Grumpy Old Man or Sage Mentor?

[GrayHare]

Engineers, at least the older ones, tend to be efficiency-minded. This comes up sometimes in Don McMillan's engineer comedy routines. Don had worked at Bell Labs and now has a youtube channel that's fun.

 

[Diogenes]

As a very young engineer I remember getting mildly raised eyebrows when I pulled out my brown bag lunch in the cafeteria. They didn’t mock me until I carefully folded up the brown bag for reuse.

I've seen cases where the engineer who brown-bags his lunch, and folds the bags for reuse, ends up in a 7-figure divorce. I've seen the fellow who blows $20 on sit-down restaurant lunch every workday, and then gets take-out Chinese for dinner, and who shows up with Starbucks coffee every morning... amass and maintain a very healthy sum, because even if he's profligate in the small, he deftly avoids blunders in the large.

 

[Koolau]

Grumpy Old Man or Sage Mentor?​

Why not both?

Yes. Two things can be true at once.

 

[Koolau]

As a very young engineer I remember getting mildly raised eyebrows when I pulled out my brown bag lunch in the cafeteria. They didn’t mock me until I carefully folded up the brown bag for reuse.

Heh, heh, who's laughing now??

 

[Gumby]

As a very young engineer I remember getting mildly raised eyebrows when I pulled out my brown bag lunch in the cafeteria. They didn’t mock me until I carefully folded up the brown bag for reuse.

I was Navy submariner, an engineer, and then a lawyer. I packed my lunch every day in my grandfather's lunchbox (almost always leftovers from dinner the night before). My grandfather was an iron miner on the Mesabi Range in Minnesota. That lunchbox became famous among my office mates.

 

[imjustawarrior]

I've seen cases where the engineer who brown-bags his lunch, and folds the bags for reuse, ends up in a 7-figure divorce. I've seen the fellow who blows $20 on sit-down restaurant lunch every workday, and then gets take-out Chinese for dinner, and who shows up with Starbucks coffee every morning... amass and maintain a very healthy sum, because even if he's profligate in the small, he deftly avoids blunders in the large.

You are living up to your user name.

BTW, a $20 lunch at a sit down restaurant would be a bowl of soup and soda around here. He would be viewed as very frugal.

 

[Aerides]

Good advice, but it's double-edged. Smith saved his nickels and invested in the S&P 500... then "got exited" at age 50 or 55. He's adrift, even if the money-situation is fine.

Smith is adrift because he didn't have a strategy, a plan. He had it happen to him, rather than expect it, or at least, go out on his own terms before it happened. That's the point. Don't get gray-hair-riffed, unless you are getting rif'd as part of your strategy (which is what I did, but I will never go gray).

 

[Diogenes]

Smith is adrift because he didn't have a strategy, a plan. He had it happen to him, rather than expect it, or at least, go out on his own terms before it happened. That's the point. Don't get gray-hair-riffed, unless you are getting rif'd as part of your strategy (which is what I did, but I will never go gray).

Well, yes. But if I may, with specifics:

1. We might have exquisitely robust and invulnerable strategy in some matters, but utterly lack such cushion, in others. A person might diligently save for retirement but have a horrible blind-spot in say matters of health, or relationships. On the other hand, somebody might flub savings, investment and retirement - but remain in great health and stay lucratively employed to 75+... doing just fine, never having saved a nickel, having $0 in the 401K and living paycheck-to-paycheck.

2. Sometimes the very act of preparing for a rainy day, brings torrential rain. Less metaphorically, it may be so, that a person who's well-prepared for early retirement, who's comfortably affluent and frugal, grows jaded and complacent and passive in late-career. If you don't need the job, why keep hustling? Then without meaning to underperform or to become deadwood, this person is the first to be let go. Management is smarter than they look! They can tell if an employee is independently wealthy, even if that person drives a jalopy and wears tattered clothes.

 

[imjustawarrior]

Well, yes. But if I may, with specifics:

1. We might have exquisitely robust and invulnerable strategy in some matters, but utterly lack such cushion, in others. A person might diligently save for retirement but have a horrible blind-spot in say matters of health, or relationships. On the other hand, somebody might flub savings, investment and retirement - but remain in great health and stay lucratively employed to 75+... doing just fine, never having saved a nickel, having $0 in the 401K and living paycheck-to-paycheck.

2. Sometimes the very act of preparing for a rainy day, brings torrential rain. Less metaphorically, it may be so, that a person who's well-prepared for early retirement, who's comfortably affluent and frugal, grows jaded and complacent and passive in late-career. If you don't need the job, why keep hustling? Then without meaning to underperform or to become deadwood, this person is the first to be let go. Management is smarter than they look! They can tell if an employee is independently wealthy, even if that person drives a jalopy and wears tattered clothes.

One of the four dams above my city might break and flood the entire city killing thousands.

Lightning might strike me dead as I walk my dog.

One should look at the likelihood of certain events. Just because something could possibly happen does not mean we should let it affect our behavior.

You propose scenarios that could occur. Sure but so what? Are these the most likely scenarios? Are they even remotely realistic? If not, then they are just a distraction from what is helpful.

 

[TickTock]

I'm still not seeing the double-edge here. Better to have saved, invested, and planned for a variety of scenarios than not.

If you don't need the job, why keep hustling?

In my case, pride of workmanship (not wanting w*rk with my name associated with it to be lazy or sloppy) combined with the belief that whoever is paying you deserves your full efforts.

