How much money is enough?

[ponyo]

Playing options is a second job in itself, if you want to do it right and not lose your ass.

Whether you make it a job or not is up to you. And you can lose your ass holding dividend stock. Option is what you make of it. More risk = higher reward. But that's true with anything.

Example of low risk option play with low payout, I could sell 25 contracts of TSLA June 18, 2021 $400 put and collect around $27 a contract. That's $2,700 a contract or $67,500 total for 25. As long as TSLA doesn't close below $400 on June 18, 2021, I get to keep $67,500. I like my odds TSLA will be higher than $400 next June. TSLA closed at $1,544 on Friday. It would have to drop $1,144 within the next 11 months for the sold puts to not expire worthless. If it's $400 or lower, it means I would buy 2,500 shares of TSLA for $400 each or $1 million total.

So that's 1 play for the duration of 11 months. How is that a second job? You make that single play and just wait for Theta to do its thing. If you lose your ass on this play, it means TSLA was the next Enron or the world has ended and you won't need money anyway.

 

[s0me0nesmind1]

For me probably about 10m would make me happy for life. Enough to retire on and coast for the rest of my life.

 

[Red Squirrel]

I consider stocks gambling, do it with money you're ready to lose, but I would not consider it as a safe long term investment unless you turn it into a full time job and REALLY know what you're doing. I own a bunch of stocks but I treat it like a lottery ticket with an undetermined drawing date. I paid money for it, and don't have that money anymore, but in years from now maybe the stock will drastically go up and I will make money, but also, maybe not.

 

[ViviTheMage]

Whether you make it a job or not is up to you. And you can lose your ass holding dividend stock. Option is what you make of it. More risk = higher reward. But that's true with anything.

Example of low risk option play with low payout, I could sell 25 contracts of TSLA June 18, 2021 $400 put and collect around $27 a contract. That's $2,700 a contract or $67,500 total for 25. As long as TSLA doesn't close below $400 on June 18, 2021, I get to keep $67,500. I like my odds TSLA will be higher than $400 next June. TSLA closed at $1,544 on Friday. It would have to drop $1,144 within the next 11 months for the sold puts to not expire worthless. If it's $400 or lower, it means I would buy 2,500 shares of TSLA for $400 each or $1 million total.

So that's 1 play for the duration of 11 months. How is that a second job? You make that single play and just wait for Theta to do its thing. If you lose your ass on this play, it means TSLA was the next Enron or the world has ended and you won't need money anyway.

That is too much risk for me, haha. I like Tesla, own a model 3, but they're is way too much unknown right now with a possible second wave of COVID possibly on the horizon. It also feels like a lot of its propped up because Musk is at the helm, if he was pushed out, I can't imagine it'd stay that high. But who knows, no one can predict what the hell's going on with the market, let alone $TSLA. I let my 401k do its thing, have a solid chunk of money with an investor who plays the options for me. He has been getting me solid returns over the last few years, so I let him just keep trucking.

That's one play, if you feel confident enough in TSLA, go for it. But as /r/WSB shows, that never moons for everyone. Way more losers then winners. One wrong tweet and down goes TSLA. IF it were me with $67500, I would spread it out in at least 5 plays. Maybe hedge a few of the more risky ones too. But I have nothing researched, let alone that feel good with anything that far out. When I think options, I think of playing 1-2 week options, not 12+ months out, the greeks are going to fall quick I hear.

I am with @Red Squirrel , stocks is gambling, and I already know I suck at that, haha.

 

[s0me0nesmind1]

That is too much risk for me, haha. I like Tesla, own a model 3, but they're is way too much unknown right now with a possible second wave of COVID possibly on the horizon. It also feels like a lot of its propped up because Musk is at the helm, if he was pushed out, I can't imagine it'd stay that high. But who knows, no one can predict what the hell's going on with the market, let alone $TSLA. I let my 401k do its thing, have a solid chunk of money with an investor who plays the options for me. He has been getting me solid returns over the last few years, so I let him just keep trucking.

That's one play, if you feel confident enough in TSLA, go for it. But as /r/WSB shows, that never moons for everyone. Way more losers then winners. One wrong tweet and down goes TSLA. IF it were me with $67500, I would spread it out in at least 5 plays. Maybe hedge a few of the more risky ones too. But I have nothing researched, let alone that feel good with anything that far out. When I think options, I think of playing 1-2 week options, not 12+ months out, the greeks are going to fall quick I hear.

I am with @Red Squirrel , stocks is gambling, and I already know I suck at that, haha.

Oh God don't get him started again on TSLA and don't you dare question his Lord and savior.

The stock will be 5 bajillion in 2 months.

 

[bobeedee]

touche


I might need some of the free "fuck you's" at end of this week.


