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This ER Group and Bell Curve
Old 06-27-2017, 11:38 PM   #1
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This ER Group and Bell Curve

(First of all, sorry for the title. I'm just not quite sure how I should title this post.)

Reading this forum, I'm going to assume many here have yearly spending between $100K-$200K. And in that Bell Curve, there will some with an even higher spending level, and those not far off on the other side of the curve.

What gets me, is I live in Southern CA, and I like to bike ride along So Cal's beaches. A few days ago, I was in Newport Beach biking along the peninsula. Those homes, the average homes along the water, and even inland, I'm assuming are all over $1MM minimum and the average ~$4MM.

So what gets me, is I see this incredible wealth, and though I may fall in the middle of the above Bell Curve, I do feel a sense a lacking when I'm in that environment. A friend owns a home down in Balboa and says he could get $5K/week if he wished to rent.

So you have those living in Newport Beach living that lifestyle, and many on this board living a very comfortable lifestyle, but not Newport Beachy. And yet, to me, this Bell Curve group, is living a life that is almost unimaginable in its luxury.

As an aside, I'm sure many of those people I saw in Newport Beach were tourists. And I'd love to know what percentage even bothered to get in the water. If I had my druthers, I'd be in a lake house with a boat, skis and doing a lot more fun stuff water activities.
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Old 06-28-2017, 04:54 AM   #2
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It's all relative.

Go to Egypt, and $25k gets you the same effect. Go to Nepal, .. you get the picture.

Small piece of unsolicited advice: stay away from more affluent neighborhoods, it is not conducive to your wallet or happiness. They aren't happier either.
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Old 06-28-2017, 05:03 AM   #3
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Luxury is in the eye of the beholder. I live in SoCal too, but 12 miles from the coast. Home worth well under $1M and annual spend well under $100K (closer to half that on both counts). I ride my bike most days, often to the aforementioned beach, travel overseas for a month or more most years and am about to go camping in the Sierras, which I do whenever I feel like it. Feels pretty luxurious to me.

FWIW I really doubt that Newport Beach is near the center of any kind of income bell curve - even in spendy California.
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Old 06-28-2017, 05:11 AM   #4
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Luxury is in the eye of the beholder. I live in SoCal too, but 12 miles from the coast. Home worth well under $1M and annual spend well under $100K (closer to half that on both counts).
We live, travel, on about $37K US a year.......no feelings of deprivation...(in fact we're currently talking about getting rid of 'stuff', rather than "I wish we had....").
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Old 06-28-2017, 05:32 AM   #5
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There is tremendous wealth in the US but there are many places where wealth is much less visible. Every major city has expensive areas. We were in Glencoe (north shore suburb of Chicago ) recently to visit friends. Talk about beautiful, very expensive homes. Our friends' place was worth $6million and it was comparatively modest. He said his property taxes are $140,000per year. Quite possible these places were bought/built decades ago at a much lower amount.

There will always be someone with more than you. Best not to think too much about that if you want to be happy. Most people get "happy" with their means whatever it is.
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Old 06-28-2017, 05:37 AM   #6
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Small piece of unsolicited advice: stay away from more affluent neighborhoods, it is not conducive to your wallet or happiness. They aren't happier either.
I look at it from the other end:
Being around extreme affluence always made me feel better.

We lived in Monaco for a while...obscene affluence! But you can have a nice lunch dockside sitting next to a 200 foot yacht and be part of the scene for the price of a meal. The guy at the next table could be some Saudi prince--and probably is!

We winter in Fort Lauderdale and the perspective is the same. Something sort of cool about sitting on the beach and have a $7MM yacht go by or having a Bentley or Rolls stop to let you cross the street. I'd rather have dinner looking at a $40MM home across the Intracoastal than some abandoned warehouse!

