Said Kevin O'Leary, on "The Diary of a CEO" somewhat recently.
I'm only interested in that statement because Tim Dillon got so mad about it on his show the other day:
To Tim, O'Leary is saying, essentially, "They just want to push you into a form that is not human.... You are stupid and you are an idiot because you didn't go and make yourself a tuna sandwich or a turkey sandwich and bring it into work.... There used to be the days of the 3-martini lunch, people would spend two hours at Smith & Wollensky's getting bombed and having fun and enjoying their life. Now people eat a bowl of slop and they're not even allowed to do that. They don't even want them doing that...."
Half a century ago, I made one tenth of $70,000 working in a ridiculous job in NYC, so I guess, by O'Leary's standard, I'd have been a fool to pay $2.80 for a sandwich, which I think I did, not every day, but it probably felt like a splurge. Actually, turkey for making a sandwich at home was considered expensive.
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158 ટિપ્પણીઓ:
While working as an engineer in the 70s, I took lunch from home for 5 or 6 years until finances got under control. Wasn't a big deal then but times have certainly changed.
I retired ten years ago, but, when working, I was notoriously cheap with lunch and breakfast. I still am. Twenty eight dollars for lunch is a hell of a splurge.
Our current economy is a mix of pathetic first world problems and gross extractive economics.
Food and houses are grossly overpriced compared to wages.
But people also don't really have or want to work.
The problem is we have 2 different cultures in our country and they can't coexist.
From what I can tell there's something not quite right about Tim Dillon so good for him he found his niche.
Dillon is intentionally misunderstanding O'Leary. For young members of the middle class, frugality is a virtue to be cultivated in a manner that stays within subcultural norms. O'Leary seems to want to rant about mean old Daddy.
Meth futures rise on anticipation of payouts to January 6th felons. Child support arrears being made whole as well.
It’s ok to splurge on stuff. Just don’t complain then about how expensive it is to buy a condo or go on vacation. If you want something, make a plan and a budget to get it. Until people behave as if they want those nice things, don’t believe that they really do.
O’Leary should look into the Permanent Income Hypothesis described by that wild-eyed socialist Milton Friedman.
kak - Your comment is ok, but on the overnight open chanel. So...fuck off.
How old is Kevin O'leary? I can tell you that prices have gone way up and in a big blue city $28 for lunch wont get you much. Even a hamburger and fries at a good restaurant will cost $20 - $25 with Tip and taxes.
I normally eat at my desk, not to save money, but because the nearby restaurants arent that great, and Im lazy. When younger everyone went out to lunch - all the time.
I’m sure it’s considered white supremacy to open a fidelity/schwab/vanguard/etc account and put any extra earned money (or your coffee money) there, invested in an index fund or two. That’s too bad.
The time to enjoy life is when you're young. Yes, you should save some $$ and invest, but if you're making 70K at 25 you'll be making a lot more at 30-35. Looking back, i wish i'd done more traveling when i was younger.
Their money is theirs to do with what they wish, but over 10% of your income for lunch isn't a plan for improving your lot in life.
Nobody talks about the pressure that immigration puts on prices. The amount of food we have hasn't increased that much in 20 years, while we've added 50 million people. A USA with 500 million isn't going to have low food prices.
People that taint good financial planning and execution as white supremacy are evil. Owning an investment account is as easy as owning a regular bank account. Money does not care what your skin color is.
Now do what they gladly pay for a cup of coffee... Deaf ears, Kevin.
I spend about 28 bucks a week on lunch when I am in a brown bag mood.
It’s easy to attack the clumsy, yet true, anecdote. The larger point is convenience culture (going out, uber, door dash, etc) is expensive. These conveniences were initially cheap to get people hooked and get numbers, but now it’s established and engrained into city culture.
And thus expensive
With entry level white collar jobs, young people often work long hours so that they can rise--get promoted, find a higher paying job. Their time is a lot more valuable then the $70,000/year pay would suggest. But it's pretty easy to get lunch for $15 (about what I usually spend). I wonder how common the $28 lunch really is.
Well gents... and ladies... I've been around for over 70 years... I've brought my own lunch to work.... I've bought lunches... taken my wife out to lunches that cost over $50... but I was lucky at work and savings... Retired! And when I do sub teaching at a parochial school I get $3.25 cent lunches!! But I take my wife out to $45 buck lunches weekly!
The only advice I can give young'uns is this.. work hard, do a good job, save $, pay off your house and car. But now and then.. live a little. You can die any day, any time.
My old man was a senior NASA pilot in the late 60s and still brought lunch from home. He was startled by the younger staff spending $5 for a cafeteria lunch every day.
