I'm fascinated by this. How does one do this? Two options I can think of are being independently wealthy and being dependent on another. Are there other ways to accomplish being so comfortable with, "eh, gonna be unemployed another 4-6 months and see what happens"?
Personally, if I get laid off, I would probably also not jump on the _very_ first offer I get desperately, but try to land something good. That's what the higher amount you get for up to 12 months is quite useful for.
Mostly comes to low cost of living in my country + being reasonably frugal + slowly building my savings over time.
(Though note that I don't have kids yet, if I had children my calculations would be totally different.)
I think there is a mentality difference here. I have savings that would easily last me 10 years of not working. But... that's kind of my plan. I will be retiring some day.
I don't want to use up even a dime of that money by not working in my prime earning years.
Different of course if you have a plan to retire at 45 or something.
Not saying you should run out and spend your nest egg. On the other hand, I'd be reluctant to suffer too much during my prime working years scrimping and saving for a retirement that might actually not happen. I'd rather have jobs I really enjoy, and frankly, if I enjoy the work well enough why would I retire? Just take longer and longer vacations and work part time. So I'm willing to use a bit of my saved up funds when necessary to get out of a work environment that is unpleasant.
My sister's landlord always told her how he planned to live in the house she's in once he was a bit older.
He ended up dying in a motorbike accident a few months ago, right after a house inspection...
I wonder what sorts of things influence the mentality. I've been reading Walden here and there recently, I remember being forced to read some of it in I think junior high, I suspect at least a little influence lies there but there's no better trick to make kids dismiss a book's messaging than to force them to read it in chunks via some textbook and then be quizzed. "The mass of men lead lives of quiet desperation." "This spending of the best part of one's life earning money in order to enjoy a questionable liberty during the least valuable part of it, reminds me of the Englishman who went to India to make a fortune first, in order that he might return to England and live the life of a poet." "Yet some, not wise, go to the other side of the globe, to barbarous and unhealthy regions, and devote themselves to trade for ten or twenty years, in order that they may live -- that is, keep comfortably warm -- and die in New England at last. The luxuriously rich are not simply kept comfortably warm, but unnaturally hot; as I implied before, they are cooked, of course à la mode."
Of course by Thoreau's standards I'm positively roasting and happy about it, and I think 10 or even 20 years at a career is more than a fine tradeoff if that's all it takes to secure a retirement. As a teen I remember thinking I'd be happy enough to avoid having worked for 40-ish years straight like most of the adults around me had done/were doing (some of whom died right before or after their retirement age goal, too).
If you've got an iDevice with Apple Arcade, it's something interesting to play.
It uses books that are now in the public domain that are twisted into games of word order, spelling, and passages that make you read the abridged version and to an extent, force/encourage you to become familiar with the words to better play the game.
Meaning it would have been easier to with a demonstrable income stream? Or just incidentally, due to macro stuff and time raising interest rates over that same period
I figured I'd be ok liquidating ~$300k max for a cash purchase and skipping the mortgage, though if needed it's possible to get a delayed financing loan after, and at least a HELOC. But spiking prices everywhere made that more difficult or impossible in certain areas. And even if something is 'affordable' at say $265k, I find it hard to stomach the idea of paying that much when I think it is (and 2019/2020 records show was) worth only about half that. (In 2014 I actually had legal control of a house but opted to get rid of it, it had been refinanced and it took months to find a buyer at $170k to zero that out. Earlier this year zillow estimated it could fetch $420k, which is absurd to me knowing all about it, but seeing actual sales in the area I believe it.)
In one case I was doing reasonably well with my software dev tasks for a while, but then they assigned me to periodic customer support, and I said up front that's not something I'll be good at. At the same time, my manager tried to increase the oversight of my work, because I was getting slower at it. So I'd wake up every waiting for my manager to "check-in" on me like a child, eventually getting to the point where I couldn't bring myself to get anything done and just resented my existence.
I'm in an ok spot now, for now, but who's to say how it'll be by January. All I want is a place I can do good work for, for a reasonable salary, but it's been very difficult to find.
Software engineers still have a much harder time justifying having a low savings rate when you compare them to the rest of the population.
Generally, there's some degree of frivolous spending going on.
Actually, software engineers in 2nd and 3rd world countries can afford to save a lot.
