The paradox of enough.

Would you live on $20,000 a year for 40 years so that — after 40 years of austerity — you’d have $1,000,000 a year for the rest of your life?

That’s a pretty extreme example; I can’t imagine many people would sign up for that. But think of it like a formula:

Would you live on $X a year for Y years so that you’d have $Z a year for the rest of your life after that?

On a forum that I frequent I recently saw a poster mention that he had $11 million saved up (as a result of 3 successful businesses) but that he and his wife lived on around $100,000 a year.

It is a pattern I’ve seen over and over again among the Live Below Your Means (LBYM) crowd. People can’t imagine (other than emergencies) ever needing or wanting to spend more than $50,000 a year. (Or $70,000 or $90,000 or whatever they’re accustomed to.)

After enough years the payoff becomes pointless. You’re never going to spend it anyway.

At that point, is it still worth working towards that payoff?

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The table on the left shows a variety of sustainable withdrawal rate calculations for retirement planning. They show how much I can sustainably withdraw from my portfolio from now until the end of time if I never earn another penny. Anywhere from $45,000 at the very low end up to $108,000 at the very high end. The median is $79,500.

Since I started keeping track in March, I’ve spent 214,959,829 Vietnamese dong. On an annual rate that’s around $22,000. I could add $12,000 a year to my expenses — equivalent to two or three very nice vacations to Europe a year — and still come in well under even the most conservative retirement guidelines above.

As the CEO of a small company there is the hope that, someday, I’ll be able to pay myself a good salary. Maybe $200,000 a year? Maybe more? But that’s two years away in the best case scenarios.

As a tech startup there is the hope that my 45% equity stake will, someday, be worth millions. Maybe $5,000,000? Maybe more? But that’s probably 5 or 6 years away in the best case scenarios.

What’s the point of a $200,000 salary or an extra $5,000,000 in the bank if I’ve spent a few years being happy on $40 or $50,000 a year?

And just to end on a happy note: James Altucher recently wrote,

I turn on Facebook and there’s all of this “DO” porn. If you aren’t hustling you’re a failure. This is BS.

There’s nothing really to do. The world doesn’t need more DO-ers. A lot of people DO things that are meaningless and then they die.

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Learn how to enjoy early retirement in Vietnam. With charts and graphs.

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