It’s not just that they are stupid for buying a $25 lunch. It’s worse—they are buying a $15 lunch and then spending another $10 to hire a taxi to bring it to them.
Stupidity on top of stupidity.
the truth is somewhere in between
IF YOU DON'T EAT YOUR MEAT, YOU CAN'T HAVE ANY PUDDING!
HOW CAN YOU HAVE ANY PUDDING IF YOU DON'T EAT YOUR MEAT?
Jan 6th felons?
An arsonist in Colorado is allowed to walk free - but it you walked thru an open door into nancy's capitol building - "you're a felon"
KAK-a-bot(D) - should we roll the footage of an undercover Biden FED breaking a window at the capitol, and the people with flags showing their horror and dimay?
RCOCEAN II said...
Nobody talks about the pressure that immigration puts on prices. The amount of food we have hasn't increased that much in 20 years, while we've added 50 million people. A USA with 500 million isn't going to have low food prices.</b.
Immigration is an important component but I think it is secondary to a bigger problem which is paying useless people to do useless things.
If you pay a bunch of women to sit in air conditioned cubicles and write HR emails or make sure the college hires enough black people you pumped money into the economy and got no real benefit.
Our education system is particularly inflationary. We are paying a bunch of women to turn our kids against us.
What gets really nasty is giving an NGO a bunch of government money and paying people to go around and burn stuff.
If you want things to get more affordable and wages to be more meaningful you have to get women out of the workforce and eliminate all of the stupid jobs we created for them and eliminate the gramscian rot in our government.
annoying.
The most inflationary thing in our economy right now is the Homeless Industrial Complex
We are literally dumping money into the economy to pay fraudsters and democrats to farm drug addicts in our cities.
Yet in someways we were richer back then. I had a part-time job as a dishwasher near Harvard Square in 1971 and could still afford a basement apartment within walking distance.
You need to look at the concept of materiality. Penny pinchers never look at the big picture. You're not going to get rich by saving $50 a week on lunch.
The 50-year compounding argument is dishonest. The present value of all that money 50 years from now is exactly $28. Money in the future is not worth the same as money today. It has to be discounted. This is finance 101. The argument also ignores inflation ... a second dishonesty.
They pulled the same trick in Margo's Got Money Troubles. Odd.
Kevin is right. Most self-made millionaires are thrifty to a fault, at least on the way up, it's a hard thing to break, which is why they generally just keep getting richer.
Thrift is one of the most important tools to wealth, maybe the most important, and not just with money, but with your time, and your passion. It's not enough by itself, but building real wealth is nearly impossible without it.
Almost everyone I know who is well into adulthood and seems to be stuck with insufficient wealth and growth is someone who spends frivolously on things that have no real return other than the short lived dopamine rush at the beginning. Like being thrifty, that too is hard to break.
A great recent example is the three day concert at Coachella, where kids were borrowing thousands of dollars at high interest rates to attend. I have family that worked the show is stage crews. They said it was a terrible experience in both the music (which few really paid much attention to) and the environment, which was dirty, expensive, and poorly planned, but these people just had to be there at any price. I went to those type of things too, but the cost was a half-day's wages.
Achilles said:
"Food and houses are grossly overpriced compared to wages."
I don't understand. Why would people agree to pay these prices if they are "too high." Why don't they buy cheaper food and cheaper housing?
I think O'Learly is reminding youth that some financial discipline can pay off down the road..
I can afford a $28 dollar lunch, but when I go into the office, I take a lunch. 1) It helps me not gain weight, and 2) I'm trying to save as much as I can to leave it to my Gen Z mentally ill kids who don't stand a chance.
The saving of 28 bucks for growth 50 years from now isn’t realistic. Instead, it’s an anecdote in overall fiscal discipline.
It’s not a good idea to spend $28 a day on lunch of you don’t have a $500 emergency fund. This is a very realistic and immediate goal.
It’s easier to save for something you want if you have the security of a $500 emergency fund.
It’s a wholistic approach and the conversation doesn’t look at that.
Luke Lea said...
Yet in someways we were richer back then. I had a part-time job as a dishwasher near Harvard Square in 1971 and could still afford a basement apartment within walking distance.
But dishwashers, usually male and young, need to compete for renting that apartment with that hotshot new HR manager that works for Walmart making 90k a year with her spiffy new women's studies diploma that she went 100k in student loan debt to get.
A friend of mine with two 20 something daughters - same problem. They barely function at work (both work at a re-hab facility w/ menial jobs. They both take time off more than work and spend time traveling. they have no money -but found a way to travel to Greece to see Metalica.
