Is ours a hidden existence?

[firewhen]

People can drive around in a Mercedes or buy a McMansion, and this conspicuous consumption is often admired, even if partially envied. But have you ever met someone who talks about FIRE? We are obviously out here. I drive around in my clunker and probably look like I am just getting by, yet am better off than the vast majority of the folks who do not LBYM. But I cannot discuss my finances or plans to RE with anyone, except my wife (and even then I am cautious, since it always seems better that she thinks we are not doing quite so well lest a new spending project might materialize).

This board is about the closest I have to a sounding board, and even than I am careful not to get too detailed or personal. It would be nice to recognize/celebrate what we have accomplished, but I feel constrained to hide it. At work, people will say it is impossible to save or they need to work until they are 70, etc. I just nod my head. I am not going to say that my problem is not when I retire but what I will do, that in most years my portfolio grows quicker than my whole annual salary.

Do any of you feel this way? Can you talk to anyone other than us? Who do you share your future plans with?

 

[Mwsinron]

Ran into basically what you are talking about. I learned very quick to keep quiet with my family about it. Certainly you are not the only one who feels that way.

 

[bssc]

My family is pretty much LBYM (except for the psycho sister) so I can talk to them. Otherwise, most of my friends and cowokers are not. Another of my friends just dumped $60K into some investment scheme. Others are struggling paycheck to paycheck. I notice that our next door neighbors just got a third Mercedes.

In our MegaCorp's annual investment seminar, I understand that they ask who pays less than $150 a month for their cell phone service. My friend said that she was the only one who raised her hand.

So, good thing that this board is around.

 

[firewhen]

bssc,

I actually laughed when reading your reply about the cell phone part. We finally got 1 last year, and it is one of those pre-paid plans, which does not even cost $150 per YEAR. Sometimes I think I could write a book, but probably no one but this board would read it.

 

[Meadbh]

I'm a private person so I don't like to "show my hand" widely. However, I do bounce specific ideas around with certain trusted friends. They tell me about as much as I tell them, which is "Not a Lot". Some of my friends are well informed but many have mental blocks about specific issues, e.g. the importance of minimizing MER. On the whole, they tend to LBYM. That's why I trust them.

 

[calmloki]

Amen brother. Folks know we have a bunch of rental property and figure we must have money, but we don't show it. Constantly having relatives and friends say "you can afford it", which is true, but being able to afford something doesn't mean you have to spend. I find, when observing others spending money they don't have, that it helps me to repeat: "there are lots of ways to live a life, there are advantages to the way they are living theirs, it's their choice". Much better for me to not advise people on how to live their lives well below their means.

 

[Cut-Throat]

People can drive around in a Mercedes or buy a McMansion, and this conspicuous consumption is often admired, even if partially envied. But have you ever met someone who talks about FIRE? We are obviously out here. I drive around in my clunker and probably look like I am just getting by, yet am better off than the vast majority of the folks who do not LBYM. But I cannot discuss my finances or plans to RE with anyone, except my wife (and even then I am cautious, since it always seems better that she thinks we are not doing quite so well lest a new spending project might materialize).

This board is about the closest I have to a sounding board, and even than I am careful not to get too detailed or personal. It would be nice to recognize/celebrate what we have accomplished, but I feel constrained to hide it. At work, people will say it is impossible to save or they need to work until they are 70, etc. I just nod my head. I am not going to say that my problem is not when I retire but what I will do, that in most years my portfolio grows quicker than my whole annual salary.

Do any of you feel this way? Can you talk to anyone other than us? Who do you share your future plans with?

Don't worry! - When you die there will be a short article in the Obit page that you died with $5 Million Bucks and left it to the local school/library - whatever. Then you'll show em!

 

[LOL!]

I'm gonna to have to respond here to defend those folks with McMansions, Mercedes, Lexus, Escalades ... maybe three or four of them. Some folks do live well below their means and still have all those things. The younger folks across the street are already FIREd. The folks next door could be, but they spend too much time in Las Vegas which I think slows them down a bit.

 

[bssc]

bssc,

I actually laughed when reading your reply about the cell phone part. We finally got 1 last year, and it is one of those pre-paid plans, which does not even cost $150 per YEAR. Sometimes I think I could write a book, but probably no one but this board would read it.

Last year it was Starbucks. Their contention is that much on discretionary items, it could be saving that money and getting the company match. They have changed the retirement plan so people don't have to make choices because that stops them from saving.

