When Earning $1 Million A Year Isn’t Enough To Retire Early

Eating soft rice takes a toll:

Rachel sees a therapist every other week to help her manage the constant pressure she feels to provide for her family, outperform her peers, and outperform the markets. The market takes no prisoners and every month she starts with incredible anxiety. She’s only as good as her last month’s performance. This type of pressure has begun to pulverize what little peace and quiet she has left inside. She’s also recently begun to develop heart palpitations, which has her worried.

Colin also sees a therapist once a month to help him get through his feelings of unworthiness for being a stay at home father. Although he’s truly a great dad, he often feels gutted to have given up his management consulting job. None of his friends, who all work, understand what he’s going through. He feels isolated and often depressed. Sometimes he gets jealous of Rachel’s success, which leads to bitter fights.

Does everyone in NYC have a therapist? How come I don’t hear anyone here in BA have one?

Also the net worth seems underwhelming:

For a base case net worth increase of roughly $1,600,000 without any appreciation in their investments or house. Assuming $106,666 in base case net worth growth over 15 years, no compensation increase during this time period, and a current $3,000,000 net worth, including the equity in their primary residence, the Chens will realistically have a $10,000,000 net worth by the time their youngest graduates from college using a 6.2% annual growth rate . She’ll be 60 years old and he’ll be 58.

Making $1M every year but only has $10M after all?

No, she earns $1M and has $3M currently.

She should quit her million dollar job and buy a big apartment in Texas, fire her therapist and enjoy her FIRE.

Btw, most of the people in BA don’t have 10x asset when they earn x a year. How can a Wall Street trader have $5M asset when he only earns 500k a year?

Notice how state/local income tax are bigger than any other bill and federal income tax is 3x bigger than any other bill?

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They must have very good therapists. I think we should mandate that everyone is entitled to a therapist everyone month

“Colin also sees a therapist once a month to help him get through his feelings of unworthiness for being a stay at home father. Although he’s truly a great dad, he often feels gutted to have given up his management consulting job. None of his friends, who all work, understand what he’s going through. He feels isolated and often depressed. Sometimes he gets jealous of Rachel’s success, which leads to bitter fights.”

Why not? Engineering couples making 500k a year don’t have 5M at retirement? Are you kidding?

If you are like @tomato and buys a 4M house in Los Altos, after he pays it off 30 years later that alone will be worth more than 5M. More like 10 or 15M.

im buying 6m just to give you more things to mock about :slight_smile:

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Housing price appreciation is off the chart in tomato-land!!

BTW it’s not entirely mocking… OK some of it is. :smile: I am just using you as a stand-in for SV SWE’s. Like you mentioned in another thread most of your peers are buying in similar locations for similar prices.

So it’s not personal. Not all of it is anyway… :smile:

7M now.

Spent some time in realestateforums.net :slight_smile:
Take a leaf out of Philip Mountbatten’s book.
What is the cost of therapy? Where is it reflected?

I’m talking about current asset. Asset value at retirement is misleading since most of it is inflation. You buy a $2M house today and it becomes a $10M asset after 30 years. $10M in 2048 is more or less the same as $2M today. Actually $10M house in 2048 is worth less than $2M today due to the inflation tax on capital gains!

Inflation adjustment for capital gains tax. I’m sympathetic of Rachel and her husband :joy:

You are right. It’s not on that table. So maybe their after tax savings will be zero after therapy expenses.

Therapy is free, included in healthcare insurance or EAP

Did you ever feel “isolated and often depressed” after retirement? :rofl:

Dang, where’s Yoda’s spa treatment? He needs to step up his game.

Did my behavior here indicate above?

Let @harriet run some sentiment analysis on you :joy:

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Fuzzy math.

Let’s base everything on today’s dollars. If your house is worth 2M today no need to worry about inflation and what it be worth 30 years later and then rebase it again in today’s dollar. It’s 2M, by definition, if there’s no increase net of inflation.

For @tomato who’s buying a 4M house, it’s 4M in today’s dollars, by definition.

Now how much will it appreciate net of inflation? I bet it will be at least 2 to 3 times. The Cupertino house someone posted in another thread appreciated 8 times in real value for 50 years. 3x is not too much to ask for. So just that house alone will be worth 10M in today’s dollar.

I don’t want to picture a wrinkled old dude in spa…

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