Early Retirement Extreme Forums

I found a quite interesting official statistic of the main income of livelihood in Germany. It comes from the federal Bureau of statistics.

official German statistic with main income of livelihood

It basically says, that the main income of livelihood is distributed as follows of all citizens in Germany:
46.5% via employment (salary, wage)
6.6% via public services (social security)
22.0% via pension
24.1% via family members (partner, parents)
0.8% via own assets (e.g. savings, rental income, dividends, ...)

I interpret the last one (0.8% via own assets) as FI. That means, that about 1 out of 100 in Germany is officially FI.

Numbers are from the year 2018.

Do you know any similiar statistic of your country?

That 25% from family members is fascinating. Does the survey specify what ages they're considering? I'm wondering how much of the family member support group is over 18.

@Wolf
Pension is FI too, could be personal pension or state, so could be well before they get to 'normal' pension age.

I suspect that in the UK, they don't have these figures. They know the employment and unemployment rates by age but don't actually ask people 'how are you managing to not work'?

Couldn't find information in easy to digest form for the U.S. This compilation of tax returns would seem to indicate that the average American investor certainly isn't surviving on capital gains income.

https://www.taxpolicycenter.org/statist ... ain-income

Every now and then I try make my way through Piketty's Capital. I believe this is his focus of study. The less people living off of capital.

@Jason - I have a copy which I have also only skimmed through so far, though it seems to explain while 19th and early 20th century novels frequently make reference to 'private income' as though it was not that uncommon. I have a travel guide written in the early 1920s which blithely asserts that 'anyone with a small, fixed income can travel all the time' before quickly getting into the nitty gritty of how to doff ones hats to foreigner and deal with colonial natives. A sort of forerunner of lonely planet.

If I recall correctly, specifically his reference to Jane Austen novels, that "private income" was from rentier income streams.

I believe rentier was also the French term for a 'private gentleman'; someone who was financially independent. Similarly possidente in Italian, proprietario in Spanish...

That's why they called it Early Rentier Extreme back then.

Some of us have multiple crappy income streams that independently wouldn’t keep anyone going but collectively get the job done (ie no main income source)

AnalyticalEngine wrote: ↑

Thu Jul 11, 2019 1:32 pm

That 25% from family members is fascinating. Does the survey specify what ages they're considering? I'm wondering how much of the family member support group is over 18.

I looked up the available data, but I couldn't find any details regarding ages. Probably they'll release more data in the coming months and years. The statistic was done within a "mikro"-census.

@Nomad: Yeah, I people with pensions are FI, too. I forgot them when I thought of FI.

@Laura Ingalls
Crappy retirement extreme?

AnalyticalEngine wrote: ↑

Thu Jul 11, 2019 1:32 pm

That 25% from family members is fascinating. Does the survey specify what ages they're considering? I'm wondering how much of the family member support group is over 18.

I would have thought it was mostly non-working spouses.

Nomad wrote: ↑

Fri Jul 12, 2019 6:19 am

@Laura Ingalls
Crappy retirement extreme?

Maybe
I frankly find it pretty pleasant.

I live in Germany and for a liberal developed economy, they are shockingly behind on thier treatment of women. I'm sure some of that is students in school, but it is likely to be disproportionately women staying home because that's what you are expected to do here once you have kids.

This thread inspired me to once again face Piketty. I finished the introduction for the third time.

According to Piketty, Germany's acquisition of private capital is growing comparably to the rest of Europe but overall remains less due to the political events between WWI to WW II where totalitarian control interrupted the acquisition of private capital. Germany was also less involved in the first globalization of the late 19th century than France and England. Both events impacted the amount of hereditary wealth that was transferred to subsequent generations.

I understand that this is a FIRE board, and discussions are contextualized within that prism, but when it comes to wealth distribution, you are really talking about income derived from human labor vs. income derived from non-human capital i.e. ownership of various and sundry income producing shit. I would put pensions and SS in the former. I'm not sure what that means but well, there's that 1% again.

I love regency fiction, which if full of calculations of living off "the funds" (2 or 3% seems to be the going rate).

It must be removed from the *gasp* filthy hands of industry. Rental from properties, inheritances, or marrying to get a piece of it was the accepted way to get money.