The Wrong Way To FIRE...

[Lis]

My friend just announced she quit her day job. She was never meant to work 9-5 in a corporate office and that it was sucking the soul out of her. She's nervous, but she's very excited to work on her side project. All of this is fine and dandy. She expressed a lot of sentiment that we all read here. If I didn't know any better, I would have applauded her. Except she's hundreds of thousands of dollars in debt with a mortgage and student loans from three (THREE) different degrees, is leasing a (fancy new) car, has only been saving for retirement for the six months she was employed at her current/former job (maybe), and believes that tutoring 6-10 hours a week will cover her lifestyle.

Last year, she quit her teaching job seven days into her teaching job. During her six months of unemployment, she purchased a fixer-upper co-op and paid for major renovations (courtesy of the Bank of Mom and Dad). She spent a ton of money on things like Comic-con, Ren Faire costumes, etc. Nearly every time going out to eat was mentioned in our group of friends, she said yes. I honestly have no idea how she survived those six months. She finally got a job in March, but being in Benefits in HR was "too hard," exactly what she said about teaching. She started tutoring for a few hours and jokingly started saying she was going to quit her day job and tutor full time. We laughed because she thought she was joking. Turns out she wasn't. She's going to set up an LLC in January to protect herself, but is going to let everything else slide this year (meaning, not paying taxes on her tutoring gig). She can get medical insurance for 'super cheap' (granted, I know next to nothing about ACA and its plans, so sure?).

I'm baffled, I really am. I'm not baffled by the idea that only working 6-10 hours a week could support a lifestyle (I've been on this site long enough!), but how it could possibly support hers. She's not downsizing, she's not getting rid of her car, she's not changing anything. She can "afford" everything now and still have "a little bit left over" (completely ignoring my question if she's saving for retirement now). Knowing her and knowing her personality, this is only going to end badly. If she were starting off in the green or at least at 0, it wouldn't be so bad, but she's so far deep in the red...

There's no real point to this post other than to share my bafflement. Am I being too harsh?

[Pooplips]

Sounds like the Bank of Mom and Dad is the gravy train for this girl.

[zephyr911]

The Antimustachian Wall of Shame and Comedy might be a better place for this adorable trainwreck.

Just wow. Of all the reasons to go from a 9-5 to self-employment, "it's too hard" makes the least sense. It's one thing if your creativity and work ethic are underappreciated, or you need the flexibility to pursue your dreams. But she sounds like the kind of person who will lack the drive to succeed as an entrepreneur. Do let us know in a few months....

[Lis]

The Antimustachian Wall of Shame and Comedy might be a better place for this adorable trainwreck.

Oops, I thought I was posting there! My bad.

This is the same friend I had posted about a while back (might have been last year - I think she was still unemployed). This is a woman in her mid thirties who tried to bring a child into the world last year. Last time I tried to help and give advice and got emotionally involved. I can't do that this time. So for the most part, all it's been from me so far has been "Wow, good luck! Sounds great!"

[Daisy]

Maybe she won the lottery and doesn't want to tell you.

[okits]

Sounds like the Bank of Mom and Dad is the gravy train for this girl.

Most likely, though perhaps spending down her meagre savings, being in arrears on loan payments, and support from a moneyed lover might all be keeping her afloat.

Consider her a friendly acquaintance or buddy.  "Friend" suggests more closeness to this trainwreck than you probably want.

[meg_shannon]

Her parents are probably giving her more money that she lets on. Being subsidized by your parents well into your 30s isn't exactly something to brag about.

[Mr. Green]

Classic entitlement mentality.

[StockBeard]

Yup, I can't empathize with your friend here if she ends up in a bad financial position.
I am extremely lazy myself and I procrastinate all the time, I totally understand people who don't want to work, and this is exactly why I work extra hard now so I don't have to even think about it later. Your friend is missing part of this equation, it seems :(

[Retired To Win]

My friend just announced she quit her day job... she's hundreds of thousands of dollars in debt with a mortgage and student loans from three (THREE) different degrees, is leasing a (fancy new) car, has only been saving for retirement for the six months she was employed at her current/former job (maybe), and believes that tutoring 6-10 hours a week will cover her lifestyle... She's not downsizing, she's not getting rid of her car, she's not changing anything. She can "afford" everything now and still have "a little bit left over"... Knowing her and knowing her personality, this is only going to end badly. If she were starting off in the green or at least at 0, it wouldn't be so bad, but she's so far deep in the red...

