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I was reading another thread and it got me thinking. I am doing well in life. I went to a good school, got a good job and so did my wife. We save a pretty good amount and if things continue that well, we will be in a great spot.
However, all of this can collapse in a moment. If I get some chronic disease that prevents me from working, get in a car accident etc. our savings will get nuked. Maybe not in one month. Not in a year. But eventually with the way things are in America you will not be able to pay medical bills or afford insurance.
So basically, I feel that people here overstate the value of discipline and underestimate luck. Yes it is very important, but one unlucky thing can obliterate everything you have worked for.
Unless you are fabulously wealthy, a serious illness pretty much guarantees you are wrecked financially.
The assumption here seems to be that if you haven’t saved enough it is because you drove a BMW, went to Hawaii 8 times a year, and bought a 6k sq ft house.
My favorite uncle wrote those words to me in a card at my college graduation. Almost exactly one year later he died suddenly from a massive coronary. The words have never left me, all of these decades later.
Totally agree with PartIrish. If you don't have your health you really don't have much. As for overstating discipline and underestimating luck, it's hard to quantify but I do believe discipline and good decision making are very important. As far as luck, that implies there's nothing you can do about it. You can however, take precautions for certain disastrous scenarios that are the most common. Long term care insurance comes to mind. To me, especially if you have a family, this is even more important than life insurance since there's a fairly high chance people will need long term care sometime in their life. An umbrella liability policy of at least $1 million is another thing.
Of course one thing can obliterate everything you've worked for. That's life for everyone. Another way to look at it is that we're all terminal. I try to look at life as kind of like a game which I only get to play once. Have fun, make good decisions, take precautions on important things. In the grand scheme of the universe we as humans are really nothing.
You have to first define luck. However, I have a different belief. Instead of luck, I look at what I use in life, and is like a HP (health point) and MP (magic point) in a game, the more you use, the less you have left to spend down the road.
So basically, I feel that people here overstate the value of discipline and underestimate luck. Yes it is very important, but one unlucky thing can obliterate everything you have worked for.
Of course, luck matters. But I see too many examples of waste every day that people are just blind to. The normal way of living in America is an exploding volcano of wastefulness (to quote Mr. Money Mustache). Yet people are just blind to it. They don't question "normal'--and that so desperately needs to happen in so many ways on so many levels.
What passes for normal sucks. Yet most people wouldn't agree with that statement. Normal is what's messing us up financially as well as health-wise. Sure weird diseases and accidents happen, but those are still the exceptions. There's too much emphasis on the oddball exceptions and not enough on taking control over the stuff we actually do have control over.
And you mention health....but 70% of our health care spending is on treating diseases that are largely preventable. That amounts to over $1 Trillion a year. This is something we have control over, but we act as if we don't. People like Dan Buettner are coming up with practical solutions to the health issue that doesn't cost a lot of money to fix...but I don't know if his ideas will take root or if they'll do so fast enough:
Luck favors the one who is prepared. If you have not put yourself in a good place via self discipline, an eager mind, and healthy lifestyle, when good luck comes along you will not be able to benefit from it.
When bad luck comes along, one will do best who has a contingency plan and is so well prepared that he has the flexibility to spin off in a different direction.
Health and genetics are different issues. We need to be as healthy as we can control and then be sure to have good health insurance, even though that might not be enough for the unfortunate few.
Yes. Hard work matters but only the most clueless people think everything they did was their “greatness” and work ethic. I see this attitude most often in boomers.
The largest positive factor working towards your earnings is your parent’s earnings. The strongest negative factor that works against your earnings is being born to a single parent household. Two factors out of your control. Even being born to a wealthy country is an advantage or say being born to an affluent area vs a small town or dying town within this country. Yes, there are outliers but it’s just that. The exception.
Health is a wildcard as well. You can eat healthy and exercise to try to get better outcomes but you can still be born to problems or have them develope outside of your control. You could have children that have medical bills their entire life.
It’s the same with marriage. You can select a good mate and work on your relationship, but people can change unexpectedly overtime or make decisions out of your control that you can’t influence.