Having low outgoings. While I would prefer to have income (I'm hoping to be able to buy a house at some point), I'm a single person with no dependents, and I probably spend around £1200/month in total (including rent). And that's in London - one of the most expensive cities in the world - and without putting any effort into living cheaply (I often buy groceries at the local store rather than the cheaper big supermarket for example). If I chose to live somewhere cheaper (even in the uk) that could probably be halved without completely destroying my quality of life.
Maybe you ought to make a masterclass on this topic.
It's pretty easy to save money on a software developer salary in the United States.
It's not that hard to accomplish for those who can be(come) location independent. For instance[1]:
> You would need around 2,582.16$ in Budapest to maintain the same standard of life that you can have with 8,700.00$ in San Francisco, CA (assuming you rent in both cities).
[1] https://www.numbeo.com/cost-of-living/compare_cities.jsp?cou...
Just about anywhere in the United States will be a lot cheaper than SF, too, without the huge inconvenience of moving internationally.
I picked Budapest as an example because it's a well known international destination with very high level of walkability, great public transportation, and affordable prices.
Prague and Krakow are two other similar options in Central Europe, only much less "weird" (and, as a result, a little more "boring").
There are also plenty of pleasant and affordable cities in Southern Europe, such as Valencia and Porto.
Actually, that makes Budapest a fair comparison to how SV and surroundings also deal with their homeless..
I used levels.fyi to find comparable salaries and my friends in tech said it’s pretty accurate
Having worked for 10ish years beforehand, it was financially easy. When I was ready to work again, I responded some recruiter emails and was hired again fairly quickly, at a position better than the one I left.
Living in a low cost-of-living area helps a great deal, as do the excellent salaries US devs make.
If yes, then...yes this is easily done.
- encouraged people and myself to hold on to about 6 months of runway because the future is unknown.
- encouraged myself and others to never have a single source of income.
- always be sharpening your skills. They get dull, redundant, and obsolete within ~5 years.
Live by these mantras, if one has the luxury to do so, and being laid off is nothing more than a disappointment.
In my case that'd be:
- living in a relatively affordable country (Latvia), where rent and other expenses aren't too high
- having an okay income by local standards, e.g. I make around 2000 Euros after taxes, which is in the upper 10% of salaries locally https://www.algas.lv/en/salaries-in-country (many earn more)
- saving and/or investing for many years now, I have about 37k Euros saved up, which isn't much for someone in US, but with monthly expenses between 500 to 1000 Euros, they might last me from 3 to 6 years (though less in practice, due to inflation)
- having additional factors that make things easier, such as sharing a residence or living with parents, having solar panels or one of those energy efficient homes if in the countryside, having reasonably affordable ways of heating if in the countryside (e.g. firewood with central heating), not having too many subscription services and so on
For people with higher living standards than mine: probably earning more than I do, even relative to their expenses.
And that's assuming you even live long enough to get to retirement...
Even as I approach elderliness, I still feel that every year of my life has become much more joyful, exciting and enriching than the previous year. I would absolutely not trade away multiple retirement years for a single year of fucking around in my twenties.
I had WARN and severance that would last me all summer, fall, and a bit into the winter before I ran out of that.
So, I spent all summer and fall and a bit into the winter (the thing that finally had me head to my parents' house was a snow storm from the Dakotas heading east in October) driving, hiking, and taking photographs.
There were some hikes that I did then (petroglyphs at Ozette, Ramona Falls on Mt. Hood) that would be much more challenging now that a decade and a half have passed. My endurance for driving has also gone down - I noticed this coming back from Dickinson, ND after the eclipse of 2017 (I really should have gotten a hotel room in Minneapolis) compared to the last leg of a trip from Twin Falls, ID to SF in '08. I can't do 10h drives anymore like I could when I was in my thirties.
And so while there's the "a year off when you're 25 vs retire earlier in your 60s" debate, I would tend to argue for the "when it's a question of experiences to be had, regrets are often the more costly side of the equation when looking back on it later in life."
Also note that not everyone has the same life trajectory of a family and kids and grand kids to look forward to in their later years. For me (single, no kids, on the far side of the half way point between 18 and 81), I am very glad that I had my great road trip when I was in my 30s rather than trying to do it when I was retired.
We of course can't trade our older years with our younger years.
For me personally, I'd much rather have spent the time with family, travelled to the places I wanted, slept around and worked on things I found fun than to slave away, just to save for a greater comfort in a future that is uncertain.
