Not sure what your point is here -- A chance of reaching the future means you shouldn't plan for the future at all, even though statistically most people do survive to retirement age?
I think the implication is that if your spend your life toiling for future reward at the expense of present reward, you may lay there on the pavement bleeding out, wishing that you'd taken that vacation you always wanted.
Obviously it's presuming that you're neglecting reasonable gratification in the present, and it's all a spectrum of choices and rewards. But often people talk about financial investment without balancing it with "personal investment". Personal enrichment can pay interest of a sort, too.
I think you're maybe being too charitable with djrobstep's comment. It's an inane response to the comment it replies to. Here's the full context:
> > Especially over a 67 year period! If she saved about $10k (2018 dollars) annually for the first ten years of her working career, got ~4% after inflation, and never saved another penny that would account for ~$1.2 million of the sum by itself.
> > Buy and hold long term; reinvest dividends folks :-).
> What if I'm hit by a bus and killed the day before I retire?
It's just not responsive to the original comment and doesn't really bring up anything novel. It might be slightly more reasonable if included your elaborations, but it doesn't, and even then it's totally silly. Saving $10k/yr is not a hardship for most tech workers and does not preclude gratification in the present! $90-100k annually is still several standard deviations above median income.
What you, and most people championing the virtues of the slow and steady save, fail to consider is the time value of money (ie why those investments compound so much interest). Money today is worth more than money tomorrow is worth a truck load more than money in 67 years. Combined with the fact that, at least in my opinion, money when I'm young and healthy is also worth multiplicatively more than money post retirement.
I think most young people would rather be, and far better off with, saving that 10k annually you suggest to amassing a down payment on city property or equivalent investment in current quality of life rather than prepping for a lonely future.
> What you, and most people championing the virtues of the slow and steady save, fail to consider is the time value of money (ie why those investments compound so much interest).
No, we (generally) have not failed to consider it. (I'm sure some have and some haven't, but it isn't an argument that holds much water anyway.)
In fact, I think it means more or less the opposite of what you have taken it to mean.
Time value of money calculations implicitly assume return on investment! If your time value of money calculation gives you a higher value for spending some money vs investing it, your valuation of the spending must be above market returns. It's fine if that is the output of your utility function some of the time, and you do have to make a personal decision about how much to spend vs save. But I would assert that most people should value retiring with non-zero savings, and highly paid tech workers have a lot of disposable income that spending provides minimal value.
No one here is suggesting you should eat cat food and live in a cardboard box to save for the future.
> Money today is worth more than money tomorrow is worth a truck load more than money in 67 years.
Time value of money is simply making the inverse of the same slow-and-steady statement: investing the money for 67 years will yield massive returns. Your core assumption is that spending the money today will yield above-market returns. And for your first dollars, I agree! Housing, food, clothing, and (some) entertainment give huge value, far above stock-market gains.
> Combined with the fact that, at least in my opinion, money when I'm young and healthy is also worth multiplicatively more than money post retirement.
"Young and healthy" and "post retirement" are not mutually exclusive, if you save. But they certainly are if you don't — it's hard to be healthy if you can't afford food or housing.
> I think most young people would rather be, and far better off with, saving that 10k annually you suggest
First, let me be clear that the 10k figure was just for illustrative purposes of compounding at average index return rates and is not a suggestion nor rule of thumb. It's a ton for someone making poverty wages and totally insufficient for someone pulling down $500k.
The general guideline is: save at least 15% of your take-home pay for retirement, starting 40 years before you intend to retire. I think this is even a little optimistic about stock market returns and would encourage saving at least a few percent higher than that.
Note that this recommendation still leaves 80-85% of your take home pay for current spending. We're not arguing about the first 30-50% of your spending on necessities (and some luxuries may be necessary to stay sane and happy), but the marginal value of that 85th percentile spending vs saving.
> to amassing a down payment on city property
Property investment is just one kind of investment. A first property certainly has special properties as far as taxes (at least in the US) and long-term expenses, but is not incompatible with "championing the virtues of slow and steady save." I would agree that saving for a down payment on property makes a lot of sense for many people.
> or equivalent investment in current quality of life rather than prepping for a lonely future.
The key word here is "investment." Your comparison is against stock market returns, so the quality of life stuff has to be really valuable to justify the lost income.
Why do you think your future will be lonely? If you really like working, great, but many people only work because they need the current income to fund their necessities. There are other avenues for socializing than work.
No, grandparent is saying "carpe diem". You never know when you're going to drop dead, and being too old makes it difficult to see the world. Also, you never know when evil politicians are going to raid Social Security or change the laws to protect insurance companies that have taken on moral hazards, causing you to lose your coverage/annuity.
The point, in my interpretation, is: don't put all your eggs in the basket of your latter years. Find the balance of long term planning and short term fulfillment.
Nobody's suggesting doing such though (yet the comment seemed to imply someone had). The suggestion was to save a meager $10K/year, which is tiny relative to the salaries of most people on here.
It's 20% of the gross median household income. For the typical family it's probably closer to 25%-30% or more of their gross pay net of taxes. That's a lot of money to save for this kind of household. It's simply not a realistic goal for the majority of households in America.
Obviously it's presuming that you're neglecting reasonable gratification in the present, and it's all a spectrum of choices and rewards. But often people talk about financial investment without balancing it with "personal investment". Personal enrichment can pay interest of a sort, too.