There’s already a community of people who do conspicuous saving: https://www.reddit.com/r/financialindependence/ In this subreddit people celebrate each other’s saving milestones, share saving/investment strategies, share screenshots of their account balances, etc. Outside of Reddit, searching for “financial independence early retirement” would yield a variety of blogs of people in this community.
However, most people do this anonymously. A common topic in the community is friends and family getting envious when you tell them how much you’ve saved. Here are some examples:
“My best advice is to STFU about your finances if you wanna keep those friends. I have friends I’ve known for 30 years who don’t know I’m retired, or that we own 3 properties out right. I’m not discussing that we paid 900k for our house, I don’t invite them to my house. I bought a new car, I don’t tell them I paid cash on a 60k mini van. That’s not going to make their life better.” https://old.reddit.com/r/financialindependence/comments/lhd6sb/feeling_disconnected_from_friends_as_we_have/
Another concern I have is that, what you’re proposing could make net worth the most salient feature of an individual—this information is out there in a database, rather than something one needs to spend time and effort to get to know the person to find out. This could lead to a hyper-competitive environment where individuals’ worth is reduced to a number, and social status is done through rankings. That usually doesn’t end well. In addition, much of the concerns about wealth inequality in today’s world still apply here.
A common topic in the community is friends and family getting envious when you tell them how much you’ve saved.
This reminds me of Romani communities in my country. Imagine villages full of poor people, most of them unemployed. Once in a month they get social benefits—then they organize a huge party with lots of food and alcohol, spend all their money during two or three days, and starve for the rest of the month.
Obvious idea: “why doesn’t someone skip the party, save the money instead, and buy some food later?”
But the problem is, this strategy doesn’t work if you are the only person in the village who tries it. As soon as the others find out that you have enough food in the middle of the month, your starving neighbors will come asking for some. Your only options are to share… or to make enemies of the whole village. So at the end, you skipped the party, and now you are starving anyway. Next time, you join the party instead.
I am not saying there are no other problems involved, such as racism etc., but this mechanism alone is sufficient to keep the entire village poor. And I see some similarity between this—and how the communities of middle-class people keep each other away from early retirement.
Uh… I see some relation, but connotationally… The Wikipedia page describes it as “if I can’t have it, neither can you”, which is quite uncharitable for humans… and I suspect even for the actual crabs.
For the Romani village, the feeling from inside is “we have an obligation to help each other”. Which, in abstract, is a good thing. Most people would say it is a central example of morality. Indeed, from certain perspective, those Romani villages are more moral than the civilization that surrounds them! Taking the food away from those who saved the money to make them also starve is not the intended goal; the goal is to alleviate the starving of the others, at least for a day.
The horrible thing is the Nash equilibrium of “having a huge party on the payday” in the community without strong norms for private property, and without competent leadership—because a strong competent leader could e.g. tax everyone, and ration the money for food during the month; and keeping the village non-starving would give legitimacy to their rule. The Romani here have lost their old cultural norms, and didn’t acquire the cultural norms of the majority, leaving them in the worst of both worlds. Culture can solve problems individuals can’t on their own; especially things about coordination.
With early retirement for middle class, the pressure that I see is twofold. First, it’s something like “don’t trade good things you could enjoy now for uncertain hypothetical benefits decades later”. Less charitably, short-term thinking. But in some sense, yeah, rationally you should discount the future a bit. You may die before reaching the date of your early retirement; or a revolution in your country may take your savings away. Also, doing some things will probably bring less enjoyment in old age. -- Here, my response is that I actually don’t enjoy some of those things I give up too much, and that I passionately hate spending 8 hours a day in a job. So, maybe other people just have different preferences than me, so their optimums are different? Dunno.
