Author Topic: "One More Year" strikes the rich the hardest  (Read 35187 times)

SwordGuy

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Re: "One More Year" strikes the rich the hardest
« Reply #100 on: February 24, 2017, 06:58:29 PM »
It's a tough decision.

Officially, we're in OMY territory.    We were going to retire this April and now we're going for April 2018 instead.

Our FI is way more conservative than most on this forum for several reasons.

Once my wife retires she's unlikely to ever find work again at a vaguely decent paying job in her field - regardless of where we're willing to move to.   It's a combination of her age and her academic specialty.

It would be fairly easy for me to find another full time job as long as I didn't mind it taking a few months to a year for a position to open up.  It's also likely I could find some remote part-time work at a good rate.   But once I quit my current career I don't think I'll want to go back.  I'm ready for a change.

Plus, we have a mentally handicapped daughter, so we have to save for 4 retirements instead of the usual 2.  (2 for my wife and I, plus 1 for my daughter, and then another for our daughter after we pass.)  Since she can't adjust to bad financial returns like the rest of us would, we can't count on that as a viable option for her to save her stash.

But I digress a bit.   We're not doing OMY because of all that.  We hit that number this March.   We would be good to go.

But we're working OMY to fund an architecturally cool house from destruction.   It will take a lot of sweat and cash to do it and we decided we didn't want to risk the standard sequence of returns risk while we had very high renovation costs to undertake.   So we decided to use OMY of income to fund it.  But that's it.   We both found MMM much later in our lives than many of you all.  (Damn you, you lucky sods! :) )

When we sell the fixed up house that will fund a few more rentals.   I suspect one of them will end up being donated for the temporary use of folks who need it, such as folks who got burned or flooded out, or who need to visit loved ones in the local military hospital.

We like to help people, but we particularly like to help people who will help themselves and then others.   So I'm planning on looking for good folks to partner with on fixing up houses to flip.   If we do it right, we'll be able to do at least one house a year.   That will give us fun stuff to work on while still leaving us with lots of time to do whatever we want.  We'll be making people's neighborhoods better and helping nice folks with get up and go get ahead.



arebelspy

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Re: "One More Year" strikes the rich the hardest
« Reply #101 on: February 24, 2017, 08:36:36 PM »
What you are saying is that "Yes, I only eat two packs of gum a year, but I can earn 30 packs of gum, when the average household only earns 5 packs of gum! I just need to work one more year for that!  How can I give that up?   Look at the opportunity cost!"

The whole point of this thread is that giving it up is hard, especially when each pack of gum can save a life.  The money isn't any good to me, but it can certainly do a lot of good for someone else.  I can make that happen, if I earn that money and then give it away.

If I had to just erase a year of my life to save those lives, it would be a harder decision.  If your job is truly soul-sucking, I feel your pain.  But most of us have chosen jobs we kind of like, and feel are important, and that make a difference in the world.  So I'm not choosing to waste a year of my life in exchange for 30 packs of gum, I'm choosing to make the world a better place at my chosen profession in exchange for being able to allocate vast sums of money towards improving the lives of thousands of impoverished individuals who weren't given the same opportunities that I was.

In that light, the "opportunity cost" is so high that it seems almost criminal to retire too early.

Sorry, gotta call bullshit.

You and I both know 99% (probably higher) of the people working "OMY" are doing it out of greed (wanting to spend more) or fear (what if I run out of money, what if the 4% rule isn't safe enough, what if healthcare, etc. etc.).

Not out of "if I work OMY, I can help a lot of people."

We had a whole long discussion on how donating your stache to charity when you die instead of kids is the moral way to go (of course, people arguing on both sides). Then did a poll.  It was, what, 5% of people that said their stache would go to charity instead of kids?

No way most people doing OMY are saying "look how many lives I can save."

OMY strikes the rich the hardest because they could earn so much more.  But they sure as heck (the vast, vast majority) aren't saving lives with it. They're padding their stache.

And at that point, it's gum. Not life saving gum, just slight peace of mind, greed gum.
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Retire-Canada

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Re: "One More Year" strikes the rich the hardest
« Reply #102 on: February 24, 2017, 08:44:48 PM »
It's extremely hard to change decades of intensive programming around work and stop doing it. I think this issue is severely underestimated by most people considering FIRE.

arebelspy

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Re: "One More Year" strikes the rich the hardest
« Reply #103 on: February 24, 2017, 08:48:52 PM »
It's extremely hard to change decades of intensive programming around work and stop doing it. I think this issue is severely underestimated by most people considering FIRE.