Being frugal when you're young is not so bad. Being poor when you're old sucks.
The honest answer is to not eat until you get home after work.
You save a lot of time and money.
Hopefully, and I believe it is a real possibility, AI will lower cost and increase output becoming a helpful deflationary tool.
A lot of the cost buried inside many products are waste of time middle whatever jobs. Fed, State, and Local tax burdens are at least 50% complete waste.
All our problems are fraud based (D)
You need to look at the concept of materiality. Penny pinchers never look at the big picture. You're not going to get rich by saving $50 a week on lunch.
$28 per day on lunch comes out to $6720 per year, assuming the person works 48 weeks per year, 5 days a week. $70k comes out to around $53k per year after taxes, so that lunch budget comes out to 12.6% of take-home pay. O'Leary is correct, this is bad planning (or more likely still, no planning).
TosaGuy said...
"The saving of 28 bucks for growth 50 years from now isn’t realistic. Instead, it’s an anecdote in overall fiscal discipline."
Sounds about right. So the guy was telling a whopper of a lie to try to make his point.
If you skip Starbucks on the way to work, bring your lunch, make dinner at home instead of going out and skip destination vacations, over the term of a 30 year mortgage, you can save a quarter of a million dollars or more.
Your choice.
This is why everything is so expensive now.
This woman most likely makes solid 6 figures.
Now she gets to buy the same stuff 5 plumbers or 10 dishwashers can buy and she didn't do a single useful thing.
She is also a retard so she is going to spend it on stupid shit like Yoga and lulemon tights and latte's.
Ann: just for context your 1/10th of $70,000 dollar salary 50 years years ago is equivalent to about $43,000 today.
There used to be a much larger middle class, and things had to be priced for them to sell. Today, there are many more wealthy people living and coming to America than there used to be. They keep the prices up. Many are wealthy immigrants who come here. The other thing is that people today are much more comfortable with debt, big debt, and they use debt to pay higher prices. The result is that sellers don't have to settle for lower prices.
No one needs to spend $28 on lunch even in NYC.
It’s great advice. O’Leary is just using lunch as an example: buy or make a less expensive lunch and invest the difference. Spend $18 instead of $28, invest the extra $10, and you’d have a nest egg of between $500k and $2 million, depending upon how long you have until retirement. It’s the concept of being mindful of how you spend your money to maximize its overall benefit. It shows the difference saving just $10 a day can make.
Dillon is a hilarious rant comic. And he blends that with trenchant social commentary here.
Convenience culture will become increasingly expensive due to Baumol's Cost Disease until automation can significantly replace the now labor intensive element.
52 years ago I worked in a burger joint for $1.60/hr. Hamburgers were $0.25. I remember thinking back then that this was incredibly cheap. I only needed to work 10 minutes to earn one. Most young people today would not settle for that burger. They have expanded demands.
bagoh20 said..."Kevin is right. Most self-made millionaires are thrifty to a fault, at least on the way up, it's a hard thing to break, which is why they generally just keep getting richer."
Shifting from saving to spending was actually challenging. Nice problem to have.
Peanut butter on white bread plus an apple. Considerably less than $28. Try it, kids.
That said, I will relate the following advice given to me fifty-five years ago by an army buddy who had worked in HR (known as "Personnel" in those days) at IBM before joining up. His boss awarded him his first raise and told him, "Don't tell your wife about this raise. Invest it. When you get your next raise, tell her about the first raise. etc."
Achilles said...This woman most likely makes solid 6 figures. You're right about the woman in the X link who thinks white mile in schools is racist. She makes six figures and doesn't produce shit. They are everywhere.
"No one needs to spend $28 on lunch even in NYC."
You do if you want a pastrami on seedless rye with mustard from Katz's Delicatessen. Which I would.
If a young person went back to the seventies, they would ask: why is everybody so poor, but to us, we were living great, and we were, even without $6 cups of coffee.
“ You do if you want a pastrami on seedless rye with mustard from Katz's Delicatessen. Which I would.”
As would I, they are also big enough for three lunches.
Compound interest is magic O’leary is correct. Believe it or not I appreciate if someone wants a splurge like a coffee drink or even a nice lunch not every day- just so long as you’re investing first…
…I’ll top O’Leary’s strategy for a twenty something I set up for the youngsters in the family: open a Fidelity cash management account instead of checking, open a Fidelity self directed brokerage account, get their 2 percent back credit card, charge as many of your monthly purchases as possible to the card so long as there are no fees, set up the cash back to roll into your brokerage account and but an index etf- VTI or one if their whole market etfs. Now the rule: credit card is paid off every month. At 70k if you do that then make a goal to collect all of your employer’s matching 401k money you’re done. Use any leftover for goals and fun…
bagoh20 said...
