Early Retirement Extreme Forums

I also don't think the system would collapse if ERE became mainstream. Wages would increase enough that people would go back to work. I'm of the opinion that a lot of jobs are unnecessary and serve as one person digging a hole while the other person filling it in. Perhaps we'd eliminate some of these, making society richer in total.

I don't know how anyone thinks this is going mainstream though. The mainstream is very resilient to change and bastardizes everything. It'll take a buzz phenomenon like "retire early" and turn it into a mainstream phenomenon. How has going mainstream gone for the environmental movement? We just pay more for shit that says "sustainable" or "green" now. I think this explains the Prudential billboard. The FIRE movement takes a lot of deep thinking to really get. It took me awhile to get it and I was already a frugal weirdo before I found out about it.

I don't think marriage is good. When someone tells me they are getting married I don't want to congratulate them. I don't think having kids is generally a good idea. I don't think you need much money to be happy. When someone gets a new car I think they are dumb. When someone gets a new job that pays well but that sounds like it sucks, I think it's bad. When one of my friends goes back to school to finish their degree in something that has no employment aspects and goes into debt, I think it's a waste of time and money. All of these ideas are theoretically becoming more popular. I NEVER express them. It's a waste of time. All of these ideas have become more popular, but they are not mainstream. Maybe in several generations they will be, but not in our lifetimes.

I remember when I was intentionally homeless living on people's couches, in parks and at work and I was worried that everyone would start doing it because it was so fucking easy. No one ever did it. I work with a 24 year old (single, no kids) who works 2 (xray tech) jobs to pay for her SUV and apartment. No one has ever asked her why. FIRE will never be mainstream. I went to a wedding last year where they had bamboo disposable plates "for the environment." At least they had decent Molly.

I think FIRE getting accepted by the masses basically means another Nice Thing that you Should Do. Like exercising, reading books, volunteering or reducing your footprint. Making the analogy with exercise, what people should be doing is running/swimming/lifting weights. What people are doing is getting another fitness app and a new pair of running shoes, buying a gym membership January 2nd and using it three times before it expires etc.

Basically, people know they should save for conventional retirement but can't manage it. I don't see them leapfrogging it to FIRE.

Just 1 percent of U.S. investors who are in the workforce — defined as nonretired adults with at least $10,000 already saved in stocks, bonds or mutual funds — say they are saving 50 percent of their take-home pay in order to retire early. That translates to about one-half of one percent of all nonretirees.

Lydia Saad, senior editor at Gallup, wrote of the findings of Wells Fargo/Gallup Investor and Retirement Optimism survey

According to the survey, which is based on responses of 1022 US investors aged 18+, FIRE is in reality not really that mainstream as the media tells.

@wolf - 1% actually saving more than 50%+ is a lot of people. It is, for example, more than the total number of engineers as a fraction of the workforce.

While that is not mainstream in the sense of that we have to start worrying about "what if everybody did it", it's enough (see Dunbar number) that any random person would likely know 1-2 people who are saving more than 50%+ of their money. Given that people's networks aren't random, people in higher income groups would likely know more (even if their colleagues aren't telling). People in software-engineering/internet businesses would likely know a lot more being as FIRE is mainly discussed online.

it's enough for the mainstream media to discuss it/be aware of the concept.

If 1% of "investors" (non retired adults with $10k invested) saves 50%+, and about 47% of people are non retired (working) adults, then we're already at 0.5%. How many of working adults are "investors"? Considering 50% don't have $500 for emergency, I'd guess maybe 10%? Which takes the number down to 0.05% or 1 in 2000?

It is actually less than one-half of one percent of all people if you include fairly large proportion of adults who are already retired or not in workforce. Maybe 1 in 400.

OTOH, proportion of millionaire-next-door semi-early retirement style frugality is likely quite a bit higher. Practically every middle-aged man I have dated in the last 12 years was roughly in this category. Most people have higher proportion of business or rental real estate ownership and inherited wealth in the mix relative to stock market investments and high income employment. IOW, pretty much every man with enough free time on his hands to keep me entertained had at least 2 of the above in his portfolio

I think the 4% rule (or 2-3% rule around here) is just an easy thing to follow. Working a salaried job is hard enough with believing that your wealth will get larger over time. If you're not even sure that the wealth will get larger, then you might as well be just wasting your time, and if that's the case, why not just stop working & collect welfare or go be a work-as-you-go van-lifer or backpacker? Learning the nuts and bolts of active investing on top of full-time work, and keeping on top of investments day to day, is also just too much to ask anyone. Maybe after they've accumulated a fair amount and are now working part-time or open to new opportunities.

TopHatFox wrote: ↑

Wed Apr 17, 2019 11:00 am

Learning the nuts and bolts of active investing on top of full-time work, and keeping on top of investments day to day, is also just too much to ask anyone.

These days, investments are easy. Just buy Vanguard and be done with it. The investment industry wants to make it sound hard, so as to justify high priced financial advisory services.

FIRE has reached a level of discussion in the mainstream financial press that it must be confronted as a personal finance option for anyone with a modicum of interest in the topic. Suze Orman came out against it because it is in her best interest to come out against it which legitimized it's traction. It is now a permanent category in Marketwatch which it wasn't not to long ago. How it actually impacts the economy, well, that's above my pay grade. But however you call it, it has affixed it's seating tag to the personal finance table.

wolf wrote: ↑

Wed Apr 17, 2019 1:05 am

Wells Fargo/Gallup Investor and Retirement Optimism survey

Going beyond the press release to the survey results, one will find that:

• The sample size for the super-saver questions was n=665 (65% of those surveyed; retired investors were excluded)
• Of those, 20% had heard either “a lot” or “a moderate amount” about FIRE. (See PI74) This is a little better than TD Ameritrade’s FIRE movement survey conducted 1 month earlier where only 11% were aware of FIRE by name (that survey was more heavily biased toward older, wealthier Americans though).
• Combining the previous with the statistic where 1% already have a 50%+ savings rate, it means that 1 in 20 (investors) who have moderate+ exposure to FIRE are actively pursuing it, which is high enough to be worthy of mainstream attention even if not mainstream.

