ENTIRE LIFETIME, so how can that be a realistic minimum threshold for the average person to retire on? She's either incompetent, intellectually lazy, or dishonest.
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Many people aren't healthy enough to keep working in old age even if they want to. She is out of touch with the average person even though she didn't grow up rich.
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Looks like an interesting thread, so PTF. Everyone is entitled to their own opinions, but it does help to understand their perspective. Suze is uber rich PF oldschool, I'm sure to her anyone that ER's in their prime with 5 million or less seems crazy to her since they could be making millions more and those 5 million or less is chump change. She sees life through her own lens and her life has worked out fine doling out conservative advice. I'd have been shocked (and impressed with her mental flexibility) if she had considered the possibility that FIRE might be sensible and possibly even rational. But then again, I've never had much respect for Suze Orman's opinions and she has never added anything new to my PF learning.
I get that it is her experience and perspective, but surely she has seen enough financial data and research to know that most people will never EARN $5 million dollars IN THEIR ENTIRE LIFETIME, so how can that be a realistic minimum threshold for the average person to retire on? She's either incompetent, intellectually lazy, or dishonest.
What I was meaning to say is that Suze probably thinks it's only OK to FIRE with $5 million at 40 (or, as she stated, at 25 with $20 million or 35 with $10 million) if you dislike your paid work, or you can 'normal retire' on a more modest amount at 65 or 70. I didn't intend to represent her view as that everyone has to hit $5 million before they can safely retire. I tried to listen to some of the podcast but don't have the stomach to 'hate listen' to someone who doesn't bother to understand their audience!
There are already plenty of examples of folks that FIRE'd successfully in their 20's and 30's with a million or less and seem to have no problem keeping expenses low or increasing income commensurate with lifestyle inflation. Many YouTubers, Twitch Streamers, travel bloggers, renaissance festival workers, etc. could probably also fall under the FIRE banner but don't fly it since ER was not their goal.
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Lol oook OMG..... Anyone else not really sure what her argument is? I mean aside from the long term disability insurance, that might be a valid claim. But the rest is a big circular argument. She gives the impression that there is never enough money to be made, ever. There appears to be a HUGE disconnect between her and the middle and lower class.
Longterm disability costs me like $100 a year... That is so cheap not even sure why she brings that up as something to worry about other then just get it. My state also pays it if you cannot work, I have known 45 year old's on it, though it pays a lot less (social security levels).
One of the unpleasant realities you learn about only when you are in the unfortunate position of having to use your paid-into-for-three-decades long term disability plan from your employer is that the insurance co. has an army of people working very hard to deny you benefits. On top of having a major illness I had to battle, appeal, repeatedly bug my very busy doctors for updates and forms, and experience the real fear of being both very ill and without a reliable income. The experience was quite eye opening, because all those years I thought I was being so smart and protecting myself, but if I hadn't had the support of my very busy doctor in filling out forms and answering appeals, I likely would have lost that benefit. It was infuriating and humiliating. The process of applying for and receiving SSDI, also paid into during three decades of work, was similar. In the end, i was lucky, but it did make me realize how thin the ice can become for people when they experience a debilitating illness and can no longer work. And I never in a million years thought it might be me.
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One of the unpleasant realities you learn about only when you are in the unfortunate position of having to use your paid-into-for-three-decades long term disability plan from your employer is that the insurance co. has an army of people working very hard to deny you benefits. On top of having a major illness I had to battle, appeal, repeatedly bug my very busy doctors for updates and forms, and experience the real fear of being both very ill and without a reliable income. The experience was quite eye opening, because all those years I thought I was being so smart and protecting myself, but if I hadn't had the support of my very busy doctor in filling out forms and answering appeals, I likely would have lost that benefit. It was infuriating and humiliating. The process of applying for and receiving SSDI, also paid into during three decades of work, was similar. In the end, i was lucky, but it did make me realize how thin the ice can become for people when they experience a debilitating illness and can no longer work. And I never in a million years thought it might be me.
This right here is why I will never understand why so many Americans believe it is a good thing to have an entire industry with the sole purpose of making a profit between themselves and access to good quality health care.
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Looks like an interesting thread, so PTF. Everyone is entitled to their own opinions, but it does help to understand their perspective. Suze is uber rich PF oldschool nouveau riche, I'm sure to her anyone that ER's in their prime with 5 million or less seems crazy to her since they could be making millions more and those 5 million or less is chump change. She sees life through her own lens and her life has worked out fine doling out conservative advice. I'd have been shocked (and impressed with her mental flexibility) if she had considered the possibility that FIRE might be sensible and possibly even rational. But then again, I've never had much respect for Suze Orman's opinions and she has never added anything new to my PF learning.
EV2020, I agree with your assessment of SO, except for one part, so I FTFY.
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I'm just going to chime in here, if I may, with an off-the-wall, bluntly made, sharp point that I'm not sure has been addressed directly yet. It may well have, but just for completeness' sake...
Maybe Suze Orman is just an egomaniac who feels like her toes are being trodden on by people far younger than her retiring with far less money.
She's lashing out with a lot of anger, spite and snobbery; all of which, to me, look like characteristics of a cornered animal attempting to defend itself while retaining dignity.
She worked hard all her life and has so much money, that surely only someone such as herself deserves to retire early at 62, right? Furthermore, she found it so boring that she started working again - yaaaawn retiring early is soooo beneath me. Wait, what's this? There are people figuring out that you can retire at 30 with only a few hundred grand? LIES! WHAT ARE THESE KIDS DOING ON MY TERRITORY?!?!?!
Does she feel invalidated that people have managed to out-do the mighty Suze Orman on the financial plane? I mean there aren't many other explanations for her ludicrously detached comments. She's gatekeeping people who earn the US median income as 'low earners'. She's throwing out huge figures of sums, stating them as trivial amounts to live off of - only a monk can live off of $60k a year!!
But then, what do I know? I'm just a clueless Brit living in a nanny state.
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I think she is trying to be relevant again by being controversial. FIRE has been in the media a lot the last couple years. To maintain her standing as a “financial guru”, she needed to weigh in. And somewhere in that interview there may have been some valid points, unfortunately they were lost in the crazy.
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I think the interview was a media grab from the beginning. Both sides, and there was a clear winner. Afford Anything came out on top. It wasn't even close. She even had a follow-up show, which it sounded like that was her plan from the beginning.
Accept the request, figuring Suze would slam us, just quietly let her speak, and have a followup show to discuss why Suze is out of touch. I loved it. It even sounded like MMM may have discussed this "master plan" with Paula prior to the interview. I say great play. Here is the followup show. I found it well worth the time:
http://podcast.affordanything.com/154-youll-need-at-least-10-million-to-retire-early-says-suze-orman/
Suze sounded unprepared to me. It sounded like she was using the interview to get her chops back after a 3 year break. It showed.
It was too bad for her. I remember some of the best advice I heard soon after the crash(quote is paraphrased): "Do not focus on what you had, focus on what you have." This was Suze of old. She went from roll up your sleeves and get to work fixing what went wrong, to doom and gloom fear.
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That was a great post-Suze round-up by Paula, and I think that final point she makes before the outro and post-amble is really the most important one - why many of us are here in the first place; we don't want to work until we're 70 because we may very well not even make it to 70. I don't want to die at 50 having spent my entire adult life working 40+ hours a week.
You're right, Paula won. And if her and MMM actually predicted what Suze would say, then that's even better.
Obviously I was feeling considerably sassy when I wrote my last comment here, but listening to that episode has me feeling more thoughtful overall now.
I guess Suze underestimated Paula and the FIRE community as a whole. As a movement that is fuelled and led by bloggers and podcasters, I imagine the outside image of it is similar to some sort of guerrilla rebellion. The thing is, it's more than that - we got this figured out.
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
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Those who are with money are easy to dispense predictions
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Except it's get of my private beach front you snot nose little shits.
