FIRE reaching Critical Mass

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ThisDinosaur
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Re: FIRE reaching Critical Mass

Post by ThisDinosaur » Wed Nov 21, 2018 10:43 am

Mister Imperceptible wrote:
Wed Nov 21, 2018 9:42 am
For those who think FIRE is some great thing we have to keep secret, I am 100% confident it will never become mainstream. Most people do not have the discipline/time preferences.
Prove it.

Seriously, prove it. If Prudential is putting up billboards, then they have done expensive market research concluding that they can capture revenue from the growing FIRE millenial demographic.

Your Iron Law of Wages only illustrates that wealth inequality is a part of this picture. Stahlmann already made that point. And jacob brought up the Jungle Fighter transition.
http://earlyretirementextreme.com/the-gamesme.html

When the coming retirement crisis hits, the tide will go out, and it will become clear that the only way to obtain wealth is to take it from someone else. Could be from nature, from your customers, from politically sanctioned wealth transfers, from smarter/luckier active management...but it comes from somewhere. This is always the case, but it will become more obvious when the pie is shrinking.

If you are physically capable of saving more than half of your income for 5-10 years, you are almost certainly a 1%er worldwide by some metric.

prognastat
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Re: FIRE reaching Critical Mass

Post by prognastat » Wed Nov 21, 2018 10:57 am

I wouldn't read that much in to a billboard.

For one we don't know how many billboards and secondly we don't have to be mainstream to warrant a billboard, just a high value niche which to a financial company people with high net worth are.

Then there's also the amount of people that come on board with FIRE/ERE and those that actually achieve it.

Mister Imperceptible
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Re: FIRE reaching Critical Mass

Post by Mister Imperceptible » Wed Nov 21, 2018 11:01 am

ThisDinosaur wrote:
Wed Nov 21, 2018 10:43 am
Prove it.
Getting millennials to load up on index funds at the top of a bull market is indeed a great way for the big banks to transfer wealth from doe-eyed youngsters to themselves.

Yes, if real aggregate wealth is decreasing, an individual can only increase his wealth if others are losing as much or more.

I’m sorry, what are you asking me to prove?

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unemployable
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Re: FIRE reaching Critical Mass

Post by unemployable » Wed Nov 21, 2018 11:08 am

Mister Imperceptible wrote:
Wed Nov 21, 2018 11:01 am
Getting millennials to load up on index funds at the top of a bull market is indeed a great way for the big banks to transfer wealth from doe-eyed youngsters to themselves.
It's much worse than that. We're talking Prudential here, so what they really want you to load up on are life insurance and annuities!

Oh and if "society" wants to "force me to work" it could start by not rejecting me after I go through its five rounds of interviews and a whole day onsite that I flew across the country to.

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Bankai
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Re: FIRE reaching Critical Mass

Post by Bankai » Wed Nov 21, 2018 11:16 am

'Retire early' on a billboard doesn't necessarily mean 'retire in your 30's on income below poverty level'. More likely they had in mind people in their 50's who'd love to retire early compared to the usual age, so maybe at 60 and not 68-70.

jennypenny
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Re: FIRE reaching Critical Mass

Post by jennypenny » Wed Nov 21, 2018 11:23 am

Did a little research. The billboards appear in over 20 metro areas. This is a concerted effort on Prudential's part to attract Millennials ... https://www.mediapost.com/publications/ ... nials.html

What I find most telling is that the idea of retiring early is becoming part of the zeitgeist of Millennials. Most won't achieve it or even try, but it's amazing to me that FIRE is a concept that many people have at least heard of at this point.

cmonkey
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Re: FIRE reaching Critical Mass

Post by cmonkey » Wed Nov 21, 2018 11:43 am

The billboard project is probably managed by a team of Prudential Millennials so it's really not too surprising. Millennials are now the dominate workforce participant. It's also not that surprising that in the Age of Internet a simple equation like {Retire = Annual Expense * 25} will go viral. If it means Millenials get to do what they want with their lives, waste less, and be happy, I'm all for it!

But just remember - FIRE and ERE are totally different. Just because FIRE is now mop occupied doesn't mean that ERE is.