The earlier you retire, the less this is a problem.  ;)
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Retire-Canada

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Re: "One More Year" strikes the rich the hardest
« Reply #104 on: February 24, 2017, 09:08:41 PM »
The earlier you retire, the less this is a problem.  ;)

Yes. I'm planning on OLY or possibly 3 Less Years*. I want to get out with my life and staying in the game until I hit 4% WR isn't worth it.

I have no kids and few young relatives [none that need any resources] so most likely I'll end up in one of the glorious FIRE start years where I'll end up with a huge pot of money I don't need and I'll be more than happy to use it for charitable purposes. I will also use my free time in FIRE to have a positive impact on my friends, family and community.

But, work extra years for money I don't need heck no.

* - I'd need to work 1 - 3 more years FT to hit my FIRE target depending on market returns and my luck with contracts.

aspiringnomad

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Re: "One More Year" strikes the rich the hardest
« Reply #105 on: February 24, 2017, 10:06:29 PM »
The earlier you retire, the less this is a problem.  ;)

Yes. I'm planning on OLY or possibly 3 Less Years*. I want to get out with my life and staying in the game until I hit 4% WR isn't worth it.

I have no kids and few young relatives [none that need any resources] so most likely I'll end up in one of the glorious FIRE start years where I'll end up with a huge pot of money I don't need and I'll be more than happy to use it for charitable purposes. I will also use my free time in FIRE to have a positive impact on my friends, family and community.

But, work extra years for money I don't need heck no.

* - I'd need to work 1 - 3 more years FT to hit my FIRE target depending on market returns and my luck with contracts.

I'm in the exact same situation; even the timeframe (FI minus 1-3 years). I think it's more my speed because I'll enjoy the challenge of knowing I may have to figure shit out if market returns are weak or if my spending doesn't drop once I quit. Seems a wee bit more adventurous to me, or at least less formulaic. But more importantly, it'll buy me years of freedom when it's more important to me to have that freedom. I realize I'd be unwilling to make this leap if I had kids or fewer life/work options.

MMM365

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Re: "One More Year" strikes the rich the hardest
« Reply #106 on: February 24, 2017, 10:09:26 PM »
Great posting and great thoughts.  Thank you for sharing. 

We have been thoroughly considering this and discussing this for some time now.  When looking at financial goals, I do think it's important to consider the positive impact that one can have with the additional income that he/she can make.  I read later in this thread, that your comment that it's almost criminal not to earn the money and use some of it to do charitable work/philanthropy.  I've come to that realization and understanding myself as well. 

Two years ago, we set up a small family foundation to which we donate an additional percentage of salary to every year.  THis offsets taxes but more importantly, begins the process of building a separate cache of wealth, only to be used for charitable giving/philanthropy.  These types of vehicles go by several names (donor advised funds, community family foundations) and in most larger cities, you'll be able to find an easy way to do this. 

What we have found, is that this represents a different way of building wealth that is primarily aimed at future giving.  ALthough we give considerably to charity now, we also relish the ability to grow this fund to be used for future giving.  I suppose that once this fund grows to a certain level (and at this point, I'm not sure what that number is), we will feel that the OMY phenomenon will no longer apply. 

I brought this idea up to this forum last year. 
http://forum.mrmoneymustache.com/welcome-to-the-forum/what-is-the-hurry-to-re/msg929586/#msg929586
THought you might enjoy reading it as it does discuss almost exactly your question here. 

Good luck. 

MMM365

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Re: "One More Year" strikes the rich the hardest
« Reply #107 on: February 24, 2017, 10:11:54 PM »
What you are saying is that "Yes, I only eat two packs of gum a year, but I can earn 30 packs of gum, when the average household only earns 5 packs of gum! I just need to work one more year for that!  How can I give that up?   Look at the opportunity cost!"

The whole point of this thread is that giving it up is hard, especially when each pack of gum can save a life.  The money isn't any good to me, but it can certainly do a lot of good for someone else.  I can make that happen, if I earn that money and then give it away.

If I had to just erase a year of my life to save those lives, it would be a harder decision.  If your job is truly soul-sucking, I feel your pain.  But most of us have chosen jobs we kind of like, and feel are important, and that make a difference in the world.  So I'm not choosing to waste a year of my life in exchange for 30 packs of gum, I'm choosing to make the world a better place at my chosen profession in exchange for being able to allocate vast sums of money towards improving the lives of thousands of impoverished individuals who weren't given the same opportunities that I was.

In that light, the "opportunity cost" is so high that it seems almost criminal to retire too early.

Sorry, gotta call bullshit.

You and I both know 99% (probably higher) of the people working "OMY" are doing it out of greed (wanting to spend more) or fear (what if I run out of money, what if the 4% rule isn't safe enough, what if healthcare, etc. etc.).

Not out of "if I work OMY, I can help a lot of people."