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Let me just sum up the interview:
You can't retire unless you have $10M saved because what if wages go down while taxes go up and you have to care for your kid that needs $50k/year for school and sick parents that need $250k/year in care.
...but isn't that 99.9% of Americans?
At least now we know never to recommend her to anyone for advice. It blows my mind that she's not laughed off her shows/books after this.
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I'm sure Orman is perfectly honest in her belief that $250K/year is what a person needs for a comfortable retirement. What she should be thinking about deeply is why she needs to spend so much more money than the average American to realize a fulfilling retirement. Millions of Americans live fulfilling lives on 20% or even 10% of this amount. She should be thinking hard about why she can't when so many others can, but instead she promotes her own misguided standards as a universal truth. Bad approach.
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It blows my mind that she's not laughed off her shows/books after this.
If she's anything like financial guru Martin Lewis here in the UK, I suspect that enough people take her word for it without doing their own research. I'm not saying that I have an axe to grind with ML, just that he (and possibly her) target the mainstream audience - one that's renowned for doing as they're told and not questioning the authority figures that the media places before them.
The FIRE movement probably isn't widespread enough for enough people to have enough knowledge about it, sadly. Heck, she might even dampen its momentum...
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
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It blows my mind that she's not laughed off her shows/books after this.
If she's anything like financial guru Martin Lewis here in the UK, I suspect that enough people take her word for it without doing their own research. I'm not saying that I have an axe to grind with ML, just that he (and possibly her) target the mainstream audience - one that's renowned for doing as they're told and not questioning the authority figures that the media places before them.
The FIRE movement probably isn't widespread enough for enough people to have enough knowledge about it, sadly. Heck, she might even dampen its momentum...
The people who buy Suze's and Dave's books believe they deserve the lifestyle that they are selling. They picture themselves living better in retirement than they do know. They are not people who are interested in leading more simple lives now and in retirement.
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Fair enough, but I question if most people can truly maintain that level of spending. Lots of sacrifice. And this is where I think crazy Suzie might have a valid point. If you lean FIRE and some crazy thing happens that forces you to dip into your principle, how can you keep going without working? And if that happens after you’ve sat out of the work world for ten years, what do you do?
I would be considered lean FIRE and I don't feel like it is a sacrifice to spend low. Worst case situation you make adjustments if you have to, even if that means going back to work. I can't see spending years more at work to cover every possible bad situation.
I think there can be a point somewhere in between. It’s obviously different for everyone’s unique situation.
No matter how many times it is addressed, there is this persistent myth that this forum pushes a lifestyle of extreme frugality. There are certainly blogs (eg ERE) that push this, but around here the main goal is a lifestyle that would be considered extremely comfortable by most US standards and luxurious by 90% of the world. MMM even wrote a blog post about it, which seems relevant to repost here:
http://www.mrmoneymustache.com/2014/11/23/not-extreme-frugality/ (http://www.mrmoneymustache.com/2014/11/23/not-extreme-frugality/)
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
Not sure there isn't something more to Mrs. Pete's comment than snark, Psychstache. Leather jackets aren't particularly the rage these days. To many, wearing leather clothing is inappropriate, reflective of cruelty to animals. To my eye, it makes her look out of step, out of date and out of touch with reality. It's almost like she donned a piece of armour, as if she was going into battle. Which is exactly what she did. Therefore, a rather calculated decision on SO's part.
Also, Psych, unless you know Mrs. Pete IRL, your comment about what you believe she is better than is out of order. Orman is a public figure. Mrs. Pete is a forum member. Please see Forum Rules, particularly Rule #1.
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
Not sure there isn't something more to Mrs. Pete's comment than snark, Psychstache. Leather jackets aren't particularly the rage these days. To many, wearing leather clothing is inappropriate, reflective of cruelty to animals. To my eye, it makes her look out of step, out of date and out of touch with reality. It's almost like she donned a piece of armour, as if she was going into battle. Which is exactly what she did. Therefore, a rather calculated decision on SO's part.
Also, Psych, unless you know Mrs. Pete IRL, your comment about what you believe she is better than is out of order. Orman is a public figure. Mrs. Pete is a forum member. Please see Forum Rules, particularly Rule #1.
Nah, she was wearing her "brand" image -- the same necklace, the leather coat, the hairstyle, and forceful way of talking and sounding exciting, etc. The comment above about trying for a resurgence sounded about right. You go onto Youtube and Podcasts when you want to increase your audience.
Too bad the image choice appeared to be intentional to distract her audience from the illogical content of what she was actually saying. She sounds like her head is in the mindtrap that many of the 1% fall victim to. I used to love watching Suzy in the first few years!
I listened to 16 minutes. At the point where she expounded that seniors care costs $20k-$30k per month, I was left thinking -- millions of Americans don't pay that and are still alive.... Suzy, you need to go onto your own "Can I afford it?" show, because anyone listening should endure that if they suggest spending that much on their parents' senior care.
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
+1
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
+1
Agreed. So many new exciting things to judge Suze on, why fall back on the old and tired classic of judging a woman by her sense of style?
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
Not sure there isn't something more to Mrs. Pete's comment than snark, Psychstache. Leather jackets aren't particularly the rage these days. To many, wearing leather clothing is inappropriate, reflective of cruelty to animals. To my eye, it makes her look out of step, out of date and out of touch with reality. It's almost like she donned a piece of armour, as if she was going into battle. Which is exactly what she did. Therefore, a rather calculated decision on SO's part.
Also, Psych, unless you know Mrs. Pete IRL, your comment about what you believe she is better than is out of order. Orman is a public figure. Mrs. Pete is a forum member. Please see Forum Rules, particularly Rule #1.
I think it's a valid thing to call someone out for. Critique her words, not her clothes. We're all better than that. Time to call each other out on these things.
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
Not sure there isn't something more to Mrs. Pete's comment than snark, Psychstache. Leather jackets aren't particularly the rage these days. To many, wearing leather clothing is inappropriate, reflective of cruelty to animals. To my eye, it makes her look out of step, out of date and out of touch with reality. It's almost like she donned a piece of armour, as if she was going into battle. Which is exactly what she did. Therefore, a rather calculated decision on SO's part.
Also, Psych, unless you know Mrs. Pete IRL, your comment about what you believe she is better than is out of order. Orman is a public figure. Mrs. Pete is a forum member. Please see Forum Rules, particularly Rule #1.
1. Not sure what you are seeing in my comments that imply I am being a jerk, but please report it and let a mod discuss it with me if you feel it is needed.
2. I don't know Mrs. Pete IRL, but have seen numerous posts from her that have taught me that she is very knowledgeable about finances, thoughtful in her comments, and a wise individual in general, so I feel confident in saying that she is very capable of adding more to the discussion than a fashion based takedown.
I think DS summed it up pretty nicely:
I think it's a valid thing to call someone out for. Critique her words, not her clothes. We're all better than that. Time to call each other out on these things.
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
Not sure there isn't something more to Mrs. Pete's comment than snark, Psychstache. Leather jackets aren't particularly the rage these days. To many, wearing leather clothing is inappropriate, reflective of cruelty to animals. To my eye, it makes her look out of step, out of date and out of touch with reality. It's almost like she donned a piece of armour, as if she was going into battle. Which is exactly what she did. Therefore, a rather calculated decision on SO's part.
Also, Psych, unless you know Mrs. Pete IRL, your comment about what you believe she is better than is out of order. Orman is a public figure. Mrs. Pete is a forum member. Please see Forum Rules, particularly Rule #1.
1. Not sure what you are seeing in my comments that imply I am being a jerk, but please report it and let a mod discuss it with me if you feel it is needed.
2. I don't know Mrs. Pete IRL, but have seen numerous posts from her that have taught me that she is very knowledgeable about finances, thoughtful in her comments, and a wise individual in general, so I feel confident in saying that she is very capable of adding more to the discussion than a fashion based takedown.
