Chicago ERE Meetup 20180901 (TV-edition)

[jacob]

@jp - Sort of. He spotted us from 150ft away and came over while we were setting up and I gave him four bucks which is all I had on me (lucky him because normally I carry a twenty and nobody is getting that). Then the journalist asked if he was willing to repeat his "speech" which he was as long as it wouldn't air in Chicago (lots of Chicagoans steered well clear when the camera was up). The kindle book I was reading is about epidemics by the way.

The recordings in public were the weirdest/most awkward ones. Downtown, chicks were checking me out (for the first time in my life haha ) ... and when I was walking the dog during the end credits, 3-4 families came outside to stand on their porches just staring at me as I was walking down the sidewalk with the camera following me.

@Seppia - No, everybody else is short. I'm 6'2" and we have 8' ceilings.

@oldbeyond - A 1950s lifestyle (+internet) describes ERE HQ pretty well. One thing that was important (a goal) for the documentary was to get people living in different places (so we have a house, an apartment, a tiny house), people investing in different ways (so we have stocks, indexfunds, real estate, startup business), people with different arrangements (married w children, w/o children, separate economies, ... ), and people in various stages of beginning or being done.

@thedollar - I think that calculation was a mental calculator SNAFU. The point I was trying to make was that my savings would last at least until I was 140 years old (I said 120 but I meant 140), that is, more than enough. It's net worth divided by annual spending + my current age. Apparently, I must have thought I was only 23 years old

The "dollar millionaire"($) term gets thrown around a bit (also when it comes to me in the beginning) and when we talked about it off camera I was referring to household net worth. I told the journalist that about a handful of the people at the meetup had reached that level.

($) Which in Danish eyes simply means "a lot of money". I continually had to mentally convert everything to Danish kroners. That's also why you hear me talking so much about what things cost in kroners when I talk about saving/not spending. Makes me sound like a bit of a penny pincher.

@all - There was a lot more recorded over here (and probably also over there) but I'm told that the higher-up directors primarily wanted to see people doing FIRE in Denmark (not the US) which is understandable. This also means that most of the filming at the ERE meetup was dropped. DW's 2+ hour interview was also reduced to a couple of sentences. There's 6+ hours of footage with me on the couch/window answering questions.

Maybe it's possible to make an extended version and get it subtitled with a kickstarter?!

Overall I'm happy with the result though. A lot of details/in-depth was (and prob had to be) cut, but overall the selection choose to highlight the important parts/points which in a nutshell was to tell viewers who have no idea about FI that it exists and that one can choose not to work for 40 years by living below one's means and investing the difference. I'm also pleased they included the "cartoons" to explain the basic principles. I was lobbying hard for that

[BRUTE]

chicks were checking me out

..

Apparently, I must have thought I was only 23 years old

humans

[Seppia]

I would back the subtitled extended version with money.

[Fish]

Watched the TV program with the wife. DW thought it was helpful to see real-life examples. As busy parents, we found Pernille (busy mom with a passion for stocks) to be very relatable. I really liked what she said starting at 43:52:

(Looking at a house) - I don't think that it's worth it.
- If I bought a house tomorrow, everything would stop(*).
- What I have invested in gives me ongoing revenue.
- With a house I get ongoing expenses.
- If I need a house, I need a permanent job.
- I'll have that for the rest of my life.
- Then I clearly choose my freedom.

(*) Pernille was retired having quit her job as an ethnologist just 3 months earlier, and was paying her half of the expenses with passive income. She had reached a point where she could trade her nest egg for her dream house, but that would also require being bound to a job for life. Being on the other side of that deal, it made me rethink that our paid-off house costs us much more than the property tax bill; there is a huge opportunity cost of capital. It made me consider that we could exchange the house for passive income.

