a 29 year old retiree wow

[FUEGO]

When my wife takes off from work to take care of the kids, we occasionally need to use some of our savings to live off of. By Madison's definition, my wife is retired I guess. Don't tell her that though!

 

[Lazarus]

I guess “retired”, means different things to different people. I think most people on this board mean financially independent without working or being supported by someone else. That is living off their investments and or pensions and Social Security.

Nothing wrong with being supported by someone else, except when you try to claim you are financially independent and are selling info to others on how to do it.

Oh yeah, financially independent means until you die, not just till you run through your savings and start working again. You could make the choice to take off for a few years and spend down your savings but that doesn’t make you retired or financially independent.

I have heard people from my hometown that quit working at the glove factory that will say “ I am retired from the glove factory”. No pension, not financially independent and working again at another job. But they say they are retired from there. I don’t see it. They are really just laid off or quit. Retired sounds better I guess.

 

[MoneyColumnist]

I wrote the story on the 29-year-old

I'm Laura Rowley. I write the Money and Happiness column on Yahoo!Finance. I was genuinely surprised by the bitter response to the story about Madison DuPaix (especially on a forum like this one).

I've answered some of the questions in this thread in a long post on my blog, www.moneyandhappiness.com/blog. This is not a ploy to send traffic over there, I just wasn't sure I could post something that long over here. Would enjoy hearing your feedback.

 

[Rich_by_the_Bay]

Laura, thank you for following up. There is considerable history here that may account for the tone of some respondents. I am guessing that some of it relates to past users making similar claims, for whom the numbers and blogs (with ads) subsequently did not stand up under scrutiny.

The possibility of driving traffic to a personally owned ad-cluttered blog adds to the reticence. Maybe there is something real here or maybe there isn't, but in context it seems to call for her to be forthcoming and accurate. The collective instinct here is often accurate in matters like this.

I'm interested in hearing Madison's full story, and wish her well. But I would approach this with a healthy skepticism.

 

[EagleEye]

Laura:

Instead of disparaging the postings here as "bitter", you might be better served by focusing on the shortcomings in your own column. It seems to me that these shortcomings are summed up by the this text from your most recent posting on "Madison":

"She would not give me the figures. Maybe I’m naive, and I was suckered by a self-promoting blogger. But I don’t think so. I did my own back-of-the-napkin assumptions; if she were making $75,000 working in finance/insurance and two-thirds of it went to daycare, taxes, and savings, then her cash flow was $25,000. She would need to have saved $1.25 million to draw down 2% and stay cash-flow even.

Impossible to accumulate that amount over 13 years? Not necessarily."

Laura, the issue is not whether you or we can prove that Madison's scenario is "impossible". Obviously, anything is possible. Maybe Madison leveraged herself, invested everything in JDS Uniphase, sold at the top, and then shorted it to the bottom. Heck, under that scenario it is "possible" that she could have made a fortune in 2 weeks. The point is not that we can't disprove her scenario; the point is that she won't give you specific numbers and data to support her story. And she still hasn't. Apparently the urgency of Halloween festivities has prevented her with posting a paragraph's worth of data which would allow us to assess her story in a substantive way.

Look, if you are going to blog to the public about money and happiness, and if you are going to relate the story of "Madison" as something of importance to your readers, possibly even as a model for their own financial paths, then you should ask for data to back up the story. It strikes me as nothing less than bizarre for this woman, using a pseudonym, to make a conscious effort to share her financial history with the public, to share generic backround information and percentages, but then to refuse to share the data in terms of actual dollars and cents.

My suggestion: stop interpreting skepticism as bitterness, and begin to adopt a healty sense of skepticism of your own.

Also, your back of the napkin analysis on Madison is flawed. She said she started saving at 16. She saved $600 the first year. One would reasonably assume that the first 5 or 6 years would yield very modest savings, as she was either a minor or a full-time student. Even you assert that she was a "super saver" (whatever that means) for only 6 years. The condo that she allegedly sold at market peak likely would have been in the Midwest where she claims to live; this was not a bubble area, so we can't assume that this accounted for much gain. Of course, all of this is like flying blindfolded, since we don't have any real data. But even a novice would have at least raised some red flags.