I think DS summed it up pretty nicely:
I think it's a valid thing to call someone out for. Critique her words, not her clothes. We're all better than that. Time to call each other out on these things.
The phrase that you used sounded condescending, IMO, unnecessarily so. Shall we just politely agree to disagree?
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If FIRE **IS** Wrong, then it it can't be **ANY WRONGER** than working your whole life with *NO* retirement savings and holding high debt forever. And if most people are allowed to do the latter, than I certainly get a pass for doing the former.
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
Apparently I'm not. :) It's what I thought when I saw that picture, but -- yeah -- it wasn't nice to say it.
It's almost like she donned a piece of armour, as if she was going into battle. Which is exactly what she did.
That does appear true.
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If I had Suze's money, I'd splurge on a leather jacket that isn't butt-ugly. Really, neither the color nor the style does anything for her. Just sayin'.
This wasn't necessary. You're better than this Mrs. Pete.
Apparently I'm not. :) It's what I thought when I saw that picture, but -- yeah -- it wasn't nice to say it.
It's almost like she donned a piece of armour, as if she was going into battle. Which is exactly what she did.
That does appear true.
Leather is still HUUUGE! And Suze can afford it. She always wears the same gold earrings - I recall her mentioning that on a show many years back.
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Anyone seen Suze's reply/apology to her misunderstanding? Posted on LinkedIn and her twitter feed.
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Anyone seen Suze's reply/apology to her misunderstanding? Posted on LinkedIn and her twitter feed.
Her apology amounts to "...as long as you keep working and making money you can "RE"." Well that's not retiring. So I don't think she gets it. Sounds like she just wanted to head off some of the pushback and negativity to her original comments, but the new remarks don't show a deeper understanding of the topic.
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Anyone seen Suze's reply/apology to her misunderstanding? Posted on LinkedIn and her twitter feed.
Her apology amounts to "...as long as you keep working and making money you can "RE"." Well that's not retiring. So I don't think she gets it. Sounds like she just wanted to head off some of the pushback and negativity to her original comments, but the new remarks don't show a deeper understanding of the topic.
It is how every single blogger and podcaster has retired.
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It is how every single blogger and podcaster has retired.
Option A - If your retirement plan depends on you earning enough income to fund your life independent of your investments than I would argue you are not retired. You are just working at something else vs. whatever career you may have started at.
Option B - If on the other hand your retirement plan does not depend on the above, but instead you happen to earn some $$ doing something fun you are retired.
My reading of Suze's "apology" is the former not the later.
If Option A is "retirement" than I have been retired my whole life! ;-)
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New article from Suze! We were so close to getting am apology/"I was wrong"
http://amp.timeinc.net/time/money/5428520/suze-orman-fire-movement
Why doesn't someone just link her the Trinity study and then she has to fight statistics instead of rhetoric: "25x income isn't enough forever"
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Why doesn't someone just link her the Trinity study and then she has to fight statistics instead of rhetoric: "25x income isn't enough forever"
I guess the problem is either that yes, she hasn't seen/read/heard about it yet, or she just doesn't agree with it. Although, if she does disagree with it, I'd very much like to know what grounds of authority she has to dispute it, because "No, it's wrong because I said so" isn't good enough for me.
Also, IIRC, her apology isn't a real apology. She discretely passes the blame on to someone else - "the information I received was wrong," implying that the fault is with the person who gave her her information, or the information itself, rather than her for not doing her own due diligence.
Either way, I'm still happy to see her give something of an apology. It takes her to swallow a lot of pride for that, which tells me a lot about her. It's definitely better than her dying on the hill of false information; becoming a martyr because of her own arrogance.
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Interesting that she posted this the same day Vicki Robin (the REAL queen of living within your means) gave her a gentle on-line slapdown:
https://yourmoneyoryourlife.com/suze-orman-fire-movement/
I hadn't read anything by Vickie Robin in over 30 years, when I read YMOYL. I didn't know that she had gone through periods of cancer and disability.
Because of my husband's severe disability, I have been wondering how people who FIRE plan to be able to manage possible disability. Many of the strategies that allow people to live frugally seem to depend on having a hale, healthy body and being able to DIY. Taking care of your own home repairs, biking instead of driving, frugal travel strategies, even picking up items at the thrift store instead of shopping online and having things delivered are things for example my husband is no longer able to do.
The answer is of course, that he has a spouse who can still do those things. And that is Vickie's answer as well in the linked article: she says she managed through periods of disability and illness with the help of her friends and social network. I do think that needs to be included in people's plans for FIRE.
In addition, the disabilities she mentioned dealing with were limited in time. Friends will be willing to help you with activities of daily living (getting dressed, fed, washed, getting to your appointments etc.) for short periods of time, but it is unlikely that they would be available for the rest of your life! So relying on your social circle to care for you should you become disabled might not work out in the long term.
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What a lovely article by Vickie. Thank you for sharing. She offers a really nice perspective on someone who has reflected a lot on the emotional side of FIRE and not just the hard numbers like us geeks. I feel like we benefit from sitting at her knee and listening to her wisdom.
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New article from Suze! We were so close to getting am apology/"I was wrong"
http://amp.timeinc.net/time/money/5428520/suze-orman-fire-movement
Why doesn't someone just link her the Trinity study and then she has to fight statistics instead of rhetoric: "25x income isn't enough forever"
Her issue isn't withdrawal rates; her issue is the idea that people could be content without an ever increasing lifestyle.
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To be fair, the 4% rule doesn't account for disastrous events of the type Suze is concerned about.
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To be fair, the 4% rule doesn't account for disastrous events of the type Suze is concerned about.
The 4% Rule doesn't say anything at all about how or what you spend your money on or how much you should budget. That's a whole different process in FIRE planning. You can account for disastrous events a number of ways and build them into your FIRE budget and your spending under the 4% Rule.
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To be fair, the 4% rule doesn't account for disastrous events of the type Suze is concerned about.
Of course it does. It accounts for world wars, global depressions, famines, oil embargoes, bank failures, and pandemics. The 4% rule has worked through all of these things and more.
If you mean the 4% rule doesn't work if you personally choose to spend more than 4%, that's something different. But if you can stick to that inflation-adjusted 4%, it pretty much doesn't matter what else happens in the world. Historically, 4% has survived through all of them.
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That's it, and it's something that we often forget. The 4% WR is safe in an absolute worst case scenario. As long as the post-FIRE future doesn't bring us the worst economic conditions we've ever seen - superseding the Great Depression - then 4% will be fine.
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The 4% rule is safe 95% of the time.
US wars (no homeland destruction) are NOT a cause of failure. Non-US YMMV.
Long term inflation coupled with equity stagnation DOES cause failure (ie 1966).
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Remember, research looking at the 4% rule in every other developed country outside of the US market has not fared nearly as well. So there is always the possibility that we turn into Japan in 10-15 years. Having said that, most people aren't retiring at 35-40 and not earning another dime for the rest of their lives, so even if that does happen, it's unlikely to send someone into poverty.
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The 4% rule is safe 95% of the time.
US wars (no homeland destruction) are NOT a cause of failure. Non-US YMMV.
Long term inflation coupled with equity stagnation DOES cause failure (ie 1966).
Right, 95% of the time is not 100% of the time and I agree it's important to look at the specifics of the failure cases. Global wars have not caused portfolio failures. Stagflation has, but I think we're much more attuned to that threat today than we were in the past, and are more adept at using monetary policy to avoid that scenario.
Also, 4% is safe 95% of the time for 30 year periods. I intend to live off my portfolio for longer than 30 years. Fortunately I have SS after only 20 more years.
On the bright side, the average expectation of someone retiring on the 4% rule is that their money will actually grow over time.
In 95% of cases the money survives 30 years.
In 5% of cases the money does not survive 30 years (without spending reductions).
