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Re: Mooching to FIRE
Old 11-29-2005, 07:16 AM   #21
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Re: Mooching to FIRE

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Originally Posted by TargaDave
When you also factor in the sizable risk, long hours and sleepness nights of getting a business going and stabilized (for those who don't inherit one) the mooching term applies even less.
None of those negatives really impact the guy who simply has a side business through which he runs various expenses -- most of which have no real practical value to the business, but only to improving his lifestyle. The average guy running an eBay reselling business, online newsletter, banner farm, etc...doesn't need any of the luxuries I mentioned (except perhaps the high speed internet, but that can be bought separately from the HD digital cable with the NFL package).
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Re: Mooching to FIRE
Old 11-29-2005, 07:55 AM   #22
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Re: Mooching to FIRE

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Originally Posted by TargaDave
There is a built in downside to all that small business mooching you hear about.* When an owner sells* the business* the buyer will negotiate based on some formula derived multiple of reported net income (cash flow). Excessive write-offs create an artificially* low net,* and any unreported income won't count at all since it can never be verified, and is illegal.* *The excessive moochers do pay a price in the end.
Net income is not the same as cash flow. When a small business is sold, the seller usually makes known to the buyer the total material benefits he received as an owner of that business and that total benefit is used to negotiate a selling price.
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Re: Mooching to FIRE
Old 11-29-2005, 08:14 AM   #23
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Re: Mooching to FIRE

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Originally Posted by retire@40
Net income is not the same as cash flow.* When a small business is sold, the seller usually makes known to the buyer the total material benefits he received as an owner of that business and that total benefit is used to negotiate a selling price.
These are called "add backs". Typically in a small business the owners either "live off" the business (basically taking everything out except
what is needed to operate), or, if they intend to sell, they might do the opposite, i.e. leave the max. in to make the balance sheet more
attractive. It won't make any difference to a savvy buyer, but
"add backs" can scare off the less sophisticated as they are more likely
to be heavily influenced by "first blush" impressions, when in reality
the balance sheet in a small business means little in terms of going forward. OTOH, if you plan to liquidate, then the balance sheet
means everything.

JG
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Re: Mooching to FIRE
Old 11-29-2005, 09:28 AM   #24
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Re: Mooching to FIRE

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Originally Posted by MRGALT2U
These are called "add backs".* Typically in a small business the owners either "live off" the business (basically taking everything out except
what is needed to operate), or, if they intend to sell, they might do the opposite, i.e. leave the max. in to make the balance sheet more
attractive.* It won't make any difference to a savvy buyer, but
"add backs" can scare off the less sophisticated as they are more likely
to be heavily influenced by "first blush" impressions, when in reality
the balance sheet in a small business means little in terms of going forward.* OTOH, if you plan to liquidate, then the balance sheet
means everything.*

JG
JG, one of the most astute, accurate and succinct posts you've made in a long time. I wish you would post in this vein more often.
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Re: Mooching to FIRE
Old 11-29-2005, 09:42 AM   #25
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Re: Mooching to FIRE

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Originally Posted by Honkie
JG, one of the most astute, accurate and succinct posts you've made in a long time. I wish you would post in this vein more often.
I feel the same way. This post leads me to believe JG may not have been exaggerating his claims to have once been a "captain of industry".
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Re: Mooching to FIRE
Old 11-29-2005, 09:48 AM   #26
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Re: Mooching to FIRE

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Originally Posted by justin
I feel the same way.* This post leads me to believe JG may not have been exaggerating his claims to have once been a "captain of industry".*
It's not rocket science, so I wouldn't get carried away. But I do feel that he has more to offer that a lot of his posts contain. You listenin' JG ?
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Re: Mooching to FIRE
Old 11-29-2005, 10:17 AM   #27
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Re: Mooching to FIRE

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Originally Posted by Honkie
JG, one of the most astute, accurate and succinct posts you've made in a long time. I wish you would post in this vein more often.*
No kiddin'.

JG on topic and on target. I nearly passed out.