There used to be a much larger middle class, and things had to be priced for them to sell. Today, there are many more wealthy people living and coming to America than there used to be. They keep the prices up.
The problem is high earners without kids.
Particularly high earning couples without kids.
"Shifting from saving to spending was actually challenging. "
I have not accomplished that yet.
I have never flown 1st class, despite really wanting to, and easily affording it. I haven't figured out how to win the argument with myself.
I did learn in my 20s to put $100 in savings and then invest when it reached a $1000. That $100/month increased to $125/$150/$200 as my earnings went up. Those slow, steady, and early dollars have done well in the past 30 years.
The thing that made me save? My first job didn’t have a retirement package. It was all on me.
“ I have never flown 1st class, despite really wanting to, and easily affording it. I haven't figured out how to win the argument with myself.”
The gateway drug to first class is the upgrade offer when you check in for your flight. I’ve scored first class to Europe for $500 on such offers.
Achilles said...The problem is high earners without kids.
I think people who take care of other people, and are depended on, are more careful with money.
When I was young and poor I blew money on stupid things. Now that I'm older and accumulated some wealth, I'm more hesitant to piss it away. Strange juxtaposition.
Now I save it to leave it to my struggling kids, so they can piss it away.
"I have not accomplished that yet.
I have never flown 1st class, despite really wanting to, and easily affording it. I haven't figured out how to win the argument with myself."
I hear you. The thing that did it for me was the realization that where I was headed was to die with a pile of money. I'm still frugal with the really big things (like owning only one house) but 16 hour plane flights in economy when we could afford much better isn't intelligent. Contemplating your own death has a way of reordering your priorities.
Some people will come up with reasons why O'Leary is wrong here. Despite having a great argument, those people will not get rich.
Another helpful insight is that you were saving it for "something", right? Well, "something" has arrived and it's not going to wait on you forever.
"...16 hour plane flights in economy when we could afford much better isn't intelligent."
I'll try that argument, but I'm pretty stubborn. I think I need to come up with a really good lie that I would fall for, and then spring it on myself when I'm in an agreeable mood.
bagoh20 said...
Some people will come up with reasons why O'Leary is wrong here. Despite having a great argument, those people will not get rich.
I grew up white trash. My family will never escape day to day living.
I have had to internalize that 90+% of the population will never accumulate or build wealth. They just can't do it. They will find a way to be poor.
The goal is to put the right segment of that 10% of people in charge.
It is really more like 1%...
Basic personal economy. Not rocket science.
If you want to blow your money on stuff you cannot afford, have at it, and live hand-to-mouth forever. Just don't blame "the rich" for your foolishness and expect somebody else (the great and benevolent "government") to support you.
For the record, we fly business class, not first class. I still don't believe in throwing money away for no reason.
"There used to be the days of the 3-martini lunch, people would spend two hours at Smith & Wollensky's getting bombed and having fun and enjoying their life. Now people eat a bowl of slop and they're not even allowed to do that."
The people enjoying a three martini lunch back then were ad executives, lawyers and people like that, who, inflation adjusted, made a lot more than current $70k/year kids.
At my first post-college job, an entry-level gopher in 1981 at a magazine, I made the equivalent of $38,000 a year today. I lived in a tiny studio apartment and either biked to work or took the Washington Metro. I had soooo little money for years but I had a ball because I was blessed with friends in similar straits and I was intensely committed to what I wanted in my career.
I think it's true that young people today have a harder time for all kinds of reasons, but splurging every day on expensive lunches and Door-Dashing at night is just putting a financial gun to your head.
Three-martini lunches lol, as if! I remember reading about those too!
He’s making a bigger point albeit a bit inartfully. Plenty of wealthy people have expressed same sentiments, btw, but O’Leary is in the “Elon” persuasion of billionaires and hence need to be put in their place.
I made $30k in 1990 so about the range being discussed. Had rent split and car payment out of college but the cost of living then was considerably less than what it is today. Still, $10 for a Goff’s Double Cheeseburger with chili, fries and a cane sugar DP was a once a week splurge with a $3.50 sandwich from a boutique place nearby or a couple Two for $.99 Jack in the Box super tacos was the norm. Or often skipped lunch.
Real spend was beer and chicks on the weekend. Paycheck to paycheck but life was simple then.
Make 10X that now, but still paycheck to paycheck. Life is much more complex.
