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Old 03-09-2014, 08:10 AM   #41
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I worked long hours in my low paying career choice that had no bonuses, stock options, incentive pay, etc. However, I was able to do something that I loved and something in which I was good. Eventually learned a little about investing that was enough to realize that LBYM was going to be a necessity if I was ever going to eat more than cat food if I could ever retire. Found free or inexpensive ways to enjoy my off time and ignored the more free spending habits of friends. Learned how to repair things when they broke (car, house, appliances, etc.). Made it a point to not owe money to anyone. There were a few bumps in the road but I survived. I was lucky three times. I had loving parents. They found a small liberal arts college that was the best choice for me. My wife worked with me on a plan to be financially secure when we retire. Anything else we earned.

Cheers!
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Old 03-09-2014, 08:28 AM   #42
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being good is easier when you're lucky.
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Old 03-12-2014, 04:03 PM   #43
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I think most folks on this forum recognize the amount of good fortune allowed their success to happen. There are still a few who believe all it takes is pulling your self up by your own bootstraps or some such gibberish.

There are many who are more virtuous than you, smarter than you, and worked harder than you who will never be in a position to retire at all. Serious illness, disabled child or family member, born in the wrong country at the wrong time etc. The list is endless. Count your blessings and support those less fortunate.
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Old 03-12-2014, 04:17 PM   #44
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“Here's the thing about luck...you don't know if it's good or bad until you have some perspective.” ~ Alice Hoffman
Am into 25th year of gaining perspective.
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Old 03-12-2014, 05:19 PM   #45
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Pretty much the same kind of luck everyone else here had. Born into a more-or-less stable family, didn't screw up so badly I went to jail, picked a stable job and employer with a pension, educational opportunity.

Living within or below our means had a lot to do with it. I know a lot of guys with the same chances I had are still working and not because they want to.
Pretty much sums it up for me. Also, two things about my late father helped a lot:
- he was very much into investing (got into mutual funds in the 1970s when he finally made enough money to have something to save) and pounded the value of compounding into my head from the time I was a young teenager. So I started my own investing about 6 months out of college.
- he also pounded it into my head never to take out a car loan, always pay cash. It certainly helped that they started me off with my first car while in college, but after that it's been cash all the way (I made sure DH was in agreement with that before we got married). That sort of sets the "LBYM" tone for us.

So thanks, Dad!
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Old 03-12-2014, 07:13 PM   #46
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Quantitatively, we weren't that lucky with respect to investments. In fact we probably had some $hitty luck. Our returns over the last 9 years were 8% per year (geometric mean), compared to 7% per year for the S&P 500. We took on a small amount of additional risk with a slice n dice portfolio of high flying emerging markets, small cap international, REITs, etc. The standard deviation of our portfolio was just a percent or two more than the S&P 500.

The way we created our own luck was by continuing to dump money into our investments as the sky fell around us (according to almost everyone around us, except some of you guys here).

This question of "were we lucky or good?" is an interesting one. I recently penned an article ("I Have a Luck Making Machine") that dealt with this theme. Perhaps just a little tongue in cheek.
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Old 03-12-2014, 07:33 PM   #47
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My father used to always tell me that "luck is when perpetration meets opportunity"....... I just wish I didn't have to prepare so damn hard to get lucky!!
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LOL. Unless you're related to Willie Sutton, my guess is that your father said 'preparation'...
I agree but I just had to look up perpetration anyway:

noun
the doing of an action <the perpetration of a series of pranks that resulted in an expulsion from school>

Synonyms
accomplishment, achievement, discharge, enactment, execution, fulfillment (or fulfilment), implementation, performance, perpetration, prosecution, pursuance

Kind of works too even if you aren't Willie Sutton (which I had to look up also)!
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Old 03-12-2014, 07:46 PM   #48
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I wonder what the distribution looks like for someone that was a saver, just stuffing everything into fixed income products: CDs, saving accounts, money markets, treasuries. I'll bet the end result is very close (within 1-2%), too close to really justify the extra risk and fees associated with the market...
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Old 03-12-2014, 09:09 PM   #49
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I wonder what the distribution looks like for someone that was a saver, just stuffing everything into fixed income products: CDs, saving accounts, money markets, treasuries. I'll bet the end result is very close (within 1-2%), too close to really justify the extra risk and fees associated with the market...