And in 50% of cases, the median future expectation, the money grows. In fact, if you want to just play the long term averages for 30 year periods, we should all be planning on SWRs closer to 6%. That's the withdrawal amount that is "correct" for surviving and average of 30 years. If you're withdrawing less than 6% per year, then you're more likely to have extra money after 30 years than you are to run out before 30 years are up.
Remember, research looking at the 4% rule in every other developed country outside of the US market has not fared nearly as well.
This is true, but the equivalent in most other countries is like 3.5%. I don't think it's a huge difference, given the flexibilities this crowd demands of retirees anyway.
Also, America is very much not 1991 Japan. Let's not dramatize the worst case scenarios. Japan's market collapse, often cited as something Americans need to protect against, came immediately after a period in which their stock market saw 75% annual growth for six years in a row. We're a long way from that level of jeopardy.
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Remember, research looking at the 4% rule in every other developed country outside of the US market has not fared nearly as well. So there is always the possibility that we turn into Japan in 10-15 years. Having said that, most people aren't retiring at 35-40 and not earning another dime for the rest of their lives, so even if that does happen, it's unlikely to send someone into poverty.
Fortunately for us we are able to buy into diversified all-world stock index funds which can hopefully mitigate some of his risk. I realize country economies are more interconnected than before, but they don’t move in lock-step with each other.
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To be fair, the 4% rule doesn't account for disastrous events of the type Suze is concerned about.
Of course it does. It accounts for world wars, global depressions, famines, oil embargoes, bank failures, and pandemics. The 4% rule has worked through all of these things and more.
If you mean the 4% rule doesn't work if you personally choose to spend more than 4%, that's something different. But if you can stick to that inflation-adjusted 4%, it pretty much doesn't matter what else happens in the world. Historically, 4% has survived through all of them.
I suppose I should have expounded a bit more. You're right that the 4% covers widespread disasters, but it doesn't account for individual disasters of the type Suze mentions--major medical issues, long-term care, etc.
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(https://farm3.staticflickr.com/2555/32137492394_f092c80db8_b.jpg)
Worth a repost [Thanks Maizeman!] to get some perspective on what you should really be worried about.
(https://farm4.staticflickr.com/3712/32600486490_6e61a470fb_b.jpg)
This ^^ one is for old people like me....the contrast is even more stark.
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These visuals are so impactful to me that I have them saved on my desktop and refer back to them from time to time. I think it is so easy to get lost in the discussion of absolute risks of going broke that you lose track of the relative risks of other things in life such as dying.
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These visuals are so impactful to me that I have them saved on my desktop and refer back to them from time to time. I think it is so easy to get lost in the discussion of absolute risks of going broke that you lose track of the relative risks of other things in life such as dying.
Yup! And these ^^^ charts assume you blindly spend you %WR every year with no adjustment for market returns and you'll never "earn" another dollar or get SS.
Put those factors into the mix and the "red zone" pretty much disappears from every chart above.
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You're right that the 4% covers widespread disasters, but it doesn't account for individual disasters of the type Suze mentions--major medical issues, long-term care, etc.
I think that would be a failure of your ability to follow the 4% rule, not a failure of the 4% rule.
The whole point of the 4% SWR is to give you a guideline of what you can safely spend. If you spend more than that, it doesn't change the safety of the guideline it just means you exceeded the guideline.
If a car is crash tested for safety at 35 mph and you then crash it at 70mph, you don't blame the crash standards, you blame the driver for exceeding the design specifications. Sometimes 70mph crashes still happen. That doesn't change the validity of the 35 mph crash test rating. Let's not start blaming the NHTSA because you crashed your car.
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She just published a new article saying she didn’t realize that most fire people continue to work in some capacity so she’s fine with that. Pretty funny!
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You're right that the 4% covers widespread disasters, but it doesn't account for individual disasters of the type Suze mentions--major medical issues, long-term care, etc.
Those are all things you should be considering during your FIRE planning. There are solutions to each item.
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You're right that the 4% covers widespread disasters, but it doesn't account for individual disasters of the type Suze mentions--major medical issues, long-term care, etc.
I think that would be a failure of your ability to follow the 4% rule, not a failure of the 4% rule.
The whole point of the 4% SWR is to give you a guideline of what you can safely spend. If you spend more than that, it doesn't change the safety of the guideline it just means you exceeded the guideline.
If a car is crash tested for safety at 35 mph and you then crash it at 70mph, you don't blame the crash standards, you blame the driver for exceeding the design specifications. Sometimes 70mph crashes still happen. That doesn't change the validity of the 35 mph crash test rating. Let's not start blaming the NHTSA because you crashed your car.
I think your analogy is backwards. A more appropriate analogy would be if someone else crashed into you at more than 70mph.
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Looks financial samurai has jumped on the "S.O." bandwagon, but his lifestyle is so clown-car in a HCOL area that I guess it makes sense for him.
I will personally add him to the list of people I never take financial advice from.
https://www.financialsamurai.com/suze-orman-is-right-you-need-5-million-or-more-to-retire-early/
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It's probably much easier to drop from an 80k to a 60k annual spend on a stash of 2 mill than it is to drop from 40k to 30k on a 1 mill stash -- typically more fluff in the higher budget that can be cut if necessary.
OTOH an easy $10K/yr PT job is 25% of a $40K/yr FIRE budget, but only 12.5% of an $80K FIRE budget so it's much easier to fill the gap with lower spending if it was necessary.
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Looks financial samurai has jumped on the "S.O." bandwagon, but his lifestyle is so clown-car in a HCOL area that I guess it makes sense for him.
I will personally add him to the list of people I never take financial advice from.
https://www.financialsamurai.com/suze-orman-is-right-you-need-5-million-or-more-to-retire-early/
Yeah, I saw that. Basically he said this is what you need to barely make it in LA:
1. Eat out every night
2. Save $600k for your kids' college education
3. Get an additional $2M term policy after you have 6.3M NW.
4. Still pay for childcare 10hrs/week (apparently forever)
5. Pay $16/gallon for gas
Other than that, he might be close to accurate if you want to retire with a huge mortgage in LA. I think what people always forget to think about is taxes in the spend down phase are a function of your needs. If you can reduce your need to spend money you can have a huge impact on your taxes as well.
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Remember, research looking at the 4% rule in every other developed country outside of the US market has not fared nearly as well. So there is always the possibility that we turn into Japan in 10-15 years. Having said that, most people aren't retiring at 35-40 and not earning another dime for the rest of their lives, so even if that does happen, it's unlikely to send someone into poverty.
Most of the countries with a hundred+ years of financial data are in Europe and were invaded and occupied, had their infrastructure destroyed and a large swath of a whole generation of young people killed during one or both world wars the failure rates can be quite high.
But there is essentially no amount of money that would allow you to FIRE in Germany in 1944 and not have to adjust your lifestyle in any way for decades to come. (Or in France in 1939, or in Japan in 1945, and so on.) If you exclude the effects of having your homeland bombed, invaded, and occupied (and/or experiencing a major civil war (Spain)) as sol and markbike528CBX said, rates around the world than ensure 0% failure tend to be between 3.5 and 4%
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Though with the recent tax reform, setting aside the minor issue of ballooning the deficit, expands the tax loophole for the rich quite nicely, so those of us living off of our long-term capital gains should be paying very little in taxes.
I suppose I should be thanking my kids for that since they will ultimately be the ones paying for it down the line.
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Looks financial samurai has jumped on the "S.O." bandwagon, but his lifestyle is so clown-car in a HCOL area that I guess it makes sense for him.
I will personally add him to the list of people I never take financial advice from.
https://www.financialsamurai.com/suze-orman-is-right-you-need-5-million-or-more-to-retire-early/
Yeah, I saw that. Basically he said this is what you need to barely make it in LA:
1. Eat out every night
2. Save $600k for your kids' college education
3. Get an additional $2M term policy after you have 6.3M NW.
4. Still pay for childcare 10hrs/week (apparently forever)
5. Pay $16/gallon for gas
Other than that, he might be close to accurate if you want to retire with a huge mortgage in LA. I think what people always forget to think about is taxes in the spend down phase are a function of your needs. If you can reduce your need to spend money you can have a huge impact on your taxes as well.