Of course I still hope to be comfortable in retirement, but without a doubt I would regret having chosen a certain path that would lead to comfort than a slightly less predictable path where comfort is not guaranteed.
Like - have a unique skillset, have multiple certifications, recommendations, proven B2B experience as a consultant.
Then getting contracts is easy. Probably less easy now tho.
> How does one do this?
In my case my wife has a job that provides the health insurance (so your "dependent on another" is partly right). In addition, our mortgage will be paid off in January, so that'll make it easier to live on one (smaller) income. We'll still be running a bit of a deficit each month (between $200 and $300/mo) but we've got a good 12 to 18 months of living expenses saved up in our emergency fund (that would be 12 to 18 months of living expenses if we both were to lose our jobs). After that there's a Roth IRA we could draw upon. So not too worried at this point.
A lot of your money is going to be for housing, and there are a lot of "conventions" that I think you should be careful with. Housing companies will tell you to spend 30% or more of your gross income on housing. You can do that if you want, but you'll have more savings if you aim for 10-15%. It's quite possible; I've lived in a nice neighborhood in NYC for 10 years and pay about 16% of my gross income on rent. (Rent stabilization is a powerful force, though, and you kind of had to be here 10 years ago to be paying 10 years ago's rents.)
Similar stabilizing forces apply if you have a mortgage as well. If you get a 30 year fixed, your monthly payment isn't going to go up over 30 years, but the value of that money is going to decrease, so it will be less of a burden over time because your income is likely to be adjusted to inflation over time. My advice to myself from 10 years ago would have been to buy and not rent; the dollar becomes worth less and less over time, but the roof over your head remains as useful as ever. If you have savings, the dollar decreasing in purchasing power just wipes out your savings. If you have debt, then the amount of time it takes to work off your debt decreases instead. Rent stabilization does give a lot of this advantage to renters, but it's rare throughout the US, NYC is kind of an anomaly.
Regardless, always be working on building that buffer. You want to be able to pay for housing for 1-2 years without working; once you have that buffer, then you can decide to use it to take time off, or you can keep it stashed away for "quirky billionaire buys my company and fires everyone". (Such things do apparently happen.) The lower your monthly expenses are, the easier that is, so keep your expenses low. The expense that I think is easiest to dig into is food; it can easily be $25-$30 to order a cheeseburger and fries for delivery (at least in NYC), but you will be hard-pressed to spend $30 on ingredients to make a single meal. If you have any free time whatsoever, there is a lot of savings at hand. If you have no free time, then hopefully you're being compensated for that.
I suppose the elephant in the room is the disparity in pay between non-FAANG and FAANG (or whatever people call it these days; Facebook, Amazon, and Netflix seem to be facing hard times, Google definitely seems interested in reducing compensation across the board, Apple's still doing pretty well), and things like that. There are no doubt great software engineers making $70k a year doing the same work that Google is paying people $400k a year to do. Try and get that job, and everything will be a lot easier for you. HN hates this, but if leetcode is what's standing between you and 4x the pay, you should probably just practice the leetcode. Your safety net and quality of life will increase dramatically, even if you move to a high-cost-of-living area. I definitely did that when I was applying to Google 10 years ago, and it was probably the best investment I ever made. $50 worth of books and a few evenings trying the exercises, and I got a 3x pay increase and a free move to NYC. Would recommend considering it.
(BTW, it seems like every company in existence has min/maxed the cost of living thing; so you are unlikely to get ahead by moving to a low cost-of-living area. Your employer will just pay you less and keep the savings for themselves. But if you start cooking food instead of ordering it, they'll never know, so that's free money for your savings and investments ;)
All companies pay you to put its interest before your own interest, but some companies are much worse and much more effective at working against the greater good than others. I'm not selling out to those just to add another few years to my already very achievable retirement.
I'm nearing the end of it now, and I've spent about $6000 over three months on things I'd categorize as normal living expenses (I took a couple of trips that added a few thousand to that). I'm not so well off that I can call this a trivial amount of money, but it wasn't the hardest decision ever, and I could make it work for much longer if I had to.
If you move to SEA your cost of living might be as low as $500/m depending on the frugality and living standards. Its not for everyone obviously due to various life circumstances (caring for relatives, wife with kids, illness). But for the young, single and free there is a world out there that doesn't require you to have a 300k/y job to survive in upper Manhattan and service the car / house loans :)
I wish people explored the world a bit more. It really does give perspective in terms of how the rest of 99% live outside of our tech bubble.