Weekly FatFIRE Update (2/25/23)
Weekly summary of “Path to FatFIRE” net worth updates AND should you share net worth with friends and family? Should you invest in RE or index funds?
“Path to FatFIRE” Net Worth Updates:
20s/30s:
$642,053 - [NWS-retireby50] - 35 year old military officer - pension eligible in 3 years twitter post
$1,875,000 - [BO-glockenspiel] - goal is $3-3.5M by early 50s - twitter thread
40s:
$2,000,000 - [MU-282] - new podcast co-host and entrepreneur - twitter post
$2,160,201 - [NWS-investorman] - 87% of assets in real estate - twitter thread
$3,761,128 - [NWS-howgen3ric] - net worth peaked at $4.4M in May2022 - $2 million home with $1.45M mortgage - twitter post
50s:
$2,231,491 - [NWS-highlander] - Canadian with several RRSP plans
$3,701,666 - [NWS-retire4lyfe] -almost back to March 2022 peak net worth
$18,000,000 - [ESI-351] co-owner medical device business - twitter thread
NWS - NetWorthShare | MU - Millionaires Unveiled | PoF - Physician on FIRE | ESI - ESI Money | BO - Bogleheads.org |
Should you share your net worth with friends or family?
Hit $4 million net worth at 34. Those who did it, is it worth disclosing to family and friends [r/FatFIRE] - Here are a few of the most liked comments “There is no benefit to sharing that information with anyone other than stroking your ego. Literally no upside and a lot of potential downside”. “Never, ever talk about your wealth to anyone”. “Absolutely never. It's nice for ego, but not for anything else. I only share with friends on similar path with similar success (or who are much more successful). Sharing with anyone else will only lead to resentment”. So there you have it - mum or shhh is the answer!
Should you invest in Index Funds or Real Estate?
Is there any rational reason to own real estate over investing in index funds? [r/FatFIRE] - Basically, there are only 3-4 reasons people sited in favor of real estate (diversification, tax deductions, monthly income or the most common was leverage). It’s definitely not as passive as it seems but it works for those that like to be more hands on with their investments. Leverage was the most response as it’s the easiest way for retail investors to get leverage. Ended with this comical response: The most rational reason to own real estate is leverage. The most rational reason to NOT own real estate is also leverage. So there you have it, if you want to take more risk via leverage than buy real estate but recognize its not passive income like owning Index Funds.
What is the most coveted luxury asset in 2023?
What all goes into a luxurious lifestyle? [r/FatFIRE] - Apparently it’s less about buying something and more about being able to do exactly what you want, when you want, how you want to without worrying about the cost or others opinion. Generally the wealthy do not have a "typical" luxury lifestyle. Some people like homes / cars / travel / fine dining, others go for model trains, home gardens and musical instruments. True wealth is the freedom to pursue whatever it is that brings you joy. However, many believe luxury comes second to the following:
#1. Trading money for more time. You'll hear a lot about house cleaners, maybe personal assistants, private chefs, baby sitters/nannies, etc. If you've got plenty of money, but not enough time, that's one aspect of a fat lifestyle. From the outside, it may look luxurious -- and maybe it is. But it's more than just luxury.
#2. Eliminating many worries. A fat lifestyle means not having to sweat the small stuff. If something comes up, you just get it taken care of by professionals (rather than trying to fix it yourself) or replace it. You hear stories about people replacing cell phones that are acting up rather than trying to get it fixed or repaired under warranty. I'm pretty handy, but if it's going to take me more than half an hour to fix it, I'm calling a professional.
#3. Reducing friction and annoyances. This includes flying first class. You aren't crammed into a small seat, with a kid kicking the back of your seat during a five hour flight.
#4. Indulging your passions. OK, here's where things get fat. You can afford to explore hobbies and buy toys that others only think about. If you like boating, you're no longer limited to a 18' bass boat. If you like dining out, you can splurge more often and at nicer restaurants. If you like tequila, you can buy the extra special Anejo. And so on.
Follow along with @Tenwilsons on twitter or our weekly newsletter Paths to FatFIRE as we show you details on more multi-millionaire net worth progressions to Fat FIRE.