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A lot of commenters seem to be bemoaning this poster as missing out on endless riches. Why? we already know that being super rich doesn't really make you all that much happier compared to being rich (and if you are a programmer in work in then you are pretty rich).

I feel that they missed out more on the rocketship journey of being on a startup. And even then that's not everyone's cup of tea.

There's a gigantic difference between $200,000 a year and "I don't need to work again."

The "money doesn't make you happy" camp compares $70,000/year and $200,000/year; not $200,000/year and "I have enough money to never work again if I don't feel like it."

Those two goals are only separated by about a decade of normal work, which is not even much more time than it takes to bring a startup to an exit.

If you can put 1-2.5M dollars into investments you can pull safe returns of enough to live on indefinitely and never need to work again.

Making >$200k a year and being frugal it is not that hard to put together 1-2.5 million dollars in capital.

At 10 years of 250k with a 40% tax rate and 30k in annual expenses with 7% average returns, you pull down about 70k in capital gains at 5% returns in year 10 (so you can keep 2% extra nominal in to keep up with the fed's inflation target and maintain that purchasing power forever). $70k is less than you made, but is more than enough to live on without working for the rest of your life.

You're completely missing the point.

> being frugal ... 30k in annual expenses

Requires budgeting and is a bit of a standard of living lower than most people would prefer. Especially if they got kids.

Plus how you going to live in SV on $30,000 a year when rent alone is that much?

> 7% average returns

So requiring those 10 years are during a bull market.

There's a big difference between "work at a startup for a good salary living an average life for 10 years" and "live in a shoebox with 10 other guys, eat nothing but lentils and beans, and own no possessions for 10 years"

> > 7% average returns

> So requiring those 10 years are during a bull market.

If your bull market includes the 2008 crash, then yes.

"The last decade provided an average return of 6.88% in the stock market. The lower return takes into account the tremendous loss the market took in 2008." https://www.creditdonkey.com/average-stock-market-return.htm... (question 2)

Anecdotally, when you don't need to work it makes you happier (though you can still work, but only when you want to). High wage vs passive income is a big difference and the research you are thinking about only captured the former.

I have a passive income of €1.5k/month without being a millionaire. Some of my friends are millionaires and we are basically equal. We all can choose to work and are free, this makes all the difference.

The main differentiator between rich people and others is the fact that rich people don't have to work. This is the biggest freedom. I figured out that I don't need to be rich to do that. I still work, but I mainly do this because I want to. I say no to things that I don't like and I've never been employed (I'm an employer myself).

I wouldn't trade this freedom for 10-20k/month (which I could achieve, but I would have to work my a* off). Deciding what to do with your time is the ultimate freedom.

edit: I worked like this in the past (making good money and having lots of stress), but nowadays I don't see the point anymore. Even if you like your work, wouldn't you prefer to work on your own visions and on your own terms?

May I ask what kind of business are you running for your passive income and how you got there?

Background of this question: Also form Europe (Austria), an EE engineer but modestly paid and overworked. I figure I should pivot to a passive income source as even switching jobs won't imporve my quality of life since companies are overly stingy on paying competitive salaries and most try ot burn you out in the long run as they try to be more competitive and government will tax the hell out of you the more you earn so I figure why bother, my healh is worth more than that.

Ok, I will give some instructions. Unfortunately, it's not an easy way. It's mainly websites.

1. Know your numbers: How much do you need to live? How much do you spend each month? How much money can you save up in your job every year?

2. Save up. Live extremely cheap and save every penny. You need enough money to live for ~9-12 months without any income, e.g. if you need 1200€ you need to save minimum €14k - no holidays and expensive stuff until you've reached your number. This is your lifeline money.

3. Save a little more: You need to invest money to make money. You need about €5-10k minimum for investments (buying domain names, themes, content, designs, ...)