Also from that article....just sayin....
Nearly nine in 10 Millennials (88%) say people now in their 20s and 30s will need to work much longer than previous generations did to retire with the same level of financial security. Even if they do work for a longer period, 79% believe that by the time they reach 80 years old, comfortable retirement will be a thing of the past. At least 70% say that’s because it’s impossible to save as much money each year as prescribed by current retirement planning tools.

7Wannabe5
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Re: FIRE reaching Critical Mass

Post by 7Wannabe5 » Wed Nov 21, 2018 1:53 pm

Another factor might be that Millenials have parents who are less likely to have total black box pensions than previous generations. So, even if their parents weren't great financial managers, they might have been exposed to some notion of the market.

ThisDinosaur
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Re: FIRE reaching Critical Mass

Post by ThisDinosaur » Wed Nov 21, 2018 2:00 pm

Mister Imperceptible wrote:
Wed Nov 21, 2018 11:01 am
I’m sorry, what are you asking me to prove?
Mister Imperceptible wrote:
Wed Nov 21, 2018 9:42 am
For those who think FIRE is some great thing we have to keep secret, I am 100% confident it will never become mainstream.
This thread is full of evidence that FIRE is becoming mainstream. FI blogs, including ERE, preach anticonsumerism and a life of idle leisure living off investment returns. This system cant possibly work if "everybody" does it. It probably cant work if half the population does it. I dont know what the breaking point is, but I know on the way there SWRs will go down, and the cost to FIRE on financial assets will go up.

MMM and mainstream FIRE bloggers seem oblivious or in denial. By encouraging everyone to ERE, jacob seems to be hastening the financial apocalypse that would justify all his years of doomer prep.

Either that or Mr. Imperceptible is right, and there is zero chance of this movement ever reaching critical mass [the point at which it collapses under it's own weight]. If so, I'm asking for evidence that it's that one.

ThisDinosaur
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Re: FIRE reaching Critical Mass

Post by ThisDinosaur » Wed Nov 21, 2018 2:03 pm

@7W5
I think it's more that Millenials have seen their parents live consumerist lifestyles that made them miserable, and are rebelling. Like the huge house and nice car they can never enjoy because they are always at work paying it off.

prognastat
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Re: FIRE reaching Critical Mass

Post by prognastat » Wed Nov 21, 2018 2:10 pm

@ThisDinosaur

FIRE might be going through somewhat of an online niche fad, but when I'm out and about offline I've met exactly one person that's actually working towards FIRE. If it were that mainstream I would know more people than that.

It's a struggle to even talk about minimally financially responsible behaviour with most people I know(almost all of which are Millennials) let alone full on FIRE talk. Given this I'm pretty sure we are far from being/going mainstream.

Loner
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Re: FIRE reaching Critical Mass

Post by Loner » Wed Nov 21, 2018 2:41 pm

People dreaming of retiring early is nothing new. Neither is trying to make money from them by trying to sell them financial products.

Here in Canada, we had the famous Freedom 55 ads in the 1980s, created by a financial planning firm. While the economy was doing well, they dangled the carrot of early retirement to sell more financial services. People remember it very well even today. Meanwhile, median retirement age has decreased by 0.7 years.

In a way, early retirement is indeed a lot like sex in high school.

I don’t think it’s very different today. With the Internet, it seems inevitable that a general concept like "retiring early" would find a niche and eventually get branded into something "sexy", like FIRE ©, to be talked about here in there in semi-amused (as well a anger-producing) fashion. But just like having half the population watch football doesn’t mean you’ll have a population of athletes, having a bunch of people read MMM doesn’t mean FIRE is going mainstream. There’s a lot of entertainment value in MMM. Just like the Woodstock hippies who ended up living in McMansions and driving huge SUVs, I don’t have a hard time imagining the millenials doing the same : talking about FIRE and proceeding to spend all their cash on travels and other allegedly-happiness-inducing-experiences until they realize at 59 that they need to plan their retirement. Human nature does not change much. And for the most part, human nature is present-focused.

7Wannabe5
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Re: FIRE reaching Critical Mass

Post by 7Wannabe5 » Wed Nov 21, 2018 2:51 pm

Loner wrote:In a way, early retirement is indeed a lot like sex in high school.
I think people who had sex in high school are less likely to retire early.

