33 - 1.4M Net Worth Drifting From Boglehead Strategy

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Topic Author
broncocountry25
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Joined: Thu May 18, 2017 11:49 am

33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
Wanderingwheelz
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Wanderingwheelz »

You sure aren’t the first 33 year old whose never invested through a big recession who thinks their way is better than a simple total market index fund based portfolio.

I’m not saying what you are doing is wrong, I’m only saying that sometimes it’s wise to pay attention to why so many people with gray hair are keeping it simple and accepting the market return.

Also, I have nothing against being a business owner- we’ve made our living that way and have done very well. I don’t think I’d ever give another person my money to help them with a business, though. I’d rather invest it in the business I completely control, or invest in publicly traded equities according to my tolerance for risk.
Being wrong compounds forever.
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

Wanderingwheelz wrote: Sat May 27, 2023 7:41 pm You sure aren’t the first 33 year old whose never invested through a big recession who thinks their way is better than a simple total market index fund based portfolio.

I’m not saying what you are doing is wrong, I’m only saying that sometimes it’s wise to pay attention to why so many people with gray hair are keeping it simple and accepting the market return.
Fair, I think I am asking more about those who have reinvested in themselves instead of a total market portfolio. I made more from my side hustle last year and my W-2 is in financial services. My wife started a business with 2 others at work that is starting to pick up major steam as well. When I see the grey hairs in my office I see people that struggle with tech and running reports. They lean on myself and my wife hard and I think I can take what we have learned and do better in the free market.
pizzy
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by pizzy »

Are the business ventures just being a landlord?

Or did you leave that part out?
Vanguard/Fidelity | 76% US Stock | 16% Int'l Stock | 8% Cash
mamster
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by mamster »

Survivorship bias.

I don't think anyone would argue that the Boglehead philosophy says "don't be an entrepreneur." The entrepreneurs I know are like writers: they do it because they can't imagine not doing it.

All entrepreneurs believe they will succeed wildly. Some do. Some don't. There is a massive upside for some and a massive downside for others.

Me? I know I would not enjoy the path you've described, so it's not part of my plan. I want to feel some control and ownership over the tiny area of work I do, but I don't want control and ownership of a whole company. I like working a low-key W-2 job and investing in the most boring of index funds. I find excitement elsewhere in life.

Not trying to convince you to be more like me. You do you! But if your question is: "Is there anyone else like me?" the answer is yes, of course.
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FreddieFIRE
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by FreddieFIRE »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse.
Do you feel this way about degrees related to healthcare or STEM? If so, I would like to hear the logic.
A house and a job. Once the American dream. Two things I'll never again have. Life is simple (and good).
bendix
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by bendix »

I guess most people who have invested money into stocks know that feeling. You did a trade, it worked better than anyone could´ve possibly guessed and you thought for a few merry days that you cracked the code and everyone else is stupid but yourself. Your story sounds like a variation of it.
Normchad
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Normchad »

It’s 100% fine to not be a boglehead; the vast vast majority of people are not bogleheads.

You get to decide how you’re going to approach life.

You’re already doing awesome, by the way. I’ve known others who were in similar positions at your age and were broke and starting over at 40 or 45. But I also know others that bet everything on themselves, and won bigly.

It’s all choices. In your shoes, I’d just put it all in VTSAX and watch with awe as it grows for 4 or 5 more decades. But that’s just me, you probably feel differently.

It’s also totally cool to”bet on yourself” by being an entrepreneur, but still invest your savings the BH way.

All the best to you!
CletusCaddy
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by CletusCaddy »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I put my time and energy into my W-2 career. I got my MBA from a top school six years ago and now I make $400k per year.

What kind of business do you think I should have started instead?
KlangFool
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by KlangFool »

OP,

I come from a multi generation business family. 50% of my extended family is in one form of business or another. We, as a family, actively, discouraged our family member from entering business. It is not an easy life. And, it takes a certain kind of people to succeed in business.

There are many early retiree in my family. That has more to do with 30+% gross saving rate. It has nothing to do with whether someone make their money from salary and investment or running a business.

Good luck to you!

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

pizzy wrote: Sat May 27, 2023 7:47 pm Are the business ventures just being a landlord?

Or did you leave that part out?
Haha no I am not counting the land lording in the business ventures. The business ventures are real estate sales and bookkeeping at the moment.

I see the land lording similar to the BH portfolio long term not touching the money just reinvest.
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

mamster wrote: Sat May 27, 2023 7:48 pm Survivorship bias.

I don't think anyone would argue that the Boglehead philosophy says "don't be an entrepreneur." The entrepreneurs I know are like writers: they do it because they can't imagine not doing it.