We had a whole long discussion on how donating your stache to charity when you die instead of kids is the moral way to go (of course, people arguing on both sides). Then did a poll.  It was, what, 5% of people that said their stache would go to charity instead of kids?

No way most people doing OMY are saying "look how many lives I can save."

OMY strikes the rich the hardest because they could earn so much more.  But they sure as heck (the vast, vast majority) aren't saving lives with it. They're padding their stache.

And at that point, it's gum. Not life saving gum, just slight peace of mind, greed gum.

Isn't this why we talk about these things?  To see other people's thoughts and to encourage others to consider philanthropy in their financial picture?

arebelspy

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Re: "One More Year" strikes the rich the hardest
« Reply #108 on: February 24, 2017, 10:40:54 PM »
What you are saying is that "Yes, I only eat two packs of gum a year, but I can earn 30 packs of gum, when the average household only earns 5 packs of gum! I just need to work one more year for that!  How can I give that up?   Look at the opportunity cost!"

The whole point of this thread is that giving it up is hard, especially when each pack of gum can save a life.  The money isn't any good to me, but it can certainly do a lot of good for someone else.  I can make that happen, if I earn that money and then give it away.

If I had to just erase a year of my life to save those lives, it would be a harder decision.  If your job is truly soul-sucking, I feel your pain.  But most of us have chosen jobs we kind of like, and feel are important, and that make a difference in the world.  So I'm not choosing to waste a year of my life in exchange for 30 packs of gum, I'm choosing to make the world a better place at my chosen profession in exchange for being able to allocate vast sums of money towards improving the lives of thousands of impoverished individuals who weren't given the same opportunities that I was.

In that light, the "opportunity cost" is so high that it seems almost criminal to retire too early.

Sorry, gotta call bullshit.

You and I both know 99% (probably higher) of the people working "OMY" are doing it out of greed (wanting to spend more) or fear (what if I run out of money, what if the 4% rule isn't safe enough, what if healthcare, etc. etc.).

Not out of "if I work OMY, I can help a lot of people."

We had a whole long discussion on how donating your stache to charity when you die instead of kids is the moral way to go (of course, people arguing on both sides). Then did a poll.  It was, what, 5% of people that said their stache would go to charity instead of kids?

No way most people doing OMY are saying "look how many lives I can save."

OMY strikes the rich the hardest because they could earn so much more.  But they sure as heck (the vast, vast majority) aren't saving lives with it. They're padding their stache.

And at that point, it's gum. Not life saving gum, just slight peace of mind, greed gum.

Isn't this why we talk about these things?  To see other people's thoughts and to encourage others to consider philanthropy in their financial picture?
Sure. What I'm saying though is that most ignore it, and it's not the real reason so many people OMY.

(As far as almost criminal not to, that's true of every moment of your life. The conclusion isn't work OMY, it's never ER at all, if you really believe it.)
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SwordGuy

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Re: "One More Year" strikes the rich the hardest
« Reply #109 on: February 24, 2017, 11:27:59 PM »
In that light, the "opportunity cost" is so high that it seems almost criminal to retire too early.

Sorry, gotta call bullshit.

Right back at you. :)

You and I both know 99% (probably higher) of the people working "OMY" are doing it out of greed (wanting to spend more) or fear (what if I run out of money, what if the 4% rule isn't safe enough, what if healthcare, etc. etc.).

Sol isn't 99% of all people.  Sol is one person.   One person who is considering doing exactly what they said they are considering doing.  All the other people are irrelevant to the decision Sol is in the process of making.

There is no bullshit about that.

Sol may decide to help people by working OMY, or may decide to help them in other ways, or possibly to help no one but themselves and their family.   They are working thru that decision.   It's worth taking the time to do so.
I can't fault them for any of those decisions and I certainly wouldn't fault them for seriously considering all three of them.

I'm working OMY to save a house, otherwise I would be retiring in April.  Ditto for my wife.
My FI plans assume I lose every dime I put into that house.   It will be a pleasant surprise if I end up making some money - in which case some of it will find its way to people in need. 

Our original plan was for every 5th or 6th house to be done for charitable purposes.   This house is #5.  Not quite the way we expected to do it when we made that agreement with ourselves a couple of years ago, but it works for us.



arebelspy

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Re: "One More Year" strikes the rich the hardest
« Reply #110 on: February 25, 2017, 12:23:57 AM »


In that light, the "opportunity cost" is so high that it seems almost criminal to retire too early.

Sorry, gotta call bullshit.

Right back at you. :)

You and I both know 99% (probably higher) of the people working "OMY" are doing it out of greed (wanting to spend more) or fear (what if I run out of money, what if the 4% rule isn't safe enough, what if healthcare, etc. etc.).

