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Is this guy crazy or what
Old 07-02-2016, 07:33 PM   #1
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Is this guy crazy or what

Does anyone follow the "Financial Independence" Reddit subforum? I have been for awhile, but get more and more convinced the average age there has to be in the low 20's and probably 99% nowhere near FIRE.

The guy below says he's RE'd at age 32 with a $750K portfolio of which $500K is in real estate equity. And others are congratulating him. The rest is in cash and bitcoins (!?), although he also says most of that cash will be used to buy solar panels (?!).

Somehow, he confidently replies in follow-up posts, he knows this will support him for the rest of his life...

Here's the post: https://www.reddit.com/r/financialin..._32_with_750k/

I get being young and naive (I had similar views of money when I was in my early 20's), but the fact that so many are giving him positive feedback I think actually shows the real value of this more niche site over a mass-consumer forum like reddit.
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Old 07-02-2016, 07:49 PM   #2
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Originally Posted by Kabekew View Post
Does anyone follow the "Financial Independence" Reddit subforum? I have been for awhile, but get more and more convinced the average age there has to be in the low 20's and probably 99% nowhere near FIRE.

The guy below says he's RE'd at age 32 with a $750K portfolio of which $500K is in real estate equity. And others are congratulating him. The rest is in cash and bitcoins (!?), although he also says most of that cash will be used to buy solar panels (?!).

Somehow, he confidently replies in follow-up posts, he knows this will support him for the rest of his life...

Here's the post: https://www.reddit.com/r/financialin..._32_with_750k/

I get being young and naive (I had similar views of money when I was in my early 20's), but the fact that so many are giving him positive feedback I think actually shows the real value of this more niche site over a mass-consumer forum like reddit.


I have seen it, but don't don't hang around too much. This is the same for just about all the rest of the subreddit groups. It's very millennial-centric and if you are aren't of that demographic, you tend to be labeled an outsider and thus "downvoted into oblivion" (which I admit I have no idea what that means...it's not tied to my VG accounts, so I am not too worried about it!)

Edit: I took a quick look at the first post and I already call BS. He retired @ 32. He had 4 years of college. He worked as a software engineer for 12 years. So, he graduated HS when he was 16? Yeah, I don't buy it.

Edit 2: And OYE... take a gander at this post he made 5 months ago. WARNING...it IS NOT FIRE related and well...you have been warned. Bottom line..I don't think this guy is legit.

https://www.reddit.com/r/NoFap/comme..._wow_it_feels/

Edit 3: Oh man...it keeps getting better and better. Thanks for making it a VERY entertaining evening on the internet!

https://www.reddit.com/r/legaladvice...s_kept_in_the/
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Old 07-02-2016, 08:16 PM   #3
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Edit: I took a quick look at the first post and I already call BS. He retired @ 32. He had 4 years of college. He worked as a software engineer for 12 years. So, he graduated HS when he was 16? Yeah, I don't buy it.
Some of us graduated college at age 20 (BS and a BA in my case). Certainly makes it easier to retire at 32 or 33 if one does so. Doesn't require high school graduation at 16, just some AP coursework in HS and some summer school during uni.

Though yeah, I saw that reddit thread and was a little surprised it got so many upvotes. $750k in assets is still $750k in assets, but wow it doesn't seem very diversified.

And combine this with the other reddit threads you mention and sounds like this guy is... interesting.

Edit: though his plan isn't completely crazy. He has enough cash to last for multiple years (even if he buys a bunch of solar panels). Combine that with rental income (even if it's impaired later for some reason) and he should have his core expenses (built around living in the basement of one of his rentals) covered for quite a while. The guy is obviously smart enough to make $150k plus per year, so he's doing something right. I imagine it wouldn't be hard to make the $25k per year he needs to cover living expenses later if his rental "empire" goes belly up (or he tires of the hassle).

Edit 2: Another gem from that guy: "The only other thing I left off is a minor position in a cricket flour/cricket protein bar company. I don't count it in my assets because it's so speculative, but it seems they are the market leader in what I think is going to become a huge market in the next 10 to 20 years." To me it sounds like he fancies himself a serial entrepreneur. So far he's been very right on one thing (bitcoin) and very wrong on other things (the weed biz, eventually the cricket business). It's like a lottery winner that hits a jackpot and thinks they have a knack for picking the numbers.
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Old 07-02-2016, 08:47 PM   #4
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real estate prices have gone up quite a bit. $750K in assets today, may have been $400K or less just 5 years ago. I know my own properties, based on a 6% cap rate, are worth about 2x what I paid.