Ah no.


Thats a simple calculation and its not even close to just 1-2%. Certainly not over a 30+ year timespan.
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Old 03-12-2014, 10:12 PM   #50
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Very grateful to say that for us, it was definitely more lucky than good:

Lucky: Started in orphanage in a developing country, adopted by parents and taken to first world where the value of LBYM and education were instilled.
Lucky: Completely lucked into superb spouse
Lucky: Read Rich Dad, Poor Dad which had more impact on my management of $$$ than an MBA
Lucky: Benefited from real estate appreciation
Lucky: Fell into job with stock options which are paying for 3 kids' college
Lucky: Spouse parents left sizable inheritance (no plans to spend it at all), which combined with stock options provided FI a decade? or more earlier than we would have by ourselves.
Lucky: Found financial education which hopefully will allow us to be good stewards of inherited $.

Good: Hard work, perseverance and scholarship for degree
Good: Worked hard (enjoyable) and gave value to all employers
Good: $ went to house mortgage rather than luxury spending

I think the Good would allow us to be comfortable middle class, but the Lucky is what gave us FI, opportunity to ER and made up for some unlucky and dumb moves (and also allows us to now drift into being less Good and a fair bit indulgent).

Lately focusing a bit more on being Gooder.
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Old 03-13-2014, 02:30 AM   #51
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Ah no.


Thats a simple calculation and its not even close to just 1-2%. Certainly not over a 30+ year timespan.

I'd say your off by a factor of 100.
It is hard to hone on a single number but I'd say the average annual return for an aggressive portfolio vs a safe one is 4% a year, and it was more than 6% during my prime accumulation years 1980-2000. At 4% difference with steady saving that adds up to 180% and a 6% that is 240% more money. Even if saving is ramped up considerable over time so that most of the saving was done in the last 10 years it it hard to construct a case where the aggressive saver does not end up with twice as much as the rik free saver. That is for a 30 year accumulation period for a early retiree, for a more typical 40 year accumulation period the difference in saving is closer to 200-300% more.
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Old 03-13-2014, 09:55 AM   #52
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In my case, I think it was a combination of Lucky AND Good. On one hand, I'm where I'm at because of hard work, sometimes pulling down a second and even third job. And sacrificing, by maxing out the 401k, saving as much as possible, etc, rather than going out and buying more house than I can afford, expensive cars, exotic vacations, etc. And having roommates can definitely be a sacrifice.

But, I also had the luck to be born healthy, and with a good head on my shoulders (most of the time, at least...I've done stupid things in the past, as I'm sure everyone else has). I'm also lucky to have a family that's been pretty supportive, a good job, roommates that are quality people and don't try to screw me over, etc. So, I think it's a combination.
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Old 03-13-2014, 10:06 AM   #53
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Fortunate circumstances definitely has something do with it. I didn't do anything to be born in a first world country with the wiring, aptitude, and genetic intelligence that happened to fit the technology boom over the last three decades. On the other hand, there are plenty of other people in my circumstances who did worse (and plenty better.)

That said, one still has to execute in order to succeed regarding most things pertaining to FIRE. An examination of what happens to lottery winners, entertainers, or professional athletes proves the point.
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Old 03-13-2014, 10:13 AM   #54
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I can echo many of the others:

Lucky:

Hit the DNA jackpot with health and brains.

Hit the DNA jackpot with stable parents, upper middle class background, and a paid for engineering degree (no student loans).

Hit the marital jackpot with a LBYM husband with similar family values and outlook on life.