It was nice how they included Casper (apartments investor with the tricked out car) to show that early retirement didn't have to be all about austerity (fatFIRE represent?). He has a fun personality and it seemed kind of extreme how becoming a soldier helped pay off his debts ("When you are at war, you do not need an apartment"). I also found Lasse and Malene (tiny house family) likable since they were affectionate and worked well together. As @jp noted, this was a very respectable treatment of FIRE, they portrayed everyone who appeared in a positive light. Even the experts' comments seemed to focus on legitimate concerns, though the consumer economist had some pointed words at 24:39:

You go poorly dressed. Or very modestly dressed. You buy used clothes. When you go to the cafeteria and eat, you are the only one with a packed lunch. When you are invited to Christmas party, you decline because you have to pay 148 kr. to attend and you want to save. In the workplace it may seem that you are a bit peculiar because you live differently. Perhaps one would be accused of being stingy or asocial. And one must live with that.

My favorite Jacob-quote from the documentary. Thanks for the lesson in making laundry detergent at 21:20.

I am about to make washing powder. I have to grate the soap first. And then when we finish it, then 1/2 cup of the washing soda is mixed in and then 1/3 cup of borax.

The ingredients here are almost free. So ten dollars every five years. It takes about five minutes. It's faster than going down to the supermarket and buying it. It's even faster than working to make the money to buy it. The latter would probably take one hour after tax.

Overall I thought it was done really well to present the topic to a general audience in an open-minded manner. For this audience, they made the right decision to focus more on the Danish FIRE retirees/aspirants and less on Jacob. Better to have breadth in seeing what is possible rather than feature one person's choices.(**) This was a thoughtful, quality piece. I wish we had more journalism like this in the US. I'm also appreciative for all who appeared in the show, allowing themselves to be put in the spotlight so others can learn that they have a choice between consumption and freedom. Also noting that I would like to see the extended discussion with Jacob and his wife (and the other people featured -- I'm sure they were also in a similar position having hours of interview condensed to a few sound bites).

(**) DW raised an eyebrow listening to Jacob at 38:56 "If I have forgotten water, then I would rather be thirsty than to buy it. Some say I'm stingy, though for me, it's about priorities." Fortunately this was immediately followed with Erica saying "You don't have to be as extreme as Jacob."

Some notes:
8:15 - Nice shot of Frank the pug next to Jacob on the couch as he browses the forum.
10:30 - Jacob refers to himself as a cult leader
23:13 - Jacob's bidet makes an appearance. @jacob What did you mean by this? "Vi købte jo nærmest et fallitbo." Were you making a joke about getting into financial trouble remodeling the bathroom for all of $50?
36:03 - The rule of thumb is given as 30x annual expenses (3.3% WR), I wonder if this is standard in Danish FIRE or if Jacob had a role in recommending this over 25x?
39:39 - More Frank the pug. I'm sure Dragline got a kick out of this.
40:58 - Some funny ticker symbols in the background as they explain the latte effect.
44:22 - Can see the June 2018 issue of Penge & Privatøkonomi which features an article about Jacob.
44:25 - Jacob appears very happy looking at his capital income spreadsheet.
46:00 - (Panhandler incident) I think unscripted moments like these reveal one's true character. Even more respect for Jacob.

[J_]

Fish: thanks for your translation and summary! Yes I am grateful seeing you all life!

[1taskaday]

Really enjoyed watching the tv show.

The only one who I felt left the whole ERE movement's philosophy down on the programme was Frank.

Definitely no enthusiasm seen there for walking!

[wizards]

36:03 - The rule of thumb is given as 30x annual expenses (3.3% WR), I wonder if this is standard in Danish FIRE or if Jacob had a role in recommending this over 25x?

I do not participate in the show, but have had a few phone calls with Eva who is behind the show.

I think this one is on me, it is my way of dealing with taxes, since the tax will not be zero in Denmark. For example, the minimum tax on dividends is 27 percent. It may seem harsh, but remember that we get paid education and health care through taxes. I don't mind this "offer".

[BRUTE]

For example, the minimum tax on dividends is 27 percent. It may seem harsh, but remember that we get paid education and health care through taxes. I don't mind this "offer".

and if wizards did mind, what good would that do, right?

[RealPerson]

I do not participate in the show, but have had a few phone calls with Eva who is behind the show.

