Author Topic: Talking to people about Early Retirement?  (Read 7145 times)

themush

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Talking to people about Early Retirement?
« on: August 16, 2013, 05:02:06 PM »
A few days ago, my wife and I had dinner with a couple we'd just recently met. My wife mentioned that we'd gotten really into paying attention to our finances, cutting spending and (gasp) early retirement. 

The guy says, instantly, "You guys must be rich." In maybe not the greatest tone. I wound up trying to explain, "It's really just a math problem..." then, as I'm not the most socially comfortable person, almost completely backpedaling "Well it probably wont happen..." He brought it up a few more times, as kind of a call-back jokey way, but it was the first time I'd been made to feel kinda crazy about the whole thing. He turned out to be a good guy, they're both really cool people we hope to see again, but it was a bit jarring for a moment.

How do you explain it when it comes up without getting into a long discussion of your personal finances? Or do you just go for it and start evangelizing? Just curious if anyone has any tips, or any stories about trying to explain the whole thing to someone who doesn't get it.

jrs

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Re: Talking to people about Early Retirement?
« Reply #1 on: August 16, 2013, 05:18:52 PM »
I've tried to talk to a few people about it...

Usually it's a train wreck...  People get openly hostile.  (example: "even if you succeed, that money will be the only thing in your life and you'll die sad and alone". )

From now on, I'm keeping my fincances to myself.

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Re: Talking to people about Early Retirement?
« Reply #2 on: August 16, 2013, 07:32:19 PM »
I never bring it up on my own.  But sometimes people will say they wish they could retire.  And I jokingly say, well maybe you can.  Then they laugh and say something like I need a couple million, right?  And I say, well they say you need 25X your annual spending needs to retire -- just as a rule of thumb.  Then do an example (like if you spend $40k/year, and you have $1M in the bank, you can go home right now.)  Sometimes this makes them say something like, well I guess I need only $1.25M, but I don't have that much -- dammit!  Then I make a joke, hey I just saved you $750,000.  I tell them I've been cutting back on spending ot save more and retire early.  Sometimes they are interested and ask more questions.

I would like to find a good way to point out that cutting spending is an accelerator for retirement, and twice as good as increasing your income by the same amount, because cutting spending allows you to not only save money faster (same as earning a higher income) it also allows you to decrease the amount you need to save in the first place, making getting to retirement easier.  I feel like I need a good analogy (like a race where the faster you run, the shorter the distance -- except that this makes it sound like you have to really tax yourself to retire early, when I want to get across the idea that it's not really that hard to cut your spending).

matchewed

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Re: Talking to people about Early Retirement?
« Reply #3 on: August 16, 2013, 07:37:43 PM »
If it does get brought up I basically boil it down to a math problem like you did. Then I support it with the concept of not following a given lifestyle path. You can choose to buy the things you buy. Actual choice and decision. Then the conversation will generally evolve to concepts like an internal or external locus of control and the concept of agency and what drives that. But that's just a reflection of my take of this whole concept. The first step is realizing you can choose your life, the second step is the math.

*Edit*

That first step is really important to realize. Alan Watts put it really well in my opinion. A video was made of one of his talks - http://www.youtube.com/watch?v=ERbvKrH-GC4
« Last Edit: August 16, 2013, 07:40:27 PM by matchewed »

James81

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Re: Talking to people about Early Retirement?
« Reply #4 on: August 16, 2013, 07:55:57 PM »
If it does get brought up I basically boil it down to a math problem like you did. Then I support it with the concept of not following a given lifestyle path. You can choose to buy the things you buy. Actual choice and decision. Then the conversation will generally evolve to concepts like an internal or external locus of control and the concept of agency and what drives that. But that's just a reflection of my take of this whole concept. The first step is realizing you can choose your life, the second step is the math.

*Edit*

That first step is really important to realize. Alan Watts put it really well in my opinion. A video was made of one of his talks - http://www.youtube.com/watch?v=ERbvKrH-GC4

Interesting. Got into Alan Watts a while back from another source. Funny that I stumble onto it here now too. Great video btw, and so very true. My biggest challenge in life has always been to stop and be more in the moment.

****

That being said, (and speaking to the threadstarter), I think you need to take a moment and think about how you personally came to the notion of early retirement and living such an "extreme" life (as most people would consider this forum and ERE to be). 

Chances are pretty good that you didn't just stumble into it. You were probably drawn into it. You probably got to a place with your personal finances where you thought "holy crap, I have to do something about my finances!" Then you probably went to google and started reading. And the more you read, the more you wanted to read and the more you wanted to read, the more likely you were to end up over at ERE or here.

In other words, you didn't just wake up one day and say "You know what? I'm going to start saving 75% of my income and retire in 7 years." Most likely, you eased yourself into it, pushing the boundaries of what you could save until you reached a level of financial savings that the outside world scoffs at.