4. You have saved up €20-30k? Continue the plan. Otherwise continue to live extremely frugal and increase your income.

5. There are many ways now: build websites, AirBnB, flipping stuff, writing books ... - first, you have to build something. After you've found something that works, you continue to increase the profit margin and automate the process (also utilizing manual labour). You can only do this if you already have some money, this is the reasoning behind step 1 and 2.

- - -

In my calculations, you need to invest roughly €30-40k to make €1-3k/month in completely passive income (I achieved it with 5-10k, but I was lucky). It's definitely achievable in 3-4 years to save this amount of money if you commit to a frugal lifestyle, save up and invest it correctly (I achieved it in some months, but as I said, I was lucky).

I think it's not fair to sell you the idea that it's easy - although my journey was extremely straightforward, I know that most people struggle to even make a dollar online. But I can assure you that you will find a way if you're committed to leave your day job behind.

But please make sure that you have enough savings, I know many people who left their job and after 6 months they ran out of money. You don't want to be the defeated one who wasn't well prepared for this type of lifestyle.

"and if you are a programmer in work in then you are pretty rich"

Incidentally, I'm not sure if this statement has any validity outside US. I wonder why that is.

It's still valid in a couple of other countries though. I'm sure I don't make more than my friends in England for example, and I know some in Brazil that make really good money (compared to those around them who are not programmers) and I'm sure there's other countries who pay their software engineers well enough. But yeah I'm aware that there are countries where being a software developer is not that profitable sadly. I always hear of outsourcing software development overseas for simple things like having a website done.

DELETED For asking a question but getting too many downvotes

In many cases it’s because that’s what we demand of them. The “you get what you pay for” line works well here, we demand low cost so they have low time to build anything right. Long term impact is that they never fully developed into seasoned and deeply skilled staff. Then we complain about quality, its kind of funny in a sad way...

As a programmer in "other countries", you're very much wrong. You just get what you pay for, and when you're going for "cheap outsource" you get bottom of the barrel. Pay senior salaries, you get senior people.

Uh, what. I'm quite undercompensated compared to US programmers but that does not mean I don't program well. It just means I don't live in the US.

Why did you assume he is missing out on being rich? Nowhere in his post he even mentions money. It felt more he missed out on being a part of a great success that every startup wants to live through similar to that of Instagram.

Why did everyone run into Larry so much back then and what happened to the startup party scene... which was so odd at the time.

Edit: Found my answers on quora, I’ll let you look yourselves as I don’t want to link to what may be gossip but I had a laugh and a wave of nostalgia for those heady nonsense days

who is Larry and why does this person matter? I searched on Google but could not find anything relevant.

I actually met Larry at a bitcoin event a while back. Seems like a normal guy. Is there some back story I am not aware of?

You simultaneously don't know who Larry is, but also know you met him?

You can see him, talk to him, ask his name - and still not know who is it. Is he a super-rich former founder? A VC? Chinese agent? Inherited money? Etc.

Yes I met him at a bitcoin event for 20 seconds, so I only know his name before talking to another person.

Hi everyone! Well, thank you for all of the comments - didn't expect my short little tale to be that interesting :)

As for me, it worked out - soon after arriving in NYC, I took a chance at starting a company for myself. Unlike Burbn/Instagram, which I would have liked from a market perspective, I went all-in on an idea and an industry that I truly loved. I managed to raise a little bit of funding, hired a great team, and exited 10x a few years later. Still at the company, now CTO. Love it more and more every day.

Right around the same time I started my company, I also met a beautiful woman who is now my wife. Bonus!

Do I think about what could have been? Sure. But I didn't let it stop me from plowing ahead and moving forward. What happened yesterday or last week or last year only impacts you to the extent that you let it. All you can ever do is believe in yourself and make the best decisions you can with the information available to you.

Your life now may be better than the one where you accepted Kevin’s offer.

That is rationalization, where we try to apply "logic" to make ourselves feel better about a bad situation.

The chances are low that life is better now, after losing out on a chance to be an early part of Instagram.

