Financial Independence Movement

[civvver]

I came across this article today

https://www.msn.com/en-us/money/ret...-cult-of-early-retirees/ar-AAvYfn0?li=BBnbfcN

Some of this stuff I have seen before. A whole wave of young people living beyond frugal, obsessed with budgets and getting free stuff through club points and such, maxing out their ira contributions every year, all with this idea of retiring in their 40s. Ok sounds cool but it's also slightly obnoxious to read about.

Apparently the author the article is about was more about using money as a tool to fuel your lifestyle and learning to use less so you can do more, like travel cheaply. It was about having more time. I don't feel like most of the fire movement adherents feel this way. They more seem like obsessed with spending as little as possible just to say they did it and have massive amounts of time later. Many of their attitudes come off as very judgmental if you have any debt or don't save 20% of your money or whatever.

I guess my question is why? What are you going to do with all this time in retirement that you couldn't kind of do along the way in any balanced lifestyle? Cus if you truly are going to retire in your 30s/40s/50s, unless you have like 8 figures saved you aren't living extravagantly. That money has to last. Even for "normal" retirement age many calculators say you need like 25 times earnings, which for someone making 75k a year is 1.875 million. I'd at least double and probably triple that if you're doubling your years in retirement.

My family and I went on vacation over spring break with my wife's old high school friend. They have 1 kid, we have two. We shared a condo in gulf shores and drove there, made a road trip of it, so that part was very inexpensive. Eating out daily was a little expensive, but altogether it was a pretty cheap trip. However her friends are very much part of this financial independence movement. They're obsessed with Dave Ramsey. They use cash for groceries. They budget annually what they're spending money on, planning out all their big purchases. That's all fine and dandy until they start to preach at you about how much money your wasting. The guy actually took home in the car a half drank 2 liter of dr pepper cus hey they paid for it and didn't want to waste it.

We also noticed a dramatic shift about half way through the vacation. The wife told my wife they had gone over their spending allotment but it was ok. Then we went to an outdoor play area that had drinks and cool stuff and they didn't order anything while the kids played. It was all really weird.

It strikes me that though they may say well debt enslaves you and you're stuck at your job, I see them as being slaves to their budget really, unable to have fun and enjoy themselves outside of it. And no, we didn't go into debt for this vacation, but yes I have a car payment, I have a mortgage, I have interest free installment payments on appliances and furniture.

Also one thing I almost never see mentioned on these blogs. I'm the sole provider for my family of four. I make enough my wife doesn't have to work anymore. I consider that a huge success. In a way she is retired and able to spend all her time with our kids, which is definitely as hard as any job. But all these saver types seem to always either stay single or both people work in high end jobs. It seems very unrealistic, well I guess it's not if you want to be alone your whole life. If my wife made the same as me and we stuck both our kids in day care then yep, we'd save like 1/3rd to half our income for sure. I don't know if we'd retire sooner or what we'd do with the money.

I guess in essence what I'm saying is I see this movement as kind of shallow. All about yourself, very self centered on I want this and that so I can do whatever I want, whenever I want. People have every right to be selfish I suppose, but the judgmental part of it gets to me.

 

[Synobun]

However her friends are very much part of this financial independence movement. They're obsessed with Dave Ramsey. They use cash for groceries.

What fools. Many grocery stores have rewards cards today. Hell, just get a credit card with cash-back. They are an embarrassment to the cult for neglecting such an easy way to increase profits.

 

[Lexicus]

This seems like an excellent Humans Of Late Capitalism Post, someone forward it there pls

 

[Farm Boy]

Why not throw a liter of pop in the fridge? It doesn't really go flat unless you keep opening and shutting it a bunch. Even then, it's sugar and caffeine. You get all the drugs from it adequately even if it is flat or hot.

 

[Disgustipated]

They more seem like obsessed with spending as little as possible just to say they did it and have massive amounts of time later. Many of their attitudes come off as very judgmental if you have any debt or don't save 20% of your money or whatever.

20% pffft. I was easily saving over 90% of my income prior to my health issues (the hospital bills I haven't gotten them all yet, but my insurance is kind of crappy, and it will be a lot). If you don't have a gf, it's easy to save 90% of your money (if your house is payed off like mine is). As of now, my medicine is over $7 a pill which is $7 a day, so this will massively lower that 90% number.