Loner
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Re: FIRE reaching Critical Mass

Post by Loner » Wed Nov 21, 2018 3:02 pm

:lol:

daylen
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Re: FIRE reaching Critical Mass

Post by daylen » Wed Nov 21, 2018 3:08 pm

ThisDinosaur wrote:
Wed Nov 21, 2018 2:00 pm
MMM and mainstream FIRE bloggers seem oblivious or in denial. By encouraging everyone to ERE, jacob seems to be hastening the financial apocalypse that would justify all his years of doomer prep.

Either that or Mr. Imperceptible is right, and there is zero chance of this movement ever reaching critical mass [the point at which it collapses under it's own weight]. If so, I'm asking for evidence that it's that one.
More people higher up on the Wheaton and Kegan scales will reduce the potential for negative outcomes and the volatility that come with them. That is justification enough to encourage those who listen, but there are many who refuse to listen and are unlikely to change their lifestyle until forced to do so. The population is dominated by the preference to avoid using abstract rules or arguments to make decisions, therefore the majority are unlikely to change until the people in their immediate social web change. The intellectuals (NT's) and idealists (NF's) who hastily join the FIRE train will not be influential enough, fast enough.

daylen
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Re: FIRE reaching Critical Mass

Post by daylen » Wed Nov 21, 2018 3:39 pm

If people mostly only change when the people around them change, then on average, they will not change in a way that makes use of their differences. ERE (or systems thinking applied to finance) is about making use of differences (in self or environment) to target and exploit production processes that provide options in the future (self-sustaining). This is not a mindset that most people can understand easily, and making decisions dynamically based on a web of goals is not something that is easily mimicked.

This is more about the ERE side of things as opposed to FIRE.

slsdly
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Re: FIRE reaching Critical Mass

Post by slsdly » Wed Nov 21, 2018 5:41 pm

My reaction has been that they will be just in time for the crash, some will get burned, the rest will decide its a pipe dream, and the cycle repeats.

Mister Imperceptible
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Re: FIRE reaching Critical Mass

Post by Mister Imperceptible » Wed Nov 21, 2018 6:35 pm

ThisDinosaur wrote:
Wed Nov 21, 2018 2:00 pm
If so, I'm asking for evidence that it's that one.
Common objections cited above include the standard McMansion/SUV/other forms of profligacy. I have no hard evidence, just the anecdotal.

Following @daylen, I would say I expect FIRE to collapse under its own weight when you find the Philosopher’s Stone that transforms profligates into thoughtful resourceful conscientious nerds. ERE is not as sexy as MTV (except to we nerds).

Regarding the billboards, once again, if the establishment itself is shilling early retirement, could that tell you anything about the current stock market valuations?

Maybe I’m just too much a pessimist.

BRUTE
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Re: FIRE reaching Critical Mass

Post by BRUTE » Wed Nov 21, 2018 8:50 pm

ThisDinosaur wrote:
Wed Nov 21, 2018 2:00 pm
FI blogs, including ERE, preach anticonsumerism and a life of idle leisure living off investment returns. This system cant possibly work if "everybody" does it. It probably cant work if half the population does it. I dont know what the breaking point is, but I know on the way there SWRs will go down, and the cost to FIRE on financial assets will go up.

MMM and mainstream FIRE bloggers seem oblivious or in denial. By encouraging everyone to ERE, jacob seems to be hastening the financial apocalypse that would justify all his years of doomer prep.
while brute doesn't think FIRE (and especially ERE, but even MMM style) will ever become mainstream, he also doesn't think it would make "the system" collapse. if the average savings rate was ~50%, capital would be extremely cheap because all humans would be looking to invest. that means that the few humans that actually did want to work would have loads of capital to do it and become very productive relatively quickly. certainly the numbers would change, but the whole system would change with them. in general, brute believes, society would be more productive in relation to its consumption - almost by definition (high average savings rate). even though that might mean lower nominal RoI numbers, it would likely be a positive development for most humans in that society.

prognastat
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Re: FIRE reaching Critical Mass

Post by prognastat » Wed Nov 21, 2018 9:47 pm

@BRUTE

I suspect ERE will never go mainstream because it is just not palatable to most people and MMM never will because though it's less unpalatable it requires well above average income meaning it's just unavailable to the majority.

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