 

[freebeer]

Sheesh, you are all sure being hard on Ms. Madison. I mean, "retired", "semi-retired", "stay-at-home mom" - what's the big diff? The main points that qualify her as FIRE in my book are that she has left the corporate 9-5 working world and is essentially in a decumulation mode.

My 77-year-old mother volunteers at the local senior center, local charity thrift store, and works an occasional substitute lunch lady shift at the local schools. The latter is the only "job" that pays any wages - but it's the least of her time commitments, and she jokes she only does it to be able to rough up little kids and take their lunch money... occasionally even her own grandchildren . You guys gonna say she's a liar if she calls herself retired?

 

[burch64]

Madison is posting on Fat Wallet Forum today 11/1/2008

Jim

 

[Janet H]

Sheesh, you are all sure being hard on Ms. Madison. I mean, "retired", "semi-retired", "stay-at-home mom" - what's the big diff? ...

Sticking up for stay at home moms here.... tough job with crappy pay and intangible benefits. Raising kids is hard w*rk. But I digress...

 

[CuppaJoe]

Sticking up for stay at home moms here.... tough job with crappy pay and intangible benefits. Raising kids is hard w*rk. But I digress...

No, that is not a digression! And don't forget the work put in by dads like CFB. That, IMO, is not retirement, it is a full-time commitment and I'm glad Madison is able to swing it.

Here's my question, if her husband disappeared, say through divorce, would Madison be able to remain FI for life?

 

[free4now]

Go Madison go!

Nords and CFB are two big posters on this board who seem to consider themselves early retired, yet both have or had spouses working full time and providing health insurance. I haven't seen anyone on this board challenge them on their early retirement status. They are male, while Madison is female. I hope that SAHM sterotypes aren't a part of why Madison is being picked on here.

This very E-R forum itself is an advertising supported business run by early retiree dory. There's nothing wrong with making money from advertising while sharing info on how to E-R.

Madison, please continue posting here; people will warm up to you as they get to know you, and you seem to have a lot of good info to share.

 

[REWahoo]

This very E-R forum itself is an advertising supported business run by early retiree dory.

Outdated information.

Dory36 (an early retiree who developed FIRECalc and created this board to discuss early retirement) sold E-R.org to AndyR (a ER wannabee ) a couple of years ago: http://www.early-retirement.org/forums/f32/dory36-demoted-25626.html

 

[unclemick]

Sooo - maybe the 29 steps might be condensed somewhat and they didn't go off to Thailand or Argentina like Billy and Akaisha or the Terhorsts.

She made a serious dent in FI and is all over frugal.

We can nit pick the rest - it will help get us through the winter plus football season doesn't last forever.

For instance - back to 16 - what would one advise now to someone starting out - like my neighbors kid with two non running beater cars and a part time job at Wendy's after school? Given current Mr Market - can it be done again - with index funds - and if not why not? I'd use a female but his sister is only 14.

heh heh heh - purity is for the Boglehead's forum - IMHO the new gold standard. Those of us with Curmudgeon certificates can be more messy. .

 

[jblack]

Go Madison go!

Nords and CFB are two big posters on this board who seem to consider themselves early retired, yet both have or had spouses working full time and providing health insurance. I haven't seen anyone on this board challenge them on their early retirement status. They are male, while Madison is female. I hope that SAHM sterotypes aren't a part of why Madison is being picked on here.

This very E-R forum itself is an advertising supported business run by early retiree dory. There's nothing wrong with making money from advertising while sharing info on how to E-R.

Madison, please continue posting here; people will warm up to you as they get to know you, and you seem to have a lot of good info to share.

Ditto.

I've only been on the board (mostly lurking) for almost 2 years but this is one of the more vulturous threads I've seen (but certainly not THE most).

At the end of the day if the article helps a few other people think more about saving towards a retirement goal then that's a positive contribution to our country's financial education, and I think we'd all agree this is badly needed.

Of course the media may spice it up a little to sell more ads, but I'd much rather read this types of article than all the fear-mongering and useless celebrity gossip crap that fills at least 50% of the airwaves, magazines, and newspapers.