The second concern is something like “not spending proportionally to your income is low-status”. In abstract, sounds kinda stupid. But is it completely wrong? Status has an impact on your life outcomes. To put it to extreme, living literally like a homeless person would save you some expenses, but it would probably also prevent you from getting a good job, so it might actually result in less net savings. And that’s just the most direct impact, ignoring the social effects. Looking attractive may help you get better friends (who may then recommend you better jobs) and a better (nicer and richer) partner. Heck, because of halo effect, looking attractive will probably get you higher salary. So, investing in looking good, physically and socially, makes sense; it’s just the question of finding the optimal level. Plus my friends and relatives have a selfish motive to make me appear higher-status; being socially connected to me, my status also reflects on them. -- Here, my response is that I already lose lot of social points by being an aspie, so the benefits of buying a nicer sweater or a nicer car are probably too low to justify the costs. I am already married with children, and I don’t plan to divorce and remarry or to cheat, so I don’t need to impress girls with displays of wealth. (Heck, even if I wanted to cheat, having 8 extra hours a day would probably help me more; some of that time could be spent in a gym, and the rest socializing. Except, whom am I trying to fool here, I would probably spend them by the computer, heh.)
So, I don’t think that “if I can’t have it, neither can you” is the correct description of how most people feel from inside. Though, of course, some people may be like this. But most probably feel that early retirement is not realistic… and if you achieve it or get sufficiently close, they will just conclude that you are an exception but that it was not realistic for them.
I think the fundamental problem in that village, which would not be helped much by skipping the party and saving, is that because they’re mostly unemployed there just isn’t enough money.
If they cancelled the party and all saved enough to avoid starvation for the rest of the month, I bet they still wouldn’t be able to save much for the longer term. They’d starve less but also have less social fun. It might be better, it might be worse, but it wouldn’t stop them being poor.
I do agree that there’s a similarity between their situation and that of insufficiently-saving middle-class communities. I just don’t buy the “sufficient to keep the entire village poor” bit; I think what keeps the village poor is the fact that so many are unemployed and (I’m guessing) those who are employed mostly don’t have very lucrative jobs.
Another concern I have is that, what you’re proposing could make net worth the most salient feature of an individual—this information is out there in a database, rather than something one needs to spend time and effort to get to know the person to find out. This could lead to a hyper-competitive environment where individuals’ worth is reduced to a number, and social status is done through rankings.
It seems like most social environments are already like this to some extent. People are ranked according to the school/job they are at, and the grades they got. The first thing is public information, and the second thing can generally be inferred by the first.
I agree that we shouldn’t try to make people feel like their social status is reducible to a single number. But if people already think that their social status is reducible to a single number, we might as well think about what number it ought to be, rather than just pretending that the number doesn’t already exist.
I also don’t know why it’s better that social status be reducible to a set of numbers rather than just one number.
In addition, much of the concerns about wealth inequality in today’s world still apply here.
I actually think my proposal should be enthusiastically supported by those concerned with wealth inequality. For one, it makes people’s wealth much more salient, which will probably make people more willing to redistribute wealth once they viscerally understand just how well some people are doing.
People are ranked according to the school/job they are at, and the grades they got.
Watch out for https://www.lesswrong.com/tag/typical-mind-fallacy in this. There may be some groups for which this is true, but it hasn’t been my experience in any of the US or UK work or social subcultures I’ve been part of. Those things are inputs to evaluation and discussion, but are only very weakly correlated with any dimension of ranking.
In my experience, there is a very wide range of jobs (and former jobs!) that contribute to high status, and outside of academia, I don’t know anyone who cares about schools a small number of years past graduation/exit. I don’t recall anyone EVER caring about grades after school is done.
There may be some groups for which this is true, but it hasn’t been my experience in any of the US or UK work or social subcultures I’ve been part of.
Sure, many different social environments use different measures for status. In the post I talked about how people rank themselves based on wealth. Here, I mentioned how some people use school and jobs.
My main point was that we already have status rankings. It’s true that we don’t have a total order, global status ranking. But locally speaking, I don’t see what’s wrong with introducing a new metric for ranking status. I’m reminded of something I saw recently as a response to social anarchists who want to abolish hierarchies: people will just create new hierarchies along different axes in response to the revolution. We might as well just ask which hierarchies are best to have.