Way to go John.
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Re: Mooching to FIRE
Old 11-29-2005, 11:05 AM   #28
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Re: Mooching to FIRE

Quote:
Originally Posted by retire@40
Net income is not the same as cash flow.
Yep, sorry about that. That's what I get for posting in the middle of night
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Re: Mooching to FIRE
Old 11-29-2005, 11:24 AM   #29
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Re: Mooching to FIRE

Back to mooching for a moment. Your average 20-something doesn't look at living with Mom and Dad as a way to FIRE (perhaps just as a place to live after being fired, but that's a different story). Rather, slackers who aren't motivated to get a job (especially one that requires paying one's dues) or go on to grad school simply see living with Mom and Dad as a way to continue their adolescence. The more ambitious 20-somethings are so anxious to get their lives "started" that they insist on moving out (or not moving back in), even if doing so is a financial stretch. Regardless of the economic advantages, members of the opposite sex don't see mooching off Mom and Dad as a positive.
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Re: Mooching to FIRE
Old 11-29-2005, 01:51 PM   #30
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Re: Mooching to FIRE

Quote:
Originally Posted by MRGALT2U
It won't make any difference to a savvy buyer, but
"add backs" can scare off the less sophisticated as they are more likely
to be heavily influenced by "first blush" impressions, when in reality
the balance sheet in a small business means little in terms of going forward. OTOH, if you plan to liquidate, then the balance sheet
means everything.
JG
I think typical add backs (a vehicle or two, the occasional business trip to Hawaii, uncle Morty on the payroll) won't scare off anyone who does their homework, but when expenses get excessive and flaky (Uncle Morty's paid assistants, Fido and Fluffy) even a savvy buyer would think twice about nasties the seller might be really hiding such as burried receivable nightmares and questionable inventory-assets. No substitute for lots of due dil beyond returns whether you are a pro or a first timer.

JG, I know you march to a different drum but I think you could jump back into the business world anytime and do just fine. Always a decent backup even if it goes against your religion.

Sorry for going off topic (again).

Working and interacting with a big state university next door I see a certain percentage of staff mooching the system to varying degrees (plenty of hard working staff as well). Not uncommon for any monopoly. Have also seen my share of unemployment-disability check moochers. Like Jay I think most mooching is driven more by apathy-laziness and/or a desire to "beat the system" rather than driven by a desire to FIRE.

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Re: Mooching to FIRE
Old 11-29-2005, 02:02 PM   #31
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Re: Mooching to FIRE

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Young man, you have got a lot to learn!

Anybody care to chime in that is properly experienced in this area?
The experience is too expensive for the privilege of chiming in!

In the spirit of learning from others' mistakes, I'll point out that Hawaii has one of the nation's highest percentages of multi-generational housing. In what may be a stunning coincidence, Hawaii also has one of the nation's higher per capita rates of domestic violence. But that may just be due to all the different cultures learning to get along with each other.

I think the whole idea of living with one's parents is really put to the test when you have to tell an attractive person of mating potential: "Yeah, I live with my parents so that I can save a pile of money and get to ER faster. Wanna come home with me and check out my etchings?"
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Re: Mooching to FIRE
Old 11-29-2005, 02:10 PM   #32
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Re: Mooching to FIRE

Quote:
Originally Posted by Jay_Gatsby
Back to mooching for a moment. Your average 20-something doesn't look at living with Mom and Dad as a way to FIRE (perhaps just as a place to live after being fired, but that's a different story). Rather, slackers who aren't motivated to get a job (especially one that requires paying one's dues) or go on to grad school simply see living with Mom and Dad as a way to continue their adolescence. The more ambitious 20-somethings are so anxious to get their lives "started" that they insist on moving out (or not moving back in), even if doing so is a financial stretch. Regardless of the economic advantages, members of the opposite sex don't see mooching off Mom and Dad as a positive.
But then there are the unique, extremely financially-ambitious 20-somethings (just turned 29 today ) who see living with the parental units as a sure-fire way to turbocharge that FIRE effort.

Also, while I do agree that a vast majority of members of the opposite sex don't see mooching off of mom and dad (or even saving money forr early retirement, for that matter) as a positive thing, I'm not looking for one of the vast majority of women out there - my financially astute and saving ways will help self-select out the purest wheat from the common chaft. Although, my parents are away for about 8-9 months/year, so it's certainly not nearly as bad as living with them full-time (if I had to live with them full-time, I'd probably have my own place).