My personal favorites were:
$6000/yr for staycations. Are you burning 50 dollar bills for warmth in the fireplace in Lake Tahoe???
$4800/ yr in Tennis Club fees. You could meet friends at a public court and buy a new racket every 3 months and still come out ahead.
$2000/ month in food. If I did my math correctly that is around $148 per person per week and one of them is a child, WTF are you people eating?
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Remember, research looking at the 4% rule in every other developed country outside of the US market has not fared nearly as well. So there is always the possibility that we turn into Japan in 10-15 years. Having said that, most people aren't retiring at 35-40 and not earning another dime for the rest of their lives, so even if that does happen, it's unlikely to send someone into poverty.
Most of the countries with a hundred+ years of financial data are in Europe and were invaded and occupied, had their infrastructure destroyed and a large swath of a whole generation of young people killed during one or both world wars the failure rates can be quite high.
But there is essentially no amount of money that would allow you to FIRE in Germany in 1944 and not have to adjust your lifestyle in any way for decades to come. (Or in France in 1939, or in Japan in 1945, and so on.) If you exclude the effects of having your homeland bombed, invaded, and occupied (and/or experiencing a major civil war (Spain)) as sol and markbike528CBX said, rates around the world than ensure 0% failure tend to be between 3.5 and 4%
Regardless of those kinds of events, I tend to believe that the large multinational corporations (that provide us all with the products and services we use day-in-and-day-out) will continue to operate. Whether the shares of ownership are denominated in dollars, euros, ameros, yuan, shillings, or shekels.
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Remember, research looking at the 4% rule in every other developed country outside of the US market has not fared nearly as well. So there is always the possibility that we turn into Japan in 10-15 years. Having said that, most people aren't retiring at 35-40 and not earning another dime for the rest of their lives, so even if that does happen, it's unlikely to send someone into poverty.
Most of the countries with a hundred+ years of financial data are in Europe and were invaded and occupied, had their infrastructure destroyed and a large swath of a whole generation of young people killed during one or both world wars the failure rates can be quite high.
But there is essentially no amount of money that would allow you to FIRE in Germany in 1944 and not have to adjust your lifestyle in any way for decades to come. (Or in France in 1939, or in Japan in 1945, and so on.) If you exclude the effects of having your homeland bombed, invaded, and occupied (and/or experiencing a major civil war (Spain)) as sol and markbike528CBX said, rates around the world than ensure 0% failure tend to be between 3.5 and 4%
Regardless of those kinds of events, I tend to believe that the large multinational corporations (that provide us all with the products and services we use day-in-and-day-out) will continue to operate. Whether the shares of ownership are denominated in dollars, euros, ameros, yuan, shillings, or shekels.
That may be the case. After all Fuji Heavy Industries is still around and today is called Subaru Corp after spending world war two building bombers and fighters for the Japanese army and navy. Volkwagen built military vehicles for the germans in the same war and still survives as a company today.
But I don't know that the people who owned shares of either company prior to the end of the world war II still had ownership stakes in the companies afterwards.
So it might be that case that major internationational companies would survive an invasion/occupation of the country you are living in, but your ownership interests in them might not.
(To be clear I'm not arguing for lower withdrawal rates, just that there are some events you cannot protect against just by saving enough money.)
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there are some events you cannot protect against just by saving enough money.)
Financial Samurai told me that I have to save six million dollars before I turn 62 so that I won't get cancer.
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there are some events you cannot protect against just by saving enough money.)
Financial Samurai told me that I have to save six million dollars before I turn 62 so that I won't get cancer.
He's a certified idiot. Who the hell retires early with a 3mill investment stash and pays a 30% marginal tax rate? That's some pretty awful tax planning....
I’ve spent most of my accumulation phase bumbling around in the dark as far as tax planning goes and I won’t be paying anything close to 30% marginal tax rate once FIRE. How does one even do that?
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there are some events you cannot protect against just by saving enough money.)
Financial Samurai told me that I have to save six million dollars before I turn 62 so that I won't get cancer.
He's a certified idiot. Who the hell retires early with a 3mill investment stash and pays a 30% marginal tax rate? That's some pretty awful tax planning....
I’ve spent most of my accumulation phase bumbling around in the dark as far as tax planning goes and I won’t be paying anything close to 30% marginal tax rate once FIRE. How does one even do that?
I think it is because you can only tax protect a certain amount of wealth. Since the IRS limits tax advantaged savings, unless you have a mega backdoor available, your surplus wealth generates too much in gains. If you follow Suzis plan, you will be a high tax bracket person, regardless of planning.
A typical early retiree could build maybe 2M max in tax sheltered accounts, even less for us older folks because tax advantaged retirement contribution limits in the 80s and 90s were much lower.
You can only shelter so much wealth, without seriously complicated strategies.
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I suspect it's a combination of getting much of not getting much of his income from long term capital gains or dividends and living in a state with a very steep progressive income tax system.
Also, least others be mislead, the first half of the 1980s was a GREAT time to shelter income if you happened to have access to a 401k (they were much rarer back then). In 1980 and 1981 you could save more than $45,000/year tax deferred (call it $130,000/year in today's dollars) and in 1982-1985 you could save $30,000/year (worth about $70,000 in today's dollars if we compare to 1985).
Now the party kind of ended in the second half of the 1980s when the limit dropped to about $16,000 in today's dollars ($7,000 then), and the limit has been relatively stable in inflation adjusted terms ever since.
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No, Suze Orman loves making the middle class and heaven forbid people below median income feel terrible by offering shitty advice which basically says, "if you aren't well above average income, you're screwed."
Anyways, on the subject, I wonder if people who get massive anxiety about this sort of thing have measurably higher risks of heart attacks, etc, than those who don't care. I'd guess if you could control for just money anxiety you'd see a lot of impact - people working harder/longer at jobs they hate, etc. It'd be interesting. I suspect the likilhood of health complications from this would be noticeable.
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Anyways, on the subject, I wonder if people who get massive anxiety about this sort of thing have measurably higher risks of heart attacks, etc, than those who don't care. I'd guess if you could control for just money anxiety you'd see a lot of impact - people working harder/longer at jobs they hate, etc. It'd be interesting. I suspect the likilhood of health complications from this would be noticeable.
I wonder about this too. People who feel like they need $10MM to be truly secure are going to feel very vulnerable for a much, much, much longer period of their life. Chronic stress does very bad things to our health and to our longevity. Feeling financially secure early on can have some massive health benefits, regarldess of whether that security is a reality or an illusion.
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Anyways, on the subject, I wonder if people who get massive anxiety about this sort of thing have measurably higher risks of heart attacks, etc, than those who don't care. I'd guess if you could control for just money anxiety you'd see a lot of impact - people working harder/longer at jobs they hate, etc. It'd be interesting. I suspect the likilhood of health complications from this would be noticeable.
I think that ^^ is a concern. Plus I also think people truly underestimate the damage they are doing to themselves and their families working sedentary FT jobs many extra years beyond what they have to in order to hit high NWs and/or super low WR%. It's frog in the pot syndrome. The damage is being done slowly to their bodies and their relationships so perhaps it feels like the incremental difference of OMY is no big deal even if it is...once you start adding up decades of damage. Everything can seem fine for a long time and then you have a heart attack or you spouse files for divorce, etc...
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Looks financial samurai has jumped on the "S.O." bandwagon, but his lifestyle is so clown-car in a HCOL area that I guess it makes sense for him.