There’s already a community of people who do conspicuous saving: https://www.reddit.com/r/financialindependence/
In this subreddit people celebrate each other’s saving milestones, share saving/investment strategies, share screenshots of their account balances, etc. Outside of Reddit, searching for “financial independence early retirement” would yield a variety of blogs of people in this community.
However, most people do this anonymously. A common topic in the community is friends and family getting envious when you tell them how much you’ve saved. Here are some examples:
“The idea that you can live comfortably without over consuming, by saving/investing, by creating additional income and deferring some gratification has put people in to a state of shock.” https://old.reddit.com/r/financialindependence/comments/ktfo8x/non_fire_people_tend_to_get_upset_and_defensive/
“My best advice is to STFU about your finances if you wanna keep those friends. I have friends I’ve known for 30 years who don’t know I’m retired, or that we own 3 properties out right. I’m not discussing that we paid 900k for our house, I don’t invite them to my house. I bought a new car, I don’t tell them I paid cash on a 60k mini van. That’s not going to make their life better.” https://old.reddit.com/r/financialindependence/comments/lhd6sb/feeling_disconnected_from_friends_as_we_have/
“Money has suddenly become a contentious issue with a family member after that person asked me for a substantial loan. I never would have anticipated this person making such a request or being upset by my refusal. I greatly regret ever sharing my financial situation.” https://old.reddit.com/r/financialindependence/comments/ixithd/lesson_learned_do_not_share_your_net_worth_or_any/
Another concern I have is that, what you’re proposing could make net worth the most salient feature of an individual—this information is out there in a database, rather than something one needs to spend time and effort to get to know the person to find out. This could lead to a hyper-competitive environment where individuals’ worth is reduced to a number, and social status is done through rankings. That usually doesn’t end well. In addition, much of the concerns about wealth inequality in today’s world still apply here.
This reminds me of Romani communities in my country. Imagine villages full of poor people, most of them unemployed. Once in a month they get social benefits—then they organize a huge party with lots of food and alcohol, spend all their money during two or three days, and starve for the rest of the month.
Obvious idea: “why doesn’t someone skip the party, save the money instead, and buy some food later?”
But the problem is, this strategy doesn’t work if you are the only person in the village who tries it. As soon as the others find out that you have enough food in the middle of the month, your starving neighbors will come asking for some. Your only options are to share… or to make enemies of the whole village. So at the end, you skipped the party, and now you are starving anyway. Next time, you join the party instead.
I am not saying there are no other problems involved, such as racism etc., but this mechanism alone is sufficient to keep the entire village poor. And I see some similarity between this—and how the communities of middle-class people keep each other away from early retirement.
Yes, it’s the [crab mentality](https://en.wikipedia.org/wiki/Crab_mentality).
Uh… I see some relation, but connotationally… The Wikipedia page describes it as “if I can’t have it, neither can you”, which is quite uncharitable for humans… and I suspect even for the actual crabs.
For the Romani village, the feeling from inside is “we have an obligation to help each other”. Which, in abstract, is a good thing. Most people would say it is a central example of morality. Indeed, from certain perspective, those Romani villages are more moral than the civilization that surrounds them! Taking the food away from those who saved the money to make them also starve is not the intended goal; the goal is to alleviate the starving of the others, at least for a day.
The horrible thing is the Nash equilibrium of “having a huge party on the payday” in the community without strong norms for private property, and without competent leadership—because a strong competent leader could e.g. tax everyone, and ration the money for food during the month; and keeping the village non-starving would give legitimacy to their rule. The Romani here have lost their old cultural norms, and didn’t acquire the cultural norms of the majority, leaving them in the worst of both worlds. Culture can solve problems individuals can’t on their own; especially things about coordination.
With early retirement for middle class, the pressure that I see is twofold. First, it’s something like “don’t trade good things you could enjoy now for uncertain hypothetical benefits decades later”. Less charitably, short-term thinking. But in some sense, yeah, rationally you should discount the future a bit. You may die before reaching the date of your early retirement; or a revolution in your country may take your savings away. Also, doing some things will probably bring less enjoyment in old age. -- Here, my response is that I actually don’t enjoy some of those things I give up too much, and that I passionately hate spending 8 hours a day in a job. So, maybe other people just have different preferences than me, so their optimums are different? Dunno.