 

[Bestwifeever]

Laura, why won't she give you the numbers about her finances? She is using an assumed name, so it's not like her privacy would be invaded--there is no real "Madison DuPaix" to stalk. So what's her problem about providing the information?

Also, do you think credit card arbitrage to the tune of $250,000 is a method of making money that you would urge people to take up?

Finally, reading between the lines of "Madison DuPaix"'s blog entry/your story: she was shocked to learn at 16 that she had to pay taxes on her little job's earnings because her parents had mutual fund investments in her name to pay for college that were "throwing off capital gains right and left" (her words). I would bet dollars to donuts that those investments were substantial enough to provide a nice little nest egg, since she did NOT need that money for college, having earned a full ride at Wisconsin (and good for her for that). Since the mutual funds were already in her name, surely her parents did not take the money back--someone invested it for her. And likely that amount--which she did not earn--was in the six figures, too, invested possibly for more than ten years (age 18 to 29).

This is the kind of information that you should have gotten from her--what were her numbers, what are her numbers? Could someone without that nest egg, without a working spouse, without a full ride at college, actually save enough $ to be retired at 29 if they had to support themselves in the process? If not, the article is a lie. If so, we don't have enough information to apply it to our own situations.

Finally, if you can't see why your story raised a lot of questions, maybe you need to get out in the real world a little more?

I know people who were fortunate enough to have family money put away for them and successful spouses, and no way would they be tooting their horns about how successful they were at saving money and living off 2 percent of their savings to help out. I have utmost respect for SAH moms and earning a little cash while doing so--that is NOT the issue here. Hope you get a commission on her blog profits.

 

[Bestwifeever]

For instance - back to 16 - what would one advise now to someone starting out - like my neighbors kid with two non running beater cars and a part time job at Wendy's after school? Given current Mr Market - can it be done again - with index funds - and if not why not? .

Yeah, it can be done if your parents have already invested enough in mutual funds in your name that you have to pay taxes on your income at 16 ("throwing off capital gains right and left" per "Madison" blog).... So advise the neighbor kids to pick their parents more carefully next time--that's what I told my kids!

 

[CuppaJoe]

... The condo that she allegedly sold at market peak likely would have been in the Midwest where she claims to live; this was not a bubble area, so we can't assume that this accounted for much gain. Of course, all of this is like flying blindfolded, since we don't have any real data. But even a novice would have at least raised some red flags.

--
In a thread she started, Madison told us her last day at work was 9/18/08; in all fairness, she did not use the word retirement.

I’m not one of the real estate experts on this board but I lived in Madison, Wi back in the ‘60s and early ’70s and believe it might be somewhat expensive by Midwestern standards. A google search on condo sales brought this up:

533 W Main St #305, Madison, WI - similar homes on Trulia

IIRC, all those locations are very near the downtown/Capitol/Square area. As EagleEye says, figuring this out is "like flying blindfolded." For all we know the condo may have been a wedding gift and it's sale, pure profit. But we don't have the numbers.

 

[Madison]

Hi guys,

I responded on my site to many of the questions here and elsewhere (no link since it is frowned upon). For example how much we made off the condo ($110,000), how much we usually saved (50%-75% of our combined income), why I don't disclose our net worth (my blog is NOT anonymous to many family and friends) and if I would feel comfortable with both my husband and I leaving our jobs and providing health care with maternity benefits (no).

Yeah, it can be done if your parents have already invested enough in mutual funds in your name that you have to pay taxes on your income at 16 ("throwing off capital gains right and left" per "Madison" blog).... So advise the neighbor kids to pick their parents more carefully next time--that's what I told my kids!

For what it's worth the term "throwing off capital gains right and left" was written from a 16 year old perspective when your friends all get their entire taxes refunded and you don't. Even if it only amounts to the price of a shirt -- at 16 it's a pretty big deal. My parents gave me $2,500 that went 100% towards my wedding, not our portfolio.

Anyways, I remember when everyone ran MMND out (one of the reasons I never even mentioned my site here - but post only as a regular forum member (and also because I know it's just a general rule of thumb that you don't promote yourself)) so I appreciate those of you that have been supportive (like free4now).

