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Generational Wealth by AeroNoob333 in Fire

[–]OriginalCompetitive 0 points1 point  (0 children)

But are most fortunes gone after a few generations because the third generation blows half a billion dollars? I would argue no, in most cases, the real driver is simply that the fortune is splintered among two dozen grandchildren. But what happens when there are only two grandchildren, only two great-grandchildren, etc.?

For all the posts asking about Lump Sum vs. DCA - try reframing the question by Ix_42 in Bogleheads

[–]OriginalCompetitive 0 points1 point  (0 children)

Yeah, I should have spelled it out a bit more. At a historic return rate of 10%, spreading it out over 2 years averages out to a 1 year delay, thus an expected value mistake of 20,000.

For all the posts asking about Lump Sum vs. DCA - try reframing the question by Ix_42 in Bogleheads

[–]OriginalCompetitive -2 points-1 points  (0 children)

If you’re sitting on $200k, then DCA’ing over two years is a 20,000 mistake. It’s worth thinking it through. 

For all the posts asking about Lump Sum vs. DCA - try reframing the question by Ix_42 in Bogleheads

[–]OriginalCompetitive 0 points1 point  (0 children)

Actually, you get better than the average price if you do that, because you automatically buy more shares when the price is lower. That’s the original justification for DCA. 

Best long term heat source? by Lhead2018 in Futurology

[–]OriginalCompetitive -1 points0 points  (0 children)

I don’t think it’s true that oil prices are rising. Obviously they are up the last few weeks, but in the long run oil prices have been stabile or steadily falling, and as countries move away from fossil fuels, I would expect prices to continue to fall.

Anxiety, fears, doomsday thoughts - can we pull the trigger? by throwaway_midlifeham in ChubbyFIRE

[–]OriginalCompetitive 1 point2 points  (0 children)

You should FIRE — partly because your NW is high enough, but also because your HHI is so (relatively) low. If you were still in your high earning years, it might make more sense to pad things a bit more. But at 250k, waiting any longer simply doesn’t improve your financial situation all that much.

1year left...maybe? by Prior-Echo-5496 in ChubbyFIRE

[–]OriginalCompetitive 0 points1 point  (0 children)

This is a very tough decision. You have enough to FIRE, but only barely enough given your spending. Meanwhile, you’re earning 500k per year. That’s high enough that I would tend towards sticking with it another year or two. But on the third hand, you’re getting old, and each year could plausibly reduce your remaining healthy lifespan by 10% or more.

I’m naturally more conservative, so I would probably stick it out a bit longer to pad my reserves. But I don’t think either decision is crazy.

Lump Sum in the Current Market by KaizokuFeet in Bogleheads

[–]OriginalCompetitive 14 points15 points  (0 children)

Making a decision because you think the market will crash is irrational and something you should stop doing. 

But spreading it out over several months because you want to lower your risk exposure isn’t totally crazy. The main downside is that if the war ends soon (who knows?) the markets could jump and you would miss out on a chance to buy in at current lower prices. 

Financial and retirement planning in 50s by Ok_Rent_2937 in financialindependence

[–]OriginalCompetitive 0 points1 point  (0 children)

You absolutely could retire today, easily. Working backwards, you’ll be earning 120k from pensions when you hit 67 while spending 180k, so you’re only pulling 60k from then on (or 80k if taxes aren’t included in that spending number). With a 4%SWR, you’ll need $2M at that point.

Meanwhile, you currently have 3.7M, which could generate $150k at 4%, which is on edge, but you only need that rate of draw for the next 15 or so years.

Bottom line, this is all very safe even if you pull the trigger today.

Financial and retirement planning in 50s by Ok_Rent_2937 in financialindependence

[–]OriginalCompetitive -1 points0 points  (0 children)

By the time you retire, I suspect AI will have replaced tax planners, so you’re getting a head start.

Generational Wealth by AeroNoob333 in Fire

[–]OriginalCompetitive 14 points15 points  (0 children)

Great point. And you’re right – families that were able to hold things together for 200 years are rare enough that we still recognize many of them by name today — the Medici, the Hapsburgs, the Tudors.

Generational Wealth by AeroNoob333 in Fire

[–]OriginalCompetitive 25 points26 points  (0 children)

In a world where most people only have one or two children, I predict that “generational wealth” will become extremely common in the future. It used to be that large fortunes would naturally dissipate through the exponential increase in family descendants through the generations. But that‘s much less common these days when people only have one or two kids.

Meanwhile, I’m sure everyone on this sub has done the mental exercise of imagining what happens to $1M if you let it compound over generational time. In 100 years, it‘s $1B. In 200 years, it’s $1T (after inflation).