Had father who retired into the go-go 90's so he was able to leave me some of his retirement savings when he passed. (If he'd retired a decade earlier or later I would not have inherited anything.)

No catastrophic illnesses or disabilities. That's definitely luck. (My brother had two cancers and died before 50.)

Good:

Worked hard in college to get a degree when women weren't typical in engineering.

Worked hard at jobs to prove I was as good as the guys.

LBYM lifestyle with focus on finding balance between work and homelife.
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Old 03-13-2014, 11:41 AM   #55
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I've got two kids in college and about to enter the workforce. They are fortunate, but they also know that in today's world, it doesn't take much to stand out.

If you work hard, serve your "customer" in a friendly manner, do more than expected without being asked, do it conscientiously, and think / act like you own the business (whether you do or not) . . . you'll succeed in your career.

Of course, if your chosen career is in the entertainment industry, forget all that . . . there are lots of other factors. :-)
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Old 03-13-2014, 01:08 PM   #56
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I guess my luck was being born to immigrant parents who saw the lack of opportunity in their native countries and decided, for all its perceived faults, raising their children in the U.S. would expose themselves to more opportunities. Something they continuously taught us as we grew up.

My good was listening to them and the teachers who encouraged me to get educated and to use my mathematical talents, instead of those who insulted me (and even threatened me) for doing things like spending time in the library than hanging out on the streets. Also, studying 5-6 hours a night in college rather than going to lots of parties (I went to some, but I had my priorities), and seeking out older workers at Megacorp to learn from, and always trying to learn something from everyone I have encountered (both what to do and what not to do).

In fact, it was probably better for me to have grown up in a tough environment... had I been "lucky" and born into a better ethnic/financial environment, I may not have been so strident to achieve. Not saying that applies to everyone, but my siblings and I often discuss how that tough upbringing gave us all a desire to achieve.
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Old 03-13-2014, 03:44 PM   #57
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I'd say your off by a factor of 100.
It is hard to hone on a single number but I'd say the average annual return for an aggressive portfolio vs a safe one is 4% a year, and it was more than 6% during my prime accumulation years 1980-2000. At 4% difference with steady saving that adds up to 180% and a 6% that is 240% more money. Even if saving is ramped up considerable over time so that most of the saving was done in the last 10 years it it hard to construct a case where the aggressive saver does not end up with twice as much as the rik free saver. That is for a 30 year accumulation period for a early retiree, for a more typical 40 year accumulation period the difference in saving is closer to 200-300% more.
I think it depends on the time span and how it's cherry picked. Don't you guys remember the late 70s, early 80s when jumbo CDs paid 10%+, of course mortgages were 16% but if you were a saver... I remember when the bond decision line was 8%, 8%!!!
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Old 03-13-2014, 04:42 PM   #58
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..,in today's world, it doesn't take much to stand out.

I second this. Both in college and at w*rk, the "Bell curve" made me look smart!
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Old 03-13-2014, 05:53 PM   #59
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I'd say your off by a factor of 100.
It is hard to hone on a single number but I'd say the average annual return for an aggressive portfolio vs a safe one is 4% a year, and it was more than 6% during my prime accumulation years 1980-2000. At 4% difference with steady saving that adds up to 180% and a 6% that is 240% more money. Even if saving is ramped up considerable over time so that most of the saving was done in the last 10 years it it hard to construct a case where the aggressive saver does not end up with twice as much as the rik free saver. That is for a 30 year accumulation period for a early retiree, for a more typical 40 year accumulation period the difference in saving is closer to 200-300% more.

Yep, thats basically the calc to compare why conservative saving vehicles that are safer can end up being a much smaller portfolio after 30 years. But my statement of not being close was by a factor of 2-3 times as clifp has factored in his example above ( but 180%-300% is a factor of 2-3 times, not 100)
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Old 03-13-2014, 06:12 PM   #60
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I think I've been good/decent with my lucky circumstances.
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