If his original investment of $400K brings in a 15% return, he could have ~$60K in income.

The trouble with real estate, even though I may have $3M in equity, I cannot even buy a cup of coffee with it...
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Old 07-02-2016, 08:52 PM   #5
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If his original investment of $400K beings in 15% return, he could have ~$60K in income.
He said he has $2,000/mo net of expenses in rental income.
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Old 07-02-2016, 09:13 PM   #6
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He brings in $2,000 rental income a month and has expenses of $1,500-1,800 per month. On top of that he has a few hundred thousand in cash for emergencies. If those 3 facts are correct and it is impossible to prove or disprove based on the information given, merely his claims, he is fine and should slowly become rich with a savings rate of 10-25% he is far ahead of the average person. I consider it a risky but reasoned approach if he knows what he is doing and the story is not full of embellishments. Certainly based on his posts he may not be the most stable of individuals but if he is determined enough and cheap enough to live as he says I would not count him out.
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Old 07-02-2016, 09:26 PM   #7
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Originally Posted by Kabekew View Post
Does anyone follow the "Financial Independence" Reddit subforum? I have been for awhile, but get more and more convinced the average age there has to be in the low 20's and probably 99% nowhere near FIRE.

The guy below says he's RE'd at age 32 with a $750K portfolio of which $500K is in real estate equity. And others are congratulating him. The rest is in cash and bitcoins (!?), although he also says most of that cash will be used to buy solar panels (?!).

Somehow, he confidently replies in follow-up posts, he knows this will support him for the rest of his life...

Here's the post: https://www.reddit.com/r/financialin..._32_with_750k/

I get being young and naive (I had similar views of money when I was in my early 20's), but the fact that so many are giving him positive feedback I think actually shows the real value of this more niche site over a mass-consumer forum like reddit.
I don't see any reason to be particularly upset with this post. Remember, success and failure may look alike before the wheel gets spun. All forums prize 100% buy-in, though clearly some more than others. ER.org is not one that insists on agreement, and I feel that people here tend to be sensible.

My favorite blogger (mostly because he doesn't put truth and rationality behind painting an attractive fantasy to get more blog traffic, is The Finance Buff. This post is kind of soft send-up of early retirement: The Biggest Rock

He has another one where he destroys the ever popular deathbed "realization" that the dying person should not have worked so hard.

Being part of a group, especially one that is perceived to be ascendant is always popular, and very often more popular than making sense.

I retired early not because I wanted to wander aimlessly and expensively around the world, or rise early and make breakfast for my wife before I put on my apron and started my wife dictated chores, but because jobs are hard and a person has to have his **** together to do well and also maintain relaxation in life. I was really not this together, and I accurately perceived that when I retired quality equities were unbelievably cheap so I thought that with frugality I could take care of my family. This turned out to be true, but one never knows. Also this investment nirvana is long gone, and anyway not everyone thinks frugality is wonderful.

Ha
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Old 07-02-2016, 09:37 PM   #8
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Saw this earlier today, and just shook my head

I believe there's ATLEAST a 95% chance this dude is trolling. That said, many of the posters at r/personalfinance think they can do it on $300k invested and only pulling out $20k/year for the rest of their lives

No doubt, that board is fun to watch ... with roughly 5-10% of the actual posters being "legitimate" -- Everyone else looks at FIRE there as a pipe dream
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Old 07-02-2016, 09:50 PM   #9
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He brings in $2,000 rental income a month and has expenses of $1,500-1,800 per month. On top of that he has a few hundred thousand in cash for emergencies. If those 3 facts are correct and it is impossible to prove or disprove based on the information given, merely his claims, he is fine and should slowly become rich with a savings rate of 10-25% he is far ahead of the average person. I consider it a risky but reasoned approach if he knows what he is doing and the story is not full of embellishments. Certainly based on his posts he may not be the most stable of individuals but if he is determined enough and cheap enough to live as he says I would not count him out.
One more thing is that his rental income should rise to help keep up with inflation. He will forever be in a very frugal living mode, but between the equity gains in value and the rising rental income, I think he can do it. Assuming he is telling the truth in his facts.
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Old 07-02-2016, 10:37 PM   #10
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I have seen that Redditt board. That's why I spend so much time here.
However, I did graduate high school at 16. It's not that unusual.
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Old 07-02-2016, 10:46 PM   #11
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I consider it a risky but reasoned approach if he knows what he is doing and the story is not full of embellishments.
I agree, very risky. I sometimes think I have a risky approach in my own FIRE situation and I believe I am in the top 5%...