PS Fuego - if you saw an error in anything I've written about, like the life insurance amount, please let me know. I'd love to make an edit and correct it! I'm human and always still learning!

 

[FUEGO]

PS Fuego - if you saw an error in anything I've written about, like the life insurance amount, please let me know. I'd love to make an edit and correct it! I'm human and always still learning!

Well, I don't really have much time to QA/QC your blog for you. You could retain me on an hourly basis if you would like, but based on what you have disclosed in terms of your budget and cash flow, paying me would send you back to work!

My point about the life insurance calculations is that you were making a mistake that virtually every "calculate your life insurance needs" news article/advice makes. Mention of the social security survivor's benefits are hardly ever made. For folks like you and I with two young kids and what I assume to be above average incomes, the SS survivor's benefits work out to be more than $30,000 per year until the kids turn 18. I don't know about you, but this amount covers a substantial portion of my expenses. Now this benefit pays off the most to those with two to three kids that are very young. To overlook this would leave you purchasing a lot more term insurance than you probably need, all things considered. Not a biggie for the typical 20- or 30-something with dirt cheap term life insurance premiums, but throw in a health issue or add a decade or two, and you might be wasting thousands per year for coverage you don't really need (and could be saving towards your retirement, or enjoying it today!).

Other than that, from what I have seen your blog is very good in terms of personal finance blogs. You can quote me on that, for what it is worth (I would suggest nothing!). I did notice another area or two where I had questions about how you discussed tax treatment of certain things, but I probably won't spend the time to research the issues any more (in fact I have already forgotten what those issues were).

In any event, best of luck developing yourself as a personal finance guru. It could potentially pay off in a big way. I think you have more substance (and accuracy) than Kiyosaki and Suze Orman, among others. But sometimes the truth doesn't sell very well (see the yahoo finance editors' sensationalist semi-truthful headline of the story featuring you, for example).

Assuming you continue to pursue this career path (or non-career path, if you don't consider freelancing and blogging work), expect to be challenged on the veracity of your claims and the facts and details of your past. I think the group at this forum takes people to task about whom amazing claims are made. I suppose we are just a bunch of skeptics! But that natural curiosity for the truth is what exposes pundits like Kiyosaki and Suze Orman for what they are (and what they are not).

 

[haha]

I'm Laura Rowley. I write the Money and Happiness column on Yahoo!Finance. I was genuinely surprised by the bitter response to the story about Madison DuPaix (especially on a forum like this one).

What you are seeing here is not a bitter response; what you see here is skepticism. I would expect a professional writer to choose her words more carefully.

Most of us are reasonably rich and have been from a reasonably young age. We didn't get this way by being credulous.

Madison DuPaix may be the best thing since sliced bread. But the odds against are long.

Go Madison go!

Nords and CFB are two big posters on this board who seem to consider themselves early retired, yet both have or had spouses working full time and providing health insurance. I haven't seen anyone on this board challenge them on their early retirement status. They are male, while Madison is female. I hope that SAHM sterotypes aren't a part of why Madison is being picked on here.

You haven't been around long enough. There were long threads about these guys. Eventually people know the context of what others say. These posters have given a lot of helpful information on many topics. Do you keep ragging on them for being impure?
Maybe Madison will tell us which laptops to buy, or how to fix stuff or what to have for dinner and how to prepare it. But she hasn't yet.

Anyways, I remember when everyone ran MMND out (one of the reasons I never even mentioned my site here - but post only as a regular forum member

That is so fantastically egalitarian!

Ha

 

[FinanceDude]

In any event, best of luck developing yourself as a personal finance guru. It could potentially pay off in a big way. I think you have more substance (and accuracy) than Kiyosaki and Suze Orman, among others. But sometimes the truth doesn't sell very well (see the yahoo finance editors' sensationalist semi-truthful headline of the story featuring you, for example).

Assuming you continue to pursue this career path (or non-career path, if you don't consider freelancing and blogging work), expect to be challenged on the veracity of your claims and the facts and details of your past. I think the group at this forum takes people to task about whom amazing claims are made. I suppose we are just a bunch of skeptics! But that natural curiosity for the truth is what exposes pundits like Kiyosaki and Suze Orman for what they are (and what they are not).