I will personally add him to the list of people I never take financial advice from.
https://www.financialsamurai.com/suze-orman-is-right-you-need-5-million-or-more-to-retire-early/
Yeah, I saw that. Basically he said this is what you need to barely make it in LA:
1. Eat out every night
2. Save $600k for your kids' college education
3. Get an additional $2M term policy after you have 6.3M NW.
4. Still pay for childcare 10hrs/week (apparently forever)
5. Pay $16/gallon for gas
Other than that, he might be close to accurate if you want to retire with a huge mortgage in LA. I think what people always forget to think about is taxes in the spend down phase are a function of your needs. If you can reduce your need to spend money you can have a huge impact on your taxes as well.
My personal favorites were:
$6000/yr for staycations. Are you burning 50 dollar bills for warmth in the fireplace in Lake Tahoe???
$4800/ yr in Tennis Club fees. You could meet friends at a public court and buy a new racket every 3 months and still come out ahead.
$2000/ month in food. If I did my math correctly that is around $148 per person per week and one of them is a child, WTF are you people eating?
There’s even a separate line item that includes “children’s food”.
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there are some events you cannot protect against just by saving enough money.)
Financial Samurai told me that I have to save six million dollars before I turn 62 so that I won't get cancer.
He's a certified idiot. Who the hell retires early with a 3mill investment stash and pays a 30% marginal tax rate? That's some pretty awful tax planning....
I’ve spent most of my accumulation phase bumbling around in the dark as far as tax planning goes and I won’t be paying anything close to 30% marginal tax rate once FIRE. How does one even do that?
I think it is because you can only tax protect a certain amount of wealth. Since the IRS limits tax advantaged savings, unless you have a mega backdoor available, your surplus wealth generates too much in gains. If you follow Suzis plan, you will be a high tax bracket person, regardless of planning.
A typical early retiree could build maybe 2M max in tax sheltered accounts, even less for us older folks because tax advantaged retirement contribution limits in the 80s and 90s were much lower.
You can only shelter so much wealth, without seriously complicated strategies.
Not necessarily. As long as you can keep your expenses reasonable, it is perfectly feasible to set up your investments so that you are living primarily off cash savings + a reasonable amount of dividends +strategic cashing out of capital gains. That is what we are doing, and it is working fabulously. We will also be gradually using available space in the 10-12% tax brackets to convert traditional retirement savings to Roths over the next 20 years with the plan to get most everything into the non-taxable bucket by the time I turn 70.5 (I turn 50 in a few weeks, DH is 60), so that we avoid a big tax hit on RMDs. But even if we use the full space in the 12% bracket, it only amounts to a few thousand a year in taxes, and probably around a 5-8% marginal rate after deductions and credits.
We're currently spending about 80-90k/year, so hardly a bare bones existence. I did have the advantage of having a Roth 403b at work for about 8 years during the market run-up, so I do have a nice bit of the retirement stash in Roths already. And we live in a state without income tax. That is a choice people can make, too.
Your missunderstanding my point. Suzi says you need 10M to retire. At 5%, a 10M portfolio grows and spits out 200k+ without trying. Unless you are advising sub optimal investments, the taxes will hit as you fund her lavish suggested lifestyle.
Of that 10M, maybe 2M could be in a Roth, and tax advantaged, but not the full 10M for most people, due to contribution limits.
Of course one can save less and be more tax efficient, but that is not her advice. I was saying that people who follow her advice will inevitably be higher bracket payers, not someone like yourself. High RMDs and taxible wealth levels are not by themselves bad, as income is handy and taxes help fund our society, but it is definitely not the most efficient path.
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there are some events you cannot protect against just by saving enough money.)
Financial Samurai told me that I have to save six million dollars before I turn 62 so that I won't get cancer.
He's a certified idiot. Who the hell retires early with a 3mill investment stash and pays a 30% marginal tax rate? That's some pretty awful tax planning....
I’ve spent most of my accumulation phase bumbling around in the dark as far as tax planning goes and I won’t be paying anything close to 30% marginal tax rate once FIRE. How does one even do that?
I think it is because you can only tax protect a certain amount of wealth. Since the IRS limits tax advantaged savings, unless you have a mega backdoor available, your surplus wealth generates too much in gains. If you follow Suzis plan, you will be a high tax bracket person, regardless of planning.
A typical early retiree could build maybe 2M max in tax sheltered accounts, even less for us older folks because tax advantaged retirement contribution limits in the 80s and 90s were much lower.
You can only shelter so much wealth, without seriously complicated strategies.
Not necessarily. As long as you can keep your expenses reasonable, it is perfectly feasible to set up your investments so that you are living primarily off cash savings + a reasonable amount of dividends +strategic cashing out of capital gains. That is what we are doing, and it is working fabulously. We will also be gradually using available space in the 10-12% tax brackets to convert traditional retirement savings to Roths over the next 20 years with the plan to get most everything into the non-taxable bucket by the time I turn 70.5 (I turn 50 in a few weeks, DH is 60), so that we avoid a big tax hit on RMDs. But even if we use the full space in the 12% bracket, it only amounts to a few thousand a year in taxes, and probably around a 5-8% marginal rate after deductions and credits.
We're currently spending about 80-90k/year, so hardly a bare bones existence. I did have the advantage of having a Roth 403b at work for about 8 years during the market run-up, so I do have a nice bit of the retirement stash in Roths already. And we live in a state without income tax. That is a choice people can make, too.
Your missunderstanding my point. Suzi says you need 10M to retire. At 5%, a 10M portfolio grows and spits out 200k+ without trying. Unless you are advising sub optimal investments, the taxes will hit as you fund her lavish suggested lifestyle.
Of that 10M, maybe 2M could be in a Roth, and tax advantaged, but not the full 10M for most people, due to contribution limits.
Of course one can save less and be more tax efficient, but that is not her advice. I was saying that people who follow her advice will inevitably be higher bracket payers, not someone like yourself. High RMDs and taxible wealth levels are not by themselves bad, as income is handy and taxes help fund our society, but it is definitely not the most efficient path.
I'm still not understanding how one would get anywhere near the 30% tax rate being quoted. Even with $200k in LTCG the current tax code would put most of that at 15%. Certainly some optimization could bring that down several points lower. Someone living off their investments is going to be paying much less in taxes than a person who has earned income in the $150-200k mark (for a similar cash flow).
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there are some events you cannot protect against just by saving enough money.)
Financial Samurai told me that I have to save six million dollars before I turn 62 so that I won't get cancer.
He's a certified idiot. Who the hell retires early with a 3mill investment stash and pays a 30% marginal tax rate? That's some pretty awful tax planning....
I’ve spent most of my accumulation phase bumbling around in the dark as far as tax planning goes and I won’t be paying anything close to 30% marginal tax rate once FIRE. How does one even do that?
I think it is because you can only tax protect a certain amount of wealth. Since the IRS limits tax advantaged savings, unless you have a mega backdoor available, your surplus wealth generates too much in gains. If you follow Suzis plan, you will be a high tax bracket person, regardless of planning.
A typical early retiree could build maybe 2M max in tax sheltered accounts, even less for us older folks because tax advantaged retirement contribution limits in the 80s and 90s were much lower.
You can only shelter so much wealth, without seriously complicated strategies.
Not necessarily. As long as you can keep your expenses reasonable, it is perfectly feasible to set up your investments so that you are living primarily off cash savings + a reasonable amount of dividends +strategic cashing out of capital gains. That is what we are doing, and it is working fabulously. We will also be gradually using available space in the 10-12% tax brackets to convert traditional retirement savings to Roths over the next 20 years with the plan to get most everything into the non-taxable bucket by the time I turn 70.5 (I turn 50 in a few weeks, DH is 60), so that we avoid a big tax hit on RMDs. But even if we use the full space in the 12% bracket, it only amounts to a few thousand a year in taxes, and probably around a 5-8% marginal rate after deductions and credits.