That's like saying a homeless person's life may be better than if he had a home. Ya statistically that scenario is possible.

But if you had a choice, do you really want that homeless person to stay homeless and just keep telling him "your life may be better now"? Or do you want that person's life to improve so that he eventually has a home?

It’s not at all difficult to imagine a scenario where his life is better after turning down Instagram. I wouldn’t even say it’s unlikely.

Just name one important relationship he formed in NYC. Done. (Or any of the other infinite ways events could have unfolded more favorably in NYC than in a hypothetical SF)

An engineer in America is wealthy, and has lots of opportunity to see and experience new and interesting things. The idea that his life is almost assuredly worse just because he forwent one unlikely opportunity to become wealthy 50x over instead of just 5x over is silly.

Of all the choices he’s made and will make, I doubt that was a very important one.

Ya you can imagine any scenario you want. I can imagine a scenario where a homeless person's life is better than if he had a home. It's not hard to imagine. But if you had a choice, which would you choose?

I don't think the argument is conclusively "Done" after naming one important relationship he formed in NYC.

I can name one important relationship he would have formed if he stayed in SF. A relationship with the founders of Instagram. That relationship is valuable too.

What makes you doubt that this choice is less important than other choices he will make in the future?

You don't need to consider the infinite possibility of events that could have unfolded. You really only have to consider the origin event--if you had the chance to choose again, would you make the same choice.

> Ya you can imagine any scenario you want. I can imagine a scenario where a homeless person's life is better than if he had a home. It's not hard to imagine. But if you had a choice, which would you choose?

Homelessness is a financial hardship that actually will ruin your quality of life, which stands in stark contrast to being a homeowner. Whereas making 150k/yr in NYC instead of 2m/yr in SF just means you have plenty of space on hardwood, instead of too much space on marble. The relationship between wealth and quality of life is logarithmic.

That's not the question being asked. Obviously being an early employee at Instagram is better than having an above-average engineering job in NYC, and more money is better than less money.

The question is, do all of the events that unfold throughout the rest of his life after he moves to NYC sum to a better life than the events that would have unfolded if he had taken that job and stayed in SF?

It can't be known, we can only speculate on the probabilities.

If we know for certain that Instagram will be the success that it is, that means NYC and SF present two radically different sets of human relationships and life experiences spanning decades, but in NYC he will make a lot of money and in SF he will make an excessive amount of money.

When I consider the infinite variation and possibility contained within those unforeseeable human relationships and life experiences, and think about the impact those factors have on a person's quality of life, I don't think there's even a comparison to be made between that and the difference between making lots of money and making tons of money. The relationships and life experiences will be the dominating factors in these outcomes. Since they're both unknowable, the relative probabilities of either NYC or SF resulting in a better life lie somewhere close to 50:50, even if we know he would have been successful at Instagram in SF.

I actually do think it was an important choice, just not because of Instagram. He was tired of SF and the contemporary startup scene, and Instagram's success was still very unlikely at that point. Staying would have been a bad decision.

I think the more brutal reality is that just because you had been there then instead of someone else doesn't mean Instagram would have done what it did. Maybe as a first hire you'd have jerked around more than the actual person, or missed deadlines or just made bad choices which lead to zero traction.

It's egotistical to assume that it being you instead leads to the same result

Ya I agree, but on the other hand, it's possible that if you had been there instead of someone else, you would have made better choices leading to 10x traction and made Instagram 10x what it is today

I mean, what signals lead you to believe one scenario is more likely than the other?

It didn't sound like he was a weak employee in any way--if anything, he sounded like a strong employee because the founder of Instagram wanted to create a full-time role just to keep him, despite not having much money for the startup back then. I would assume the founder of Instagram is a better judge than I am, of who is good to hire.

It's possible that Instagram would have been more successful if he was there to support it back then.

I could boil it down to a thought experiment: If you could trade being alive and healthy today, for hitting it rich 10 years ago but you have no idea if you'd still be alive/healthy/happy today - would you do it?