Sol isn't 99% of all people.  Sol is one person.   One person who is considering doing exactly what they said they are considering doing.  All the other people are irrelevant to the decision Sol is in the process of making.

There is no bullshit about that.

Sol may decide to help people by working OMY, or may decide to help them in other ways, or possibly to help no one but themselves and their family.   They are working thru that decision.

Well then the thread should be called "OMY strikes Sol the hardest."

;)

I stand by my assessment.
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Metric Mouse

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Re: "One More Year" strikes the rich the hardest
« Reply #111 on: February 25, 2017, 01:04:21 AM »
The earlier you retire, the less this is a problem.  ;)

Yes. I'm planning on OLY or possibly 3 Less Years*. I want to get out with my life and staying in the game until I hit 4% WR isn't worth it.

I have no kids and few young relatives [none that need any resources] so most likely I'll end up in one of the glorious FIRE start years where I'll end up with a huge pot of money I don't need and I'll be more than happy to use it for charitable purposes. I will also use my free time in FIRE to have a positive impact on my friends, family and community.

But, work extra years for money I don't need heck no.

* - I'd need to work 1 - 3 more years FT to hit my FIRE target depending on market returns and my luck with contracts.

I'm in the exact same situation; even the timeframe (FI minus 1-3 years). I think it's more my speed because I'll enjoy the challenge of knowing I may have to figure shit out if market returns are weak or if my spending doesn't drop once I quit. Seems a wee bit more adventurous to me, or at least less formulaic. But more importantly, it'll buy me years of freedom when it's more important to me to have that freedom. I realize I'd be unwilling to make this leap if I had kids or fewer life/work options.
This is awesome. While I did so accidently, I deffinately took the O(many)Less Year path. It was a fantastic adventure, and I would highly recommend it.

Out of the Blue

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Re: "One More Year" strikes the rich the hardest
« Reply #112 on: February 25, 2017, 04:23:02 AM »
I see several related strands of thought running through this thread:

  • the opportunity cost of not working OMY is higher for those who earn more - this is simple math. For someone who can save $20k by doing OMY, they are looking at trading a year of their life for $20k more (ignoring the drawdown, for simplicity's sake).  Whereas someone who can save $200k by doing OMY is still looking at trading a year of their life, but this time for $200k more.  So I do not think it is seriously arguable that the opportunity cost of a year is higher for higher earners.
  • how much time/money one should donate to charity - this was something I struggled with in my college years, where I always felt I like I could and should be doing more for charity, because I was already in such a privileged position, and even $20 could do so much more good elsewhere in the world than spent on myself.  This is the whole utilitarianism school of thought that was brought up earlier in this thread.  The line just has to be drawn somewhere, really.  I haven't figured this out entirely, but my plan for now is to just work as much as needed to enable me to FIRE frugally but comfortably on a stash, which will likely end up being quite a significant amount when I die, and donating all the funds to charity.
  • whether you can do more good continuing to work and donating the extra funds, or FIRE-ing and doing some more hands-on charitable work personally -  William Macaskill has done some very interesting work in this area, and has suggested that you can do more good working on Wall Street and donating your earnings than by doing hands-on work for charities. (See more on earning to give.) The answer to how you can do the most good depends on (1) how much good (or bad) you do in your current job; (2) how much extra you can donate from the funds at your current job; (3) how much good you can do for a charity after FIREing.  This is something I am still trying to work out for myself, and there are still a lot of unknowns.  I don't do much (if any) good in my current private sector job, but I am planning to change to a job in public policy that will hopefully benefit society in a year or two and I could potentially do a lot of good in that job (I may possibly be overly idealistic for thinking this, though).  I will probably earn a decent amount at that job to give to charity, but it won't be tons - I could give more ($) to charity by staying in my current job but I suspect more good would be done by moving into policy.  And I do think I'll be doing some work that is beneficial to society after I FIRE also, though I'm not sure what form that will take yet.   

Overall I do agree with the idea that those of us who are privileged are in a better position to, and should, give more back to the world.  Especially as most high income earners are also likely to have high social capital and useful skills that can do a lot of good.  Where the line is to be drawn between giving priority to one's own needs vs others' needs is not an easy question though, nor is the question of how one goes about doing the most good. 

Thank you for starting this thread - I do like seeing ideas like this discussed on these forums.

Edited to respond to this:
Quote
You and I both know 99% (probably higher) of the people working "OMY" are doing it out of greed (wanting to spend more) or fear (what if I run out of money, what if the 4% rule isn't safe enough, what if healthcare, etc. etc.).