I wonder sometimes what goes though someone's head that thinks $2K a month is enough to live on forever. Even if it has a COLA, it's a small enough amount you have to think about every dollar spent and not spent.

I would rather have enough cushion to be able to spend another $20 if I have to.
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Old 07-02-2016, 10:54 PM   #12
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I read the links. I wouldn't be surprised if he has some psychiatric issues, specifically delusions. But who can tell? It's the Internet!

Edited to add: I too graduated from high school at age 16.
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Old 07-02-2016, 11:20 PM   #13
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I have seen that Redditt board. That's why I spend so much time here.
However, I did graduate high school at 16. It's not that unusual.

Yes, it is possible.... one of my sisters did it... AND actually started in college during the summer so she could say she started college when she was 16....

Funny thing is that she never graduated from college!!!
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Old 07-03-2016, 04:14 AM   #14
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Well, since we're off to educational bragging: finished high-school at 16, had my masters at 20 and PhD at 25

Reddit forums are indeed mostly the 20s crowd, it shows in every topic.

His financial plan might pan out, it's a really a high-risk / medium reward type of bet though.

Living on 2k isn't that hard. I do that, and I don't think about every dollar spent (well, I do, but not out of necessity ). I do have socialized healthcare living in the Netherlands, so that's a big risk I don't have to deal with.
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Old 07-03-2016, 06:36 AM   #15
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[QUOTE=Totoro;1751563]Well, since we're off to educational bragging: finished high-school at 16, had my masters at 20 and PhD at 25
Okay, here is an example of other end of that educational spectrum. Our DS (youngest) dropped out of high school at age 16, bummed around living on his own & eventually got his GED. After finishing his enlistment in the USMC, put himself through school. Always a bright kid, he had a real knack for technology. And now, 12 years later at age 34, is the Sr. Cyber Security Engineer for an international law firm.

He went from spending most days in the principal's office to present day having a corner office!
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Old 07-03-2016, 08:54 AM   #16
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Its the internet. Anyone can write anything. I could say I am 6'6", very good looking, have a PhD in nuclear physics from Oxford, and a net worth of $300 million. (None even remotely close). Probably makes sense to take much of what you read online cum grano salis.
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Old 07-03-2016, 09:32 AM   #17
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Well, since we're off to educational bragging: finished high-school at 16, had my masters at 20 and PhD at 25

.


Took you FIVE years for a PhD?
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Old 07-03-2016, 09:56 AM   #18
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He said he has $2,000/mo net of expenses in rental income.
That is the most important part of his post. If he profits $2000/mo from his rentals and can live on $1500 then he's in good shape regardless of his total assets. Rent will likely go up as fast or faster than overall inflation. He shouldn't include his home equity in his assets though if he's living on the income from those houses IMO. I don't know much about bitcoin but it sounds like he has more than enough income to cover his expenses and has 6-figures in cash/bitcoin as well. What's the problem? Not everyone needs $5K/mo to live on and not everyone wants to get married, have kids, and live in a big house of their own if it means working for 20 extra years. I say congrats to this guy for being FI at his age. I don't know how you could say he's not if his numbers are accurate.
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Old 07-03-2016, 11:29 AM   #19
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The Reddit poster seems to have nailed the frugality part of FIRE, but he also seems to have "shiny ball" syndrome where he'll chase the latest fad be it financial, health-related or whatever. I suspect we will later hear that this young man postponed ER after an ill-fated investment in electric cars, a can't-miss meditation studio or maybe copper!


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Old 07-03-2016, 05:59 PM   #20
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Well, since we're off to educational bragging: finished high-school at 16, had my masters at 20 and PhD at 25
Wow, it took you to 25 to get a doctorate? I had my first at 23.

It was "only" a juris doctorate so barely counts.
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