We're currently spending about 80-90k/year, so hardly a bare bones existence. I did have the advantage of having a Roth 403b at work for about 8 years during the market run-up, so I do have a nice bit of the retirement stash in Roths already. And we live in a state without income tax. That is a choice people can make, too.
Your missunderstanding my point. Suzi says you need 10M to retire. At 5%, a 10M portfolio grows and spits out 200k+ without trying. Unless you are advising sub optimal investments, the taxes will hit as you fund her lavish suggested lifestyle.
Of that 10M, maybe 2M could be in a Roth, and tax advantaged, but not the full 10M for most people, due to contribution limits.
Of course one can save less and be more tax efficient, but that is not her advice. I was saying that people who follow her advice will inevitably be higher bracket payers, not someone like yourself. High RMDs and taxible wealth levels are not by themselves bad, as income is handy and taxes help fund our society, but it is definitely not the most efficient path.
I'm still not understanding how one would get anywhere near the 30% tax rate being quoted. Even with $200k in LTCG the current tax code would put most of that at 15%. Certainly some optimization could bring that down several points lower. Someone living off their investments is going to be paying much less in taxes than a person who has earned income in the $150-200k mark (for a similar cash flow).
Completely depends on what those investments are. CD yields are treated the same as earnings, for example.
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Completely depends on what those investments are. CD yields are treated the same as earnings, for example.
Well, if you assume your retirement accounts are all held in CDs, then Suze's $10m number looks slightly less ridiculous!
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Completely depends on what those investments are. CD yields are treated the same as earnings, for example.
Well, if you assume your retirement accounts are all held in CDs, then Suze's $10m number looks slightly less ridiculous!
Indeed. If you found a CD earning 3%, you'd pay 0.9%/year in income taxes, for a post-tax nominal yield of 2.1%. With inflation currently running at 2.3%/year, your real post-tax rate would be -0.2%/year.
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I'm still not understanding how one would get anywhere near the 30% tax rate being quoted. Even with $200k in LTCG the current tax code would put most of that at 15%.
I think your first mistake is assuming that these financial bloggers know anything at all about taxes. I'd be shocked if Financial Samurai can quote the current tax brackets from memory.
These folks are online entertainers, not professionals. We should probably all stop taking them so seriously.
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Required distributions from IRAs and 401Ks, plus other investment income can reqlly add up. For example RMDs are treated as ordinary income.
Suzi's retiree worked unto 65. For example, a 65 year old with a 2M IRA, earning 7% would need to have at a minimum RMD withdraw of 95k per year. That alone fills up the desirable brackets.
Lets say they also have 8M in a taxable account, half in income focused REITs and half in a S&P500 index stock fund. The stocks pay roughly 2% ordinary dividend, not including any forced capital gains. Thats 4Mx2% or another 80k. If the REIT pays maybe 7%, so thats 4Mx7% or 280k more.
So RMDs and dividends have this guy already at 450+k in income, not counting SS, which gets added in too. Now I never personally said it is 30%, but thats also not a 15% bracket. AMT is still out there too. Plus, if they like the lights of LA, CA state tax!
You might be suprised how taxes under her scenario add up. Sure there are ways to try to minimize the tax, but clever tax dodging schemes are scarcer than you might suspect these days. Many have been voided by the IRS or require accounting which limit options or introduce other headaches, so many just pay their tax. A vague statement that they should be able to avoid taxes is not a real thing.
PS, if you have specific plans other than the usual keep earned income low, max your cap gains and fill up ROTH options, Im all ears. In summary, we all agree that too much wealth can be sub optimal (from a tax perspective, certainly). Sol summarized it well.
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(https://farm3.staticflickr.com/2555/32137492394_f092c80db8_b.jpg)
Worth a repost [Thanks Maizeman!] to get some perspective on what you should really be worried about.
(https://farm4.staticflickr.com/3712/32600486490_6e61a470fb_b.jpg)
This ^^ one is for old people like me....the contrast is even more stark.
You are saying there is a 100% probability I will end up dead?
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You are saying there is a 100% probability I will end up dead?
Only if you keep orbiting the sun. :-P
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You are saying there is a 100% probability I will end up dead?
Only if you keep orbiting the sun. :-P
Your spirit will never die though!
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Looks financial samurai has jumped on the "S.O." bandwagon, but his lifestyle is so clown-car in a HCOL area that I guess it makes sense for him.
I will personally add him to the list of people I never take financial advice from.
https://www.financialsamurai.com/suze-orman-is-right-you-need-5-million-or-more-to-retire-early/
Yeah, I saw that. Basically he said this is what you need to barely make it in LA:
1. Eat out every night
2. Save $600k for your kids' college education
3. Get an additional $2M term policy after you have 6.3M NW.
4. Still pay for childcare 10hrs/week (apparently forever)
5. Pay $16/gallon for gas
Other than that, he might be close to accurate if you want to retire with a huge mortgage in LA. I think what people always forget to think about is taxes in the spend down phase are a function of your needs. If you can reduce your need to spend money you can have a huge impact on your taxes as well.
I used to read his articles. However, he has become so 'upscale' that it is kind of silly at this point for the average person. The problem I have with him is that he 'justifies' his articles by the fact he lives in a 'HCOL' area, etc... However, he doesn't *have* to live there.
Anyway, his site has moved far down the list of sites I check frequently.
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I used to read his articles. However, he has become so 'upscale' that it is kind of silly at this point for the average person. The problem I have with him is that he 'justifies' his articles by the fact he lives in a 'HCOL' area, etc... However, he doesn't *have* to live there.
Anyway, his site has moved far down the list of sites I check frequently.
He doesn't *ahve* to live there, nor does he *have* to live like other Los Angelinos. That's the main beef I have with the FS, and why I prefer MMM's philosophy better. Housing is about the only thing you can't avoid paying more for in a HCOL area, but food, entertainment, even education doesn't have to be wicked-expensive. Just because your neighbors and friends spend $2k/month on restaurants doesn't mean you have to (or even should).
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I used to read his articles. However, he has become so 'upscale' that it is kind of silly at this point for the average person. The problem I have with him is that he 'justifies' his articles by the fact he lives in a 'HCOL' area, etc... However, he doesn't *have* to live there.
Anyway, his site has moved far down the list of sites I check frequently.
He doesn't *ahve* to live there, nor does he *have* to live like other Los Angelinos. That's the main beef I have with the FS, and why I prefer MMM's philosophy better. Housing is about the only thing you can't avoid paying more for in a HCOL area, but food, entertainment, even education doesn't have to be wicked-expensive. Just because your neighbors and friends spend $2k/month on restaurants doesn't mean you have to (or even should).
I was hoping that someone else would find that FS blog to be sarcasm or a joke.
I mean 25k/year for the rest of your life for 529 college? Really?
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I used to read his articles. However, he has become so 'upscale' that it is kind of silly at this point for the average person. The problem I have with him is that he 'justifies' his articles by the fact he lives in a 'HCOL' area, etc... However, he doesn't *have* to live there.
Anyway, his site has moved far down the list of sites I check frequently.
He doesn't *ahve* to live there, nor does he *have* to live like other Los Angelinos. That's the main beef I have with the FS, and why I prefer MMM's philosophy better. Housing is about the only thing you can't avoid paying more for in a HCOL area, but food, entertainment, even education doesn't have to be wicked-expensive. Just because your neighbors and friends spend $2k/month on restaurants doesn't mean you have to (or even should).
I was hoping that someone else would find that FS blog to be sarcasm or a joke.
I mean 25k/year for the rest of your life for 529 college? Really?
At its most expensive, 4 years of Ivy-league university education runs about $240k, which includes tuition, materials, room & board. It's fairly easy to cut this number in half and still get a top-tier education. I have no idea why FS and Suze somehow double or triple this maximum amount necessary and declare that "what you need to save for your children's college fund". It's bonk. And I work in higher-education.
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I have no idea why FS and Suze somehow double or triple this maximum amount necessary and declare that "what you need to save for your children's college fund". It's bonk. And I work in higher-education.