I don't know that that's true at all. I think there are many people continuing to work even when they don't need the money (i.e. I'm not just talking about people on these early retirement forums, but also the many, many people in the world who are FI/wealthy already) not out of greed or fear, but because they find their jobs fulfilling and/or think that it benefits society - either directly, or because it enables them to earn to give.  I would hope that it's more than 1% of the population who are already FI, but I really don't know - I think I have had the good fortune of having known a decent number of altruistic and civic-minded people who are motivated more by a desire to give back to society than by money.  Certainly they have demonstrated that in their career choices.
« Last Edit: February 25, 2017, 04:40:27 AM by Out of the Blue »

Zoot

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Re: "One More Year" strikes the rich the hardest
« Reply #113 on: February 25, 2017, 04:41:13 AM »
My lifestyle wouldn't change, but if I can save the lives of 1000 children by sitting in my cubicle for another 12 months, how many annoying meetings and TPS reports could I suffer through to accomplish that goal?  How many homeless drug addicts or abandoned puppies or acid-burned girls can I help for each awkward performance appraisal I endure?

At a high earning job, that fire hose of cash can do a lot of good in the world once your own expenses are met.  That's the OMY problem I'm struggling with.

A friend of mine went through something like this.  She had a good job in an engineering field, but as it turned out she wasn't happy (ENFJ, for those who know the Myers-Briggs Type Indicator).  She left to form a successful business, which she sold a few years later.  She then had a decision to make about what to do from there.  (I don't know if she was FIRE by that point, but it's possible; I don't know all the details.  She was married at the time to a spouse also making good money, so with that and the business proceeds it's likely she didn't need to work.).

She decided to go back to work in engineering so that she could devote the money to funding some 529's for her (then very young) nieces who would not have had any college funding from their families otherwise (she and her spouse had no kids of their own).  She got laid off after a couple of years, but was unfazed by it--"because I worked those two years," she told me, "my nieces will be able to go to college; the money has years to grow and by the time they need it it will be there for them."

arebelspy

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Re: "One More Year" strikes the rich the hardest
« Reply #114 on: February 25, 2017, 01:54:45 PM »
    • whether you can do more good continuing to work and donating the extra funds, or FIRE-ing and doing some more hands-on charitable work personally -  William Macaskill has done some very interesting work in this area, and has suggested that you can do more good working on Wall Street and donating your earnings than by doing hands-on work for charities. (See more on earning to give.) The answer to how you can do the most good depends on (1) how much good (or bad) you do in your current job; (2) how much extra you can donate from the funds at your current job; (3) how much good you can do for a charity after FIREing.  This is something I am still trying to work out for myself, and there are still a lot of unknowns.  I don't do much (if any) good in my current private sector job, but I am planning to change to a job in public policy that will hopefully benefit society in a year or two and I could potentially do a lot of good in that job (I may possibly be overly idealistic for thinking this, though).  I will probably earn a decent amount at that job to give to charity, but it won't be tons - I could give more ($) to charity by staying in my current job but I suspect more good would be done by moving into policy.  And I do think I'll be doing some work that is beneficial to society after I FIRE also, though I'm not sure what form that will take yet.   

    Earning to give is awesome.  That's exactly what we're talking about in this thread.

    We've been considering going back to work once our kid(s?) is a bit older.  Very few people do this, which is why you hear about the few who do.

    Quote
    Edited to respond to this:
    Quote
    You and I both know 99% (probably higher) of the people working "OMY" are doing it out of greed (wanting to spend more) or fear (what if I run out of money, what if the 4% rule isn't safe enough, what if healthcare, etc. etc.).

    I don't know that that's true at all. I think there are many people continuing to work even when they don't need the money (i.e. I'm not just talking about people on these early retirement forums, but also the many, many people in the world who are FI/wealthy already) not out of greed or fear, but because they find their jobs fulfilling and/or think that it benefits society - either directly, or because it enables them to earn to give.  I would hope that it's more than 1% of the population who are already FI, but I really don't know - I think I have had the good fortune of having known a decent number of altruistic and civic-minded people who are motivated more by a desire to give back to society than by money.  Certainly they have demonstrated that in their career choices.

    You'd be surprised.

    How many do you actually know that are earning to give, i.e. working past FI to donate all of their salary to charity?

    I'd bet not more than one or two, if that.

    And even if you know a handful of people earning to give, that's probably still only about 1% of the people you know, or less.

    Quote
    She decided to go back to work in engineering so that she could devote the money to funding some 529's for her (then very young) nieces who would not have had any college funding from their families otherwise (she and her spouse had no kids of their own).  She got laid off after a couple of years, but was unfazed by it--"because I worked those two years," she told me, "my nieces will be able to go to college; the money has years to grow and by the time they need it it will be there for them."

    Here's a great example.

    This is total bullshit.

    I mean, I'm sure it's true.  But let's look at the problems with this:
    1) She's earning an engineering salary, yet only funds 529s to the limit that they can "grow in time" for the money to be there?  That means she saved or spent the vast majority of it.

