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I don’t do high car/mortgage payments and no family (but that’s not mainly for financial reasons). No reason to keep up with the Joneses.
I agree. My rule is never borrow money to buy a depreciating asset (like a car). Debt should only be used to enable a financial return (for a business, house, education). If you only have $5000 for a car down payment, then you can only afford a $5000 car.
During your working life, your financial goal is to build enough wealth to not work for the last few decades of your life. Through unfortunate circumstances, you may have one or more non-working years earlier in life because you lose a job. If you are well on your way to funding retirement, then a year or so out of work should not be a big deal. If you live beyond your means, then you will not build wealth and being out of work for a short time will be difficult.
Chief
We get paid very, very well, but costs for everyday goods keep going up faster. I don't travel, my car is average, no fancy clothes or accessories.
I do not live over my means, but life is expensive, and I have a kid in college.
I'm deeply concerned that I'll be laid off by year end (GPS), so I cut extra spending and am preparing for the worst.
Tl;dr: Be a realist and understand that things can change anytime.
Rising Star
That’s why I have a HHI of $750k and a mortgage of $3k per month…
We saved to have 12 months of contingency easily available in case we need it. Bought our cars outright, so no car payments, and chose cheaper cars than we could afford. The house we chose was at a price in which if one of us lost a job, the other could still cover the basic living expenses. Our splurge is travel because there may not always be a chance to take the trip, but we establish a budget for each trip and do our best to stay under that budget.
I do have 12 months of buffer given the current economy. But also there are horror stories where people are seeking employment for longer than 12 months, which is my main worry.
You can get let go at any time (I was) but if you're good at your job you can get a new job at any time too. I found a better role with a big bump in salary within a couple weeks.
Finding another job now in a short turnaround time is much harder now. There are good people I know who have been unemployed for close to a year
There is no financial security at all. Not with AI, India, and possibility of losing the reserve currency status. We've got to behave like the breeders who have no concept of risk and just live their lives if we want to have families.
You do realize the first thing AI will replace is India, right
You have to stay clear of big expenses and live within your means. Once investment compounding starts working you will find out that at some point you make more money from your investments than from your work. That’s when I stopped caring as much about working and started calling bs everywhere I saw it. It was truly liberating treating people in high level positions like the children they were behaving as.
This
Already have a house paid for in Asia and $2 million in assets. Can live very comfortably off interest alone.
For as long as there have been employees, there was always something new to worry about. AI is just the latest thing. Unless you have an employment contract, you are an at will employee and can be let go easily. Follow the accepted practice of having an emergency fund, keeping your skills current, investing out of each paycheck (even in tiny amounts - it does add up) and not getting into debt that you cannot reasonably get out of - just like every prior generation did with their jobs.
Rising Star
Being let go at any time has always been there. It happened to me twice in my working life. Each time. I transitioned to something new. Yes, Ai is going to cause folks to lose jobs but this is no different than the beginning of the computer age. Pivot.
If your going by past 5 years so was job hopping. So many people jumped jobs to make more. Companies realize they didn’t need all the people they hired when things were great. It’s an ebb and flow. It’s not any different that times past. It’s just new to you. Like everything it will pass
F
The world is inherently unstable. The 75 year period post WWII is the aberration. Govern yourself accordingly. But this is reality for most of the planet’s history.