Author Topic: Charles Schwab on FIRE: "I think it is fantastic"  (Read 794 times)

TVRodriguez

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Charles Schwab on FIRE: "I think it is fantastic"
« on: October 21, 2019, 02:21:11 PM »
Charles Schwab is no Suze Orman, apparently.

https://www.yahoo.com/finance/news/charles-schwab-is-a-fan-of-the-millennial-financial-independence-trend-150359540.html

Article:

Charles Schwab on millennial FIRE trend: Fantastic!
By Scott Gamm

Billionaire financial pioneer Charles Schwab, founder of The Charles Schwab Corporation (SCHW), applauds millennials who are saving more than half of their income to prepare for retirement.

“I think it is fantastic,” he said.

Over the past several years, a trend has emerged thanks to different blogs and books, advocating an extremely high savings rate - over 50% - in order to retire at age 35 instead of 65. Some who follow the movement don’t even plan to fully retire, but instead pursue a passion once they achieve a certain nest egg of savings. The movement even has its own catchphrase: FIRE — that is, financial independence, retire early.

“Millennials I think have been aware because they lived through some really difficult financial moments early in their childhood and now they’re taking over responsibility for their own personal savings,” Schwab said. “They don’t want to be where some parents ended up being who didn’t save adequately.”

Schwab is and author of the new book, “INVESTED: Changing Forever the Way Americans Invest.”

The other force fueling the financial independence movement is higher life expectancies.

“People know they’re going to live a lot longer than their parents or their grandparents, so they [got to] be prepared,” Schwab added.

Schwab acknowledged that challenges of attaining a sky-high savings rate.

“I don’t know how [millennials] do it, actually, because most of us, early on, don’t make that much income when we’re really young and how do you pay for your rent?” he noted.

With that, Schwab said the traditional financial advice of saving 10% of one’s income is a working number, but he praised a 15% or even 20% savings rate.

“What a great outcome,” he said, referring to the higher savings rate.

keepingmobens

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Re: Charles Schwab on FIRE: "I think it is fantastic"
« Reply #1 on: October 21, 2019, 02:46:36 PM »
I love their tagline: "Own your tomorrow." That's what the whole thing (investing, fire, living frugally, etc) is all about.

Phenix

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Re: Charles Schwab on FIRE: "I think it is fantastic"
« Reply #2 on: November 01, 2019, 08:37:10 AM »
“I don’t know how [millennials] do it, actually, because most of us, early on, don’t make that much income when we’re really young and how do you pay for your rent?” he noted.

I don't know about everyone else, but I found it much easier to save 50% of my income when I was single making $45k.  Fast forward 10 years, making $100k with a SAHM and 2 kids, I'm happy to be able to save 25-30% of my income.  It doesn't hurt that all of the money I put in in the early years has seen a lot of growth so it doesn't sting as bad having a lower savings rate.