I expense my lunches now, though…
Money gives you optionality. He’s encouraging kids to invest for the future. I had a professor who taught us, “the past is dead and the future never gets here.” Both sides are right.
To make the opposite point, I have been frugal all my life. I was a dope it turns out. I could have spent much more than I actually did. Those few dollars I could have spent early in my life would have made a different to my way of life. Instead, I still have all those dollars I saved, but I can't go back in time and get the pleasure I lost from not spending them.,
Normal human behavior for thousands of years is angrily rejected by the entitled. O'Leary is right. More and more people live short-sightedly and get angry at being told that. It's the get a cookie now or get ten cookies in two hours problem writ large.
My version of this story: Forty years ago in the big city, making next to nothing, my wife and I were able to save a down payment on our first house by being frugal and eating in restaurants only once or twice a year. A colleague renting in a hip neighborhood was mystified and wanted to compare finances. I learned her and her husband carried credit-card debt of more than $125,000 (the equivalent of $350,000 today) because they’d eaten in restaurants every night of their lives together. Needless to say these finances predicted who would feel comfortable having children.
Ocean: "Nobody talks about the pressure that immigration puts on prices."
Interesting hypothesis. I hadn't thought about it. But doesn't migrant labor lower the cost of farming and the wage of the restaurant cooks? Not to mention the illegal semi drivers trucking it to the restaurant - if they make it there without killing anyone, that is. CC, JSM
By all means save and invest that $28. Then, when you withdraw it in 50 years, after taxes and inflation, you might have enough to buy…well, lunch. Of course the lunch will be some kind of mashed insects, but I’m sure they’ll find ways to make it tasty.
Many of us Boomers who wisely lived below their means during their working years are now millionaires in retirement.
If you listen to Dave Ramsey, he will tell you that a lot of school teachers are now millionaires because they lived below their meager salaries and invested.
Original Mike said:
"I hear you. The thing that did it for me was the realization that where I was headed was to die with a pile of money. I'm still frugal with the really big things (like owning only one house) but ...."
Grandchildren solve this problem. How bad can you feel about giving your grandchildren an easier life? Traditional family values solve a lot of problems.
Drama is always the best defense against common sense.
Of course O’Leary is right. It isn’t even arguable. Both my twenty-something sons have savings that would have seemed like a fortune to me at that age. But I didn’t have me to set an example.
$28 invested at 8% for 50 years would be over $2,000. So they really cost your older self $2000 a pop? You want fries with that?
The martini lunch was a casualtty of fewer tax deductions they want to pay higher tax
I used to have the chili. It was like an accommodation. Not too expensive and yet every spoon was full of flavour. Though, every now and then, I had to make the turkey sandwich, because my night life started taxing me the most. That, and having chili every day was not possible.
I blame 90s sitcoms like "Friends".
Good-looking people worked invisible effortless jobs for comfortable money and had plenty of time and cash for coffee-shop lattes and trendy clothes.
The kids watching these shows all thought they'd grow up to live Life like Chandler or Rachel.
They didn't realize that the status quo was actually the "Friends" barista Gunther, who lived in unrequited love and ate store-brand soup in a no-doubt crappy small apartment with sketchy roommates and no real Future.
Today the wannabe Chandlers and Rachels are realizing that they are the Gunthers, and they are angry.
Something I learned from 70s TV: not everyone grows up to be Fonzie.
I am Laslo.
Paying twice or three times as much for a sandwich as you have to has a very different sound when it means paying $10 or $15 dollars more than it did when it only meant paying $1.00 or $1.50 more. Many of those who grew up when a dollar was worth a dollar (or in Kevin's case, when a loonie was worth a buck) recoil at paying $10 or $20 more than you have to for anything. You don't have to be a billionaire grinding the faces of the poor into the dirt to have that reaction.
My motto: you aren't poor if you can afford to buy Kraft Macaroni and Cheese. (In a pinch, ramen will do.)
" How bad can you feel about giving your grandchildren an easier life?"
I'm currently struggling to figure out what to do with money I could never spend on my own. I'm nearly certain that if I gave the people close to me a lottery winning, it would ruin them. They would stop striving, blow through it quickly and likely be worse off for it in the end. Easy wealth has a way of destroying people. People are rarely poor or rich by accident. You have to be dedicated to it, and that's what O'Leary is saying. You can be dedicated to growing or to blowing the money that comes to you, but it takes real dedication either way, and I think it's rare to change from one to the other.
john mosby said...
Ocean: "Nobody talks about the pressure that immigration puts on prices."