 

[chinaco]

The number of American households with a net worth of $1 million or more, excluding their principal residence, grew to a record 8.9 million last year (2006).


The households had an average net worth, excluding principal residence, of nearly $2.2 million, of which more than $1.4 million was in liquid, or investable, assets. The survey counted some tax-deferred retirement savings but did not include individual retirement accounts in the liquid assets.


I guess this board is frequented by quite a few average millionaires based on the definition above. Plus quite a few above and below average millionaires.


http://www.nytimes.com/2006/03/28/business/28rich.html?ex=1301202000&en=1a202b83c18e6232&ei=5090&partner=rssuserland&emc=rss

 

[igsoy]

The number of American households with a net worth of $1 million or more, excluding their principal residence, grew to a record 8.9 million last year (2006).


http://www.nytimes.com/2006/03/28/business/28rich.html?ex=1301202000&en=1a202b83c18e6232&ei=5090&partner=rssuserland&emc=rss

Just wanted to clarify that that article was posted March 2006, so "last year" refers to 2005.

 

[mountaintosea]

In some ways I think I'm quiet about my finances and in other ways I guess not. I tend to talk too much even though I think it's not much. I had one coworker blurt out that I probably had more money than god! I thought that was interesting since I'm single with no double income whereas his wife also works with a good income. I think he tends to spend. :

Really in August in California when we were going through that Enron debacle and everybody thought or maybe did, have electric bills go through the roof. My electric bill was a little over $2. No kidding. Even my Dad became annoyed.

It's very strange. I've heard some very nasty things said about me over many years because I tried to save. I would say, it was mostly my coworkers urging me to spend like them. I don't lecture people UNLESS they come to me for help regarding their financial situation.

I've been a vegetarian since age 18. That always got a negative reaction from people in the early years. I never said anything about the way they ate. They would just notice that way I ate, ask if I was a vegetarian, then launch into an extended argument about why I shouldn't be. Same thing with LBYM. They notice I don't spend money on cars etc. and they get annoyed. Go figure?

 

[bbbamI]

I would talk to anybody and everybody about money, but get very few occasions to do so. This doesn't mean I would give them my net worth number, but simply discuss investments and goals.

So, the only people that I am really upfront with about future plans are my DH, mom and dad....and this board.

Maybe the reason other people don't talk to me about money is becasue they figure I don't have any. (If you saw me on the street getting out of my 11 year old car wearing a tee shirt and shorts, you'd know why I said that!)

 

[Fireup2020]

I am proud of the fact that I am gonna FIRE no later than age 55 - and tracking very well for it. People are floored that I can live "so well" and so cheaply....spread the word on LBYM! Might not always fall on deaf ears

 

[TargaDave]

I do get occasion to talk to business acquaintences and co-workers about saving and FIRE, though not on a detailed level. I generally get to know someone pretty well before we hit this topic. I was surprised at the number of people I meet that really do save hard (maybe not to FIRE at 50 or sooner but on a solid course). As expected it doesn't match up with income level though I've never met a venture capitalist who seemed like a hand-to-mouth type.

What I also notice is a fair number of people who truly enjoy their work, something that is not understandably common on this board. I was pretty surprised by that too.

My previous corporate attorney ($295/hr billing rate) is this geeky guy (like me), saves a bundle (way more than I could), drives an well worn Honda minivan, walks to work every day, truly enjoys his job, and actually has a life. Probably not a strong candicate to show up on this board. Quite an impressive person though.

 

[TromboneAl]

The number of American households with a net worth of $1 million or more, excluding their principal residence, grew to a record 8.9 million last year (2006).

It would be interesting to see how that number has changed over the years when adjusted for inflation and population. I'd guess that it is decreasing.

 

[saluki9]

It would be interesting to see how that number has changed over the years when adjusted for inflation and population. I'd guess that it is decreasing.

I would guess quite the opposite

I just took a quick glance at the Census website and I can see that from 1998 to 2000 the % of households with $500K or more in networth went from 6.4 to 8.1%

 

[TromboneAl]

How can the author of that article not realize that it's meaningless without considering population changes and inflation?

The article says that in 1999 there were 7.1 million millionaires, and in 2006, 8.9 million.

Population in 1999 was 273 million, in '06 it reached 300 million.

So in 1999 2.60% were millionaires and in '06, 2.96% were.

