I read this Guardian Article today. It struck an eerie correspondence in me regarding the FIRE movement. I knew some food bloggers and their lives revolved around getting the foodie shot. If your purpose for eating is photography, is there a disconnect. Are you enjoying the food or the photographing, displaying, and commenting on the food for your following?
In the FI world I see the same. Is it about living in freedom or is it about chronicling some process you cooked up so you could publish? In the foodie community not much is lost if the beautiful steak is tough as an old boot. In the FI world much more is on the line. Success is about right sizing and diversifying risk, because failure when you are old is catastrophic. Is life about turning your work into a vacation? Is publishing on your “vacation life” merely advertising for your book or God forbid your movie? FinCon is listed as a media event. What does a media event do except tune up product?
I came across this MMM article today. He bottom lines:
In this situation, the following three sentences represent the entire universe of probability for you:
- If you retire with $800,000 in investments, you willprobably make it through your whole life without running out of money (a 5% withdrawal rate)
- If you start with a $1 million nest egg (a 4% withdrawal rate), you will very likely never run out of money
- If you start with a $1.33 million chunk (a 3% withdrawal rate), it is overwhelmingly certainthat you’ll have a growing surplus for life.
So I dutifully Monte Carlo’d a 3% WR on a 60 year horizon using a super safe BH3 portfolio.
Runs out of money 11% of the time with normal SORR. The first failure is 12 years in. Not what I call overwhelmingly safe. Let’s add 3 years of initial bad SORR:
60% failure rate and the first failure is only 10 years in. That means if you retire at 30 there is a 10/10,000 chance you’ll be SOL by age 40, a 2663/10,000 chance you’ll be broke at 50, a 4631/10,000 chance you’ll be broke at 60, yep super safe NOT
I read an article on Millennial Revolution debunking FIRE as a cult. On 3 out of 4 by Wanderer’s own criteria FIRE is a cult. But is he talking his book (literally there is an add for their book at the end of the prose). I disagree with his last point and find all 4 points cult like
Here is what he defines as a cult:
WARNING SIGN #1: AN IDEOLOGY AT ODDS WITH NORMAL SOCIETY He calls FIRE cult like on this count.
WARNING SIGN #2: AN AUTHORITARIAN LEADER He calls MMM as the leader. I call the Bogelheads social media as the leader. Either way there is a narrative that needs be followed to be on the inside.
WARNING SIGN #3: INDOCTRINATION/BRAINWASHING 4 x 25 anyone? He claims no brainwashing yet in the MMM article I easily refute the safety of the argument. He points out they have a workshop and a book. Because you hold church services for the cult does not mean you are not a cult, it just gives you a means to fleece the flock.
WARNING SIGN #4: EXPLOITATION
He says no exploitation. Fincon just finished. A meeting devoted to honing the social media tools of exploitation. I guess GOOGLE and FACEBOOK aren’t about exploitation either. Read the article about “Living Fully” again. Is FI about being actually independent or about being an Instagram equivalent?. If your 60 year projection fails 60% of the time you ain’t holding your mouth right.
6 Replies to “Is “Living Fully” Just a Social Media Moment?”
I read Your Money Or Your Life during medical school. It made sense to me. I read somewhere that Joe Dominguez apparently made a million dollars in sales from their book and then gave it all away. If that was true I was duly impressed. That captures the spirit of all this to me.
Unfortunately all I see nowadays are folks wanting to gain notoriety. Everyone unmasks themselves on their blogs. I FI’ed at 36 years old. I knew to keep my trap shut and not flaunt it to my friends and colleagues. I simply enjoy 10 years home with my kids. And it was awesome.
Saying anything on the internet is fun. For all people know it’s all made up. But these folks love to out themselves on a grand scale.
And everything they say is rather common freaking sense. My mother would laugh at them. She knew all that with zero education.
Furthermore everyone is out to make a buck. Isn’t the whole point of being financially independent not caring all that much about money.