What do you have in common with this person that you would consider her your friend?  I ask because, when her train wreck happens -- which it will -- she's going to go to her friends (you?) for bailout help.  Are you ready for that?

[Lis]

I am extremely lazy myself and I procrastinate all the time, I totally understand people who don't want to work, and this is exactly why I work extra hard now so I don't have to even think about it later.

This is my goal in life! :D

What do you have in common with this person that you would consider her your friend?  I ask because, when her train wreck happens -- which it will -- she's going to go to her friends (you?) for bailout help.  Are you ready for that?

Admittedly it's gotten much harder to be her friend since we've met. We're at the point where we'll occasionally meet up (with a bunch of mutual friends) and try to catch up. I honestly don't think she'd ask me for money, apparently I don't make enough because I don't like spending it on stuff (I don't bother to correct her). That said, I've stopped sharing all money discussions with her, like how I'm currently saving for a down payment. I'd much rather she think I'm poor.

[Cpa Cat]

It will be important for her to file tax returns if she plans on utilizing ACA subsidies. Whether or not she actually pays her taxes is between her and the government.  But she'll screw herself out of her subsidy if she doesn't actually file the return. Not to mention the EITC - which it sounds like she might be in the range for. Some states also have tax credits that are only available if you timely file.

*sigh* Sometimes, as an accountant, I just want to get up and bang my head against the wall when I hear this stuff. People end up costing themselves so much money.

[Lis]

Apparently she hasn't told her parents or siblings yet because she's afraid of their reactions. Rightly so in my opinion. Keep in mind this is after she called her sister a mooch (single parent going through a terrible divorce who accepted aid from her parents). I'm very curious (in a nosy, snoopy way) to find out her parents' reactions, though I'm fairly certain I'll just hear "they're very supportive" regardless.

[Indexer]

This is not FIRE.

This is WATER.

Wrong attitude towards early retirement.

Or ICE.

Indebtedness continuation experiment.

[Cookie78]

This is not FIRE.

This is WATER.

Wrong attitude towards early retirement.

Or ICE.

Indebtedness continuation experiment.

LOL
!!

[BeardedLady]

This is not FIRE.

This is WATER.

Wrong attitude towards early retirement.

Or ICE.

Indebtedness continuation experiment.

Nice. I appreciate your wit!

[okits]

This is not FIRE.

This is WATER.

Wrong attitude towards early retirement.

Or ICE.

Indebtedness continuation experiment.

I'm going to chime in and say I really liked your WATER/ICE acronyms, too!

[Retired To Win]

What do you have in common with this person that you would consider her your friend?  I ask because, when her train wreck happens -- which it will -- she's going to go to her friends (you?) for bailout help.  Are you ready for that?

Admittedly it's gotten much harder to be her friend since we've met. We're at the point where we'll occasionally meet up (with a bunch of mutual friends) and try to catch up. I honestly don't think she'd ask me for money, apparently I don't make enough because I don't like spending it on stuff (I don't bother to correct her). That said, I've stopped sharing all money discussions with her, like how I'm currently saving for a down payment. I'd much rather she think I'm poor.

Very smart!  And good for you!

[FatCat]

This sounds like a friend of mine. He inherited some money and stopped working or going to school. Spent it all. Took out a credit card. Maxed it out. The cable was cut off. The phone was cut off. The water was cut off. He asked everybody he knew for money to delay the electricity being cut off. Once the electricity was cut off, he decided to get a job. It's a real pain to try to get a job with no gas, no phone, no internet, no shower...

She might have enough money coming in from parents or a lover. Or she's got more money than you think she does. Or she's in denial. If she's just delaying the inevitable, hopefully she'll come around before she's exhausted all her resources. That's a bad state to be in when looking for a job.

[Cassie]

I had a friend that mostly quit working when he got an inheritance & it lasted 10 years. Instead of buying a condo with cash to be secure he bought a home that eventually he had to sell. At one point he asked his friends if he could couch surf. I said no.  Right at the last minute a friend that was well off gave him $2,000 & that was the scare he needed because he is now working enough to pay bills & save some $. Pretty scary place to be in at age 60 though.