I was reading another thread and it got me thinking. I am doing well in life. I went to a good school, got a good job and so did my wife. We save a pretty good amount and if things continue that well, we will be in a great spot.
However, all of this can collapse in a moment. If I get some chronic disease that prevents me from working, get in a car accident etc. our savings will get nuked. Maybe not in one month. Not in a year. But eventually with the way things are in America you will not be able to pay medical bills or afford insurance.
So basically, I feel that people here overstate the value of discipline and underestimate luck. Yes it is very important, but one unlucky thing can obliterate everything you have worked for.
Unless you are fabulously wealthy, a serious illness pretty much guarantees you are wrecked financially.
The assumption here seems to be that if you haven’t saved enough it is because you drove a BMW, went to Hawaii 8 times a year, and bought a 6k sq ft house.
I feel that’s pretty sanctimonius.
Somebody once said, "I'd rather be lucky than good"
But eventually with the way things are in America you will not be able to pay medical bills or afford insurance.
Spot on. The way health care costs are going in this country, unless you are a multi-millionaire, a disease/condition/accident can completely wreck your finances. Some people have a general predisposition to certain diseases due to genetics. Or you can rack up high medical bills because of some random event that causes you or a family member an injury.
Yes. Hard work matters but only the most clueless people think everything they did was their “greatness” and work ethic. I see this attitude most often in boomers.
The largest positive factor working towards your earnings is your parent’s earnings. The strongest negative factor that works against your earnings is being born to a single parent household. Two factors out of your control. Even being born to a wealthy country is an advantage or say being born to an affluent area vs a small town or dying town within this country. Yes, there are outliers but it’s just that. The exception.
Health is a wildcard as well. You can eat healthy and exercise to try to get better outcomes but you can still be born to problems or have them develope outside of your control. You could have children that have medical bills their entire life.
It’s the same with marriage. You can select a good mate and work on your relationship, but people can change unexpectedly overtime or make decisions out of your control that you can’t influence.
This. A lot of people on here are "it was all me, I saved, while you chose to buy 8 BMWs and go to Hawaii". Yes, that's absolutely a big part of it, but they ignore that there are a lot of hard working people who can't get ahead for a variety of reasons - taking care of a sick parent, sick child, being sick themselves, injuries, low income etc.
One example of the luck I am talking about is where/how you were born. Yes, hard work can overcome a lot of these things, but that makes it so much easier. For example, my wife and I bought a house in San Francisco which cost us >$1 million. It is a normal house. Our neighbor is our age and her parents just gave it to her to live with her friends. We basically had to go to top schools and work our butts off to get to where she is by doing nothing. No shade. Good for her. Just stating the obvious. She has a good job, too and she thinks that "I worked hard, so I am proud of what I have accomplished". But accomplishing that was so much easier for her than it was for us, who came from nothing. It is a lot easier to save 50% of your income, when you don't spend 25%-30% of it on housing like the average person.
And accomplishing what we did was so much easier for us, who had loving parents who pushed us, even though they were poor, and made sure we were able to go to top universities and have a good work ethic. The woman who cleans our house once every two months doesn't work any less hard than us. In fact, she probably works much harder. But she was born in a poor country, was never in a position to learn English when she was a kid, and moved to the US without having an opportunity to land a high paying job. It is not because she is lazy, or because she drives a BMW, while we drive a Honda. It is because my mom started teaching me English when I was 6, while hers was a farm-worker in Guatemala.
And health is another big thing. My wife's cousin's kid is severely autistic. His wife had to quit her high-earning career to stay at home and take care of him. He is a doctor, so they will ultimately be fine, but he will have to work much longer than he had anticipated because the kid will never be able to take care of himself.
I think people don't like to think about these things, because it makes it obvious how much is actually out of their control. The myth that everyone has bought in is that if only you work hard, you will get all you want. Work is a key ingredient. But a lot of the other key ingredients are out of your control and people don't like that.
Last edited by HappyinCali; 03-09-2018 at 08:14 AM..
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