I seem to care less and less about getting more and more of it with each passing day.
There are no guarantees when it comes to money. They are all selling a mirage.
You make my point. There is a difference between cooking dinner, eating dinner, and living a media life around dinner. Cooking dinner and eating dinner and enjoying that experience IS the point. I love taking my wife out to explore different restaurants and seeing her get into it. That is the point. No marketing required. Getting rich is the same. Right size your life, right size your risk, spend some time thinking about it, and engage a plan, learn from your mistakes, read some more, hone the knife, cut through the bullshit down to bone, ENJOY THE RIDE. There is no media involved. MMM is featured in: and 12 media outlets are listed. I see plenty of schemes, portfolios that come out of a game of telephone (like 4×25 can be generalized to 60 years maybe even 100!) crowd source (sending a bazillion dollars to a stranger, what could possibly go wrong) people with 100% stock portfolios (bet your Mom would never do that) and assumptions and delusions and so on and so on and scooby dooby dooby. None of the 30 year olds have made it to 90 yet they talk like it’s in the bag. They HAVE to talk like that. Their lives are levered to the narrative regardless of the truth. When you retire at 30, 60 years is a long damn time for something to go wrong.
I’m glad to learn I’m not the only one with this crazy-unpopular view of the current landscape.
There is too much hype, marketing, and echo chamber repetition of half-truths.
There are actually more than you think that secretly hold these opinions. People are not stupid they just don’t feel empowered and confident enough to disagree with the party line.
Off topic, but I recently read Phil DeMuth’s books after hearing about them on your blog. I’m interested in whether you still index or if you only buy individual stocks, and if are following his zero dividend idea in your taxable account?
He gave the following list as example zero dividend ideas. Some have held up better than others.
Y (Allegheny Corporation)
WTM (White Mountain)
GLRE (Greenlight Capital)
TPRE (Third Point Reinsurance)
LMCA (Liberty Mutual Communications)
DJCO (Daily Journal Corporation)
The structure of my portfolio is the same, the players are different. My perspective is not buy and hold, it is buy low sell high. I held those for a while and as the ETF industry grew found some sector or tilted ETF’s do a better job because of the diversity and liquidity. I still have a few of those like BRK.B which I’ve owned for decades and GOOG, but I traded some of those issues for things like SPLV and MTUM and QQQ. Those still provide a means to get me on the efficient frontier. Something like BRK is like a managed ETF itself since they hold about 65 businesses.
MKL was a Russian mining stock. It was exploding back in the day. Putin went short the stock, and then arrested the owner and put him in jail. The price of the stock plummeted. He sold his shorts and then went long since mining in Russia is a sure bet. At that point it became clear foreign markets are rigged and rule of law is a joke which is why I own damn little foreign in my portfolio. I’m too far away from those markets to judge their veracity. Foreign makes up 13% of my holdings. US major companies are often global so I let them do my diversification and currency hedging.
Most of my “stock “diversifiers” like BRK and QQQ live in taxable accounts. I’ve devolved from the dividend idea as a major feature of my investing. Dividends are 95% correlated with the underlying so they add a little diversity to growth along the way but are not major diversifiers. They can be robust FOR A WHILE in a crash, so that is useful if you reinvest them. You automatically buy low. I always re-invest dividends anyway, so at 95% correlation it just acts as a source of growth anyway, that gets taxed as ordinary income. My main focus is non correlated diversity. Correlated diversity IMHO is closer to navel gazing than actual analysis, like the BH3 is pretty much navel gazing 50% US and 30% foreign is not really different than 80% US. On the way up you get a little diversity. On the way down all correlations go to 1, so the only thing that matters if everything is 1 is the total risk, and something like EM is a lot more risky than US so it goes down even further. I don’t want to own much of something that goes down further in a crash so I own only a little EM like 5% and that’s part of the 13% global allotment.