 

[38Chevy454]

Good discussion. I think a lot has to do with the lack of personal finance education. Also while the young engineers are making good money, they also have high COL, notwithstanding buying an expensive car making the monthly budget higher. As a young engineer, I was less knowledgeable about finance, even though I did understand the math part. I was smart enough to save in the 401k, and saved enough to get into a house after 2 years working. That's starting out with nothing saved, and maybe $2000 debt from school. Not a huge amount of debt, but also not inconsequential when I was making $28000/year. Being a self supporting student, graduating with almost no debt was a good thing.

One of the biggest benefits I had as young engineer was working at an aerospace company with some gov't contracts, was that we were able to get some OT pay [It was a kind of weird in that it was base pay/hour equivalent plus $5/hour extra for the OT premium]. So I just worked 5 x 10 hours/day, and saving all of that extra OT money. That's what enabled me to get into a house.

Back to the OP and the original question, I think the best thing to tell the young engineers is reinforce the three main rules for personal finance:
1) Pay yourself first
2) Live below your means
3) Power of compounding (the engineers inherently should understand this)
Do all of these and the young engineers should be OK, and will come around later to save more as they come to understand personal finance better.

 

[Diogenes]

You propose scenarios that could occur. Sure but so what? Are these the most likely scenarios? Are they even remotely realistic? If not, then they are just a distraction from what is helpful.

I'm not suggesting that we should have overwrought dread of edge-cases, stymying our lives just-because. What I am suggesting, is that there's a kind of insidious law of nature, where the well-prepared are as it were punished, while the dissolute and flighty are somehow nurtured, as if some guardian angel has mercy.

A practical example. Car mechanics' own cars keep breaking down. Needs a new clutch, needs drum brake slave cylinders, keeps throwing engine-codes. Mechanics know what they're doing, right? They ought to be able to repair their own cars, and understand the value of preventative maintenance. Meanwhile the clueless teenage kid or the busy housewife ignore oil changes for 20,000 miles... and yet, their cars keep on ticking.

I'm struggling to find the appropriate term, or to recall the precisely worded adage.... but it goes along the lines of, "Nature looks after the foolish, but punishes the wise". Stocking the larder, to prepare for winter? Well then, the winter will be ferocious indeed. Flittering away the summer, going into winter unprepared? Then the winter tends to be mild.

So, when we look at these spendthrift kids who fail to appreciate the value of a buck, well, maybe they're going to be OK after all. And that rare young person who saves diligently and buys-and-holds the S&P 500? Chances are, that something horrible will happen, to lay him low.

We should think about that, before criticizing the haplessly clueless, or congratulating the thoughtful planners.

 

[GrayHare]

"Nature looks after the foolish, but punishes the wise"

A glum or happy thought, depending on perspective: that's Democracy in action, maybe?

 

[imjustawarrior]

"Nature looks after the foolish, but punishes the wise".

Thank you for sharing. I appreciate hearing other people's world views. I just don't happen to hold your view. I think it is much better to be wise than a fool. Here is an ancient proverb I like:

The crown of the wise is their riches, But the folly of fools is foolishness.

 

[pjigar]

I was smart enough to save in the 401k, and saved enough to get into a house after 2 years working.

Same here. We bought our first house because DW got a small windfall (enough for a 5% down payment and closing cost) and we didn't know what to do with the money, so we bought a house! Research says that homeowners have a higher net worth compared to the renters. My theory is that homeowners have to run a tight show (at least early in the homeownership journey) so they get used to spending less and saving more (and making more!). I remember few months after we bought the house, we realized that we barely have any money left over at the end of the month (after 401k, mortgage, etc.). That is when I started looking for a better job. I doubt if I would be that motivated if we didn't buy the house at such a young age.

 

[SnowballCamper]

I'd just have copies of Bernstien's "If you can" in a drawer. https://www.etf.com/docs/IfYouCan.pdf

When they ask, just say something like, "It's not about getting rich, it's about not becoming broke." and hand them a copy.

 

[MC Rider]

"It's not about getting rich, it's about not becoming broke."

That's how I look at it. I don't care about being rich, but want to not be poor and have enough to be comfortable. So far so good.

 

[SnowballCamper]

Ahh reading If again I found the real quote, "If you can't save you'll die poor."

 

[mebden]

Most people who ask me how to retire earlier than normal. I only tell them when asked I tell them do you want to work till your dead? and when they say no I tell them to start to live below their means. I also say quit trying to staying with the Jone's by what you need and no more and credit cards use them but if you can't pay the balance off monthly then they are your worse enemy

 

[Koolau]

^^^^^

Yes, I've given such advice to at least 3 co-w*rkers over the years. Not one has followed my advice. I guess I'm not very convincing.

 

[MichaelB]

Something about horses and water.

Selective hearing affects some. They only hear what they want, not what they ask, or need.

 

[HFWR]

My batting average of anyone taking my advice is pretty low, though not zero.

 

[imjustawarrior]

If I can get my kids to take my advice, I take it.

Currently, we match their W-2 income for their Roths up to the limit. We are really hoping this will get them off on the right foot. None of them have shown any interest in how I retired early while their mom was always a SAHM. Maybe once they are out of college and have to earn a living reality will smack them in the face.

 

[Dtail]

Yup tough to make them listen, but then complaints later on in life.

 

[Koolau]

Something about horses and water.

Selective hearing affects some. They only hear what they want, not what they ask, or need.

Old buddy at w*rk would hear someone trying to come up with that old saying and he would always offer: "You can lead a fish to swim but you can't drink a horse" whereupon everyone would throw something at him.



I guess you hadda be there.

But, yeah, the selective hearing issue was always rampant whenever even a suggestion of changing behavior was brought up - especially about spending/saving/investing.