If you lose the envy aspect, you can be (a small) part of the experience without the price! Eye candy.
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Old 06-28-2017, 05:54 AM   #7
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Originally Posted by Danmar View Post
There is tremendous wealth in the US but there are many places where wealth is much less visible. Every major city has expensive areas. We were in Glencoe (north shore suburb of Chicago ) recently to visit friends. Talk about beautiful, very expensive homes. Our friends' place was worth $6million and it was comparatively modest. He said his property taxes are $140,000per year. Quite possible these places were bought/built decades ago at a much lower amount.

There will always be someone with more than you. Best not to think too much about that if you want to be happy. Most people get "happy" with their means whatever it is.


+1
I learned this when I worked for megacorp in a senior management position. I was at a business dinner with the top corporate officers, most of whom owned expensive homes on multiple continents with cars/staff supporting each home. They got into a discussion about when was the last time they had seen their wives, and instead of lamenting their situation, it felt like they were in competition with each other - bragging about how long it had been (weeks or months) since they and their wives had been in the same place. A light bulb went off in my head that I didn't want that kind of life. Instead of pursuing the next rung on the corporate ladder which would have required nearly constant global travel, I pursued stepping off the treadmill to spend more time with family and friends. I wasn't yet ready to ER, but actively sought a less responsible position that would allow me to spend more time off the job. Took a large pay cut to do so. People thought I was crazy but I don't regret it.

So when I see huge waterfront homes, megayachts, and other displays of way more wealth than we'll ever have, if I feel any twinge of wishing I had whatever, I just remind myself that I could have had more, but chose to follow my heart and live my values.

Regardless of specific wealth level, anyone who voluntarily ER's likely traded off time for cash - by definition, volunteering to ER is leaving some money on the table in exchange for spending one's time on activities one values.
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Old 06-28-2017, 06:02 AM   #8
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Regardless of specific wealth level, anyone who voluntarily ER's likely traded off time for cash - by definition, volunteering to ER is leaving some money on the table in exchange for spending one's time on activities one values.
+1
And in one sentence, there it is!! Bravo.
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Old 06-28-2017, 06:03 AM   #9
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He said his property taxes are $140,000per year. Quite possible these places were bought/built decades ago at a much lower amount.
I was in Cairns, Northern Queensland, in 1962.....at that time a fair percentage of the (then small) population were 'escapees' from the major Australian cities who bought properties at dirt cheap prices.

As the town turned into a tourist Makkah, house prices rose...the now 'house rich, cash poor' (often jobless) initial residents couldn't afford to pay their rapidly increasing/highly inflated property taxes.

"All grandiose and nowhere to go."
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Old 06-28-2017, 06:04 AM   #10
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You can own your possessions or your possessions can own you. Your choice.
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Old 06-28-2017, 06:12 AM   #11
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You can own your possessions or your possessions can own you. Your choice.
Agree, but there is no evidence that wealthly people are "owned" by their possessions. Probably just another way to feel satisfied with your own position? Not a bad thing to internalize this idea, but projecting it on others? Not so much.
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Old 06-28-2017, 06:15 AM   #12
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So you have those living in Newport Beach living that lifestyle, and many on this board living a very comfortable lifestyle, but not Newport Beachy. And yet, to me, this Bell Curve group, is living a life that is almost unimaginable in its luxury.
I think the bell curve sorta begins at 50K spending per year, and might skew out to 150-200K. Just a WAG. I know there are polls that covered this.

A few weekends ago we visited the NJ shore. We went from a smallish 1950's style bay front home to a newer multi-million dollar home in an afternoon. It had all the whiz-bang you or I would need. The family business is billboards. Go figure. Was he happy? After taking a slice of bakery pie we brought, he seemed to smile.
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Old 06-28-2017, 06:23 AM   #13
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Originally Posted by Danmar View Post
There is tremendous wealth in the US but there are many places where wealth is much less visible. Every major city has expensive areas. We were in Glencoe (north shore suburb of Chicago ) recently to visit friends. Talk about beautiful, very expensive homes. Our friends' place was worth $6million and it was comparatively modest. He said his property taxes are $140,000per year. Quite possible these places were bought/built decades ago at a much lower amount.

