Skepticism and critical thinking

Interesting testimonial.

gersontherapy.wistia.com/medias/9rxtpoiq04?utm_source=Gerson+Email+Club&utm_campaign=89c8c3713d-ENEWSLETTER_AUGUST_2024&utm_medium=email&utm_term=0_3d3e879086-89c8c3713d-22590449&mc_cid=89c8c3713d&mc_eid=6ffb38f9c6

The believer in me wonders how much better my life would be if I spent some time each day filling my gob with fresh organic food rather than the processed GMO chemically laden stuff that passes as food at the supermarket.

Here is a possibility - the 'stuff' that passes as food there might soon turn you into a stiff

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fangman said..
The skeptic in me wonders how much better my life would be if I spent some time each day filling my bum with coffee ( as per ^). I think I will keep tipping it down my gob for the time being, but please let us know how it goes for you.

At the very least you'd want to be extremely careful, hate to get something wrong and end up bleeding from your bum.

I was just doing some maths and want a peer review of what I figured out.

A single person aged 65 to be moderately comfortable in retirement they need $40k per year.

www.bt.com.au/personal/your-finances/retirement/how-much-super-will-i-need.html

Using the FIRE 4% rule, that means at age 65 a peron needs to have $1m saved in assets, not including their home, which isn't counted, so they don't run out of money before they die.

www.investopedia.com/terms/f/financial-independence-retire-early-fire.asp

So let's assume they start work aged 25 and own their own home. One would need to save $480 per week for 40 years to save $1m at age 65.

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myscreenname said..
I was just doing some maths and want a peer review ..

Who would you consider to be one of your peers ?

Judging by the current price of a bitcoin Carantoc wouldn't make the list..

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Mr Milk said..
You seem to think that the money just gets stuffed under the mattress or is held in a non interest bearing account.
The share market in Australia returns about 9.5% pa, which is very close to the return required to get the first year's savings of $25K to become $1M over 40 years.

You'd have to counter interest against inflation though. In 40 years time the $1m required would have grown as well.

Ignoring both might be roughly similar to considering both, just easier maths.

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Carantoc said..

Mr Milk said..
You seem to think that the money just gets stuffed under the mattress or is held in a non interest bearing account.
The share market in Australia returns about 9.5% pa, which is very close to the return required to get the first year's savings of $25K to become $1M over 40 years.

You'd have to counter interest against inflation though. In 40 years time the $1m required would have grown as well.

Ignoring both might be roughly similar to considering both, just easier maths.

OK. Say the return on the ASX200 beats inflation by 5%.
The real return on $X invested for 40 years is then X* 1.05^40.
That turns out to be 7.03X.

If my math was still in practice from 6th form, I could fairly readily work out what proportion of income has to be invested every year to result in whatever multiple of income is desired to fund retirement with various combinations of interest, inflation, and income variations.

After the monkeypox fear campaign most will succumb to the fear and inject themselves with their experimental con coction.

The final solution after the monkeypox is likely to be the sheepox. There are after all way too many sheep remembering we need to be carbon neutral as a way to stop their other theory of global warming.

I do see FN being one of the first in Perth to succumb to their fear campaign and take both the monkey and sheep pox 'vaccines'.

You simply can't make this **** up.

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Pcdefender said..
After the monkeypox fear campaign most will succumb to the fear and inject themselves with their experimental con coction.

The final solution after the monkeypox is likely to be the sheepox. There are after all way too many sheep remembering we need to be carbon neutral as a way to stop their other theory of global warming.

I do see FN being one of the first in Perth to succumb to their fear campaign and take both the monkey and sheep pox 'vaccines'.

You simply can't make this **** up.

How would you rate sheeppox as a threat to humanity, compared to say.... Measles?

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Pcdefender said..
You simply can't make this **** up.

Hang on, you just made this **** up.

You tell us, you're the one with the incredible imagination

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Pcdefender said..
Is it sheepox or sheep-pox lol.

Was not aware the world hell organisation have declared as yet a sheep pox plandemic.

Its D3 - so he means She-pox

Wait this is confusing - a link to Jimmy Dore who is hyper partisan left wing?! That's him down on the bottom left of the chart.

