The High Cost of Early Retirement

[explanade]

Some of it is also just what you are used to. In the book the The High Beta Rich, is was hard for some families to go back to flying commercial when the recession hit. In one of the stories, a little girl asked her mom what were all these strangers doing on their plane?

The Wild Ride of the Wealthiest 1% - WSJ.com

One woman was sad because she couldn't afford to finish her 90,000 square foot mansion, and had to stay in the 26,000 square foot mansion, even though in the old house when they have "parties with, like, 400 people, it gets too crowded."

That sounds like the family in Queen of Versailles.

They had to take commercial and when she rented a car, she wanted to know where the driver is.

And they're known for building the biggest home in the US. He made his fortune in time shares.

 

[Elbata]

They call 'em link farms. When I google stuff, I just plain do not go to low quality sites (like yahoo) because there's never anything insightful there. Another is ask.com and that ilk. If you look up changing a tire, it will have a five step process, starting with stop the car, get out, and the last step will be "change the tire" without any detail. Written by someone who googled tire changing, but has never done it.

Sorry to go off on a tangent, but how about watching a "how to" video and it's nothing more than an ad to have you purchase a product? If a link gives you the idea they're going to give you something of value, and don't produce, I dismiss them ASAP.

 

[traineeinvestor]

The cost of early retirement may be high, but its d@@! good value for the money.

Thanks for posting. While there is plenty of truth in the article, there is just as much truth in the omissions.

 

[scrabbler1]

That sounds like the family in Queen of Versailles.

They had to take commercial and when she rented a car, she wanted to know where the driver is.

And they're known for building the biggest home in the US. He made his fortune in time shares.

Couldn't she just hail a cab?

 

[daylatedollarshort]

That sounds like the family in Queen of Versailles.

They had to take commercial and when she rented a car, she wanted to know where the driver is.

And they're known for building the biggest home in the US. He made his fortune in time shares.

I looked up Queen of Versailles and see it is a documentary on one of the more egregious families in the High Beta Rich book. I will have to watch it.

I think one interesting take away is that people often get happy or sad based on changes in individual circumstances which can be fleeting. There is a cute Ted Talks on Netflix by Shawn Anchor that goes into this in depth. One example he used was that he was thrilled to get into Harvard, but after two weeks everyone there was used to being at Harvard and the initial thrill of being admitted had worn off.

His research points are that the happiest people are happy because of their internal outlook, not external circumstances. Obviously if you are going to bed hungry or are worried about paying the rent, this is going to make you unhappy, which I think is the point of the annual income for happiness research papers.

But after a certain point how happy you are depends more on your internal outlook than outward circumstances. Anchor says you actually can make yourself more happy by developing a more positive filter on life, i.e. less watching horrific crimes on the nightly news and more gratitude journaling and performing acts of kindness.

 

[cranberryjoe]

Wow! That's a terrible article. Basically - If you retire early, you will have less money than if you don't. Talk about stating the obvious.....

If you retire early you get more time to enjoy retirement. Since as the saying goes, time is money, depending on the "exchange rate" I may be making more money by retiring early. At least that's how it feels 6 months in.

Agree, terrible article.

 

[brett]

I think that the author overstates the costs. We found that our lifestyle has changed in retirement. Yes, we have less income. But our cost of living has gone down, as has our tax burden. Our travel costs have increased significantly and we are very happy about that. The other question is lifestyle. We like to travel. Retiring at 59 and gaining these extra healthy years is a huge increase in the amount of anticipated post retirement 'travel' years for us. My father retired at 58 many years ago. He was plagued with health problems and stress. After two years of retirement, and golf three times a week or more, his health completely turned around. He was able to enjoy 30 years of active retirement (and DB pension). This is an individual decision...one size does not fit everyone.

 

[RobLJ]

I'm a little surprised at the push-back because the article is absolutely on the money in terms of the costs of ER.
It's aimed at the average person without a plan but a desire to retire, not the FIRE crowd, or I'm 98% certain of that.

So while most (or maybe all) of the critiques here are to some degree right, they're kind of beyond the point. It's pretty much look before you leap.