Thanks for sharing and congrats! Any regret making the move? Were you scared? Are you enjoying retirement? Do you wish you would've done it sooner?

No deep regrets, but despite the fact that I had more than enough money to retire, I never really had a plan on what I would do with all my time but I wasn't scared at all. My blood pressure did go way down just 2 months into retirement however and I finally convinced my wife to give up her part time tutoring job so we could travel (Covid 19 has put a hold on that however). I also think I went at the right time in my life; I always thought I wanted to retire no later than 58 years old but 62 was just right. I am actually shopping for an Aston Martin that I can wash and rub with a microfiber towel every day

 

[JEDI]

my expenses are never more than 30$k a year, so it won't take much for me to retire

i figure throw in another 10$k/yr for healthcare, another 10$k/yr for family/misc expenses

50$k/yr at a %3 withdrawal rate is 1.67$ million

30k/4% safe withdrawal rate = $750k.

you dont need $10k healthcare.
$50/month (not married) after obamacare subsidies if income = $30k.

if you have $750k, you can say FU to your job NOW!

your safety net is social security at age 67. (im not counting SS as part of the $750k).

 

[ringtail]

yeah well what if your blue is only low-value LIGHT blue instead of the real deal Navy? Then you're just pedaling fools' gold.

Own the color blue. Then you're not just rich, you're wealthy.

 

[DigDog]

oh you guys ..

$750k really?

100k is enough to live a spectacular life, if you just but move out of the US (which, given the recent and dramatic loss of its coveted "best country in the world" status, shouldn't be too hard), but if you had 750k, you could literally fuck off and never be seen again. That, obviously, comes with some caveats.
If you want to live like the king of the hill, say, in NYC, you gon' need more than a million.

But if you want to own your own piece of land and live the life of a modern savage, surrounded by sex slaves, and eating the unspoiled fruits of nature, yeah, you can do that. No internet, no hospitals .. but you can, you totally can.

(if i had 300k i'm move to south america and spend the rest of my life doing 2 chicks at one time)

 

[Red Squirrel]

100k does not really go that far these days especially for rest of your life. Unless you use part of it to buy a used school bus and park it down by the river, then the rest will be for groceries and other life expenses. You need to replace your clothes and shoes at some point, and put gas in the bus if you decide you don't like that particular river anymore as well. And not owning any land is not living. I would absolutely not want to be in a situation where I don't own any land especially if this is suppose to be a half decent life. So you still have property taxes to pay, though if you do like I would do and find an unorganized township that is like a few hundred per year. But even if you did find yourself living in a situation that has no monthly costs whatsoever, 100k is still not going to go that far if you have any kind of hobbies. There's no point in being retired if you don't have anything to do.

 

[dasherHampton]

Ponyo's not wrong, at least not in this case.

 

[Exterous]

For us I want to be able to cover a bit more of our expenses than we spend now because we plan to retire early and filling those 40-50 hours of time a week might involve things that cost money. This also gives us more flexibility if we need to tighten our belts in retirement for any reason. Guessing what healthcare costs are going to be also makes that a bit of a moving target. I also want to be in a position where a 3% SWR provides for the situations above because that is where my comfort level is and I don't want to be stressed out in retirement. I realize my plan is more conservative than many would need to be comfortable. Of course neither of us hates our jobs so, if that ever happens, the calculus could change.

Oh and if Social Security and my wife's pension get fixed that would change the math too. My plan includes 66% of what Social Security promises and 0% of the pension. They've made some changes to start undoing the years of unfunded pension liabilities but thats going to take a lot of time. They were under funding by as much as 25% for many years and thats really going to hurt when you add in the loss of compounded interest on the missing funds. The current shortfall is ~$30Bn and the annual contributions are ~$2.5Bn to meet minimum obligations (So the $30Bn doesn't grow) + ~300M in catch-up funding. So yeah

your safety net is social security at age 67. (im not counting SS as part of the $750k).

SS payouts are based on 35 years of earnings. The earlier you retire the more zeros you add to that, decreasing your payout so it might not be much of a safety net

 

[brianmanahan]

SS payouts are based on 35 years of earnings. The earlier you retire the more zeros you add to that, decreasing your payout so it might not be much of a safety net

once you hit that second bend point in the SS curve (about 2$ million career earnings), then the payout from future SS contributions is only 15 cents per dollar contributed. once that is reached then paying more into SS becomes lot less of a reward, even if you don't have 35 years of contributions.

i'll probably only end up with about 25 years worth

 

[ponyo]

OK. I have Fuck You money now. I cashed out.

 

[ultimatebob]

OK. I have Fuck You money now. I cashed out.

Does this mean that you're no longer a TSLA shareholder? If so, do I need to take over your fanboy duties?

