Interview with Mr. Money Mustache

Re:Interview with Mr. Money Mustache by the_gastropod on Wednesday September 27, 2017 @12:20PM (#15349319)

I suggest just reading MMM. It's all about savings rate. As an example, I live in Brooklyn, NY (one of the most expensive places to live in the U.S.) In 2016, I spent $32k ($24k was rent!) Assuming a $50k income, that'd be a ~36% savings rate, which requires a 23 year career.

Assume someone making $50k lives in not NYC, I imagine this scenario could be a lot better.

For a more extreme version of MMM, read http://earlyretirementextreme.com/. This guy (Jacob, who MMM mentioned in this interview) never earned much money (never over $50k prior to becoming financially independent), and retired after working 5 years. With a little creativity, most people can retire far sooner than standard retirement age.

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Re:Interview with Mr. Money Mustache by cheetos on Wednesday September 27, 2017 @12:31PM (#15349453)

> In 2016, I spent $32k ($24k was rent!) Assuming a $50k income, that'd be a ~36% savings rate, which requires a 23 year career.

Assuming a $50k income post-tax

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Re:Interview with Mr. Money Mustache by froindt on Wednesday September 27, 2017 @01:15PM (#15349969)

Knocking off 18k for 401k and 5.5k for a Traditional IRA dramatically reduces the tax liability. I recognize 50k-32k = 18k (so the full 23.5k can't be executed in this case), but it makes a significant difference regardless.

And there are methods to pull this money out well before the standard ages without penalty, such as Substantially Equal Periodic Payments (SEPP).

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Re:Interview with Mr. Money Mustache by davis_m on Wednesday September 27, 2017 @12:39PM (#15349566)

You are forgetting taxes (FICA, state and federal income taxes, etc), which would eat up a significant portion of those savings.

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