    More importantly:
    2) She's not actually giving any to charity!  She gave some money to relatives who she says couldn't afford college otherwise.  If this is truly the case, there would have been plenty of grants and scholarships available for them. 

    Giving some money to relatives (and only a small fraction of what she earned, based on the information given) instead of actually helping dying children, and then getting credit such that someone uses her as an example of earning to give, and altruistic behavior?  What horse *.

    I'm sure your friend is a nice person, I don't mean to degrade her personally. But going back to work to put a little aside for your relatives?  ...okay?  That doesn't earn you a lot of altruistic credit in my book.  I'd say it's roughly equivalent to adopting a dog that would have been put down.  No doubt a nice thing to do that costs you some money, but not that praiseworthy versus average charitable behavior.  It's not the going above and beyond earning to give.

    It's incredibly, incredibly rare to actually see OMY for altruistic purposes.  You all can cite that one person you know, or have heard of, but that's probably under 1% of the people you know.  And I'd wager much, much, much less.

    The truth is, OMY strikes the rich the hardest, because they're used to piling up money, and don't want to give it up.  Not because of some magical "How much could I have helped with this watch"-Schindleresque mindset.[/list]
    « Last Edit: February 25, 2017, 01:56:37 PM by arebelspy »
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    Out of the Blue

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    Re: "One More Year" strikes the rich the hardest
    « Reply #115 on: February 25, 2017, 02:08:25 PM »
    Quote
    You'd be surprised.

    How many do you actually know that are earning to give, i.e. working past FI to donate all of their salary to charity?

    I'd bet not more than one or two, if that.

    And even if you know a handful of people earning to give, that's probably still only about 1% of the people you know, or less.

    I don't know any that donate all their salary to charity (though some may be and just don't brag about it, I wouldn't know). But I don't think it's an all-or-nothing game - I think continuing to work to continue to be able to give 50% of your salary still counts as "earning to give" and very admirable, even if you could be giving 100% (because you're already FI).   You're still giving away money that you wouldn't have been able to had you not continued working, even if you continue to derive some financial benefit from it also.   

    Also, I know of quite a few people who don't give 100% of their salary to charity, but have chosen (or downshifted into) lower-paying careers that let them give back more in terms of their time/skills, etc. While that's not exactly the "OMY" dilemma that is being discussed in this thread, it does make me believe that more than 1% of people who continue to work when they don't have to are not doing it solely or even primarily out of greed or fear.  But I could be being naive.

    Zoot

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    Re: "One More Year" strikes the rich the hardest
    « Reply #116 on: February 25, 2017, 02:37:02 PM »
    Quote
    She decided to go back to work in engineering so that she could devote the money to funding some 529's for her (then very young) nieces who would not have had any college funding from their families otherwise (she and her spouse had no kids of their own).  She got laid off after a couple of years, but was unfazed by it--"because I worked those two years," she told me, "my nieces will be able to go to college; the money has years to grow and by the time they need it it will be there for them."

    Here's a great example.

    This is total bullshit.

    I mean, I'm sure it's true.  But let's look at the problems with this:
    1) She's earning an engineering salary, yet only funds 529s to the limit that they can "grow in time" for the money to be there?  That means she saved or spent the vast majority of it.

    More importantly:
    2) She's not actually giving any to charity!  She gave some money to relatives who she says couldn't afford college otherwise.  If this is truly the case, there would have been plenty of grants and scholarships available for them. 

    Giving some money to relatives (and only a small fraction of what she earned, based on the information given) instead of actually helping dying children, and then getting credit such that someone uses her as an example of earning to give, and altruistic behavior?  What horse *.

    I'm sure your friend is a nice person, I don't mean to degrade her personally. But going back to work to put a little aside for your relatives?  ...okay?  That doesn't earn you a lot of altruistic credit in my book.  I'd say it's roughly equivalent to adopting a dog that would have been put down.  No doubt a nice thing to do that costs you some money, but not that praiseworthy versus average charitable behavior.  It's not the going above and beyond earning to give.

    My apologies--I gave the example here because it was the closest thing I had experienced in my circle of acquaintance of working with any goal other than pure personal gain.  I don't know all the details; I'll ask for more info the next time we talk. 

    My understanding was that most of if not all of her salary went to this purpose, and that the number of children involved meant that the division among their accounts would not have resulted in a contribution sufficient to completely cover their college costs without time for growth. 

    Giving money to relatives is not strictly charity, of course, but I do think that comparing funding education for a child to adopting a dog is a bit harsh.