Interesting hypothesis. I hadn't thought about it. But doesn't migrant labor lower the cost of farming and the wage of the restaurant cooks? Not to mention the illegal semi drivers trucking it to the restaurant - if they make it there without killing anyone, that is. CC, JSM
It would if they were working and producing things.
But most of them are on welfare.
I just checked, the chili is gone and the prices are probably changing so frequently, they are not displaying them online.
bagoh20 said...
" How bad can you feel about giving your grandchildren an easier life?"
I'm currently struggling to figure out what to do with money I could never spend on my own. I'm nearly certain that if I gave the people close to me a lottery winning, it would ruin them.
People who get a bunch of money and change their lifestyle will be poor again rather quickly.
People who get a bunch of money and go buy a C&C machine or buy a bunch of stock or a rental house on the other hand have a better chance.
The point bagoh20 makes here isn't really about frugality.
It is about what you think money is for.
Us 70s kids had sitcoms that prepared us to be disappointed.
“Happy Days” told us the best years were in the 1950s past, and fading fast.
“Laverne and Shirley” showed us that, even in those best 50s years, you’d still probably be living in a crappy basement apartment with sketchy friends.
“One Day at a Time” showed us that, if you worked hard today, you could have a hot daughter and live in a crappy apartment with a lecherous maintenance dude.
“Alice” showed us that, if you worked hard with a jerk boss, you could have the crappy apartment but with no hot daughter.
“Good Times” showed us that the ghetto was always there, waiting, so stop complaining about your crappy apartment.
It was clear to us 70s kids: not everyone got to grow up and be “The Jeffersons”.
I am Laslo.
Yeah lennie and squiggie couldnt have been real
I don't regret missing a single sandwich. I don't regret having to live off rice and beans 7 days a week. I don't regret living with 4 or 5 guys in a small apartment for years. In fact, I'm thankful for those things and what they got me. If you hit 50 and still have nothing, then what will you regret. If you die young, you don't regret anything, you can't, unless you end up in hell.
When I was in college, the local nightclub ran “any coin, any drink” specials and another “$1 pitcher” night.
@bagoh20.
Sometimes dopes straighten themselves out in their thirties and would appreciate a bit of a cushion in life.
And if some of them are irredeemable, well whatya gonna do. You can't predict the future perfectly, and besides, you'll be dead.
I'm afraid of creating another Nick Reiner.
"Grandchildren solve this problem. How bad can you feel about giving your grandchildren an easier life?"
They'll get plenty. Too much, right now, in fact.
And there's another thing about brown bagging it; we are helping the children out right now.
"Us 70s kids had sitcoms that prepared us to be disappointed."
A favorite saying of my parents whenever one of us kids had a complaint was "Life's not fair." "The world doesn't owe you a living" was another one.
"The point bagoh20 makes here isn't really about frugality.
It is about what you think money is for."
Right on.
"and you died having eaten one less sandwich."
Oh, noes!
All of the virtue signalling in these comments smells like the vapors off the cooker at a rendering plant. You people are awesome
This guy is an idiot.
Dillon has been a dull knife for a while now
Dillon is being pretty stupid on this. Is it an act?
My daughters boyfriend ( about 45 ) busted his ass and just paid off his house. So O'leary is spot on.
Howard said...
All of the virtue signalling in these comments smells like the vapors off the cooker at a rendering plant. You people are awesome
boring
"My motto: you aren't poor if you can afford to buy Kraft Macaroni and Cheese. "
My motto: you are poor if you can't pay for your own health care.
It's grumpy Howard today.
As Tim noted above, it isn’t the expensive lunch. It is having the lunch delivered, because then it is not just lunch. I was having lunch out with family while reading this stuff. I watched the delivery truck come up to deliver the ingredients for the restaurant. They do that, because their time is better served making food with the ingredients than shopping for the at a store. Too many people now won’t even go to a store to buy tuna, Ramon, or Mac&Cheese. They’ll order and have it delivered as if their time sitting on the couch is valuable.
It's painful to watch people who are obcessed by money to this extent. Sheesh. Pathos and bathos at the same time.
Investment through moderation and productivity.
"It's painful to watch people who are obcessed by money to this extent. Sheesh."
Providing for yourself and your family is not an obsession. It's honoring your responsibilities.
I can tell you fancy, I can tell you plain:
You give something up for every thing you gain
Here’s where O’Leary is right. Once you save up enough FU money, your job no longer owns you. You don’t have to wait 50 years for the benefit of that.
Here’s where O’Leary is wrong. If you’re saving $10,000 a year or more on your $70,000 salary, you can afford to buy some $28 lunches with the money you have left, and there’s nothing wrong like that.