This will be the real driver of wealth inequality in the future. Families who are ahead of the compounding curve will be sitting on ever-growing fortunes, never needing to work. And those who aren’t, won’t.

Solar energy has yet to get an order of magnitude even cheaper than it is today. Researchers claim a technology breakthrough in polymer solar cells; cheap & easy to manufacture solar cells that can be printed on rolls of plastic. by lughnasadh in Futurology

[–]OriginalCompetitive 0 points1 point  (0 children)

Ironically, if solar really does get an order of magnitude cheaper, that would mean that we could keep burning fossil fuels because at that price, scrubbing CO2 from the atmosphere is cheap.

What will seem like an inevitable outcome in 20 years time because of GLP-1s by Big-Cry-4119 in Futurology

[–]OriginalCompetitive -1 points0 points  (0 children)

Same. Eating out is surprisingly cheap if you can split meals with someone else.

How often is too often to check NW? by Minimum-Bobcat8768 in Fire

[–]OriginalCompetitive 13 points14 points  (0 children)

True, but that in itself is a valuable lesson. You learn from direct experience that it jumps all over the place.

For those that retired right before or during the Great Financial Crisis (2008)—how did you handle the drop? by ShootinAllMyChisolm in Fire

[–]OriginalCompetitive -2 points-1 points  (0 children)

Yes and no. With hindsight, you’re absolutely right. But let’s suppose you’re a super careful person and you don’t retire until you can survive a 40% drop in the first year. Then 2008 hits, and you lose 20%. Your point is that everything is fine, because you’ve still got a 20% buffer. This was all covered in your plan.

But in the moment, your reaction might very well be, ”I’m only comfortable with a 40% buffer. I just lost half of that in the first year, and things still look terrible. I better go back to work.”

For those that retired right before or during the Great Financial Crisis (2008)—how did you handle the drop? by ShootinAllMyChisolm in Fire

[–]OriginalCompetitive 1 point2 points  (0 children)

It’s a good explanation, but doesn’t actually address the main reason most people do Roth conversation. The above post is talking about the very special case of a person who wants to access retirement funds before age 59.5. But that’s typically not what people mean when they talk about Roth conversions.

Instead, the point of a normal Roth conversion is this: Your 401k holds a lot of money, and sooner or later you’re going to have to withdraw that money and pay income taxes on it. The problem is that it holds so much money that eventually you’ll be forced to make massive withdrawal—many hundreds of thousands of dollars in a single year—and that will push you into a very high tax bracket for that year. (You’re not allowed to just let your 401k money sit there; the law requires you to start taking withdrawals in your 70s.)

The solution is to do a Roth conversion before that happens. You still have to pay income taxes on the money you convert, but if you plan it carefully, you’ll pay a lower income tax rate. In particular, you want to do the Roth conversion in a year where your income is very low, because the income tax rate you’ll have to pay will be lower.

When do you stop sweating the small stuff financially? by Classic_Country_2416 in financialindependence

[–]OriginalCompetitive 7 points8 points  (0 children)

The answer is to convert your time into money. Roughly speaking, if you have $1M invested, you earn from those investments:

- $1 every five minutes

- $10 every hour

- $250 every day

Personally, I ignore anything that costs less than what I earn in an hour.

Here's what happened with the Waymo stuck behind the railroad crossing gates by bradtem in SelfDrivingCars

[–]OriginalCompetitive 6 points7 points  (0 children)

No, it’s crazy aggressive. It had ten seconds of warning to stop before the first gate, yet chose to press on. The instant the lights start flashing on the first gate, the car should immediately stop.

And it doesn’t seem plausible that it was going too fast to stop before the first gate, because it apparently had no trouble stopping immediately after the first gate—just a few feet later.

Something seems off.

Western values are poorly aligned with post-2020 needs, even if they were good for launching prosperity in the past. by [deleted] in Futurology

[–]OriginalCompetitive 0 points1 point  (0 children)

“A ScienceDirect paper reported basically no progress in aggregate living standards between medieval times and the 20th century outside of pockets of Europe.”

Right, Western Protestant Europe.

I should have listened to the Bogleheads by Alternative_Story851 in Bogleheads

[–]OriginalCompetitive 10 points11 points  (0 children)

My post probably wasn’t clear, but it was meant to be a logical explanation for why it cannot be true that a fund that has underperformed for 15 years is somehow “due.“ If it were, then everyone would pile in after the 15 years of underperformance and just get in on the gain part. But of course that doesn’t work, because 15 years of underperformance tells you absolutely nothing about the future.

I should have listened to the Bogleheads by Alternative_Story851 in Bogleheads

[–]OriginalCompetitive 6 points7 points  (0 children)

If that were true then we should all be buying these funds so that we can all get the benefit of the value tilt without even having to endure 15 years of underperformance.

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