[mistershankly]

I had a friend that mostly quit working when he got an inheritance & it lasted 10 years. Instead of buying a condo with cash to be secure he bought a home that eventually he had to sell. At one point he asked his friends if he could couch surf. I said no.  Right at the last minute a friend that was well off gave him $2,000 & that was the scare he needed because he is now working enough to pay bills & save some $. Pretty scary place to be in at age 60 though.

I read this envisioning a 30-something as your friend and the last sentence stunned me.  I wonder how many folks at that age are in the same situation.  Wow!

[FatCat]

I had a friend that mostly quit working when he got an inheritance & it lasted 10 years. Instead of buying a condo with cash to be secure he bought a home that eventually he had to sell. At one point he asked his friends if he could couch surf. I said no.  Right at the last minute a friend that was well off gave him $2,000 & that was the scare he needed because he is now working enough to pay bills & save some $. Pretty scary place to be in at age 60 though.

I read this envisioning a 30-something as your friend and the last sentence stunned me.  I wonder how many folks at that age are in the same situation.  Wow!

He was probably hoping he could make it without working until 62.

[Cassie]

He won't collect enough at 62 so he isn't going to collect to age 70 so hopefully if he is frugal he can live on it. BEing mostly out of the work force so much for so long the amount he gets at 62 is not much.  It really is scary to think at this age someone could be in that bad shape.  I have helped people through the years but not when it is self inflicted like this was.

[steveo]

Am I being too harsh?

No you aren't. FIRE involves hard work and delayed gratification.

[steveo]

Her parents are probably giving her more money that she lets on. Being subsidized by your parents well into your 30s isn't exactly something to brag about.

Classic entitlement mentality.

My wife comes from a lot of money. Her younger sister is in her early 30's. She had a job (her own business) where her dad subsidised the business until it went bust. She then remodelled the rental house for $1.5 million (I'm not joking) and must have been paid a bit there. She then flew to New York (we live in Australia) to work with her friend (dad would have paid for the trip and a bit extra but I don't know for sure). That didn't work out so now she is learning to be a Yoga instructor with dads support.

My wife's older brother borrowed money for a house and for a car. He wasn't going to pay that back so his dad paid for it. He (the brother) then sold the house and car and kept the money. He intends to move back to Sydney but dad has to find a job that pays at least $150k per year for him (I think he needs more like $250k). He doesn't think that is possible so dad is working on getting him a business to run.

My wife gets nothing and neither does the other Sister. I'll be honest and state that my FIL paid for 25% of our house but he expects the money back if we move.

What is funnier is that they came back for Christmas and didn't have enough money so my wife lent them a couple of hundred dollars. That will never be paid back.

I reckon the family worth could be close to say $40 million. I reckon if it gets split evenly it will be gone pretty quickly from their hands. If it doesn't and they get the majority of the money (which could easily happen) it will last a little bit longer but it will still disappear.

[Cassie]

NOthing worse then enabling adults to remain children. Ugh!

[Chuck]

This is not FIRE.

This is WATER.

Wrong attitude towards early retirement.

This post has justified the whole thread all by it's self. Bravo, I plan on using this.

[Lis]

We gather weekly at a bar for some pub games and she texted the group before I left "pregaming at home because bars are expensive!" I'm in agreement with a few of our other friends that we do NOT want to hear about money from her since she tends to make terrible decisions about it then complain. She showed up shitfaced to the bar (not sure how much she drank at home), bought three more drinks over the course of the night and some take out from a joint next door. She's also flying to another state next week to visit friends and to celebrate not having a 9-5 anymore.

[Fodder]

You definitely have to scratch your heads at some people.  I know someone who was employed as a high school teacher (which in my area, after 10 years experience, you're at about 92k, which is NOT shabby).  The person worked for five-ish years, and has now quite their job to sell for one of those annoying multi-level marketing firms.  She's convinced it's an AMAZING opportunity and that she's pretty much going to be a millionaire.

And as far as I know, no money saved, no assets to speak of, and possibly student loans (or maybe other debt?).  The significant other works in physio, which isn't a bad living, but definitely not conducive to the millionaire lifestyle the couple clearly aspires to.

