I simply saved more than three quarters of my income for five years. The math works out. If you save 83% and spend 17%, you need 25*0.17/0.83 ~ 5 years of savings, where 25 is the inverse of 4%, which is a safe withdrawal rate for at least 30 years.
What I like to do is solving impossible problems. Or just “hard problems”—problems that people don’t want to wrestle with. I did this in physics and learned a lot. I realized that I wouldn’t learn very much from solving a similar problem in physics and that’s why I quit physics. The challenge would not have been the same. Fortunately, I realized this quickly and I had the money to quit or “retire from my career“.
ERE is another one such “hard” problem solved (it’s only hard, because it’s somewhat out-of-the-box and thus more a question of shifting your perspective than it being any kind of technical challenge). I’ve written enough material here on the blog and in the book to show you how it’s done. I have the same problem with ERE. The challenge is gone for me. Many others are currently on the road towards financial independence and this is exciting for them but for me it’s just vicarious living. Becoming financially independent, the subject of this blog, is a period of transition and obviously one can only transition once. This is why fresh blood is needed.
[Uhh, part of the challenge is maintaining the minimalist lifestyle, well, for the rest of your life...]
... So what am I going to do now? Well, yesterday I got a job offer as a quant trader/researcher. I took it! I think this fulfills all my criteria. It’s a hard problem, it requires no marketing, no politics, no self-promotion, and no management. As far as I can tell, I’m safe from the Peter principle and can focus on research and development without worrying about suddenly finding myself having to sell or manage my stuff.
“Being the richest man in the cemetery doesn’t matter to me … Going to bed at night saying we’ve done something wonderful… that’s what matters to me.” [The Wall Street Journal, May 25, 1993]
“Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life. Because almost everything — all external expectations, all pride, all fear of embarrassment or failure — these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.” [Stanford commencement speech, June 2005]
“Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma — which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.” [Stanford commencement speech, June 2005]
Economist: ... People, studies show, behave differently at different ages. Older people have fewer rows and come up with better solutions to conflict. They are better at controlling their emotions, better at accepting misfortune and less prone to anger. In one study, for instance, subjects were asked to listen to recordings of people supposedly saying disparaging things about them. Older and younger people were similarly saddened, but older people less angry and less inclined to pass judgment, taking the view, as one put it, that “you can’t please all the people all the time.”
There are various theories as to why this might be so. Laura Carstensen, professor of psychology at Stanford University, talks of “the uniquely human ability to recognise our own mortality and monitor our own time horizons”. Because the old know they are closer to death, she argues, they grow better at living for the present. They come to focus on things that matter now—such as feelings—and less on long-term goals. “When young people look at older people, they think how terrifying it must be to be nearing the end of your life. But older people know what matters most.” For instance, she says, “young people will go to cocktail parties because they might meet somebody who will be useful to them in the future, even though nobody I know actually likes going to cocktail parties.” ...
WHAT I HAVE LIVED FOR.
Three passions, simple but overwhelmingly strong, have governed my life: the longing for love, the search for knowledge, and unbearable pity for the suffering of mankind. These passions, like great winds, have blown me hither and thither, in a wayward course, over a deep ocean of anguish, reaching to the very verge of despair.
I have sought love, first, because it brings ecstasy -- ecstasy so great that I would often have sacrificed all the rest of life for a few hours of this joy. I have sought it, next, because it relieves loneliness -- that terrible loneliness in which one shivering consciousness looks over the rim of the world into the cold unfathomable lifeless abyss. I have sought it, finally, because in the union of love I have seen, in a mystic miniature, the prefiguring vision of the heaven that saints and poets have imagined. This is what I sought, and though it might seem too good for human life, this is what -- at last -- I have found.
With equal passion I have sought knowledge. I have wished to understand the hearts of men. I have wished to know why the stars shine. And I have tried to apprehend the Pythagorean power by which number holds sway above the flux. A little of this, but not much, I have achieved.
Love and knowledge, so far as they were possible, led upward toward the heavens. But always pity brought me back to earth. Echoes of cries of pain reverberate in my heart. Children in famine, victims tortured by oppressors, helpless old people a hated burden to their sons, and the whole world of loneliness, poverty, and pain make a mockery of what human life should be. I long to alleviate the evil, but I cannot, and I too suffer.
This has been my life. I have found it worth living, and would gladly live it again if the chance were offered me.
Keynes's intellect was the sharpest and clearest that I have ever known. When I argued with him, I felt that I took my own life in my hands, and I seldom emerged without feeling something of a fool. I was sometimes inclined to think that so much cleverness must be incompatible with depth, but I do not think this feeling was justified.
... For those who find that even “the exercise of choice is in itself tiresome,” (147) Russell has a remedy that anticipates the smart unconscious. “I have found, for example, that if I have to write upon some rather difficult topic the best plan is to think about it with very great intensity—the greatest intensity of which I am capable—for a few hours or days, and at the end of that time to give orders, so to speak, that the work is to proceed underground. After some months I return consciously to the topic and find that the work has been done.” (49-50)
Perhaps the greatest obstacle to happiness is “the disease of self-absorption.” (173) Russell offers that his own conquest of happiness was due “very largely [. . . ] to a diminishing preoccupation with myself.” (6) A happy person knows that “one’s ego is no very large part of the world.” (48) ...