Yeah, I think its time I became a personal finance guru...........

 

[Nords]

Nords and CFB are two big posters on this board who seem to consider themselves early retired, yet both have or had spouses working full time and providing health insurance. I haven't seen anyone on this board challenge them on their early retirement status. They are male, while Madison is female. I hope that SAHM sterotypes aren't a part of why Madison is being picked on here.

Dude, let me help you get your facts straight.

My health insurance is the military's Tricare Prime for retirees, in my name, and I'm providing healthcare insurance for the family.

Spouse resigned from active duty in March of 2001. She drilled with the Navy Reserve until July 2008 with approx five of those years being in a pay status. Drilling consisted of the "traditional" one weekend a month and two weeks per year, although one year she managed to string together a whole 28 days. She's retired now awaiting retired pay which starts in 2022. Her pay often funded her Thrift Savings Plan account up to the limit ($15,500 now, used to be less), sometimes her IRA, and occasionally mine.

Our ER plans were built on my 20 years of active duty, her ~18 years of active duty, my pension, and her pension. Her Reserve money is not part of our FIRECalc calculations nor counted as part of our ER portfolio.

I've also learned not to point out to her that our gains in Berkshire Hathaway and some other stocks far exceed anything she earned in the Reserves. I especially learned not to point that out during the first week of her two-week active-duty stints.

I hope that SAHM sterotypes aren't a part of why Madison is being picked on here.

She gets just as much credit for her facts as you do for yours. Gender isn't relevant, any more than religion or political party or skin color.

I'll also point out that MMND quickly played her own gender card and has a history of doing so on more than one discussion board. At the time she was marketing a book and had made a TV appearance... don't even get me started on Montel Williams.

I'll let CFB speak for himself, but he was ER'd before he married and also does not include her income in his ER budget. I'm not sure that she's working full time-- she's been part-time for months-- but I believe that her employer does provide their health insurance.

I think that most Cubicleville residents would have a difficult time getting excited about "ERing" to Madison's lifestyle. And Laura's choice of words (from someone who presumably has built a large inventory of words among which to choose) confirms my opinion of that magazine. We'll have to see if she decides to mine any of the experiences of this board's ERs.

 

[CuppaJoe]

....
I think that most Cubicleville residents would have a difficult time getting excited about "ERing" to Madison's lifestyle....

--
I had an office with a door and view, such as it was, and see no excitement there. Seems like more w*rk than volunteer mod. But again, I'm glad she's able to do it.

Let's here it from the Cubicleville residents.

 

[Sarah in SC]

There isn't enough money in the world for me to stay home with children. Cubicleville is heaven by comparison.

Skepticism is good, and this article was a good one to bring to the attention of our members, but to Madison's credit, she isn't the one who posted it. She really didn't ask (at least originally) for input from us. I'm inclined not to put a whole lot of invective into the issue. Whether she is or isn't retired, at least her info is somewhat more legit than some touts like Kiyosaki and Orman. If asked, I'd say the credit card arbitrage is the most dangerous thing to advocate.

I suspect there are a lot of moms out there who'd like to figure out how to be a SAHMs instead. If her blog/info helps inspire them to get there, hey, that's okay with me. I don't think the article was presented as high finance, it was a fluff piece of the kind we denigrate regularly here at ER.org. I don't think Madison is on our forum to promote herself like MMND, a point surely in her favor.

 

[Bestwifeever]

Madison, I apologize for reading between the lines about the mutual funds your parents set up in your name when you were young. Good thing you got a scholarship as $2500 would not have funded your education at Wisconsin--that is not much of a college fund.

I'm sorry for being hard on you. I think the article was unfortunate in posing you as someone unusual (I guess that is Yahoo and Laura Rowley's fault for presenting you thus) in being a SAHM mom who, with her husband, saved money while she worked and now works part time, in your case by blogging, to generate some income and also uses some of those savings to be able to afford to stay home while her husband works, like thousands and thousands of other families (mine, for one, for several years).

Good luck with your blog and I also hope you continue to post here on other threads with helpful information in response to others' questions.

 

[claire]

As much as I reject the 9 - 5 rat race I would never want to be a SAHM.