He has long divorced himself from any sort of relationship with the truth, (rates 12 out of 64) for the sake of entertainment I guess..., so maybe that's why YouTube algorithm whacked him into PcD's inbox. lol.

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myscreenname said..
The FIRE thing is just something I started reading about, maybe a bit missleading. However the 4% rule is what some financial advisor calculated in the 1990s by looking at history. In a nutshell it is a conservative estimate how much savings yould need to retire on based on how much you could spend per year and not go broke. For example, if you have $1m you could spend $40K per year (4%) and in 30 years you should not be broke.

Yes, of course I simplified things, 40 years ago the average wage would have been far less than $480 per week.

aifs.gov.au/research/research-reports/families-then-now-income-and-wealth#:~:text=In%201981%2C%20average%20weekly%20earnings,23%25%20(Figure%201).

I would think, for an average person earning an average wage, for the past 40 years, saving $1m to retire at 65 and not go broke, by the time they die at the average age of 84 would be near impossible.

Do the maths.

www.prudential.com/financial-education/4-percent-rule-retirement

Yep, fair enough.

But the maths might be a bit beyond me. Because it appears to be more than just maths. It also appears to include lots of assumptions about all sorts of things.

And from that Prudential link I am not sure all the assumptions on the 4% rule apply.

At base level maths you could say $1m / $40k = 25. and retire at 65 and die at 84 = 19 years

So even if you put the $1m under the mattress you wouldn't be broke after 19 years. But then you have to consider inflation over 19 years and that you might require more than the absolute value of 4% beyond the first year. And if you don't put it under the mattress you'd be able to earn interest on it.

Which is what I think the article is saying is included. But it also says things like it assumes you pay tax on the withdrawl.

I thought in Oz you pay 15% tax on amounts going into super (up to the super contribution cap) and then zero on withdrawl. One of the reasons why super is a pretty good choice.

Maybe the maths is saying you are better off setting yourself up to have an income in retirement rather than a lump sum amount ? But maybe that maths depends on how your emotions view life and security and comfort ? Which ain't the sort of maths C-Toc is in to.

This dragon is out.

Okey-dokey, so just the maths, no opinion, and simplifed to a reasonable amount for the purposes of the exercise :

Start paying super / saving for retirement at 25, retire at 65
Average wage today : 90k per year
Pay rises over the years at 3% per annum, raised once per year
Super / retirment investment contributions made quarterly at 9% of gross pay (ignoring compulsary super raises of recent years)
Anytax on contribution does not reduce the contribution
Super / reitrement investment earns 4% annual (inclusive of all costs), interest paid quarterly
Then at retirement super account would hold $411,632

If you earnt 5% annual on the investment holdings then account would hold $513k

Sticking with the 5% interest, if you paid an additional voluntary contribution of 1% of gross pay (so about $17.31 a week at today's $90k per annum average wage, but was about $5.46 per week at 25 years old) then super account would hold $570k

To get $1m you have to either :

Additional voluntry contribution of about 10% gross pay (so equavalient of about $173 per week at today's $90k average wage, about $55/ week at 25 years of age)

or, no additional voluntary contribution and earn about double the average pay (so about $180k per annum gross todays money, about $56k when aged 25)

or no additional voluntary contribution (9% of gross pay only invested), earn average wage (90k today) and you'd have to earn 7.75% interest on your super / retirement account

Or randomly if you had no additional voluntary contribution (9% of gross pay only invested), earn average wage (90k today), but earn 6.5% interest on your super / retirement account and start off age 25 with a lump sum amount $25k (about equal to annual gross wage of $28.4k), you'd hit the $1m mark.

Or if you invest wisely and if the super makes 9.5% as Mr Milk summarised above, then you could have retired 5 years early on $1m lump sum, at 60 years old, earning at the time $77.6k per annum. If you'd have kept working to 65 you'd be on about $1.59M lum sum. And you only have had to pay in the 9% compulsary super contribution.



So, mmm, dunno I'd conclude not easy if you just do vanilla compulsary super contribution into a default fund, but not impossible if you add a bit more or earn a bit more interest or dabble in a bit of bitcoin or something. Oh sorry, no opinion.