My point is this...when having a random conversation with people about this life, I think it's more effective to talk in a way that puts a desire for them to learn more about it in their minds than it is to try and convince them why you are right. Even those of us who have read this blog and post on this forum don't all necessarily do things the same way. We've all come to our own conclusions and are all growing and changing in this world in different ways.

So, trying to convince someone to get on your level may be a futile attempt that might get you laughed at or dismissed. But challenging someone to think about where they may be wasting their money could be an awesome experience for both you and them.

Frankies Girl

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Re: Talking to people about Early Retirement?
« Reply #5 on: August 16, 2013, 10:01:19 PM »
I sort of did this to myself today. Was talking to a coworker about changes happening in our department and how too many middle managers are making it increasingly difficult to work and how I didn't plan on being around long-term as I'd been counting on retiring early and hopefully in the next 5-10 years. He seemed shocked at the idea. He mentioned that he'd grown up pretty poor and lived in some pretty expensive cities, so while he's probably doing pretty well and saving something, I don't imagine the idea that he could retire early ever occurred to him.

I don't talk about money or finances or anything usually, and I felt a little stupid for mentioning the ER, as now the guy probably thinks I'm either crazy or rich... and I don't like the idea of people thinking either one of those about me.

Personally, if someone did actually bring up early retirement or trying to live frugally to become FI, I'd be interested in talking about it, but it hasn't every happened. It's kind of weird to me even talking anything about money with most friends/coworkers as I'm so off the grid I feel like nothing I could contribute would be helpful and would just seem judgmental.

Mike

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Re: Talking to people about Early Retirement?
« Reply #6 on: August 17, 2013, 03:51:25 AM »
If I broke it down by percentage, it would go something like this:
10%: impressed and curious to know how I'm doing it
80%: impressed but believe they have no shot at doing it themselves
10%: convinced that I'll be miserable and/or will fail in some fashion / won't be "living"

That first group is the easiest to talk to for obvious reasons - and is the most likely to follow a similar path and accomplish the same thing.  The last group is impossible to talk to because there simply is no convincing those people that early retirement is not only doable but is also a desirable outcome in terms of lifelong happiness.  The middle group would be fertile ground for "evangelizing" - if I could think of a proper way to motivate those people into embracing some of the changes one must make to achieve financial independence.  Part of this is certainly math, but a big part is also philosophical - determining what "enough" is and differentiating between what your needs are vs what your wants are.  Most people have those concepts mixed up - and I would venture a guess that the blame would fall squarely on the advertising that's been directed at them since they were very young (along with perhaps parenting that didn't make clear what the real trade-offs are when it comes to buying things / earning money / using credit).

MakingSenseofCents

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Re: Talking to people about Early Retirement?
« Reply #7 on: August 17, 2013, 08:42:36 AM »
If I broke it down by percentage, it would go something like this:
10%: impressed and curious to know how I'm doing it
80%: impressed but believe they have no shot at doing it themselves
10%: convinced that I'll be miserable and/or will fail in some fashion / won't be "living"

That first group is the easiest to talk to for obvious reasons - and is the most likely to follow a similar path and accomplish the same thing.  The last group is impossible to talk to because there simply is no convincing those people that early retirement is not only doable but is also a desirable outcome in terms of lifelong happiness.  The middle group would be fertile ground for "evangelizing" - if I could think of a proper way to motivate those people into embracing some of the changes one must make to achieve financial independence.  Part of this is certainly math, but a big part is also philosophical - determining what "enough" is and differentiating between what your needs are vs what your wants are.  Most people have those concepts mixed up - and I would venture a guess that the blame would fall squarely on the advertising that's been directed at them since they were very young (along with perhaps parenting that didn't make clear what the real trade-offs are when it comes to buying things / earning money / using credit).

This is pretty much exactly what I was going to say as well. Whenever I tell people, they tend to think we are crazy that we are even thinking about it. Some call us stupid, but some are really interested in what we have to say.

acanthurus

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Re: Talking to people about Early Retirement?
« Reply #8 on: August 17, 2013, 12:06:02 PM »
I treat it like my religion. I never, ever, ever mention it unless someone else cops to being the same first. Then I might discuss it with them, depending on the particulars.

If someone makes a comment about my lifestyle in any fashion, I either outright lie, understate, misrepresent, or reply in such a way as to conveniently change the subject. If they ask why I drive such an old, tired car, I might simply say I'm trying to save up for a down payment. If they ask why I have roommates, I just say I like living with other people. If a good coworker says I don't need to save so much, I might say something like "I see what you guys' wives cost you, and I'd have to disagree". It's different depending on the situation - diffuse, deflect, some smart-ass comment to shut them up? So many choices.

