Comment by stlHusker | Hacker News Reader

Comment by stlHusker | Hacker News Reader

Parent Full thread

You can't claim to be financially independent and come back two years later with this gem:

"The secret is that my wife is no longer really retired, and in fact she started a business that is now big enough to FUND OUR ENTIRE FAMILY'S LIFESTYLE."

http://www.mrmoneymustache.com/2017/03/06/etsy-shop/

If not outright dishonest, it certainly gives the off appearance that you can't put any weight in the numbers he is throwing out.

I guess I'm one of those "retirement police" who hates seeing a huckster give bad advice while eschewing talking about the real increase in realized risk you take by retiring early and not considering it in your plan. As one of the previous comments stated: your budget is not static, investment returns are not guaranteed, life events and medical situations change drastically.

So when I see, "I made it so can you", I want to respond, "Come back to me when you are 90 and on your death bed and talk with me again." I've seen the cancer treatment bills and what they do to someone with 10x your "financial independent" worth.

I think his definition of "retired" is pretty simple:

his family could cover all of their living expenses from investment income alone.

When you think about it, this is pretty much what we mean by "normal" retirement as well. If a 70 year old retiree does some maintenance on his rental property we don't accuse him of lying about being retired.

Your point about medical bills doesn't really hold water. I'm sure plenty of unlucky people who retired at a more conventional age end up having to come out of retirement because of an unforeseen tragedy.

Unless you want to change the definition of "retired" to: "having sufficient investment income to cover any possible expense that you or your family could possibly incur from now until your death, without ever doing a single hour of paid work"

I don't agree with MMM all the time but accusing him of not being retired does seem like a pointless exercise in semantics.

if you are doing 3 different jobs ( 4 counting the etsy shop ), you are working at 3 jobs. That's not retirement. Sure, he claims his investment income covers his expenses, I get that. But, no matter how you look at it, he is working. He is not retired. If a 70 year old is spending time doing maintenance on rental properties, that 70 year old is working part time

MMM gave a talk last year[0] where one of his key points was "Work is better when you don't need the money."

That's what he's doing when he says he is "retired" and yet works odd jobs to make money, or his wife sells things on Etsy for fun. I do think there's something behind the idea that it's more fun to do money-generating activities when you don't need the money they generate.

Also, his talk is pretty funny (and a good intro to his way of thinking for those who haven't read any of his stuff). Worth a watch.

[0]: https://vimeo.com/183016901

ok. but if you don't need the money, why not do a million other activities that don't bring in money?

Why does it matter whether doing what you want to do brings in money?

it doesn't but then there is no advantage to whatever MMM is doing, vs just having a well paid regular job that you like.

to me the point of retirement is to be able to wake up at 9 and go for a walk or travel or reading a book. Not going to 3 different part time jobs.

Of course there is a difference. MMM doesn't have to do what he's doing in order to pay for a place to live and food to eat. He doesn't have to stress out about losing his income stream. He basically has hobbies for which he gets paid.

In your retirement, you'd choose to walk and travel and read books. Those are good hobbies! What if eventually you want to get into something like woodworking (a very popular hobby)? What if - gasp - you sell some of your woodworking creations for money? Does that invalidate your retirement?

If you sell those wooodworking creations for money and you keep the money - yes, absolutely. Why don't you give those woodworking creations away for free if you don't need the money? or why don't you donate the money you earn from them to charity - if you don't do those things, you admit you need that money for something that you can't afford otherwise. In that case, why not just work a job? I mean if you love woodworking and do it for money, you just have a job that you love, which is fantastic. but it's a job.

In the woodworking example, you may only have room for so many chairs around the house. And, if you don't really need the money, you make what you want when you feel like it. That's a lot different from the typical job.

Needing money isn't binary in any case. I may or may not need more money. But maybe I'll be glad I had it some day. Of, perhaps unlike MMM, maybe I'll buy something or take a trip someplace with the extra money that I wouldn't have otherwise done.

needing money is pretty binary, in my opinion. If I can do all the things I like without working at all, then I have enough to retire. If I occasionally need more money to do some of the things I like and I need to work to get it - I don't have enough to retire.

I'd probably like to hop on a NetJets when I travel but I'm not planning to hold off on retiring until that's a reasonable option. Pretty much everything is about tradeoffs.

Of course you can do that too. Leisure is awesome. I think I'd do a lot of that myself.

I don't think I'd give up programming though. I really enjoy it. Maybe after tinkering on a bunch of my own projects that nobody ever sees, I would get bored of that (pretty sure I would anyway). I'd probably get an itch to do something that other people can use too. And then it's likely there'd be money involved.

But also, "going to 3 different part time jobs" isn't really a good way to look at it. If someone asks you "hey, do you want to help me build a deck?" , there's a world of difference between saying yes because you need the money vs. saying yes because you enjoy the work and want something to do.

I would not underestimate being in the position to walk away. Even if you never act on it, that feeling of control is worth something. (see also: "fuck you money").

It's not dishonest, you're missing the point of that sentence.

The Etsy shop could fund the family's lifestyle. The family is already funded by investment returns. They could shut the shop down and continue living just as they do. MMM is just using "fund our family's lifestyle" to give an idea of how much the shop is pulling in (about $30k/year).

All of these concerns are real. You'll be reassured to learn that health costs are probably the fourth-most discussed topic in the MMM community, after safe withdrawal rates, asset allocation, and game plans during the next big market crash.

MMM's blog posts are very basic - you won't safely retire early if all you do is read them. Fortunately, people are responsible and put slightly more effort into planning their entire lives than uncritically following some blog post on the internet. For example, many people are planning on using a 3.25% withdrawal rate rather than 4%, and have much more in bonds than the 100%-equities-or-bust message on the blog.

One of the key insights about his situation, I think, is that you can live on his under-30K budget and not feel super poor, if you don't have regular 9-5 job with a fixed location, if you don't need to worry much about good schools (can homeschool—these two things combine to mean you can choose inexpensive housing with fewer other trade-offs, which makes it easier to have a paid-off house), and if you already have a lot of money and in-demand skills so you can reasonably have much lower insurance spending generally, and especially health insurance. The overwhelming bulk of his budget savings comes from already having lots of money and from having plenty of time to DIY stuff others might pay for. The rest is useful but relatively marginal.

His blog's good for reinforcing that you can spend less money when you already have money, so it's heartening in that it tells you your target income for retirement can be much lower than the income you need pre-retirement. It's not especially helpful for getting there.

Reply on news.ycombinator.com