"supersaver freaks" in NYT

[EMJ]

"Unlike the crisis of a milestone birthday, where fear subsides into resignation, Mr. Reining decided to change his cubicle fate and set a goal of having $1 million in his brokerage account by the time he was 35. Given that he was making about $75,000 a year working in information technology, he knew the goal would take considerable discipline.

Mr. Reining is part of a small group of supersavers who commit to a number that they say will support their lifestyle in retirement and never stray from achieving that goal. They are the financial equivalent of people who go on a diet, lose the weight and actually keep it off."

http://www.nytimes.com/2015/11/12/your- ... -goal.html

[Ego]

Given that two-thirds of Americans report having little savings for retirement — and half of married couples and three-quarters of single people in retirement count on Social Security for half or more of their income — saving is a problem and supersavers have something to teach the rest of America.

Holy crap. What's happening here? I think it might, dare I say it, be getting p-p-p-popular.

His blog got hugged to death.

http://mreverydaydollar.com/becoming-a-millionaire/

[jennypenny]

The comment about supersavers being "coachable" was interesting. Does he just mean willing to learn? Or something more like game theory and creating the right 'problem' like in this article?

[Gilberto de Piento]

At first I was very interested in the everyday dollar blog because my age and his are similar. After reading some of it I'm starting to become skeptical that I'm going to get anything out of it.

As stated in the comments on his blog homepage his stock market returns are incredible. He hasn't shared how he's investing or saving. Either he's a great investor (it's unlikely I'll replicate that), he got lucky (I can't replicate that), or he's BS. Everything is just way too vague to be useful.

It doesn't help that the name of his blog is just a mash up of other popular finance blogs and most of his posts include an affiliate link to something. I feel bad saying this without evidence but I think he wants to be the next MMM but cash in on it. I won't be back.

[bradley]

I love the "freaks" title The mainstream media makes me chuckle so many times.

I've read his blog a couple times, and he seems like a more low-key but charismatic "professional" type compared to MMM and Jacob. His advice is pretty applicable to a wide "consumer" audience, so maybe some people will find his ideas useful. I can already tell from glancing at the comments Ego linked to that some people though will get caught up in the details, even though it's really as simple as live below your means, invest the rest.

As stated in the comments on his blog homepage his stock market returns are incredible. He hasn't shared how he's investing or saving.

My bet is that he's a super-focused value investor or has his funds managed by a good broker. He has mentioned that he focuses on restaurants. Even focusing on just something like the ideas in The Dhando Investor and The Little Book That Beat the Market make his double-digit returns possible.

I'm downloading some of his spreadsheets though cause they're pretty

[Gilberto de Piento]

If people find his articles motivating that's great. I'll leave it alone now.

[jacob]

MSM articles are often guilty of causal oversimplification.

Here's the typical situation for featured young millionaires:
1) Saved 50%+ of their income.
2) Earned in the top 20% quintile for all ages.
3) Had incredibly strong returns, e.g. 20%+ CAGR (not widely reproducible)
4) Registers 1M at a young age.

Crank it through the MSM machine and it becomes: Supersaver becomes a millionaire at age 35". A causal simplification going from (1) to (4) while ignoring the very important (2) and (3).

And if that's inspiring, I guess I'm fine with that too ... as long as one realizes how this plays out in the full population space.

1) Saving 50%+ of 75k leaves annual expenses at 35k-ish (ignoring taxes). So you're a supersaver, if you spend 35k or less. Hey wait what?! The majority of people don't even make that much in the first place.
2) The median income for a US person is 26k ... Whoops. If the median-dude became a "freaky supersaver" he'd be 9k in the hole. Whoops. This is rather pointing towards bankruptcy instead---a situation that is not surprisingly way more common, because simple statistics. Okay, let's reduce the sample population and dial it back up to 75k. Reducing relevancy from 100% to 20%.
3, 4) Assuming we're just average investors (thanks to indexing anyone can be an average investor), then the SP500 CAGR over the past 7 years has been about 7%. However, that would only leave us with about half a mill. However, the recent past is not an indication of the immediate future. Between 2001 and 2008 the market CAGR was -3.0% ... so doing the same exercise would have resulted in a net worth of 250k instead of 1M.

Exactly same method, income, etc. but highly variable results just from changing the interest rate.

This is not at all a critique of the blog. It's a critique of the lack of critical thinking in the MSM.

[George the original one]

From what I can tell, the income mentioned in the blog is after taxes. He's done a good job, but not outstanding (except he's living in NYC).

[SimpleLife]

Either lack of critical thinking or sensational journalism. The media intentionally used a picture of Trayvon Martin when he was 9, posing with his preppy innocent child look, not the one of him as a thug posing with weapons, drugs, etc. Of course they showed it side by side with a photo of Zimmermans booking photo, rather than a pic with his face and head beat and bloody by Martin. That wasn't a lack of CT. It was designed yo sell the most advertising. And people are dumb so they get sucked in.

[enigmaT120]

Either lack of critical thinking or sensational journalism. The media intentionally used a picture of Trayvon Martin when he was 9, posing with his preppy innocent child look, not the one of him as a thug posing with weapons, drugs, etc. Of course they showed it side by side with a photo of Zimmermans booking photo, rather than a pic with his face and head beat and bloody by Martin. That wasn't a lack of CT. It was designed yo sell the most advertising. And people are dumb so they get sucked in.

He was 16 in the picture that was mostly used, only one year before he was killed.

http://www.snopes.com/photos/politics/martin.asp