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this post was submitted on 13 Oct 2023
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Frugal
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Discuss how to save money.
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The people who tell you that you are poor because you get coffee at a coffee shop every day. At best you would save ~$2000/year if you bought $5 cup everyday. $2000 saved would not be a significant amount of money to make in an investment either. Personal happiness isn't worth trying to cut out things you like.
$2000 extra a year into a 401k over a lifetime of work is a substantial amount of money when you retire. This 401k calculator estimates it as $150k after 45 years. That sounds high to me but regardless $2k extra a year is a lot when you consider compound interest over decades.
you have to count inflation as well (although i believe us $ deprecates at a very less inflation rate) , but still the calculator you showed shows it can make 22% of total retirement fund
Plus I believe coffee is just a legal drug which is why its so prominent , and as such i shouldn't use it
But who knows maybe i will drink coffee as well?
This is a good philosophy. I gained a caffeine addiction because I wasn't aware that was a thing and now I don't wake up in the morning until I've had something with a bit of caffeine. It's not too bad, I just get a bad headache if I don't get any caffeine, but I'd prefer if I'd known that caffeine addiction was a thing so I could make an informed decision when I started drinking coffee
Every model simplifies reality in some way. Inflation, fees, stock/bond mix, tax rates, risk tolerance, and the biggest one of all market performance are all variables that the calculator doesn't seem to take into account to some degree.