    MMM365

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    Re: "One More Year" strikes the rich the hardest
    « Reply #117 on: February 25, 2017, 02:54:16 PM »
    I don't know that the decision to work OMY to give another year of percentage giving to charity has to necessarily be 100% to be a compelling reason to affect one's decision.  Whether giving 50%, 25%, 10%, I do think that the commitment to ongoing percentage giving does make the OMY equation a bit more complicated to add up.  However, I also feel that, when those of us who have done well financially, there is a responsibility to consider philanthropy and charitable giving in how our FIRE lives will proceed. 

    Does it have to be to work OMY to give 100% of income away to be applicable?  Does only giving 10% of OMY not mean anything?  I think, no, on both counts.  However, if giving charitably is not near 100%, I agree with arebelspy that the reason for working beyond FI is often primarily wanting to obtain more stuff/stash. 

    Personally, we committed long time ago to give a percentage of our income, and over time, have been increasing it by a few percentage a year.  We are far from Sol's goal of 50% or the number of 100% (although this thread is actually making me consider that long term goal).  However, when consider FIRE, I think that NOT only should lifestyle, living simply, frugality be considered, but ALSO, we should consider how we can impact other financially with charitable giving and work. 

    ducky19

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    Re: "One More Year" strikes the rich the hardest
    « Reply #118 on: February 25, 2017, 02:56:57 PM »
    ...but I think I've convinced myself I'm good to go now.  I believe OMY is now 5MM.

    I assume that means 5 more months? Because i first read that as 5 million ("M" being the Roman numeral for 1000) and almost choked on my Dorito.

    Ha, I read it as 5 More Millennia.

    See, I saw 5 Money Mustaches...

    Retire-Canada

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    Re: "One More Year" strikes the rich the hardest
    « Reply #119 on: February 25, 2017, 06:52:32 PM »
    I'm in the exact same situation; even the timeframe (FI minus 1-3 years). I think it's more my speed because I'll enjoy the challenge of knowing I may have to figure shit out if market returns are weak or if my spending doesn't drop once I quit. Seems a wee bit more adventurous to me, or at least less formulaic. But more importantly, it'll buy me years of freedom when it's more important to me to have that freedom. I realize I'd be unwilling to make this leap if I had kids or fewer life/work options.
    This is awesome. While I did so accidently, I deffinately took the O(many)Less Year path. It was a fantastic adventure, and I would highly recommend it.

    Aspiring Nomad I can't say I'm excited about pulling the FIRE plug at say 5%WR for the extra challenge, but I totally understand your motivation for having more time off sooner. I guess if there is any aspect that I look forward to challenging myself about it's defeating the decades of programming to work and define myself by it. That will something I feel good about working through and seeing what's on the other side.

    MM I am looking forward to all the amazing things I will have time to do that matter a lot to me. That's going to be so great. :)

    PizzaSteve

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    Re: "One More Year" strikes the rich the hardest
    « Reply #120 on: February 25, 2017, 11:14:53 PM »
    We are in my last OMY, so please wish me good luck pulling the trigger when the target date hits.  (edited out personal details)
    « Last Edit: February 26, 2017, 04:11:32 PM by PizzaSteve »

    Mr. Green

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    Re: "One More Year" strikes the rich the hardest
    « Reply #121 on: February 26, 2017, 09:16:10 AM »
    The variables here are so many, and have so many ripple effects, that it's an incredibly difficult topic to argue. Looking at sheer efficiency, governments could spend money more efficiently and have way more impact than one person ever could with his money, unless you're in the Billionaire club. So choosing to sacrifice your freedom (which assum es that if all things were equal you would chose a different life path than to continue earning big money) also requires admitting that you choose to shoulder a burden that everyone else is equally capable of carrying.

    Philosophically, one could also argue that remaining in a high earning position might ultimately rob you of an alternate life where your free time in "retirement" led to an idea or passion that would have had a much larger impact on the world than your money ever could have.

    I'm not saying to keep working is wrong. If no one ever shouldered a burden larger than themselves the world would be a pretty ugly place. We all should strive to do good things that impact other people. However, the rabbit hole on this one is a lot deeper than just saying, "I could work a couple more years and the money I'd earn would save lives."

    The argument gets even more complicated for anyone involved in saving lives at their job (doctors, EMTs, firemen, etc.).