All entrepreneurs believe they will succeed wildly. Some do. Some don't. There is a massive upside for some and a massive downside for others.

Me? I know I would not enjoy the path you've described, so it's not part of my plan. I want to feel some control and ownership over the tiny area of work I do, but I don't want control and ownership of a whole company. I like working a low-key W-2 job and investing in the most boring of index funds. I find excitement elsewhere in life.

Not trying to convince you to be more like me. You do you! But if your question is: "Is there anyone else like me?" the answer is yes, of course.
Yeah I guess I am looking for BH's who were on "the track" and decided to take a risk and change their course to pursue business for themselves.
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

FreddieFIRE wrote: Sat May 27, 2023 7:50 pm
broncocountry25 wrote: Sat May 27, 2023 7:21 pm I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse.
Do you feel this way about degrees related to healthcare or STEM? If so, I would like to hear the logic.
No I don't. I am not attacking an education at a university. I am just very business minded, I think those in healthcare these days if they aren't subsidized by the bank of mom and dad have to pay a big price. Long education and low pay before making money and then repaying loans.
pizzy
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by pizzy »

broncocountry25 wrote: Sat May 27, 2023 8:20 pm
pizzy wrote: Sat May 27, 2023 7:47 pm Are the business ventures just being a landlord?

Or did you leave that part out?
Haha no I am not counting the land lording in the business ventures. The business ventures are real estate sales and bookkeeping at the moment.

I see the land lording similar to the BH portfolio long term not touching the money just reinvest.
So the business ventures sound like jobs not investments.

Why is the boglehead philosophy impacted if you are just changing careers?

There are plenty of self employed bogleheads.
Vanguard/Fidelity | 76% US Stock | 16% Int'l Stock | 8% Cash
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

bendix wrote: Sat May 27, 2023 7:53 pm I guess most people who have invested money into stocks know that feeling. You did a trade, it worked better than anyone could´ve possibly guessed and you thought for a few merry days that you cracked the code and everyone else is stupid but yourself. Your story sounds like a variation of it.
I don't understand? I did a trade that worked?

I have worked my butt off for a decade and have a little more then half of my net worth in the BH portfolio. The other pieces in RE and PE.

Now we are pursuing businesses and seeing that if we work the same level of effort on those businesses that we do in the W-2 that the upside is much larger?
livesoft
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by livesoft »

broncocountry25 wrote: Sat May 27, 2023 8:21 pmYeah I guess I am looking for BH's who were on "the track" and decided to take a risk and change their course to pursue business for themselves.
What about BHs who were on track and decided to quit working and retire early? :twisted" :beer
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Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

Normchad wrote: Sat May 27, 2023 7:55 pm It’s 100% fine to not be a boglehead; the vast vast majority of people are not bogleheads.

You get to decide how you’re going to approach life.

You’re already doing awesome, by the way. I’ve known others who were in similar positions at your age and were broke and starting over at 40 or 45. But I also know others that bet everything on themselves, and won bigly.

It’s all choices. In your shoes, I’d just put it all in VTSAX and watch with awe as it grows for 4 or 5 more decades. But that’s just me, you probably feel differently.

It’s also totally cool to”bet on yourself” by being an entrepreneur, but still invest your savings the BH way.

All the best to you!
I would not invest everything into the new ventures. I am only going to pursue the new business lines with money I make from them. We don't need to bet he house. I think the only way we would sink ourselves is if we went all in and went big into debt.

I would like to keep adding to the BH portfolio if I can succeed in the other businesses.
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

CletusCaddy wrote: Sat May 27, 2023 7:58 pm
broncocountry25 wrote: Sat May 27, 2023 7:21 pm Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I put my time and energy into my W-2 career. I got my MBA from a top school six years ago and now I make $400k per year.

What kind of business do you think I should have started instead?

Probably one of the ones that employs you...

There is only one reason to pay someone 400K they make the business more money. More power to you for your big income.

We are making as a household close to that but it is certainly not off of one company and at top MBA. State school for us!
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

KlangFool wrote: Sat May 27, 2023 8:02 pm OP,

I come from a multi generation business family. 50% of my extended family is in one form of business or another. We, as a family, actively, discouraged our family member from entering business. It is not an easy life. And, it takes a certain kind of people to succeed in business.

There are many early retiree in my family. That has more to do with 30+% gross saving rate. It has nothing to do with whether someone make their money from salary and investment or running a business.

Good luck to you!

KlangFool
Thanks KlangFool I respect your outlook and posts.