So he’s only half right, and for the wrong reason.
8 percent is kind of standard when discussing historic equity returns. There’s a 150-200bp of dividends some of the metrics miss. That’s a 2-3 percent real rate of return. Yes things will cost more in the future but investment is intended to outpace. Otherwise we call it savings where the goal is to spend it or keep it out of market risks harm while minimizing lost of purchasing power…
Even if the return after taxes and inflation is zero%. That saved up money can do you more good than expensive daily lunches that do you no good. I can't imagine anyone who saved up money for a down payment on their first house, saying I wish I had all those sandwiches instead.
"It's painful to watch people who are obcessed by money to this extent. Sheesh."
Well, it is the subject of the post, so...
"I can't imagine anyone who saved up money for a down payment on their first house, saying I wish I had all those sandwiches instead."
We don't have to imagine it; we have people stating it.
But I'm with you.
NYC does still have cheap eats. $2 slices, egg sandwiches; etc. You have to know where to go. And as another commenter notes, portions are often gigantic at the midrange places. You could eat a quarter of your deli sandwich and keep the rest in the fridge for the remaining lunches of the week. CC, JSM
So if everyone has tuna sandwichs for lunch instead of eating out for lunch, we'll all be millionaires in 10 years. Somehow I doubt it.
Lets say you save 50 dollars a week in food by being frugal. That's $2500 a year (rounded). In ten years that's $25,000. you cant even buy a new car with that.
BTW, if its a lock to make 8-10 percent a year, i suggest everyone go out and borrow all they can at 5-6 percent and buy stocks. But of course, its not a lock.
For people in their teens and twenties, spending $$$$$$$$$ on dining and dating can be a solid long-term investment if they catch the right partner. Or, a reckless waste that ruins one's financial future.
Spending big money on ordinary work lunches makes no sense. Spending several dollars a day on a cup of coffee or a tiny tub of "overnight oats" versus making them yourself for pennies is also nuts. Survival of the fittest.
"In ten years that's $25,000. you cant even buy a new car with that."
We paid about $25k for our last, brand new, car, though it was 7 years ago.
So maybe you can't buy a new car now for $25k, but I bet you can buy a pretty good car. Or you can go out to lunch. To each his own.
"Lets say you save 50 dollars a week in food by being frugal."
The original example was a $28 lunch. You don't even have to try hard to make a lunch for less than $8, so that's $100/week right there, or $50k in 10 years. You can save even more by eating dinner at home, too. If you're paying $28 for lunch, dinner has to be pushing $50 before tax/tips. Adding savings from making your own dinners, you could easily be up to $150k in ten years.
Just by not eating out all the time.
Or you can go ahead and spend that $150k on having meals prepared for you and continue complaining about how hard it is to save money, and how unfair it all is.
I hear young people talking about shopping and cooking as if they were being asked to learn to use a checkbook - an antique, pointless skill. You can have a lunch with expensive ingredients - roast beef on deli rye, kiwi fruit, fresh juice - and save more than ten dollars a day when it's made by yourself. Buying ingredients and making meals yourself has enormous savings, it's more like 75% cheaper for something that is better, fresher.
"BTW, if its a lock to make 8-10 percent a year, i suggest everyone go out and borrow all they can at 5-6 percent and buy stocks."
It's done all day every day. It's called buying on margin and it's a big part of the market, and the return over the last year in NASDAQ has been 41.53%, so paying 5-6% would have been a pretty good deal. That $28 sandwich would be $40 after just 1 year.
Most days at work I would be too busy to go out and have lunch. My circumstances dictated that if I wanted lunch, I'd better bring one, heat it and eat it at my desk. So I did; leftovers, always a base of brown rice and veggies, with different proteins depending on what I made at home. Great taste (I cook very well), healthy and low cost. Once every couple of weeks, I could shake loose and go out with a coworker and eat Cuban for less than $10 including tip and of Cafe Cubano, the only known antidote to the soporific effect of lechon asado.
I'm not virtuous, just making the best of a situation. It can be done.
Gerda,
I’ve lamented that I could have done e more things earlier if I had spent the money, but I get the option now to retire next year in my 50s or downshift out of a career job. At the very least, I won’t be one of the 50 somethings downsized out of their job and cost to much to latch on somewhere else.
Frugality at the expense of future pleasure is debatable, lack of frugality that denies you later security is not.
so that's $100/week right there, or $50k in 10 years
…taken to extreme for a 24 year old: spend that $8 on lunch instead of $28, invest the twenty in equities at the end of the week. Over your working career that could be 750k at retirement. That’s Kevin’s point…
Huel is less than $4.50/btl…
Bitching about not having enough money is easier than doing any modest amount of planning, apparently.