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    EnjoyIt

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    Re: "One More Year" strikes the rich the hardest
    « Reply #122 on: February 26, 2017, 09:55:50 AM »
    I fully agree that one more year increases with income.  This comes multifold.  Usually to earn those high incomes requires much time and dedication.  Most people do not come out of high school making a $250k+/yr.  Most people out of college don't make that kind of money either.  It usually requires a graduate degree and then years of dedication at your skill to earn an increasingly growing income.  For example. It took me 12 years out of college to get my MD degree and finish residency.  It then took another few years before I started earning at my peak earnings potential.  One more year seams very appropriate since my working career has been so short.  Also, since I gave up so much of my youth towards education I want some luxury in my life as well. I want to be able to travel more staying in more convenient locations with better accommodations, live in a nicer community with a bit more land, pay for my kids education. . . etc.  I am willing to work a few more years to earn those extra luxuries.  Not to mention after spending 12 years learning my skill, it would be kinda sad to give it up after only 8 years of working. Also, I understand the cost of healthcare and what is associated with not having enough funds during your later years in life. Although medicare will provide the basics, the basics are piss ass pathetic without someone advocating for you. I want to make sure we have enough to cover those extra costs.

    Today if I wanted to move into a smaller home and travel more frugally, we can retire right now.  Instead we plan for 2-3 more years and then work part time not necessarily for the money but for the fun of doing something I enjoy.

    As for the comment above regarding a recession.  I agree at some point in the future a recession is coming.  Unfortunately we do not know when and how long it will last.  I hope it happens while we are still working full time so that we can add to our nest egg.  We have also been slowly adjusting our asset allocation as we near semiretirement. That way if the markets do drop we can always consider moving to a more aggressive asset allocation if we are willing to take on more risk. 

    TomTX

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    Re: "One More Year" strikes the rich the hardest
    « Reply #123 on: February 26, 2017, 12:27:05 PM »
    It's extremely hard to change decades of intensive programming around work and stop doing it. I think this issue is severely underestimated by most people considering FIRE.

    The earlier you retire, the less this is a problem.  ;)

    I've been on plan to retire at 53 (10 more years) - based on when I can first take my pension (at ~55% of pay. No COLA) Not early by the standards here, but quite early for where I work - almost everyone who takes the pension immediately just goes to work at another job for 10+ years. Hell, we have one "return to work retiree" who has been drawing the pension for 24 years and still comes into work. Admittedly a special case - his wife has a "honeydo" list more like War and Peace. He works harder at home than at work...

    Anyway:

    There are several difficulties with my retiring earlier than I can draw the pension:

    1) Accrued vacation and sick leave vanish instead of counting toward years worked.

    2) Pension amount is based on salary and years of service. Leaving earlier means the pension is smaller forever.

    3) Pension start date is based on age + years of service. If I quit at 52 instead of 53, I can't start drawing the pension til 54.

    4) Health insurance worries me.

    retired?

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    Re: "One More Year" strikes the rich the hardest
    « Reply #124 on: February 26, 2017, 12:49:27 PM »
    Plus in my case (and I suspect others), you can get significant family/spouse or social pressure in the form of, "Are you kidding me? You're giving up that plush job with the outrageous salary -- and for what?!" Other forms are, "I would kill for that job and salary, and you're just throwing it away?!"


    Arrrggghhh!  This idea kills me...as a federal, I can't move up until someone ahead of me retires or gets promoted...so these folks who keep working just because they want to and not necessarily need to, means that there is one more person like me who's potential growth is stunted. 

    My last employer had a GS12 who was 79 years old and napping for half the day in his cubicle...but he was given all the defference in the world and noone did anything about it.  So he sits and takes up space, and keeps other folks from being able to move in there and be productive.

    Your OMY syndrome doesn't just affect you, it affects all those who want to follow in your footsteps but just need you to get the hell out of the way.

    Well, the problem in this case isn't someone hanging around that doesn't need to work, but the federal govt that lets it happen.

    No one has an expectation that others will "clear the way" so they can move up.  That's ridiculous.  Move to the private sector if these sort of policies bother you.

    Metric Mouse

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    Re: "One More Year" strikes the rich the hardest
    « Reply #125 on: February 26, 2017, 12:52:05 PM »
    I'm in the exact same situation; even the timeframe (FI minus 1-3 years). I think it's more my speed because I'll enjoy the challenge of knowing I may have to figure shit out if market returns are weak or if my spending doesn't drop once I quit. Seems a wee bit more adventurous to me, or at least less formulaic. But more importantly, it'll buy me years of freedom when it's more important to me to have that freedom. I realize I'd be unwilling to make this leap if I had kids or fewer life/work options.
    This is awesome. While I did so accidently, I deffinately took the O(many)Less Year path. It was a fantastic adventure, and I would highly recommend it.

    Aspiring Nomad I can't say I'm excited about pulling the FIRE plug at say 5%WR for the extra challenge, but I totally understand your motivation for having more time off sooner. I guess if there is any aspect that I look forward to challenging myself about it's defeating the decades of programming to work and define myself by it. That will something I feel good about working through and seeing what's on the other side.

    MM I am looking forward to all the amazing things I will have time to do that matter a lot to me. That's going to be so great. :)
    I hope it's even better than you imagine.