To the self-absorbed person, other people primarily serve as objects of comparison. “What people fear [. . .] is not that they will fail to get their breakfast next morning, but that they will fail to outshine their neighbors.” (27) Russell warns that “the habit of thinking in terms of comparisons is a fatal one.” (57) To overcome it, “teach yourself that life would still be worth living even if you were not, as of course you are, immeasurably superior to all your friends in virtue and intelligence.” (173) “You can get away from envy by enjoying the pleasures that come your way, by doing the work that you have to do, and by avoiding comparisons with those whom you imagine, perhaps quite falsely, to be more fortunate than yourself.” (58-59)
Likewise, Russell advises not to worry too much about what others think of you. On the one hand, he suspects that “if we were all given by magic the power to read each other’s thoughts, I suppose the first effect would be that almost all friendships would be dissolved.” (76) On the other hand, he doubts that “most people give enough thought to you to have any special desire to persecute you.” (79) This is a nice example of regression to the mean: Chances are you overestimate the love of your friends and the disdain of your foes.
hy·po·ma·ni·a: A mild form of mania, characterized by hyperactivity and euphoria.
From the intro to The Hypomanic Edge by J. Gartner, professor of psychiatry at JHU medical school.
"The 1990s will be remembered as the age of Internet mania, a time when entrepreneurs making grandiose claims for their high-tech companies swept up millions of Americans with their irrational exuberance, inflating the biggest speculative bubble in history. The idea that some entrepreneurs may be a little manic is hardly new. A Google search for "manic" and "businessman" yields more than a million hits. Entrepreneurs, as well as the markets they energized, were commonly described in the media as "manic." Yet, until now, there has never been a serious suggestion that the talent for being an entrepreneur and mania, the genetically based psychiatric disorder, are actually linked. Perhaps because I am a clinical psychologist, it was clear to me that "manic" was more than a figure of speech in this case.
I called several reporters who had written profiles of these "manic" entrepreneurs and asked them, "Do you think he really was manic?" None said yes. "Not really manic; not clinically," was a typical response. They resisted applying the psychiatric diagnosis because the entrepreneurs they had interviewed were boastful, hyperenergized, and zany, but they "weren't crazy." And the journalists were right. Their subjects were not manic. They were hypomanic. Hypomania is a mild form of mania, often found in the relatives of manic depressives. Hypomanics are brimming with infectious energy, irrational confidence, and really big ideas. They think, talk, move, and make decisions quickly. Anyone who slows them down with questions "just doesn't get it." Hypomanics are not crazy, but "normal" is not the first word that comes to mind when describing them. Hypomanics live on the edge, betweeen normal and abnormal.
...My new hypothesis became that American entrepreneurs are largely hypomanic. I decided to undertake what social scientists call a pilot study: a small-scale, inexpensive, informal investigation meant to test the waters. I placed announcements on several Web sites devoted to the technology business, expressing my interest in studying entrepreneurs and requesting volunteers. I interviewed a small sample of ten Internet CEOs. After I read them each a list of hypomanic traits that I had synthesized from the psychiatric literature, I asked them if they agreed that these traits are typical of an entrepreneur:
* He is filled with energy.
* He is flooded with ideas.
* He is driven, restless, and unable to keep still.
* He channels his energy into the achievement of wildly grand ambitions.
* He often works on little sleep.
* He feels brilliant, special, chosen, perhaps even destined to change the world.
* He can be euphoric.
* He becomes easily irritated by minor obstacles.
* He is a risk taker.
* He overspends in both his business and personal life.
* He acts out sexually.
* He sometimes acts impulsively, with poor judgment, in ways that can have painful consequences.
* He is fast-talking.
* He is witty and gregarious.
* His confidence can make him charismatic and persuasive.
* He is also prone to making enemies and feels he is persecuted by those who do not accept his vision and mission.
I feared they might find the questions insulting. I needn't have worried. All of the entrepreneurs agreed that the overall description was accurate, and they endorsed all the hypomanic traits, with the exceptions of "paranoia" and "sexual acting out" (these traits in particular are viewed as very negative and thus may be more difficult to admit to). Most expressed their agreement with excitement: "Wow, that's right on target!" When I asked them to rate their level of agreement for each trait on a standard 5-point scale, many gave ratings that were literally off the chart: 5+s, 6s. One subject repeatedly begged me to let him give a 7."
Marcus Aurelius
"Or does the bubble reputation distract you? Keep before your eyes the swift onset of oblivion, and the abysses of eternity before us and behind; mark how hollow are the echoes of applause, how fickle and undiscerning the judgments of professed admirers, and how puny the arena of human fame. For the entire earth is but a point, and the place of our own habitation but a minute corner in it; and how many are therein who will praise you, and what sort of men are they?"
...Beginning in the 1980s, Lykken and his colleagues surveyed 2,310 pairs of identical and fraternal twins, some reared together, others brought up apart, looking to see how closely mood, affect, temperament, and other traits tracked with shared genes and/or a shared environment.
What they found (from a smaller subset of the original group) was that the "reported well-being of one's identical twin, either now or 10 years earlier, is a far better predictor of one's self-rated happiness than one's own educational achievement, income, or status." This held not only for identical twins raised together but for those brought up apart, while for fraternal twins raised in the same household, the likelihood that one's sense of well-being matched one's twin's was, statistically speaking, not much greater than chance.
Happiness Is a Stochastic Phenomenon
David Lykken and Auke Tellegen
University of Minnesota
Psychological Science Vol.7, No. 3, May 1996
Happiness or subjective wellbeing was measured on a birth-record based sample of several thousand middle-aged twins using the Well Being (WB) scale of the Multidimensional Personality Questionnaire (MPQ). Neither socioeconomic status (SES), educational attainment, family income, marital status, nor an indicant of religious commitment could account for more than about 3% of the variance in WB. From 44% to 53% of the variance in WB, however, is associated with genetic variation. Based on the retest of smaller samples of twins after intervals of 4.5 and 10 years, we estimate that the heritability of the stable component of subjective wellbeing approaches 80%.
