Comment by deanmoriarty | Hacker News Reader

Comment by deanmoriarty | Hacker News Reader

I got my first million by being an early employee at a startup for a few years, and cashing out: horrible deal, absolutely horrible reward compared to the risk taken and the years invested, I could have gone to FAANG and get at least that much with minimal risk (and likely much, much more considering their stock growth over those same years!).

I got the second million by working at FAANG, finally convinced that being an early startup employee on average is for suckers.

The third million came by investing in boring index funds throughout my entire adult life.

Currently working on the 4 million mark, by working a very lucrative but mind-destroying tech job in finance.

When I arrive at $4M, I might call it quit and go to Thailand for a few years, which I love. I’m 34, no kids and no plans of having any, my parents are relatively well off and unlikely to need financial help from me, so $4M should last me for the rest of my life with a general minimalistic lifestyle.

Pardon me if this is rude but if you have $3M and no kids why not just retire and work on personal projects?

Part of it is because I don’t believe in the 4% rule, I think it’s way too optimistic moving forward.

My assumption is just that my investments will keep up with inflation (0% real return). So, if I live til 100 (unlikely, considering family history I’ll drop dead at around 75 at best) the money I have will need to last me 65 years. That’s about 1.5% withdrawal rate. $4M gives me $60k a year inflation adjusted, which is what I am comfortable with. When you look at it using this math, you can see how $3M is not an obvious retirement number. It could be for some, I’m sure.

Another part is being surrounded by very successful Silicon Valley people: a lot of my friends have net worths around the $10M, so there is a bit of FOMO as well.

Also, I really don’t have a lot of productive personal projects, nor desire to spend my free time programming, I don’t like programming. I envision my retirement volunteering, reading tons of books, enjoying time with my partner and family, and eating street food in SE Asia.

Lastly, while my family is a modest middle class one, I grew up with extremely limited means: I never lacked food or shelter, but my parents never spent any discretionary money on their kids, so I always felt incredibly poor compared to my peer in school and college, who had toys, clothes, fun money for activities. Had to work on my own for even the smallest purchase, to the point where I would have to think very long and hard in my teens to buy a $1 snack. That had profound effects on me, still to this day.

"...being surrounded by very successful Silicon Valley people: a lot of my friends have net worths around the $10M..."

Wow

SV is a crazy bubble to be in. Scroll through the very average 'middle class' $3M+ homes in Menlo Park / Palo Alto to get a sense of how distorted things are here

I thought average was around $1m, but that's even more "wow" at $3m+.

I guess I can see how if you get in early, the property can really appreciate. I've seen that to an extent with my house going up 10% in a couple years of ownership.

4% - "risk free" the long term average is closer to 2.5-3.5%, difference doesn't sound much but the margin over inflation as a percentage makes it huge.

An even better reason to advocate for my 1.5% withdrawal rate.

I work in tech for a financial company. I hate it too.

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