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Comment by dangwu | Hacker News Reader

It’s not about living on 500k vs 1 million. It’s about much, much earlier retirement.

To expand on this, many people who make this much as employees have a great deal of anxiety about the future of tech, and a reasonable doubt that this level of income cannot continue indefinitely. From that point of view it seems foolish to walk away from the opportunity.

People outside of tech have anxiety about the future of tech.

People inside tech having anxiety about it?

Seems to me the anxiety has far less to do with tech than with the nature of the economy and employment in general.

For many readers here, and adherents to the FIRE philosophy, sure.

But to most people who actually make $1.2 million per year, it means giving up all kinds of status symbols and creature comforts. Many of which they are locked in to via mortgages, leases, etc.

More likely it's about keeping up with the Joneses. If all your old school friends are making $5 million, it pains your status gland enough to "only" be making $1 million.

The funny thing is when you move from making $1mm to $5mm you pick up a different set of friends to keep up with.

It's true, the coke dealers don't really hang around until you reach a certain income threshold.

I don't understand the mindset of burning yourself out in middle age so you can "enjoy the world" when you're much more likely to be frail and have serious health problems that prevent you from participating in many activities.

If you make 1.2 million a year you could literally retire after 1-2 years and live comfortably (on ~40k) for the rest of your life. Want to live on 100k? Only takes 4 years.

Taxes.

And inflation.

Is it?

Many people could retire after one year at 500k or 1M because their cost of living is such that they would be able to save almost all of it, and this would spread across their retirement..

The average UK private pension pot is £100k ... this implies that either people with £1m should be retiring earlier, or we'll have a generation who can't afford to retire.

The situation is similar, if not worse, in the US, and the latter is true: absent government pension programs like Social Security, almost nobody can afford to retire. Social Security is the retirement plan for regular people. Basically only union workers with defined-benefit pensions and high-salary professionals who are able to fund their 401(k) meaningfully have any kind of plan for retirement besides living on Social Security. The luckiest can also draw on help from family, life insurance, and getting part-time work as e.g. a Walmart greeter.

Thinking about retirement savings at all is kind of a luxury.

Even a poverty level wage (for family of 4) is $25k/year. So $500k over a 20 year retirement sounds like a lot, but it’s not.

You're leaving out the compound interest that could be earned through stocks/bonds.

Yes, but even bonds don't keep up with inflation, and you need enough principle to ride out the dips. The "safe" return is considered to be 4%, which is $20k on $500k, so you'd be dipping into the principle even on that poverty scale.

It just take a lot more to retire than the average person realizes, and not eat Alpo.

not saying it's easy, and no, doesn't sound like a lot.

but it's possible, is my point - the difference on whether it is possible or not possible is the lifestyle one chooses to lead with it.

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