Google Trends searches:
"Early Retirement Extreme" peaked April 2014
Mr. Money Mustache (website) / "money mustache" search term had a long plateau in 2014-2015, followed by a lull and then a peak in Feb 2017
"Mad Fientist" peaked August 2017
"Frugalwoods" peaked March 2018 (when they released their book)
"Go Curry Cracker" peaked April 2015, though based on their blog their page views peaked in 2018
"financial independence" has not yet peaked

Reddit rank of /r/financialindependence vs. other sub-reddits peaked at rank 255 in June 2017, but number of subscribers is still going strong along with Reddit as a whole.

It looks like the peak of these FIRE blogs becoming popular happened around 2015, with FIRE in general still growing strong today, just not as much concentrated in the discovery of the big-name or "classic" FIRE blogs. Now attention is spread out to Reddit posts and a greater number of blogs.

Based on Go Curry Cracker, viewership (max # subscribers) can peak a few years after searches (new discovery / going viral) peaks. Similarly, the number of people pursuing FIRE could easily peak years after web popularity peaks, as I'm sure many people binge a few blogs and then start working toward FIRE on autopilot without needing to consume much more web content. Same as with peak oil or other resources - peak discovery occurs decades before peak production.

With advance in Tech (AI, robotic) and productivity, we don't need as many human working as before. It's possible for some people to retire early and let the robots do all the work..

Also, just because someone is interested in FIRE, it doesn't mean they will achieve their goal.
It requires an entrepreneurial spirit. Most people don't have it. and to retire early, one needs either lots of money or a very high ROI, or super low expense, all three are not achievable for most people in the society. If I mentioned I can get above market return, I'll be ridiculed to death by indexing warriors.

@Tofi, I'd say you really only need the super low expense and some money. That money doesn't even need to be from a portfolio. I'd honestly consider someone who pays for their housing, food, transportation, and insurance on 20 hours of part-time remote work to be financially independent, in that they are basically doing what they'd be doing if they did have a 500k portfolio (i.e. a mixture of hobbies, home projects, friends, relationships, and computer work).

I will say that you're totally right: most people will not do the low expense thing. In fact, they've already messed up by making choices such as buying an expensive yet questionably employable college degree, having kids they can't afford, marrying or living with people they can't afford, or keeping up with the unattainable consumer expectations of social media.

Lots of money can be done, but it typically requires a high IQ, high contentiousness, and probably to be Judging if not Thinking. That's a pretty tiny percentage of the population.

Finally, very high ROI is unlikely as well because it requires a lot of risk and analysis to be successful, which again probably draws upon luck or the combination of high IQ, work ethic, and planning over time.

With Millennials and Gen Z living at home longer than any generation (even I'm doing that), having unprecedented levels of student debt on questionably employable degrees, and trying to keep up with typically expensive experiences on social media, I do not see vast numbers of people using FIRE. Hell, literally all of elementary, middle school, high school, college, and grad school doesn't teach people a lick of personal financial planning, just anti-capitalist rhetoric and narcissistic, anti-social behavior. The group most likely to like FIRE are probably just high income earners that know to plan ahead, "crazy" scientist prepper types like us, or boho types that live a pay-as-you-go travel lifestyle.

TopHatfox, I agreed with most of what you've said. Low expense is the key. We still need some kind of income, part time job, indexing, individual stocks or not. I didn't have fortune of high income so I focused on what I can maximize or minimize.

For normal people, even I ask them if they are interested in investing, they are either not interested or say don't have time or say don't have money which are all excuses.

So OP is just worried too much. Just be happy and F.I.R.E.

Yeah, agreed, I'm becoming more attuned to peoples' clocked excuses. I don't have time means I'm probably choosing to place my time elsewhere. I'm not interested (actually) means I don't care. They don't have money means they'd rather spend the money on other things, work too few hours, picked the wrong major/car/house/spouse, or probably don't live in a developed country.

It's almost akin to how many middle class and in particular women speak. Not replying means no. I have work to do, I need to go to a meeting, I need to study for a test, and so on typically means they're not interested. I'm just not looking for that right now means they probably still are, just not with you. It's nice to be able to read straight through indirect yet polite language.

I really don't see FIRE taking off any time soon except for a few select groups. Young kids are taught from K-College to not manage their money and go into debt and buy expensive things. Maybe if the internet provides sub-forums for this sort of thing, but tbh, corporations and celebrities are using social media platforms, and they'll take up the lion's share of internet attention if they don't already.

Looks like the NYT has an opinion on FIRE reaching critical mass:

"How Millennials Could Make the Fed's Job Harder"
https://www.nytimes.com/2020/02/17/busi ... ement.html

It's as if being FI is bad for the economy. To the contrary, FI is good for economy because we won't default on our mortgage, car loans, credit card. We provide stability to the economy. There'll be less boom and bust if more people are FI. We also create more jobs for those who need it.

FIRE is falling out of favor because people aren't being laid off. You'll see interest pick back up when there's another downturn.