The second concern is something like “not spending proportionally to your income is low-status”. In abstract, sounds kinda stupid. But is it completely wrong? Status has an impact on your life outcomes. To put it to extreme, living literally like a homeless person would save you some expenses, but it would probably also prevent you from getting a good job, so it might actually result in less net savings. And that’s just the most direct impact, ignoring the social effects. Looking attractive may help you get better friends (who may then recommend you better jobs) and a better (nicer and richer) partner. Heck, because of halo effect, looking attractive will probably get you higher salary. So, investing in looking good, physically and socially, makes sense; it’s just the question of finding the optimal level. Plus my friends and relatives have a selfish motive to make me appear higher-status; being socially connected to me, my status also reflects on them. -- Here, my response is that I already lose lot of social points by being an aspie, so the benefits of buying a nicer sweater or a nicer car are probably too low to justify the costs. I am already married with children, and I don’t plan to divorce and remarry or to cheat, so I don’t need to impress girls with displays of wealth. (Heck, even if I wanted to cheat, having 8 extra hours a day would probably help me more; some of that time could be spent in a gym, and the rest socializing. Except, whom am I trying to fool here, I would probably spend them by the computer, heh.)
So, I don’t think that “if I can’t have it, neither can you” is the correct description of how most people feel from inside. Though, of course, some people may be like this. But most probably feel that early retirement is not realistic… and if you achieve it or get sufficiently close, they will just conclude that you are an exception but that it was not realistic for them.
I think the fundamental problem in that village, which would not be helped much by skipping the party and saving, is that because they’re mostly unemployed there just isn’t enough money.
If they cancelled the party and all saved enough to avoid starvation for the rest of the month, I bet they still wouldn’t be able to save much for the longer term. They’d starve less but also have less social fun. It might be better, it might be worse, but it wouldn’t stop them being poor.
I do agree that there’s a similarity between their situation and that of insufficiently-saving middle-class communities. I just don’t buy the “sufficient to keep the entire village poor” bit; I think what keeps the village poor is the fact that so many are unemployed and (I’m guessing) those who are employed mostly don’t have very lucrative jobs.
It seems like most social environments are already like this to some extent. People are ranked according to the school/job they are at, and the grades they got. The first thing is public information, and the second thing can generally be inferred by the first.
I agree that we shouldn’t try to make people feel like their social status is reducible to a single number. But if people already think that their social status is reducible to a single number, we might as well think about what number it ought to be, rather than just pretending that the number doesn’t already exist.
I also don’t know why it’s better that social status be reducible to a set of numbers rather than just one number.
I actually think my proposal should be enthusiastically supported by those concerned with wealth inequality. For one, it makes people’s wealth much more salient, which will probably make people more willing to redistribute wealth once they viscerally understand just how well some people are doing.
Watch out for https://www.lesswrong.com/tag/typical-mind-fallacy in this. There may be some groups for which this is true, but it hasn’t been my experience in any of the US or UK work or social subcultures I’ve been part of. Those things are inputs to evaluation and discussion, but are only very weakly correlated with any dimension of ranking.
In my experience, there is a very wide range of jobs (and former jobs!) that contribute to high status, and outside of academia, I don’t know anyone who cares about schools a small number of years past graduation/exit. I don’t recall anyone EVER caring about grades after school is done.
Sure, many different social environments use different measures for status. In the post I talked about how people rank themselves based on wealth. Here, I mentioned how some people use school and jobs.
My main point was that we already have status rankings. It’s true that we don’t have a total order, global status ranking. But locally speaking, I don’t see what’s wrong with introducing a new metric for ranking status. I’m reminded of something I saw recently as a response to social anarchists who want to abolish hierarchies: people will just create new hierarchies along different axes in response to the revolution. We might as well just ask which hierarchies are best to have.