[ExI] Psychology of "Entitlements"

[BillK]

On 5/15/09, Alejandro Dubrovsky wrote:
> An amount of interest equal to the inflation rate is assumed in the
>  above calculations to keep the dollars constant.  Most banks will give
>  you only 1 or 2 percent above the inflation rate on secure investments.
>  This translates to less than the avoided costs of having a full-time job
>  that I mentioned above (but go on and add another 3.5k on the first year
>  after quitting if you like, it doesn't change the equation by much).
>  Also remember that you are living off your principal, ie your money
>  doesn't grow ever-larger.
>


See?  I said that most people don't appreciate the magic.  :)

You don't retire as soon as the interest received = dole payment.
The exponential has hardly started by then.

Wait until the interest received is more than you can reasonably spend.

And don't think of it as just interest received. Capital appreciation
is just as good.


BillK