I've recently met someone that I think has a damn good chance at being the future Mrs. Peter76 ....so I might only need to tough it out for another 18-24 months at home (equivalent to a 6 month full-time sentence with my parents) while I sock away even more dinero.

Plus, there's the benefit of being able to pack my entire belongings in the back of my car in just one trip - no sofa, kitchen table, plates, drapes, shades, lamps, etc., that are a bachelor's taste but wouldn't be touched with a 10 ft pole by any woman.

--Peter
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Re: Mooching to FIRE
Old 11-29-2005, 02:31 PM   #33
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Re: Mooching to FIRE

Peter,

Happy Birthday

Your situation is a unique one, and were I in your shoes, I might consider it as well. Just out of curiousity, why are still living at home?
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Re: Mooching to FIRE
Old 11-29-2005, 02:35 PM   #34
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Re: Mooching to FIRE

Quote:
Originally Posted by Peter76
But then there are the unique, extremely financially-ambitious 20-somethings (just turned 29 today ) who see living with the parental units as a sure-fire way to turbocharge that FIRE effort.
Happy Birthday!


Quote:
Originally Posted by Peter76

Plus, there's the benefit of being able to pack my entire belongings in the back of my car in just one trip - no sofa, kitchen table, plates, drapes, shades, lamps, etc., that are a bachelor's taste but wouldn't be touched with a 10 ft pole by any woman.

--Peter
Ah, to be single again. *With controllable amounts of "stuff" to move around. *

When we moved out here 3 eyars ago, the moving company said it was the second biggest load they ever did from a residence. *40,000 lbs. of stuff! *It took one full 53 foot trailer packed so tight a cockroach would have suffocated and 1/3 of another one. *
Long story and I am working on downsizing all the time. *However, getting remarried only a year ago has somehow increased rather than decreased the amount of "stuff" in the house. *

I guess I know what I will be doing in my early ER years.
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Re: Mooching to FIRE
Old 11-29-2005, 03:16 PM   #35
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Re: Mooching to FIRE

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However, getting remarried only a year ago has somehow increased rather than decreased the amount of "stuff" in the house. *

I guess I know what I will be doing in my early ER years.
Not to deride women on this issue, but why do they *need* so much stuff? Also, why can't I use the towels in the guest bathroom?
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Re: Mooching to FIRE
Old 11-29-2005, 03:29 PM   #36
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Re: Mooching to FIRE

Ah, 29, I remember it like it was yesterday. Panic set it, hysteria came at 30. Now that I'm 31, I'm relaxed again, I figure I'll freak out at 35 (closer to 40 than 30, same thing happened at 25) and I'll go through panic mode again at 39. Growing old stinks, but it beats the alternative.
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Re: Mooching to FIRE
Old 11-29-2005, 03:33 PM   #37
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Re: Mooching to FIRE

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Originally Posted by Jay_Gatsby
Not to deride women on this issue, but why do they *need* so much stuff? Also, why can't I use the towels in the guest bathroom?
What the heck are you doing in the guest bathroom? Who let you in there? I'm telling!

--not-DH
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Re: Mooching to FIRE
Old 11-29-2005, 03:35 PM   #38
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Re: Mooching to FIRE

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Originally Posted by Laurence
Ah, 29, I remember it like it was yesterday.* Panic set it, hysteria came at 30.* Now that I'm 31, I'm relaxed again, I figure I'll freak out at 35 (closer to 40 than 30, same thing happened at 25) and I'll go through panic mode again at 39.* Growing old stinks, but it beats the alternative.
I didn't really panic at 30. Most people saw 29 as still being a 20-something punk, whereas 30 was a mature adult.

Turning 35 this year didn't sit well with me at all.
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Re: Mooching to FIRE
Old 11-29-2005, 03:38 PM   #39
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Re: Mooching to FIRE

Just my opinion --- living at home in your late 20s just to FIRE, no thanks. *I like women too much * *Nothing gives them a better impression than living with your parents in your late 20s. *Aside from that, to me, leaving the nest really helps a person develop & become self-sufficient.
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Re: Mooching to FIRE
Old 11-29-2005, 04:03 PM   #40
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Re: Mooching to FIRE

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Originally Posted by Peter76
my financially astute and saving ways will help self-select out the purest wheat from the common chaft.

Peter, I never saw you a a dirty talker. :P
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