I think I am one of those who needs to go out and try and either I will succeed or get burned. I care more about the journey then the outcome.
Topic Author
broncocountry25
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by broncocountry25 »

pizzy wrote: Sat May 27, 2023 8:24 pm
broncocountry25 wrote: Sat May 27, 2023 8:20 pm
pizzy wrote: Sat May 27, 2023 7:47 pm Are the business ventures just being a landlord?

Or did you leave that part out?
Haha no I am not counting the land lording in the business ventures. The business ventures are real estate sales and bookkeeping at the moment.

I see the land lording similar to the BH portfolio long term not touching the money just reinvest.
So the business ventures sound like jobs not investments.

Why is the boglehead philosophy impacted if you are just changing careers?

There are plenty of self employed bogleheads.
I think the difference is in both of the ventures you can scale it and employ other people. I think you are right though the profits would be plowed back into RE, BH portfolio, or the business.

So not so much questioning the strategy of BH's as much as venturing into business.
stoptothink
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by stoptothink »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
To an extent, yes, but it really depends on the person. Without my PhD I'm not making the living I do, and with my set of skills, it has created a work/life balance and compensation I don't think I would be capable of without my education. For my wife, her education was absolutely pointless because she has a different set of skills (exceptional people skills and high emotional IQ). As someone who taught adjunct until '20, I COMPLETELY agree that it is progressively getting worse, but that is a thread for a different board.

I marvel at some of my wife's fintech co-workers who are constantly working on side projects, and I know most of them will ultimately become super successful, but wife and I have never had that entrepreneurial mindset. We've managed to become financially independent in a decade (starting from basically nothing in '13), both working for other people, so it has worked out fine for us.

Our kids are 11 and 8. I really have no clue how they will develop in the next several years and whether higher education will be for them, although they both have 529s with 4yrs of local U already covered.
Last edited by stoptothink on Sat May 27, 2023 8:37 pm, edited 1 time in total.
pizzy
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by pizzy »

broncocountry25 wrote: Sat May 27, 2023 8:33 pm
pizzy wrote: Sat May 27, 2023 8:24 pm
broncocountry25 wrote: Sat May 27, 2023 8:20 pm
pizzy wrote: Sat May 27, 2023 7:47 pm Are the business ventures just being a landlord?

Or did you leave that part out?
Haha no I am not counting the land lording in the business ventures. The business ventures are real estate sales and bookkeeping at the moment.

I see the land lording similar to the BH portfolio long term not touching the money just reinvest.
So the business ventures sound like jobs not investments.

Why is the boglehead philosophy impacted if you are just changing careers?

There are plenty of self employed bogleheads.
I think the difference is in both of the ventures you can scale it and employ other people. I think you are right though the profits would be plowed back into RE, BH portfolio, or the business.

So not so much questioning the strategy of BH's as much as venturing into business.
So you want to be self employed instead of an employee.

Nothing wrong with that.

I still don’t think it impacts the BH strategy for your eventual retirement.
Vanguard/Fidelity | 76% US Stock | 16% Int'l Stock | 8% Cash
adamthesmythe
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by adamthesmythe »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I think it would be a big mistake to make decisions based on this (perceived) trend.

There are professions such as doctor, lawyer, engineer, scientist, etc. that are inaccessible to those without college degrees. I strongly doubt that this will change.

I do expect many failures of institutions that do not deliver good value to their students. Those remaining (serving in aggregate fewer students) will mostly provide good value.

I do feel that non-college careers (welder, plumber, carpenter,...) have been sadly neglected as options. Not sure what OP imagines, does he think that the genes for entrepreneurial success can be inherited? In all endeavors the contribution of good luck should not be underestimated.
Wanderingwheelz
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Wanderingwheelz »

CletusCaddy wrote: Sat May 27, 2023 7:58 pm
broncocountry25 wrote: Sat May 27, 2023 7:21 pm Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I put my time and energy into my W-2 career. I got my MBA from a top school six years ago and now I make $400k per year.

What kind of business do you think I should have started instead?
I will tell you that my wife has a fashion design degree with no MBA and earned more than you did last year selling clothing and accessories from her boutique.

So maybe you should have opened a womens clothing and accessories boutique instead. :sharebeer
Being wrong compounds forever.
stoptothink
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by stoptothink »

Wanderingwheelz wrote: Sat May 27, 2023 8:46 pm
CletusCaddy wrote: Sat May 27, 2023 7:58 pm
broncocountry25 wrote: Sat May 27, 2023 7:21 pm Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I put my time and energy into my W-2 career. I got my MBA from a top school six years ago and now I make $400k per year.

What kind of business do you think I should have started instead?
I will tell you that my wife has a fashion design degree with no MBA and earned more than you did last year selling clothing and accessories from her boutique.