Actually I think the point is that the universe is vastly complex and due to chaos theory and the butterfly effect all sorts of alternate outcomes may have resulted

Yes I agree. That's my point as well.

There's more to it than rationalization.

https://www.ted.com/talks/dan_gilbert_asks_why_are_we_happy

No, it isn't rationalization

Startups still have "lottery ticket" chances. Better, but still not a guaranteed payoff.

What if instead of IG it was Theranos or Color (or that startup that nobody heard of)?

Doubt it

You know how in war movies when the guy leaves the trench only to come back and find that all his friends have been killed?

In the valley you leave the trench and come back to find that all your friends are rich.

No words can alleviate that regret. But if you’re having near misses like this you’re actually really close to something good.

If you trouble yourself over regret on how you didn't get rich that one time, while still living a life that is probably in the upper 90th percentile comfort-wise, you aren't doing yourself any favors. Money is just numbers, and in the end we are all dead, so spending your days regretting not winning the lottery has to be one of the most stupid things to trouble your mind with. A dose of some traditional values would probably help.

Yet I read a similar comment every day here on Hacker News. Maybe there's something cultural going on with a website run by an investment fund/startup incubator.

I identity with this - it bugs me that I haven't done as a Kevin (and people like him) when not only has he had the success but exited and moved on with his life.

I go to the gym most days and am pretty well disciplined but I still feel this way every so often (I've been ill earlier this week so I'm feeling down, which is probably what bought this on). How does someone get traditional discipline?

Similar themes in DHH’s “The Day I Became a Millionaire”, https://m.signalvnoise.com/the-day-i-became-a-millionaire-55...

> No words can alleviate that regret.

I can relate. I cry myself to sleep every night thinking about those bitcoins I didn't mine, back when you could get hundreds on a single GPU overnight.

Well, at least you aren’t the guy that bought two pizzas for 10 000 bitcoins. If he’d have held onto them until the $20 000 peak (a tall order in itself) he’d have netted a cool $200 million.

> If he’d have held onto them until the $20 000 peak (a tall order in itself) he’d have netted a cool $200 million.

If he could have sold them at that price without moving the market, that is.

Did that guy who binned his hard drive with his bitcoin wallet ever retrieve it from the garbage dump? Last I heard he was planning on digging up the entire dump to find it.

OTOH, the pizza shop owner sure struck lucky, if he kept them

Well, not so bad if they were nice pizzas!

I’ve had three misses of similar magnitude. No regrets.

The fandom of getting rich and famous in the Silicon Valley is equivalent to high school girls wanting the bad boys as boyfriends.

I don't think that's accurate. A more apt anology (and one trending on HN, coincidentally) is the California Gold Rush. The prospectors (workers) are willing to work super hard and risk it all to find gold (unicorn equity).

You know what they say: “When humans discover immortality, the person who will die the minute before will be the most …”

"the most..." what? Is that an add-your-own-ending quote for reflecting on personal philosophy? :).

(Also, this is a plot point in Bostrom's "The Fable of the Dragon-Tyrant" - the last people to die will really be mourned, and people will then start asking if, maybe, they could have started working on the problem sooner...)

I think all the people who die unwillingly after humans discover mortality will have a good claim to be the most...

Immortality will probably never work for those that die from getting hit by a train and the like. This will make their death so much worse for their loved ones.

why just restore from latest backup

The most what?

The most recently dead?

Fortunate!

You made the best decision you could at the time.

That’s the only thing and best thing you can ever do in life.

Exactly. You can only make decisions based off the information you have. Heck, for all we know if this guy did go work at Instagram then the company could have never taken off! You can never be sure of anything.

> I went to tech and they went finance, sigh

I doubt they would be that much better off...

Might be worth reaching out and saying best wishes. Short & sweet. Not for any ulterior motive, just out of the spirit of an old, forgotten friendship.