Now, figure 1 million in 1999 was worth 1.21 million in 2006. We don't have enough information to know how many households had 1.21 million in 2006. Let's say 15% fewer households, or 7.565 million, had that much. In that case, 2.52% of households had a million 1999 dollars in 2006.

 

[OKLibrarian]

So in 1999 2.60% were millionaires and in '06, 2.96% were.

Now, figure 1 million in 1999 was worth 1.21 million in 2006. We don't have enough information to know how many households had 1.21 million in 2006. Let's say 15% fewer households, or 7.565 million, had that much. In that case, 2.52% of households had a million 1999 dollars in 2006.

That's not bad, especially when you consider how many paper millionaires there were in 1999.

 

[Ed_The_Gypsy]

As to retiring early, I can't. Early has already gone for me. I am focusing on survival when I no longer work.

I have met some in the oil sands business who have since retired early, but by and large, most of the people I work with enjoy their work and do not have FIRE as an objective. Those who have retired early mostly have been forced to do so one of the times our industry cratered. A wise friend once said. "Engineering is the most fun a man can have--if he can afford it." I know he was not talking about working directly for an oil company, though. Ask John Greaney.

As to investment philosophy, there are very few people of my acquaintance who have a similar outlook to mine so there are few to talk to. None in either of our families. Brother-in-law did retire from teaching on the stroke of 20 years, though, and manages his affairs very well.

 

[txdakini]

DH and I are 54 and 55 respectively. Retiring in 5 months. We've mostly gotten grief from friends and family about even thinking about retiring. "What will you do all day?" "You're going to be bored, go crazy, etc." "you're going to move DOWN in your housing?" They assume that retiring must mean keeping the exact same living style or even upgrading so therefore we must have a lot more money than we do.

I led a Your Money Or Your Life group here for a few years. It's my belief that most of the folks who attended the meetings did so because they wanted someone to talk to who had similar values and issues. Many didn't even know about the YMOYL program. All of them lived below their means, were financially aware and knowledgeable, and generally wanted a good quality of life. Some were already early retired, some were never going to retire and others were on their way to ER. About half were already millionaires. And all complained that there were so few people out there that understood their choices.

 

[Sparky]

You know, we don't tell anybody that we are ERd in our 40s... Imagine what questions people would have (or think)... are you a drug dealer? Won the lottery?

We met some new neighbors lately and they said, "we're not rich and, obviously, neither are you". And I thought "perfect!" I don't want anybody to think we are...

We drive a 5 year old car and always dress as though we are going to the gym.

 

[WM]

We don't usually bring up the topic of finances with people we know, but if it comes up among friends (not aquaintances) then we've been honest but cautious about discussing our FIRE plans.

We actually know several other couples who are LBYM types, at least to some extent, so perhaps we are fortunate in that regard. Not so much among DH's work colleagues, but my grad school friends all understand our choices and wouldn't be critical. My college roommate is actually planning to FIRE around age 35, so she's the person who is especially fun to talk with about it.

We can also talk openly with my family, and sort of with DH's. Extended family members don't know of our plans, but we don't socialize all that much with them anyway. I have several teachers in my family, most of whom retire after their 30 years are up, so RE isn't exactly a foreign idea.

I like the idea of a YMOYL group, that sounds fun.

 

[saluki9]

Pardon me for asking, but why WOULDN'T you want to fly under the radar?

Nobody is happy about you being wealthy but you.

 

[firewhen]

Regarding the number of millionaires, I would say there are 3 general categories:

1) inherited wealth
2) high earners/business owners (who are not necessarily big savers, but earning many hundreds of thousands per year will even make most big spenders a millionaire eventually)
3) LBYM types

I would say the vast majority of folks on this board are #3, but most of the millionaires in the country are #1 or #2, although I have nothing to back this statement up, just my perspective.

Until finding this board, I never came across anyone who was like me. I remember my first few days reading some of the posts and showing my wife and her saying something like "Wow, there are other people like us".

What I find lonely is not being able to talk about this to anyone else. Not so much talking about my wealth, but questions like:

when would be a good time to stop w*rking?
what does a man in his 50's, or even 40's, do all day if not w*rking?
how much will it really take if SS is a decade or 2 away?

Yes this board and Firecalc helps, but it seems a shame to have to shade the truth when a neighbor says we can't afford such and such and I nod my head and say I know what you mean. Not that I could suggest a LBYM lifestyle.