There will always be someone with more than you. Best not to think too much about that if you want to be happy. Most people get "happy" with their means whatever it is.
^^^Whoa. Really??^^^^

That just made me throw up in my mouth a little bit.....
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Old 06-28-2017, 06:23 AM   #14
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Agree, but there is no evidence that wealthly people are "owned" by their possessions. Probably just another way to feel satisfied with your own position. Not a bad thing to internalize this idea, but projecting it on others? Not so much.
I would agree that if you are truly wealthy and you can easily afford to have all the nice possessions, then you are not owned by them. Heck, I have many things others would deem overly luxurious. But I have known many people who are not wealthy enough to support their possessions without continually working until they drop. In that case, it seems to me that they are indeed owned by their possessions. As with anything, opinions vary.
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Old 06-28-2017, 06:37 AM   #15
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Reading this forum, I'm going to assume many here have yearly spending between $100K-$200K. And in that Bell Curve, there will some with an even higher spending level, and those not far off on the other side of the curve.
I think your assumption would be a little off, and most here would have yearly spend below $100K shifting the Bell Curve downwards.
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Old 06-28-2017, 06:44 AM   #16
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I would agree that if you are truly wealthy and you can easily afford to have all the nice possessions, then you are not owned by them. Heck, I have many things others would deem overly luxurious. But I have known many people who are not wealthy enough to support their possessions without continually working until they drop. In that case, it seems to me that they are indeed owned by their possessions. As with anything, opinions vary.
I think we would all agree that one should live within their means. There are a lot of people in the US with very high means. Many of these people have very nice things.

Sometimes we might think that people with nice things can't really afford them and surely there are many that can't. Generalizing this might be a convenient way to feel better about oneself? But I have to think, based on my personal experience and circle of friends, that most people can afford their lifestyle. There are certainly many anecdotes about those that can't though. Should we list a few? Might make the OP feel better.
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Old 06-28-2017, 06:50 AM   #17
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+1
I learned this when I worked for megacorp in a senior management position. I was at a business dinner with the top corporate officers .... They got into a discussion about when was the last time they had seen their wives.... A light bulb went off in my head that I didn't want that kind of life. ....
This was us. We would often go weeks without seeing each other due to work travel and her call schedule; got much tougher with small kids. We chose for me to step off, rather than accept BigLaw partnership; some of my peers chose to stay for career. Hopefully they are as happy with their choice as we are with mine.

To the original point, whichever data set is the source for the curve, we are content.
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Old 06-28-2017, 06:52 AM   #18
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Living in the heart of the world's highest Gini co-efficient, I'm surrounded by wealthy people who aren't shy about living a far more affluent lifestyle than we do. I also live with the knowledge that I could have kept working in my high paying career and had a bigger home, a holiday villa in Phuket (or wherever), a farm in NZ, a couple of high end cars and a whatever. I'm also living with the knowledge that by walking away from these things I gained a fantastic early retirement. Three years in, I wouldn't think any amount of material affluence would be worth losing what I gained when I left the rat race. If other people make different decisions I neither envy them nor regret my choices.

YMMV (but probably not on this forum).
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Old 06-28-2017, 06:52 AM   #19
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Reading this forum, I'm going to assume many here have yearly spending between $100K-$200K. And in that Bell Curve, there will some with an even higher spending level, and those not far off on the other side of the curve.
I think that's a little high. Per capita, I'd guess it is closer to $30k-$50k. I'm around $25k, at the low end.
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Old 06-28-2017, 06:57 AM   #20
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Regardless of specific wealth level, anyone who voluntarily ER's likely traded off time for cash - by definition, volunteering to ER is leaving some money on the table in exchange for spending one's time on activities one values.
+2.

If I kept working, I'd have a lot more money, from both my salary (which would be over $100k FT, much less if still PT) and from my company stock (at least $500k). But I would be so miserable I can't comprehend. And that doesn't include how awful things would have become if I tried to keep working through my health issues 2 years ago. Being ERed greatly helped my getting over my health issues.
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