

Ask HN: How do you plan to retire from a long-term career in technology? - agentultra

I don't really plan to ever stop programming, but I have been wondering how one would eventually retire from this field. I haven't heard of a company offering pensions to its technology workers and relying on the government doesn't seem feasible. So the question on my mind lately has been how are other programmers and tech workers planning on retiring from the field?
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SlipperySlope
Been there, done that ...

I was laid off by an AI research company in 2006 at age 55, where I was a
programmer - I have been a programmer or project manager since 1976.

My wife and I have been frugal our entire lives and are very aggressive
savers. When I was laid off, I persuaded my wife that if I accepted one of
several job offers it would just put more money in our retirement accounts and
investment real estate. Furthermore, our financial advisor said that we
already had enough saved.

I have been researching and developing my own AI software since 2006 at home
and without pay - I have published a few workshop/conference papers. I work
8-5, happily self-directed, on stuff that I really enjoy and which - maybe -
might eventually make a big difference in our world. I use the latest
technology. At age 60 I became an Android programmer and soon I will be
setting up cloud infrastructure using Amazon Web Services - and so forth.

Programmers and software developers make good salaries. Here is my advice to
follow in my footsteps ...

1\. Aggressively save from your family income.

2\. Get the advice of a financial advisor. I am too much of a risk taker for
my own good and would have wasted my savings gambling in the options and
futures market. Better to simply buy and hold index ETF or mutual funds. I
average an 11% annual return on investment residential real estate that I
manage and about 8% annual return over several decades on a mixed stock / bond
diversified mutual fund portfolio.

3\. Avoid non-investment debt. I.e. mortgage on investment property is OK,
credit card debt is not OK.

4\. Marry well! E.g. Be sure your mate is an aggressive saver.

5\. Live substantially below your means. The greatest benefit of being
comparatively wealthy is simply not having to worry about money. E.g. avoid
university debt, do not buy too big a house, do not take expensive vacations,
do not have an expensive wedding or throw an expensive bar/bat mitzvah, buy
used cars, etc.

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sopooneo
Your advice sounds very good. I'm looking at the situation from the other end
of the tunnel. One point I would add is that you have to be very careful in
finding a financial adviser. A large portion of people that work under that
title are actually just commission based "whole life" insurance salesman. It
took me and my wife quite a while to find a person we felt comfortable with
and that was 100% fee based.

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Wilduck
I would like to second the need for avoiding insurance salesmen as investment
advisers. Beware anyone trying to sell you "Cash Value Life Insurance" (Also
known under other names, such as "whole life". These are all broadly in the
Permanent Life Insurance camp[1][2]). They are only masquerading as a
financial adviser in that role. There's no good reason to combine insurance
and investment.

Stick with "Term" [2] life insurance (good coverage, cheap, but only for a
fixed number of years), invest the difference, and plan to self insure after
the term is up. Good financial planning makes this approach much more cost
effective.

I've recently had the experience of a friend going into the life insurance
business, and it's been painful to observe how sleazy the life insurance
"products" that they try to sell you are. We sat down to discuss my
savings/insurance plans, and when it became clear that I was not interested in
starting his "Cash Value Life Insurance" plan, he resorted to pitching the
product to me with the desperation of a Quickstar/Amway[4] representative. It
was a very off-putting experience, but it makes sense now that I know his only
compensation comes from commission.

[1] <http://en.wikipedia.org/wiki/Permanent_life_insurance>

[2]
[http://en.wikipedia.org/wiki/Life_insurance#Permanent_life_i...](http://en.wikipedia.org/wiki/Life_insurance#Permanent_life_insurance)

[3] <http://en.wikipedia.org/wiki/Term_life_insurance>

[4] <http://en.wikipedia.org/wiki/Multi-level_marketing>

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ZanderEarth32
By saving wisely and living well below my material means. I don't plan to
retire lavishly after selling a hot start up for hundreds of millions of
dollars. Sure, that might happen but I am planning on retiring from a average
paying job after working for many years while saving and going without luxury
items like fancy cars, giant TVs, having kids and real estate I can't afford.

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ef4
Save money. Invest it well. That's it.

Most people in technology are earning significantly more than the median
income in their region. If you can learn to keep your spending near median,
you end up with a sizable cushion.

If you can save 1/3 of your income and earn a 4% real rate of return on your
savings, in about 8 years you have 5 years worth of living expenses in the
bank. That gives you a lot of flexibility for taking risks that can earn big
payouts.

Or if you keep doing it for 30 years, you end up with enough savings to live
off the investment income alone. This is the slow, reliable way to get rich.

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dripton
Max out the 401k and IRAs every year. Save more on top of that. Hope we don't
get hyperinflation to wipe out all those savings. If necessary, keep working
(maybe part-time, maybe telecommuting, whatever) into old age.

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HeyLaughingBoy
Most people (self incl.) have 401(k) or Roth IRA. My long term goal is to
build a very profitable business that is itself my retirement plan.

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jiganti
I'd imagine that many HN readers intend to use money from an exit to fund
their life after "retirement".

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platzhirsch
Do you mean how to manage the retirement from a financial perspective or in
general, how to spend one's retirement?

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agentultra
From a financial perspective, in general.

I've come to realize in researching the issue that there are several options
and in asking this question I am hoping to get a sense for popular strategies.

I am uncertain how it is possible to retire at all at this point (even though
I've still got a few decades if I'm lucky).

~~~
sopooneo
I think the shortest answer is: live below your means.