I expect they are extrapolating the past increases in college prices 20+years into the future. In which case they're talking literal dollars, not today's dollars, after separating out regular inflation from the inflation of college costs.
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I used to read his articles. However, he has become so 'upscale' that it is kind of silly at this point for the average person. The problem I have with him is that he 'justifies' his articles by the fact he lives in a 'HCOL' area, etc... However, he doesn't *have* to live there.
Anyway, his site has moved far down the list of sites I check frequently.
He doesn't *ahve* to live there, nor does he *have* to live like other Los Angelinos. That's the main beef I have with the FS, and why I prefer MMM's philosophy better. Housing is about the only thing you can't avoid paying more for in a HCOL area, but food, entertainment, even education doesn't have to be wicked-expensive. Just because your neighbors and friends spend $2k/month on restaurants doesn't mean you have to (or even should).
I was hoping that someone else would find that FS blog to be sarcasm or a joke.
I mean 25k/year for the rest of your life for 529 college? Really?
At its most expensive, 4 years of Ivy-league university education runs about $240k, which includes tuition, materials, room & board.
I think most ivy-league schools are free or mostly free. Most of the schools have a "pay your EFC (expected family contribution), and no more!" program. Ivy league schools have more money than they know what to do with.
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I have no idea why FS and Suze somehow double or triple this maximum amount necessary and declare that "what you need to save for your children's college fund". It's bonk. And I work in higher-education.
I expect they are extrapolating the past increases in college prices 20+years into the future. In which case they're talking literal dollars, not today's dollars, after separating out regular inflation from the inflation of college costs.
Hard to believe these people should then be considered 'financial experts'.
Let's take the most expensive option available today, then extrapolate cost increases for two decades. We'll ignore inflation entirely and assume that your college fund will have a zero rate of return. We won't allow for cheaper and more practical options. And then just for the hell of it we'll tack on another 50%. Yeah, that seems realistic, when its so expensive that >99% of families could never afford it...
I think most ivy-league schools are free or mostly free. Most of the schools have a "pay your EFC (expected family contribution), and no more!" program. Ivy league schools have more money than they know what to do with.
Many are, and to my knowledge all offer extensive support for a good portion of their student body. That's why I said "the most expensive option" possible. Harvard and Stanford both offer free tuition for families with an AGI of <$100k. Many in-state public schools are top-tier institutions and charge just a few thousand per semester. There are so many ways of keeping college well under the $100k mark (all 4 years combined) without sacrificing quality of education.
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I think most ivy-league schools are free or mostly free. Most of the schools have a "pay your EFC (expected family contribution), and no more!" program. Ivy league schools have more money than they know what to do with.
Orman and friend are recommending that you work long enough to have SO much money that your EFC will still be paying full freight. This is one of those circumstances where the more you have, the more you pay.
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It's all a clever marketing ploy. Suze's got a book coming out; this new FIRE thing is getting a lot of publicity - let's get a lot of publicity by crapping on it publicly! She got a week worth of free publicity from a wide variety of bloggers who either couldn't spot the play or decided to play along, then she 'recanted' and got another week of free publicity! And then of course all those bloggers posted about her again, getting their own opportunity to piggyback off her recent notoriety. Everybody got a whole bunch of exercise by riding their favourite hobbyhorses, everybody got a bunch of extra pageviews or book sales and the whole fight was about as real as WWE wrestling.
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It's all a clever marketing ploy. Suze's got a book coming out; this new FIRE thing is getting a lot of publicity - let's get a lot of publicity by crapping on it publicly! She got a week worth of free publicity from a wide variety of bloggers who either couldn't spot the play or decided to play along, then she 'recanted' and got another week of free publicity! And then of course all those bloggers posted about her again, getting their own opportunity to piggyback off her recent notoriety. Everybody got a whole bunch of exercise by riding their favourite hobbyhorses, everybody got a bunch of extra pageviews or book sales and the whole fight was about as real as WWE wrestling.
... in the style of "it's better to be talked about than good" - or maybe "no publicity is bad publicity"...
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I listened to this podcast - and I was struck by how much she seemed to LOVE herself. IMO it seemed that there was ZERO humility on two accounts.
First I found that I was listening like I was gawking at a car wreck - incredulous that someone would publicly speak in such a manner. I have over $100M, I was welcomed with Open Arms back to NBC - they love me, I live on a private island, I am the best at Finance. If I didn't know it was Orman I would swear it was Trump.
Second, I found it surprising there was no care by Orman to ask what FIRE was, what it means to others.
It will be interesting to find out the reactions to her over the Webs .
The Wikipeda article on Suze quotes her saying she has $10M...
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The Wikipeda article on Suze quotes her saying she has $10M...
well if Wikipedia says it...
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And several other news outlets as well...
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I listened to this podcast - and I was struck by how much she seemed to LOVE herself. IMO it seemed that there was ZERO humility on two accounts.
First I found that I was listening like I was gawking at a car wreck - incredulous that someone would publicly speak in such a manner. I have over $100M, I was welcomed with Open Arms back to NBC - they love me, I live on a private island, I am the best at Finance. If I didn't know it was Orman I would swear it was Trump.
Second, I found it surprising there was no care by Orman to ask what FIRE was, what it means to others.
It will be interesting to find out the reactions to her over the Webs .
The Wikipeda article on Suze quotes her saying she has $10M...
I was curious, so I looked. The Wikipedia article you mention states the reference said her net worth was "more than $10 million". That was reference #38. That reference, wrongly attributed to "The Young Turks", is only discussing her use of whole life insurance, and her hiding the fact that she uses it while telling others it is a waste of money.
That looked odd to me, so I looked for the article by Deborah Solomon mentioned in the reference. Here it is:
https://www.nytimes.com/2007/02/25/magazine/25wwlnq4.t.html
In it, she says her net worth was about $32 million, with only about $1 million of that in stocks and $7 million in real estate. There is no mention at all in the online article referencing insurance. When searching for "The young +Turks Suze Orman", I found nothing.
I looks like Michael Scott failed me regarding Wikipedia:
https://www.youtube.com/watch?v=kFBDn5PiL00
I would doubt very highly she lost or spent $20 million in a decade. Since she is in low/no risk munis, it likely increased.
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I listened to this podcast - and I was struck by how much she seemed to LOVE herself. IMO it seemed that there was ZERO humility on two accounts.
First I found that I was listening like I was gawking at a car wreck - incredulous that someone would publicly speak in such a manner. I have over $100M, I was welcomed with Open Arms back to NBC - they love me, I live on a private island, I am the best at Finance. If I didn't know it was Orman I would swear it was Trump.
Second, I found it surprising there was no care by Orman to ask what FIRE was, what it means to others.
It will be interesting to find out the reactions to her over the Webs .
The Wikipeda article on Suze quotes her saying she has $10M...
I was curious, so I looked. The Wikipedia article you mention states the reference said her net worth was "more than $10 million". That was reference #38. That reference, wrongly attributed to "The Young Turks", is only discussing her use of whole life insurance, and her hiding the fact that she uses it while telling others it is a waste of money.
That looked odd to me, so I looked for the article by Deborah Solomon mentioned in the reference. Here it is:
https://www.nytimes.com/2007/02/25/magazine/25wwlnq4.t.html
In it, she says her net worth was about $32 million, with only about $1 million of that in stocks and $7 million in real estate. There is no mention at all in the online article referencing insurance. When searching for "The young +Turks Suze Orman", I found nothing.
I looks like Michael Scott failed me regarding Wikipedia:
https://www.youtube.com/watch?v=kFBDn5PiL00
I would doubt very highly she lost or spent $20 million in a decade. Since she is in low/no risk munis, it likely increased.
I'm not a fan of Suze any longer, but I wouldn't fault her over using whole life in her situation. It's a waste of money for the vast majority of people, but not for wealthy business owners.