
Financial Independence: What If Passive Income Isn't Necessary? - DVassallo
https://danielvassallo.com/financial-independence/
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mark_l_watson
Well, the author has one opinion, I have another: acquiring deep assets
(income property, stock market, investment in businesses, farms, etc.) should
be a natural thing that people do. You never know what might happen in life
and building deep assets is a hedge. A wonderful result of conservatively
building assets is that assuming things go well and you don’t need them,
assets can be passed on to younger generations.

What the author of the article is promoting is not financial independence, it
is simply finding a pleasant job and then enjoy life. Good advice but no
reason to not also build up assets.

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adrianmsmith
The author makes two assumptions which are either wrong, or at least I don't
think they apply to me.

\- "it would be quite unpleasant if I had to regress on my standard of
living", this makes the assumption that how great your life is is dependent on
how much money you spend. That assumption sounds obvious, and I made it for
decades. I realize now it just isn't true. I can meet my friends somewhere
cheaper and have just as much fun. I can cook at home and, although it's more
effort, it can be just as good if not better than the takeouts I used to get
every day. Making the effort to have relationships with people in the city I
live in, as opposed to finding people on the internet on the other side of the
planet. At least for me, I was able to cut down on my expenditure
significantly without cutting down on the pleasure I had in life.

\- "Work gives me satisfaction, and I intend to continue working for as long
as I’m able to.". When I was in my 20s, my girlfriend's father was near
retirement, also a software developer, and he seemed to try and do as little
work as possible. I didn't understand, I was building great stuff (my first
job was at a social network in Europe, with 6m users and about 50 servers), I
loved it. I assumed I'd always want to work and would never be like him. Now
I'm in my 40s, that social network has long been taken offline, most of the
work I've done for startups is no longer online, my one stint at a large
company involved politics making me write worse code (e.g. 1y with a team of
15 developing basically a static website, we wrote our own CMS because it
meant the company could bill its customer more hours). What I mean is, just
because you are enjoying work now, doesn't mean you'll enjoy work forever.

The author builds their argument on these two assumptions, which (at least for
me, but I'd say for everyone) aren't valid.

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ellisv
The author is inflexible in his conviction that he has no intention of
retiring. (and never will!) In 10, 20, or 30 years he may change his mind,
what then?

He points out that he's willing to make the trade off of working in exchange
for money (even if he doesn't need it) -- but what about working for other
reasons? Taking a job at a non-profit that can't possibly pay what you're
"worth".

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DVassallo
I know dozens of people that are able to retire, but don't. Or they chose to
retire, but then very quickly started doing some other work that gave them
satisfaction. I just don't believe in the myth that if you retire early you're
going to spend the rest of your life sipping pina coladas on the beach. My
argument is that if I can be doing the work that I would be doing if I
"retired", and it paid me enough money to make ends meet, then I won't need to
retire. Sure, if the work you want to do can never pay you enough to live off
it, then you have to find another income stream; maybe passive income. But
it's not the only option if what you seek is satisfaction.

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scarface74
Because of $bad_life_decisions I made in my late 20s to mid 30s, recovering
from those bad decisions for the last few years and getting married, (gladly)
taking responsibility for two step children, “retirement” is not in the cards
for me anytime soon.

But, I’m okay with that. I’ve been a software developer for 20+ years and I’ve
never hated my career. I have hated my _job_ at various points but as long as
I kept my skills marketable, I could always get another job. The only burnt
out I’ve ever felt was the politics of corporate America. I’ve learned
sticking with small companies was the best way for me to avoid that or being a
contractor/consultant where I don’t care about the politics.

That being said, my wife did choose a low stress, relatively low pay job with
the school system that guarantees us lifetime access to health insurance after
10 years to allow me to just jump back and forth between being a salaried
employee, contractor, consultant or not having to work for a few months.

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olcor
Living off interest and investments seems to be a recent phenomenon (FIRE). My
grandmother ensured that all her well-off children never sat on their laurels
and depended solely on passive income even though it could be considerable.

The goal was to keep the mind fresh and running, and to be a productive member
of society even if you didn’t exactly need to work. If you had more, you could
give back more, but stopping work was always heavily discouraged.

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knn
What do you mean by recent? There's been a whole society of rentiers living
solely off investment income in most countries for at least the last 300
years, if not several thousand years. It's extremely well documented,
especially in Britain and France since the early 1800's (see Thomas Piketty's
work on wealth distribution). The more capital one owns, in general, more
income is earned from capital rather than wages. This ratio increases sharply
when you look at the top 1% and 0.1% of owners.

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speedplane
> What do you mean by recent?

I think the recent phenomenon is that many folks with moderate levels of
income and initial capital have become convinced that they can attain
financial freedom. Pickety's research does not support that, in fact, it
supports the opposite conclusion: the only way to get wealthy, is to start
wealthy.

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SeanAppleby
That's an ironic claim on this platform. If you make $200k/year (normal high
tech comp, probably not far from the average person here), save $100k/year and
average 6.5% returns over 10 years, you have $1.4M.

You can then on average draw down $63k/year assuming 2% inflation to retain
your purchasing power until the end of time. That's very comfortable if you're
just willing to not live in the bay area or NYC.

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scarface74
Yet another example of HN bubble thinking that the “normal high tech comp” is
anywhere close to $200K a year.

[https://money.usnews.com/careers/best-jobs/software-
develope...](https://money.usnews.com/careers/best-jobs/software-
developer/salary)

~~~
SeanAppleby
I'm drawing a line between "software developer" and "high tech"

By high tech I ideally mean a company building novel and innovative software
using new ideas and techniques, but implicitly I pretty much mean FAANG/well
resourced startup in a tech hub.

And of course it reflects the "HN bubble", that's literally what I was
referencing.

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scarface74
HN ranks in the top 1000 most popular sites in the US. How many of those
visitors do you think are building “new and innovative” software?

How many of those who are building software at all do you think are not just
building yet another software as a service CRUD app where the founder thinks
they need “rockstar ninja” employees who can do leetCode in their sleep?

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bitxbitxbitcoin
It sounds like what you're describing is financial comfort/stability more than
true "independence." That being said, those that seek traditional financial
independence aren't exactly free from bad beats that might destroy their nest
egg and force them to become financially dependent on their labor again.

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idDriven
The idea that the amount of money you make working is in any way a 'measure of
the benefit you provide society' is pathological. Many of those who provide
the most benefit are paid a suppance.

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DVassallo
Author here. I didn't mean it's the only measure. Or that it's a perfect
measure. But if you were to give me your hard earned money for something I do
to you, it's very likely that I provided something useful to you.

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lazylester
The daily structure of work life allows one to avoid facing some questions
that otherwise arise. Financial independence forces one to explore how one
wishes to spend one's time when the work constraints are eliminated. This can
be a very exciting, fruitful and rewarding endeavour. I highly recommend it.

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yhavr
Well, really, there is no binary choice "work for money" and "don't work at
all", but rather a huge spectrum: "work at a shitty job", "work at an awesome
job", "be a contractor and take sabbaticals every half of a year", "have a
small stream of passive income and cool freelance gigs",... Therefore limiting
your attention to the final stage which is quite hard to achieve, it's quite
unoptimal.

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arcaster
Why would you not want passive income if you had the means to attempt to or
outright realize these kinds of income sources?

This article wreaks of a bizarre misdirected form of moral superiority and
relativism....

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IlyaStam
Financial independence is important if you have better things to do with your
time than work. And if that’s not the case - keep on workin! :)