It's mainly about doing the math for your situation, and approaching your budget with cold-blooded practicality.
Frugality knows no end. Those who retire with millions saved have about a 40% to 50% chance of dying with more money than when they retired. Some retirement planners coach lifelong savers into becoming spenders, with mixed success.
The major brokerages and 1% Assets Under Management (AUM) advisors earn larger and larger paychecks by increasing the amount of AUM, so they tend to push excessive savings goals and stoke fear about spending. "You can only spend 4% per year" -- as they ignore short bridge periods, the impact of pensions and social security, and that spending tends to naturally decline with age.
Original Mike's post about spending over 10% of your income on lunch got me to do some math. $28 for lunch 5 days a week for 52 weeks (assumes paid holidays and vacation) is $7,280. Which, in 5 years is over $36,000. Depending on where you live that could be a down payment on a house. The $7,280 could also be used for a pretty good vacation. If invested at an average of %7 into a mutual fund the $7,280 would be would be worth over $55,000 in 30 years. If you invested $7,280 every year earning an average of 7% you would have over $1,000,000 in 34 years. With no further investment you would be over $2,000,000 in another 10 years. So assuming you start the investment at 25 when you are 69 you would have over $2,000,000. At which point inflation will make it worth $545,000 in todays dollars and you might be to old to enjoy it. On the other hand, living on just SS is horrible. I know people who do it. And definitely look into buying the house. They're a hassle, but it's very nice to not have to pay a mortgage or rent anymore.
"Half a century ago, I made one tenth of $70,000 working in a ridiculous job in NYC ..."
Yes, life before S&C must have been a downer. But look what came afterwards.
"Nobody talks about the pressure that immigration puts on prices."
I can't fix immigration. I can save my lunch money.
I just bought a new car with a note below $25k. Sure, I traded in another car, but that's what real equity is about; rather than that social equity nonsense. How did I get it? Well first, I skip lunch half the week, because eating 2 meals a day is all I really need. I also have a couple of New York Strips that cost less than $20, and with a simple salad for about $8; I'll have a nice home prepared dinner for <$28 feeding both my wife and me.
These ant-grasshopper wars are hilarious.
You Eat Better Than Warren Buffett
See also You Are Richer Than John D. Rockefeller
Speaking of Kevin O'Leary, he had an excellent interview with Tucker on the subject of AI datacenters. Respectful, went back and forth, disagreed on a lot, agreed on a lot.
https://youtu.be/xTAJnJUos3g?si=DjMIjS85KM6I6d6M
CC, JSM
" i suggest everyone go out and borrow all they can at 5-6 percent and buy stocks."
Thanks for the tip. I got 100 pairs of Bombas. CC, JSM
A half century ago a turkey sandwich cost about half. of $2.80 -- a buck, buck 75.
My Dad always made his lunch for work, was a welder at a Utility company, retired at 55, bought 2 houses and had a sizable investment portfolio. He was a child during the Depression. Knew hunger. Knew the value of money.
I see people order their food via door dash, I cringe. Dennis O'Leary > Tim Dillion.
“ 50-year compounding argument is dishonest. The present value of all that money 50 years from now is exactly $28. Money in the future is not worth the same as money today. It has to be discounted. This is finance 101. The argument also ignores”
I’ve read some stupid arguments here but this is next level.
Using standard modeling of real returns after controlling for inflation, $28/day 5 days a week for 50 weeks a year is $7000 per year invested. Over 50 years it’s $350k in principle. Assuming 6-8% real returns (Consistent with “finance 101”), the end balance would be $2.0-4.2 million depending upon whether the CAGR was 6% or 8%.
Yah that was kind of a Kamala word salad of bits of the dividend discount model, present vs future value, nominal vs real interest rates. I do respect the personal preference for buying the lunch though. I suspect most who loathe finance don’t recognize the power of compounding but if you do and still find utility in uber eats then by all means have at it. Just don’t demand everyone pay your loans or other free stuff…
We've a number of retirement age friends who are embarrassed to be still financially supporting their young adult post-college kids. Paying for apartments and apartment shares in "nice" neighborhoods. Paying for multiple vacations to cosmopolitan cities. Paying for nights out with friends; ubers to get home. Paying for their significant other "plus 1" to fly out-of-state to attend big family events. Paying while post-grad kid sits at home waiting for the posh NGO or unicorn Fed agency job to materialize. All while fretting about their own retirement prospects.
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