I already know what I’d choose but here are the details of the debate.
Let’s say you have two choices:
A) You are 20 years old but have $0 in the bank
or
B) You are retired at 65 years old and have $1 million in the bank
Which life path would you choose? Start off at 65 as a retiree and have a million bucks
to do with for the rest of your life or be young (like 20 years old) but have not a penny to spend and
start from scratch with nothing.
Reasoning:
People would choose A because they’d say even though you don’t have any money right now, you could earn that money plus have 45 years of life to live while making it.
People would choose B because they’d say why bother living all those years if you are going to be 65 one day anyways with a million? I’d rather just start living off the million right now and enjoy retirement and the million bucks at my disposal.
$1 million isn’t what it was. While it’s some serious walking around money it’s not that special. I would probably sacrifice 45 years of my life for truly “fuck you” money, as long as the 65 starts off baseline healthy, but $1 million isn’t close enough.
I’ve always thought that one way to cheer up a heart-broken young person is to remind him that a 70-year old billionaire would change places with him in a heartbeat!
I’m sure I’ll piss off a lot of people, but if you were born in the USA without serious disadvantages and make it to 65 with less than $1 million, you’ve failed financially pretty hard.
No question I’d take 20 @ $0, especially since I’m much wiser now than I was then and would have far more earning potential.
Very interesting. Yes, as I suspected, I also think the same way about being young with $0 than to be old with a million…even several millions might not even do it.
Thanks for your perspective! Yes, I suppose 65 actually could seem pretty young to 90 or 80 year olds. My grandfather is 94 and near death and to think of him being 65 again would be like thinking of him as a young man!
My mother lived to 93, so at 71 I wouldn’t mind a million dollars to piss away during my next 22 years.
Re the irony of the age thing: the motto of my generation was “Don’t trust anyone over 30.” That seems absolutely LUDICROUS to me now. Dear God, we were a cocky bunch. Yikes! Now I barely trust anyone UNDER 50!
I’m 66 and if you include the value of my house (which I own) and assume that my three pensions are valuable (which they are); then, combined with my savings (and no debt), I’m worth around $1,000,000.
When I was 20, I had just dropped out of University :smack:, was living with my parents and had no money.
So I’m in the ideal position to judge.
It would make a lot of difference if at 20 I knew what I know now.
I don’t mean ‘buy Microsoft stock’, but just how I could make the best of myself.
I’ll assume that you’re going to disallow such self-knowledge.
In which case … I don’t know.
Overall I’ve had a pretty good last 40 years, so I don’t know if I would do better starting again. I’ve certainly been very lucky on occasion, so perhaps I’ll take life as it is.
Sorry, in my original question I meant that whatever scenario you end up with, in both scenarios you’ll have the SAME amount of money.
The question is if you’d prefer to just “skip” those years and go straight to the year where you have all the money or live out those years to get to the same point where you’ll end up with all the money.
Most people will always choose to live out those years and enjoy it while you make the money…why just throw away those years and skip a few years to the money.
So yes, if the question is re-phrased: would you like to be 40 years old with 5 million dollars right now or be 10 years old with $0? But that 10 year old will eventually have 5 million when they reach 40 years old.
But I see where this debate can become more interesting if we change the question and make it more enticing hehe.
A million dollars at 65 is a shitty retirement you only get ~$40k per year. I’d absolutely take the 20 years old with $0. Now if the offer was 65 with $10mm it would at least be worth considering. Going from 70 years to 30 years those last 30 would have to be awesome.
Median net worth for retired people is about 250k. Saving a million on paper isn’t hard after factoring in mortgage and 40 years of compound growth on investments, but it doesn’t happen in reality as often. Around 20% of people in their 70s have a net worth of a million or more.
This is true. Majority of Americans (I don’t know about the rest of the world but probably even poorer) don’t have more than 500k savings by retirement.
If you break it down by year, 1 million in savings by 65, that’s like saying you saved up 20k every year AFTER paying off mortgage/rent, car payments, insurance, health, food, bills, other daily necessities and expenditures on family/kids, friends, events, social life etc.
If you are actually still saving 20K after spending your money on all those things I mentioned, you must be either A) making well over 50k per year or B) living in a really cheap country.
It’s not easy to save 20k per year AFTER expenses. I forgot the stat but majority of Americans are living pay check to pay check.
Yeah, In america we’ve had 40+ years of wage stagnation combined with skyrocketing cost of living. Prices on real estate, tertiary education, health care, daycare and regressive taxes have all gone up. At the same time, pensions disappeared and people are supposed to save for their retirement w/o employer help.
Having said that, $1 invested in the stock market in 1980 would be worth something like $70 today. So you don’t need to put 20k a year into investments, more like 5k inflation adjusted a year as long as there is decent long term growth potential in investments.
Plus you have your primary residence. You get a house with a 15 or 30 year mortgage, then when you retire its worth a few hundred grand in assets. Some people got lucky on this (I know people who bought a home for 30k and sold it for 500k decades later) and some people are permanently locked out of hte housing market due to high prices now.
Plus some people (not all obviously) get an inheritance when their parents die. That can be a few hundred grand too.
I mean, its easy to assume that ‘everyone’ is a middle class or upper middle class college educated worker with a stable career. But a lot of people aren’t.
But ‘on paper’, getting to a million isn’t too hard. Get a 15-30 year mortgage on a house worth a few hundred grand, get an inheritance worth a few hundred grand, and invest a few hundred a month into long term growth stocks for 45 years. But thats not realistic for everyone for various reasons.