On the one hand, I applaud someone going after their dreams, but on the other hand, I have a hard time imagining how you can sell crappy overpriced products (or sell opportunities to sell crappy overpriced products) and think that will end up even with the 92k/year teaching salary and defined benefit pension......and paid maternity leave, etc. 

And these guys definitely have not said goodbye to a high-consumption lifestyle.

[Faraday]

This is not FIRE.

This is WATER.

Wrong attitude towards early retirement.

Or ICE.

Indebtedness continuation experiment.

+1000! SO Good!

[steveo]

We gather weekly at a bar for some pub games and she texted the group before I left "pregaming at home because bars are expensive!" I'm in agreement with a few of our other friends that we do NOT want to hear about money from her since she tends to make terrible decisions about it then complain. She showed up shitfaced to the bar (not sure how much she drank at home), bought three more drinks over the course of the night and some take out from a joint next door. She's also flying to another state next week to visit friends and to celebrate not having a 9-5 anymore.

This kills me. A celebration of not having a job when you don't have any money. It should be panic stations.

[patrickza]

How good a friend is she, ie how soon before she asks you for a loan...

[Lis]

So she posted on FB that she's looking for a roommate to share her 2 bedroom. That's a great start, and I'm kinda proud that she's kinda shimmying in the right direction, but I don't have high hopes. Unless she finds someone who never socializes, never leaves their room, and doesn't make any sort of noise or mess (which, hey, I suppose is possible), it's going to end in a headache. Also, I'm not 100% sure renting is legal in that space - I had been looking for apartments in that neighborhood and I'm fairly certain renting was not allowed in that building. Could be wrong, and I don't know if the rules are different if the owner still lives in the building.

[okits]

So she posted on FB that she's looking for a roommate to share her 2 bedroom. That's a great start, and I'm kinda proud that she's kinda shimmying in the right direction, but I don't have high hopes. Unless she finds someone who never socializes, never leaves their room, and doesn't make any sort of noise or mess (which, hey, I suppose is possible), it's going to end in a headache. Also, I'm not 100% sure renting is legal in that space - I had been looking for apartments in that neighborhood and I'm fairly certain renting was not allowed in that building. Could be wrong, and I don't know if the rules are different if the owner still lives in the building.

Learning how to live with someone else is a huge opportunity for personal growth.  When DH and I shacked up I was in awe of what an experienced and awesome roommate he was.  (I was lucky; I'm not amazing at sharing living space but he'd had some real doozies so I got credit for not doing crazy shit like leaving a field of broken glass on the floor...)

[CU Tiger]

I had a friend that mostly quit working when he got an inheritance & it lasted 10 years. Instead of buying a condo with cash to be secure he bought a home that eventually he had to sell. At one point he asked his friends if he could couch surf. I said no.  Right at the last minute a friend that was well off gave him $2,000 & that was the scare he needed because he is now working enough to pay bills & save some $. Pretty scary place to be in at age 60 though.

I read this envisioning a 30-something as your friend and the last sentence stunned me.  I wonder how many folks at that age are in the same situation.  Wow!

My friend's mom inherited over a million when she was in her 50s. She spent about 10 years living off that. She now lives in a tiny apartment and works at Home Depot. She asks her adult children for money for bills and they take her on vacation. It makes me sad, because if she had made better decisions she would be comfortably retired now.

[Thinkum]

Sounds like a person who thinks "it will all work out", despite no plan based on strategic planning.

The worst is when the people who do this sort of crap are people close to you. Ask me how I know. Of course, I'm the one who is too strategic and doesn't know how to enjoy life. HAHAHAHAHAHA!!!! Go figure.

[k290]

Not necessarily.

You can live lavishly, rack up a shit load of debt, and if you die happily soon enough, well then it's not your problem any more  :)

[Lis]

The complaints are beginning.

Maybe not beginning, since they've always sorta been there. But worsening.

We're making plans in our group chat (getting together tonight to watch new episodes of a TV show, going to a haunted house this Friday night) and she can't go because she's tutoring. Is it that shocking that students need a tutor on weekday evenings or weekend days? She's bumming out because she can't hang out with her friends that often now and is feeling left out.

Well, at least it seems she's getting more hours...

[okits]

Suggest she ask her parents for an allowance so she doesn't have to work anymore. Then she'll have more time to go out with her friends!

(Mad props to you if you can pull this off without her realizing you're poking fun.  :)