[FooBarBizBazz]

Yeah, the blurb does literally say, "No-one deserves to be a millionaire." That threshold is the wrong choice, at least with prices where they are today.

If you do the math, millionaire is just about where your assets start to balance your liabilities. By liabilities, I mean the cost of a modest and frugal life. In that fuller accounting, the millionaire is merely the freedman, the person who has climbed out of the debt-hole into which almost all of us are born.

Let's do the math.

1. A millennial can get a decent Gold PPO plan on the health insurance marketplace, including basic dental and vision, for about $500/month. Anything below Gold merely coinsures ER visits and does not actually protect against catastrophic loss.

2. If you move to a cheap city and shop around, you can rent a decent one-bedroom apartment for $1,300/month. Even in a cheaper city, it will not be new and it will not be downtown.

3. Now consider utilities. Say $30 for a cheap cell phone plan, $50 for Internet, $100 for electricity (if you have electric heat), $20 for water. That's $200/month total

4. Allow another $80/week for groceries and $100/month very-occasional minor luxuries (get lunch out, get Starbucks).

5. Finally, let's say you really hit the jackpot with apartment and job location and are able to get by with a monthly bus pass costing $50/month.

We're at $2,230/month, or $26,760/yr.

Now assume you can get a 3% real yield. To finance your $26,760 annual costs, you need $892k invested -- nearly $900k.

This analysis has assumed unusually cheap rent and lifestyle. Add in car payments for a Corolla, or a less optimistic rent, and you're quickly at $1M needed. Yet I'm still talking about living frugally. I'm also assuming no childcare expenses.

So, for those reasons, and because $1M is a nice round number, I simply summarize that $1M is actually zero.

And it's only zero in a cheap place. If you're in California with only $1M you're still in the hole.

...

Yes, there is a problem. The natural world was expropriated from us before we were born, we were born into a system we didn't choose, and we must work off an indenture we never signed up for. So I agree with much of the spirit of what the author says.

But, quantitatively, if everything else about the current system remains as it is and we are only talking about where the cap is, then $1M is too low. Because $1M is merely where assets begin to balance a single person's liabilities.

[briHass]

You forgot a big asset on this hypothetical balance sheet: the individual's (your) productive output over their lifetime. Until we get to a point where all existing, and all possible, human output can be done by machines at no cost to anyone, the 'indenture' is more of a reciprocal arrangement where you trade your output for others'.

The scenario you outlined is one of unimaginable privilege for most humans living today, and arguably most humans and non-human animals through history. A climate controlled, personal living space in a safe society, varied and effectively limitless food/clean water, modern conveniences like a car/internet/telephone, access to healthcare by highly-trained doctors -- completely free of drudgery and effort (i.e. work).

[FooBarBizBazz]

I like the "reciprocity" angle. Indeed, if you're consuming food &etc without contributing anything, then you're sort of a leech. That's fair.

When we go further to speak of "unimaginable privilege", then I have mixed feelings. In historical and global terms this is comparatively true. But if this comparison is simply used to scold workers when they get too uppity, then it serves another purpose.

Returning to "reciprocity" -- it might be worth pausing to ask why my imagination is limited to financial rents. If I were the baker, and I lived next door to the butcher and the candlestick-maker, then maybe I wouldn't mind making a loaf of bread and trading it for some meat or some light. (Yes, I see the predation involved in the meat -- perhaps it is inescapable -- but I will choose to gloss over it for now, privileging humans.) In this imaginary village, people have roles and trade labor, but you understand that your labor is in fact useful, and you understand who it is helping. I guess I am talking about Marx's "alienation", or lack thereof.

As a software developer, in many industries it is not clear that your work really benefits any individual person, or even society in the abstract. You perform drudgery and endure stress, but it all seems to be some terrible social game that accomplishes nothing, and you participate only because you must, to justify your existence.

So it makes sense why many software developers -- despite the flexible work arrangements, and the physically undemanding job, and the good pay -- would see work as only an evil and seek to escape it.

There has to be a way to do reasonable amounts of useful labor -- to pull your own weight -- without participating in Silicon Valley style "life".

Unfortunately, a degree of financial independence has to be an intermediate goal. But what the next step should be after that, I am not sure. For the super-rich, the answer is philanthropy. But for the yeoman programmer, it's less clear. It will need to be less grandiose than all that. It will need to continue to produce some cashflow, but it should provide understandable value to the community. I will need to think about this.

[rufus_foreman]

ACA subsidies or, in most states, expanded Medicaid would be available for health insurance for someone living off $1 million in assets.

You can get an apartment in a cheap city for under $800 a month. In a cheaper city it will most likely be downtown, and that will be a bad thing.

[FooBarBizBazz]

Touché.

I forgot about subsidies, once your income gets that low. (Remembered that marginal tax rates would be low, at least.)

The difference between "cheap city downtown" and "expensive city downtown" is an interesting phenomenon. It isn't a hard and fast rule, but you're right about the general pattern.

It's also true that I could have aimed even lower than I did. If I'd assumed roommates in a larger apartment, I could have ended up with lower numbers.

If you really wanted to be a starving artist, you could probably get by on $1k/month. So then, as little as $400k invested plus a $30k cash cushion might suffice. It'd be pretty rough though if you were trying to pull it off in the US. Honestly we're starting to get into food-stamp territory.

[rufus_foreman]

I did the starving artist thing as a young man, decades ago. On one hand, there's really no limit, it's about how committed you are to this starvation thing, but on the other hand, yeah, less than $1k a month in current dollars, you're out of the joke starving artist level and into the real starving artist level.

Now I'm an old man and I'm looking at it from the other direction. Is $x amount enough to get me by until SS and Medicare. It's scary because as an old man I don't think I'm going to be able to jump back in to a software developer job once I quit. And on the other hand, the clock is ticking.

[FooBarBizBazz]

> Is $x amount enough to get me by until SS and Medicare. It's scary because as an old man I don't think I'm going to be able to jump back in to a software developer job once I quit.

Yeah, I'm not always sure whether "retirement" is a carrot held in front of us, or really a threat.