Now if someone says "I see you're saving a lot of money. Have you read MMM/Bogleheads/ERE?" - then yeah I'll talk. But unless I know someone is on the level, it's just not worth the risk.


Russ

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Re: Talking to people about Early Retirement?
« Reply #9 on: August 17, 2013, 01:14:42 PM »
I'm very open about it. If that leads a to a long conversation on personal finance, that's cool, I like talking about that. That doesn't mean you have to push it down everyone's throat though. As well-intentioned as those people are, I've found the evangelical angle to be counterproductive. People get defensive and shut down.

I don't see how else I could expect to ever meet people with a similar mindset IRL. If whoever I'm talking to isn't at least open-minded enough to accept that financial independence as a concept is possible, they get put at the bottom of the friends list (not that they're no longer a friend, just that I'd choose to spend time with other people first). I've found that this way I've surrounded myself with like-minded people and rarely have to "fake it" anymore.

I feel like I need a good analogy (like a race where the faster you run, the shorter the distance -- except that this makes it sound like you have to really tax yourself to retire early, when I want to get across the idea that it's not really that hard to cut your spending).

Sol posts the idea every once in a while that your retirement savings are a debt to future-you until you pay them off by accumulating enough to cover your expenses. You could then say that the sooner you pay off your debt to future-you, the less "interest" you have to pay in the form of a bigger retirement fund. That might be a little too abstract though

Jamesqf

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Re: Talking to people about Early Retirement?
« Reply #10 on: August 17, 2013, 01:26:31 PM »
I sometimes have just the opposite problem: people assume that I'm either retired or unemployed because I don't go to a regular job every day, and take off in the day for hiking &c.  They don't see that instead of spending evenings in front of the TV, I'm usually at work on the computer.

suntailedshadow

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Re: Talking to people about Early Retirement?
« Reply #11 on: August 17, 2013, 06:26:34 PM »
I have always found it incredibly funny that some times people who are more than willing to share their financial aspirations with a group of complete strangers online (some times even down to the nitty-gritty) are totally unwilling to even have conversations on finance with those they associate most. I guess thats the anonymity of the internet though! I certainly don't want to shove success down anyone's throat but I am more than happy to strike up conversations on finances and investing with anyone who is willing to listen. If they are not interested that's fine, we can move to another subject but I not going to shy away from the subject.

I understand that there are legitimate times that you don't want to talk money with someone (for example a family member you know would misuse the information) but as a general rule of thumb I enjoy sharing all of the wonderful things I learn from this and other sources. I hope everyone stops wasting their money and starts retiring early ;-)

oldtoyota

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Re: Talking to people about Early Retirement?
« Reply #12 on: August 18, 2013, 07:14:08 AM »
A few days ago, my wife and I had dinner with a couple we'd just recently met. My wife mentioned that we'd gotten really into paying attention to our finances, cutting spending and (gasp) early retirement. 

The guy says, instantly, "You guys must be rich." In maybe not the greatest tone. I wound up trying to explain, "It's really just a math problem..." then, as I'm not the most socially comfortable person, almost completely backpedaling "Well it probably wont happen..." He brought it up a few more times, as kind of a call-back jokey way, but it was the first time I'd been made to feel kinda crazy about the whole thing. He turned out to be a good guy, they're both really cool people we hope to see again, but it was a bit jarring for a moment.

How do you explain it when it comes up without getting into a long discussion of your personal finances? Or do you just go for it and start evangelizing? Just curious if anyone has any tips, or any stories about trying to explain the whole thing to someone who doesn't get it.

This just happened to me. I posted about it here about 2 weeks ago. I wish I could recall the post title so I could share the responses with you!

In my case, I mentioned it to my ILs. I had this feeling they thought I was going to mooch off their son. Our plan is we retire in X years, he keeps working a spell, and then we both wrap it up. While he continues to work, we can probably live off of his income. I mentioned I might start a business and then MIL said, "Oh, so you'd still be working..." Well, yeah, but I'd be FI. I did not even mention FI because the conversation felt uncomfortable to me at that point.

Do what gives you peace. For me, the best thing for now is not to bring it up except with my closest friends. I would be disappointed if a good friend had discovered this idea and not shared it with me. On the other hand, some folks will look at you as rich or preachy or who knows? So, I will float the idea in a general way with very good friends and leave it out of the conversation with relatives.

PS: I should mention that my relatives appear to have their finances in order. If they didn't, then I might feel slightly more compelled to raise the subject in a general way.


« Last Edit: August 18, 2013, 07:22:39 AM by oldtoyota »

oldtoyota

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Re: Talking to people about Early Retirement?
« Reply #13 on: August 18, 2013, 07:17:48 AM »

I would like to find a good way to point out that cutting spending is an accelerator for retirement, and twice as good as increasing your income by the same amount, because cutting spending allows you to not only save money faster (same as earning a higher income) it also allows you to decrease the amount you need to save in the first place, making getting to retirement easier.  I feel like I need a good analogy (like a race where the faster you run, the shorter the distance -- except that this makes it sound like you have to really tax yourself to retire early, when I want to get across the idea that it's not really that hard to cut your spending).