I don't do this to retire early. As my above mentioned health care problems indicate, not working is not an option because any medical bills will screw you over harshly. You HAVE to have insurance, there is no other option. And the only decent way to have insurance is through work in my country.

I save money not by some misguided philosophy. I can care less about early retirement. I get immense satisfaction through my job, and it's the only social contact I have. I save money because I have nothing to spend it on.

I wouldn't call myself cheap, I cook with 1% ground turkey breast which isn't the cheapest. I try to eat reasonably healthy, unfortunately I still struggle with cholesterol.

Why not throw a liter of pop in the fridge? It doesn't really go flat unless you keep opening and shutting it a bunch. Even then, it's sugar and caffeine. You get all the drugs from it adequately even if it is flat or hot.

Eliminating soda is the quickest and easiest way to save money. I almost never drink it, and when I do it's the free stuff at work.

 

[stinkubus]

What fools. Many grocery stores have rewards cards today. Hell, just get a credit card with cash-back. They are an embarrassment to the cult for neglecting such an easy way to increase profits.

The majority of credit card holders carry a balance. The cash back is swamped by finance charges and fees for most folks.

 

[Farm Boy]

I buy a lot less of it than I used to. But if I found myself with a 2 liter of it, I'd throw the extra in the fridge.

Beer costs more than pop, btw!

 

[Synobun]

The majority of credit card holders carry a balance. The cash back is swamped by finance charges and fees for most folks.

Fools! Treat a credit card like an extension of your wallet. It's real dollars, not debt dollars. Operate your card as though it is your cold, hard cash and you won't carry a balance.

Joking aside, if you pay off your balance every month and use your credit card for all purchases, you'll more than make up for any annual fees with a basic cash back feature. With higher credit scores and greater income, you'll likely also get other features like rewards with certain stores/gas stations and air miles. Credit cards are amazingly useful if you use them properly.

 

[innonimatu]

Funny how credit card companies take a cut from every payment, and still sell the idea that people can save from paying with credit cards instead of cash. It can only work credit card holders on average lose money compared to using cash.

Some can save money depending on how they use the cards, true. But at the social cost of others losing more. A rather nasty invention.

@Civver, retiring in the 40s seems absurd to me because what are you going to do with your free time after that? Better to plan on doing something useful, I can't imagine life being some kind of extending vacation where I wouldn't be doing useful things! Evading the pressures of full time employment, I can understand that people wish that. Especially in the US where vacation time apparently is regarded as an oddity... But retiring?

About your friends, there's one thing they did well: avoiding being "shaming into consuming". You probably didn't intend to do any harm, rather the opposite, but that is often a problem when friends with different financial capabilities get out together. It's nice to be mindful of what the people with you can and cannot afford to pay, and avoid putting them into difficult situation. Either for their finances or for their pride. Try to find something or somewhere else cheaper to spend your time together, sometimes it is surprisingly easy! I've eaten some cheap sandwiches as lunch by the sea in hidden beaches near rather expensive places, rather that eat the reputedly delicious dishes in the extremely expensive restaurants nearby, when traveling with friends who couldn't afford them. And those times are among my best memories!

 

[stinkubus]

Funny how credit card companies take a cut from every payment, and still sell the idea that people can save from paying with credit cards instead of cash. It can only work credit card holders on average lose money compared to using cash.

Some can save money depending on how they use the cards, true. But at the social cost of others losing more. A rather nasty invention.

Capitalistic societies are literally designed to take money from those who can least afford it so that it can be given to those who don't really need it.

 

[Lexicus]

 

[warpus]

A whole wave of young people living beyond frugal, obsessed with budgets and getting free stuff through club points and such, maxing out their ira contributions every year, all with this idea of retiring in their 40s.

All the power to people who are able to do this and go through with it.

However, it's probably worth pointing out that current trends put most young people in North America in an entirely different predicament... for a lot of young people it's not a question of how to retire early, but how to retire at all

Personally I also think it's a waste to fill up your 20s and 30s working your butt off and not having any fun, and then retiring when you're starting to get old and having "fun" then. The way people end up doing this, since when you get old you just don't want to do many of the things when you were younger is.... buy a flashy car. Yay? Your whole youth, for a car? No thanks

 

[TheMeInTeam]

What matters for this choice is what the chooser values.