 

[Midwayman]

If it were just me, probably $2M or so. The wife likes living in high rent areas and can't handle roughing it tho, so probably more to account for that.

 

[BudAshes]

Probably need about 20 Million.

 

[ponyo]

Does this mean that you're no longer a TSLA shareholder? If so, do I need to take over your fanboy duties?

I'm still TSLA shareholder. I will always be TSLA shareholder. I'm not touching TSLA shares in my retirement accounts. I only cashed out my trading account shares but left single TSLA $300 Jan 17, 2021 call option in that account. I paid less than $4,000 for that option last year. I'm saving that so it can pay for new Tesla Roadster when it's released with that option. It's bad enough I'm going to have to pay close to half of my profit to the Fed and state next year.

My mom now also has FU money because of TSLA. I moved all her retirement money into TSLA shares when TSLA was in the low $200s. People said I was crazy but she didn't need the money and now she really doesn't need the money! And I also moved some of my sister's retirement money in TSLA in the low $190s. But because I was more conservative with her and didn't go all in, she doesn't have FU money yet but she's well on her way.

 

[Bitek]

oh you guys ..

$750k really?

100k is enough to live a spectacular life, if you just but move out of the US (which, given the recent and dramatic loss of its coveted "best country in the world" status, shouldn't be too hard), but if you had 750k, you could literally fuck off and never be seen again. That, obviously, comes with some caveats.
If you want to live like the king of the hill, say, in NYC, you gon' need more than a million.

But if you want to own your own piece of land and live the life of a modern savage, surrounded by sex slaves, and eating the unspoiled fruits of nature, yeah, you can do that. No internet, no hospitals .. but you can, you totally can.

(if i had 300k i'm move to south america and spend the rest of my life doing 2 chicks at one time)

Obligatory Office Space quote

 

[Bitek]

Wife and I's saving and investing goal is to have $3M+ for retirement.

This should be sufficient for 4%/yr withdrawal without having to rely on my pension or our SS.

Certainly could live with less, but aiming conservatively so we don't fall short.

If we do, live cheaper.
If we exceeded goal, retire earlier, help out kids more.

We like our jobs well enough we have no plans to leave them soon and retire. Still too young anyway.

OK. I have Fuck You money now. I cashed out.

I cashed out TSLA too earlier but have been crying watching it balloon up and up. Made some money, but OMG, could have made so much earlier....
But I'm risk adverse with these types of stocks and the market and reality are moving in two different directions.
Overall hate losing more than winning, so I'll just have to live with it.

 

[Svnla]

Never ever enough. More money = merrier.

Seriously. I think whenever you are rich enough to have your own private Gulfstream jet, several mansions in different countries/continents, and never have to work for a living because your network is in the billion and billion, then it is enough to be content. Just travel around the world in style, enjoy different cultures and cuisines, and help others that are not as fortunate.

Personally, I save most of my money now (about 90% savings of my income ---> F.I.R.E. principal) and a few years from now (less than 10 years for sure), I would leave this place and do my own things with a net worth (paper) of over $1 million USD and zero debt whatsoever. Freedom to do what and when I want and no boss = great. No one ever says he/she would love to work longer in the death bed.

 

[EliteRetard]

I retired in my late 20s with like $20k, living in one of the most expensive places on earth.

If I can live here on $1,200 a month, it should be possible almost anywhere.

 

[dullard]

From reading your posts you seem more savvy than me on on financials, but it's (probably) not like that 1.67M is going to all of a sudden stop earning after retirement. So you might be able to retire before hitting that number.

In the last 150 years of (proper) investment, the lowest amount that was ever deemed safe was to retire in the 1960s with a 4% withdrawal rate. Any lower than 4% and you are basically just going to live poor and let others inherit your wealth. See the image below showing what withdrawal rates would have left you with enough money to last your life, based on the year that you retired.



3% is a highly conservative number. But, it does allow for non-proper investments, splurges, not having to think about money, etc.

I personally am aiming going for 6% and adjusting it as conditions need. There is about a 50/50 chance that I'll have to withdraw lower than 6% during my retirement, but there is a 50/50 chance that I can increase it. If I am really healthy and/or the market is doing poorly, I'll reduce it. If I am sickly and/or the market is doing well, I will increase it. I also want to have a semi-jetsetter lifestyle in retirement. So, roughly $4 million would do it for me.

 

[Red Squirrel]

I retired in my late 20s with like $20k, living in one of the most expensive places on earth.

If I can live here on $1,200 a month, it should be possible almost anywhere.

How is 20k going to cover 1,200/mo for the rest of your life? I don't think you thought this through.

 

[EliteRetard]

How is 20k going to cover 1,200/mo for the rest of your life? I don't think you thought this through.

It has worked out so far, I have about 80k now. Another ~30k in outstanding loans.

The trick is to not buy anything.