I think this one is on me, it is my way of dealing with taxes, since the tax will not be zero in Denmark. For example, the minimum tax on dividends is 27 percent. It may seem harsh, but remember that we get paid education and health care through taxes. I don't mind this "offer".

How do you calculate 3.3%? According to Numbeo, the cost of living in Denmark is about 25% higher, and you have a 27% tax on dividends. That should take roughly half off of the table, leaving you with a SWR of 2%. Are there other elements in play that affect the numbers? Unless of course you accept a much lower standard of living in Denmark, but that does not seem self evident for a person living an ERE lifestyle.

[rube]

@realperson Cost of living is unrelated to the swr %?

[wizards]

How do you calculate 3.3%? According to Numbeo, the cost of living in Denmark is about 25% higher, and you have a 27% tax on dividends. That should take roughly half off of the table, leaving you with a SWR of 2%. Are there other elements in play that affect the numbers? Unless of course you accept a much lower standard of living in Denmark, but that does not seem self evident for a person living an ERE lifestyle.

As Rube says COL is unrelated to swr, and the tax system is progressive, so there is no "one size fits all" calculation - there are some deductions which should be considered as well. As stated in the programe the 30x "rule" should never be the final answer, its a rule of thumb...

[frihet]

Thank you Jacob and everyone else for an enjoyable Christmasday watch. Understood most of it, I think Jacobs danish was actually the easiest to understand.

As has been said before a very balanced and fair view of ERE.

And Jacob your washing powder explanation was epic Guru wisdom

[jacob]

@Fish - The inner stoic shone through there. I don't think that was explained very well. I was trying to make a point about delayed gratification and valuation. I remember telling too other stories but they must have been either too long or not on camera. As a child when we got a dollar for icecream, I would always go for the candy because it would last longer. If the stand sold comic books, I'd go for that because then I could enjoy them permanently. Another example was when I bought two amplifiers (pre and power) weighing ~50lbs and costing $1000+ and walked them home (~5-6km) in two shoulder bags because I didn't want to spend $0.25 on a bus ticket.

So, I would have to be really really thirsty before I paid $1 in "stupid tax" because I forgot to bring water. In my value-system buying bottled water is practically immoral.

There's another comment about me never buying movie tickets. This is not because they cost money or because I can "just wait for the DVD" but because I don't have the patience/interest to sit and stare at a movie for 2+ hours w/o having a book to distract me. (Same reason I don't watch 1hr long youtube video lectures.) But yes, in general, my consumer spending is quite different from the norm.

Fallitbo = foreclosure. What I didn't realize before buying was that when people foreclose the last thing they stop paying is the mortgage. Consequently maintenance and repairs had been neglected for a good 10 years before we bought it which meant replacing almost everything. Most people would hire a contractor and get everything done. We were quoted $18000. Instead we've slowly worked through the house room by room and issue by issue. Bathroom was included in that process. The kitchen is next.

There was some back and forth on the 30x rule in post-production (for making the cartoons). I was asked about the 4% and 25x rule and I said that I'd rather the program aimed for higher numbers since 25x is a bit foolhardy for ER (albeit not so much in Denmark due to different SS calculations). I told her my standard was 33x (3% rule) but I was willing to bend on that and what did the other participants say? She came back with the 30x number and I was okay with that. I also ran some tax calculations(*) showing that it's important to include taxes in the consideration. These did not make it into the cartoons but a comment about the importance of considering taxation did(?).

(*) Requires some above-noob level algebra because of the brackets.

My capital income spreadsheet is obviously a work of art

@1taskaday - Frank became the star of the show. You can see how he barks when people came in during the meetup. After he snored his way through multiple scenes, she took some shots of him to explain where the sound was coming from. During the walking scene it was 85F outside. He just wanted back inside. He's a lot faster in freezing temperatures despite being 15 years old (14 at the time). That entire walk was super awkward. Neighbors came out on the porch to stare while she (camera) was trying to walk backwards and I was trying to appear natural.