Super early retirement makes sense if the overwhelming majority of your preferred actions are not expensive. I know for me it's very nice not to be beholden to anybody. Work is one of those things where you are. The most fortunate are beholden to things they actively enjoy, making the fact that they're beholden to it moot (so long as the preference holds).

For me, I'm not quite at that point but still have it pretty good. But I could see how for some people sleeping in, running with an old-guy sports league, playing games, or doing whatever else you feel like doing on a whim is appealing. If that "whim" doesn't include things you've priced yourself out of via early retirement it can work.

It's hard to estimate lifespan and all possible contingencies though. Running out of money and going to work at 70 would be the literal screw up of a lifetime...though I suppose one's retirement was frontloaded and it's not a total loss it still sounds rough.

 

[Manfred Belheim]

The guy actually took home in the car a half drank 2 liter of dr pepper cus hey they paid for it and didn't want to waste it.

OMG!!

What's wrong with that? Sounds reasonable to me. Also what is that? A single drink?! 2 litres seems rather a lot to drink in a single sitting.

But yeah... they saved a drink they'd bought instead of throwing it away, and they didn't get another drink another day while they let their children play. That doesn't sound so bad really.

 

[Yeekim]

The guy actually took home in the car a half drank 2 liter of dr pepper cus hey they paid for it and didn't want to waste it.

Seems like an entirely normal thing to do?
EDIT: nice x-post

 

[Manfred Belheim]

Also find it odd that you "need" to put away 20% of your income (or acrue 25 times your earnings), regardless of what you earn. Surely the more you earn, the smaller a percentage you'd "need" to put away?

 

[Synobun]

The more wealthy FIM followers would advocate for a static 60%. 40% investment, 20% savings.

 

[luiz]

Yeah as others have said some sort of balance is much preferable to just hoarding all your income. There are certain pleasures in life that are much more enjoyable while you are in your 20's or 30's than your 50's or later, so it seems rather stupid to me to go through your youth in self inflicted austerity so you can enjoy later on.

Of course if you can save you should, but within reason. Remember to enjoy the present because there is no guarantee you'll be alive in the future. And it's guaranteed that even if you are alive, you'll be older and your health will decay.

All that said, to each his own. But personally I can't stand cheap people.

 

[Bamspeedy]

Also find it odd that you "need" to put away 20% of your income (or acrue 25 times your earnings), regardless of what you earn. Surely the more you earn, the smaller a percentage you'd "need" to put away?

The idea is that there will be enough at retirement to keep up the lifestyle you were used to (quality of housing, food, etc.). My parent's love to eat at restaurants often and travel across the country. My dad still had to drive a cab during 'retirement' to be able to do that.

The guy actually took home in the car a half drank 2 liter of dr pepper cus hey they paid for it and didn't want to waste it.

If it was in a plastic bottle and had a cap on it, why not? Now, if he tried to take home half a pitcher with no lid and the kids were supposed to keep it steady so it doesn't spill in the car....then that would be weird. Or combined everyone's half-drank cups into one container.

 

[Valka D'Ur]

The guy actually took home in the car a half drank 2 liter of dr pepper cus hey they paid for it and didn't want to waste it.

Oh, horrors!

I'd do the same, if I could carry it without risk of it spilling. Should he have poured it on the ground and tossed the bottle into the garbage instead of drinking the contents later and turning the bottle in for the deposit?

People have every right to be selfish I suppose, but the judgmental part of it gets to me.

How are they being selfish? Was their kid complaining about being deprived of some treat or activity that would have cost money? Is the kid being deprived of any of the necessaries of life, such as adequate food, clothing, education, or medical care?

There was a news article awhile back here about a guy who lived very frugally for a few years and paid off his mortgage decades ahead of when most people would expect to achieve that. He took on as much work as he could, drove an old car, lived in the basement of his house and rented out the main floor, didn't go out to eat, didn't travel... and the reaction from social media was the kind of hateful stuff that one would expect to see directed at a murderer or rapist. How DARE this guy decide to live frugally for a few years and put every extra dollar toward paying down the largest debt he would ever have in his life? How DARE he defer luxuries for a few years so he could enjoy them later, guilt-free? The vitriol directed at him was mind-boggling.

So I don't get why you're so bothered about this couple's decision. It's their life, and unless they promised you a gift or something that they're not going to come through with due to their decision to live more frugally, I don't understand why it's even your business.

That said, them preaching to you about it is tacky behavior, and I don't blame you for being annoyed about that.