On this board, we talk a lot about charitable giving. The above is one way to give in a non-monetary fashion. You give knowledge and it is knowledge that person may not have had the fortune to come across on their own. That is a gift for the other person, and it is a gift that can completely change their life for the better.




zarfus

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Re: Talking to people about Early Retirement?
« Reply #14 on: August 19, 2013, 10:14:59 AM »
+1 on the completely open and willing to help, but will not usually initiate such a conversation.

Which is a damn shame because I love talking about PF. Not "money", but achieving dreams.

Hunny156

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Re: Talking to people about Early Retirement?
« Reply #15 on: August 19, 2013, 10:46:50 AM »
It really depends on the situation.  Once, on my first day at a new job in a very open working environment, my new boss came by to talk to me.  He had run my background check, and I guess he thought I was a victim of identity theft, b/c my name had popped up on all these addresses in other cities and states.  I confirmed that the information was correct, and just said I own some rental properties on the side.  Well, one of my new co-workers caught wind of the conversation and demanded to know what my husband did for a living.  I hadn't connected the two, so I told her.  I guess in her mind, there was no way our two average jobs could result in such a side business.  I knew early on that this was just a bridge job on my way to something better, but she made her disdain for me well known and told everyone else about my personal business.  The day I quit that toxic place, I was so happy, and it reminded me to think twice before sharing anything, even though it was clearly my boss' fault for not having that conversation in his office!

I went out w/some friend a few weeks ago, and they know that we are close to FIRE - they ask a lot of questions, but are limited by fear (husband) and consumerism (wife).  I mentioned something about our desire to move into a smaller home and not have a mortgage, and said that it would mean we could retire in 2-3 years instead of five, and the wife couldn't help herself but snort loudly.  I smiled inwardly, she'll get it when we actually achieve the goal, right around the time she's looking to replace her new SUV w/another one.  She works from home and barely knows how to get out of the neighborhood!

We were visiting family a few months ago, and the topic of $$ came up, as everyone is complaining about how much the neighborhood has changed, the cost of living is impossible, etc.  My father in law (retired & penniless) made the comment that "the more $$ you have, the more you spend".  I watched as everyone w/in earshot of this comment just shook their heads in agreement.  I kept my mouth shut, hubby & I are proof that you can make better choices instead of accepting a stupid platitude as fact...

StetsTerhune

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Re: Talking to people about Early Retirement?
« Reply #16 on: August 19, 2013, 04:16:23 PM »
I try to test people out a little bit by 'joking' about retiring. Most everyone who knows me knows I'm insane and outdoorsy and kind of a bum. A high-functioning hobo is how my wife describes me. So when I'm bored at work I'll say I'm "thinking about quitting this job and just living in a beach somewhere." Most people take this as 100% joke,but occasionally someone will take it semi seriously it'll lead to a real conversation about it. Its as good a shibboleth as I've found anyway.   Also, I think it's a good way to introduce people to the concept. Everyone accepts that I could quit and become a bum on a beach somewhere. After that its just a matter of degrees: how much of a bum do I have to be to not have to work.

rocklebock

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Re: Talking to people about Early Retirement?
« Reply #17 on: August 19, 2013, 08:33:13 PM »
I'm pretty new to this myself, but so far I've just been saying something like, "I'm lucky to have really good retirement plan through work and I'd be totally set if I retired at 65. I'm trying to save a little more than that so I can retire earlier and do some consulting on the side." That's all 100% true and so far no one has seemed flabbergasted or threatened by it.

sleepyguy

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Re: Talking to people about Early Retirement?
« Reply #18 on: August 20, 2013, 01:49:29 PM »
We're on a 5-7 yr plan ourselves... 8 yrs is probably worst case scenario.  We definitely don't go out of our way to mention it to others... not even to family.  I've told 2 coworkers only because they asked and I kept the details low... one said it was "impossible" with today's expenses... the other seems pretty interested (she is finance) and understood the numbers behind it.  We have not even mentioned it to family at all... my immediate family is horrendous with my money.  I'm pretty close to my brother but he thinks it is IMPOSSIBLE to live on a 60k salary... yes impossible.  I just shake my head and stay quiet of our plans.

We're by no means a hardcore MMM though... we drive 2 cars, own 2x 50+ tvs, too many gadgets to count, and eat out way too often.  What we do right is we invest alot of our takehome salary, own a rental (will be 2 soon) and make a decent side income... and glad we learned at a relatively young age of 34.

Next few years will be interesting to say the least.