@RealPerson - COL in Denmark is about the same as COL in Chicago but as others noted, this has nothing to do with SWR. Danish taxes are higher but then you also don't have to worry about health insurance. The median disposable (after tax) income from a few years ago is $34k/year. If you live outside the major cities, RE is cheap---just like in the US. Casper in the program lives on Lolland-Falster where houses are quite inexpensive (one the the cheapest areas in the country).

[prognastat]

Though some of it may have been lost in translation for me it seems in general much more objective and non judgemental about FIRE/ERE than most articles and videos in the US where even articles that have a generally positive tone can't help but poke at least some fun at FIRE/ERE and the people pursuing it.

I also like that they tend to focus a lot on the shift in perception between what something costs right now and what it costs both to regularly buy said item and what those funds could have been if invested giving you the true cost in the long term.

@Jacob
regarding buying movie tickets I stopped mostly due to the can watch it later on DVD or rental much cheaper and I already have far too much entertainment waiting to be consumed to spend that much to watch something immediately. This has happened even more for video games for me.

I used to buy video games new for $60 and not bat an eye. However I started price watching and instead setting the watch for $20. In the beginning this was quite slow, but over time this meant more games would build up in the list of games not played yet until it got to the point where there was no point in buying a new game for $60 even ones I would generally really want as I had multiple good games still waiting to be played so even those got put on price watch leading to even more games. This has reduced my spending on games some, but mostly it has meant better value for my spending. Generally getting 3 games for what I used to pay for 1. I could go even cheaper and buy used, this could probably cut my spending in half to $10 per game, however I feel morally responsible to at least support the developer of the games a little as they made something I enjoy and would like them to keep doing so and thus keep buying new.

This has lead to probably 20 games still unplayed which in a way is inefficient, but at the same time video game pricing tends to follow a U curve where a game is most expensive when it's either very new, or very old when it isn't being produced anymore. I only do this for video games though and not for movies/tv shows so this could be called my one vice.

[henrik]

@cimorene12 Thanks for the subtitle tip. Even with the context there, spoken Danish is hard on the brain:)

It was a well made and positive piece. Compared to Jacob, the local Danish participants were not very specific about their financials. It would have been interesting in comparison to all the US details you get here and elsewhere on the internet. Still it's remarkable that people are willing to appear with their real names and faces (Jacob included, although he's probably used to it by now).
@jacob Does one get paid to appear in a TV show like this?

[prognastat]

@Henrik

I think most of the ones featured were post FIRE or very close at least. At least for me I would feel much more comfortable sharing this kind of information without being anonymous if I didn't think there was a chance it might affect my employment opportunities which it wouldn't if I were FIREd already.

That might be why most of the people featured were more comfortable with it.

[jacob]

@henrik - Well, I wasn't and I don't think it's normal to get paid for something like this.

[Fish]

the local Danish participants were not very specific about their financials.

I didn't find this to be the case. They disclosed Pernille's salary as well as the amount she was able to save each month. From that you can solve for living expenses, and estimate her NW knowing that investment income is enough to cover her share of the expenses. They mentioned that Casper owns X apartments with a goal of X+Y for a monthly income of Z at retirement. You can guess that their household income is likely 2-3 times Z given that they are aggressively saving for FIRE. There's a scene where he goes through a list of his rentals, rattling off the purchase price and outstanding loan amount on each one. Lasse and Malene disclosed purchase price of their land and the ongoing cost of the tiny house. From my perspective there was plenty of detail provided and to give more would have been unnecessary and somewhat awkward.

However, I do agree with your other comment regarding spoken Danish. I wasted an hour at near-zero comprehension , then discovered the subtitle button and had a second viewing while attempting to read Danish in real time, then used @cimorene12's trick to translate to English, and watched it a 4th time together with DW. I have the whole thing memorized.

[cmonkey]

I watched glimpses of it when it came out and didn't think of using Chrome's translation tool. It worked surprisingly well! It's a very well made little documentary.

I spent an entire day making a capital income calendar similar to @jacobs when I saw this. I don't know why I hadn't thought of arranging them like that but it is genius!

[jacob]

Thanks for the chrome tip. I nearly had an aneurysm trying to do a simultaneous translation for DW.

Chrome worked but only after I installed the Unitrans extension.