So maybe you should have opened a womens clothing and accessories boutique instead. :sharebeer
Or started a concert/event promotion business. One of my childhood best friends, who did not graduate high school, makes well into 7-figures (probably 8) a year and is close to retiring (at 42) so he can dedicate all his time to racing trophy trucks (he owns his own team). Really depends on the person. I admit I needed my education and I don't think that is likely to change any time soon for people like me.
WapelloHawk
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by WapelloHawk »

I turned 33 in 1999. Had convinced myself I was an investing genius, buying individual tech stocks that only went up. Then 2000 came along.
CletusCaddy
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by CletusCaddy »

broncocountry25 wrote: Sat May 27, 2023 8:29 pm
CletusCaddy wrote: Sat May 27, 2023 7:58 pm
broncocountry25 wrote: Sat May 27, 2023 7:21 pm Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I put my time and energy into my W-2 career. I got my MBA from a top school six years ago and now I make $400k per year.

What kind of business do you think I should have started instead?

Probably one of the ones that employs you...
Ah right, so let me just quit my job and go back to school for my computer science degree so I can come out and found the next billion dollar cloud computing company. Why didn’t I think of that?
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by KlangFool »

broncocountry25 wrote: Sat May 27, 2023 8:30 pm
KlangFool wrote: Sat May 27, 2023 8:02 pm OP,

I come from a multi generation business family. 50% of my extended family is in one form of business or another. We, as a family, actively, discouraged our family member from entering business. It is not an easy life. And, it takes a certain kind of people to succeed in business.

There are many early retiree in my family. That has more to do with 30+% gross saving rate. It has nothing to do with whether someone make their money from salary and investment or running a business.

Good luck to you!

KlangFool
Thanks KlangFool I respect your outlook and posts.

I think I am one of those who needs to go out and try and either I will succeed or get burned. I care more about the journey then the outcome.
broncocountry25,

I come from a multi generation business family.

Our business philosophy is to make the most ROI with our time and effort. This applies to both of our jobs and our businesses.

To each its own.

KlangFool
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by coachd50 »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I think you are defining boglehead differently than most here would.
Boglehead's most core tenet is investing in broadbased index funds to lessen expense drag. Other personal finance believes seemed to be shared by man on this board such as living below one's means, avoiding high interest rate debt, etc. Working for a company as a w2 employee is not a boglehead tenet.

Being a business owner is not venturing away from being " a boglehead". Being a landlord is not venturing away from being a boglehead. Buying 500 shares of Nvida would be given your current net worth.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by KlangFool »

CletusCaddy wrote: Sat May 27, 2023 9:20 pm
Ah right, so let me just quit my job and go back to school for my computer science degree so I can come out and found the next billion dollar cloud computing company. Why didn’t I think of that?
CletusCaddy,

Why do you need a computer science degree to start the next billion dollar cloud computing company?

My older brother jointly started 3 companies and sold two while being full-time employed. The founder of those companies need a marketing person with the right business contact to partner with them. My older brother was the marketing/business person for them.

It takes more than technical expertise to create a start-up. You need marketing and funding too.

KlangFool

P.S.: I am not saying that you should do it. But, do not limit yourself.
Last edited by KlangFool on Sat May 27, 2023 10:07 pm, edited 1 time in total.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by AerialWombat »

Being an entrepreneur is not against the Boglehead tenets. It’s what you do with the profits and windfalls from liquidity events that matters.
Last edited by AerialWombat on Sun May 28, 2023 10:33 am, edited 1 time in total.
This post is a work of fiction. Any similarity to real financial advice is purely coincidental.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by AerialWombat »

…………..
Last edited by AerialWombat on Sun May 28, 2023 10:32 am, edited 1 time in total.
This post is a work of fiction. Any similarity to real financial advice is purely coincidental.
coachd50
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by coachd50 »

KlangFool wrote: Sat May 27, 2023 9:49 pm
CletusCaddy wrote: Sat May 27, 2023 9:20 pm
Ah right, so let me just quit my job and go back to school for my computer science degree so I can come out and found the next billion dollar cloud computing company. Why didn’t I think of that?
CletusCaddy,

Why do you need a computer science degree to start the next billion dollar cloud computing company?

My older brother jointly started 3 companies and sold two while being full-time employed. The founder of those companies need a marketing person with the right business contact to partner with them. My older brother was the marketing/business person for them.

It takes more than technical expertise to create a start-up. You need marketing and funding too.

KlangFool

P.S.: I am not saying that you should do it. But, do not limit yourself.
Nothing goes over KlangFool's head. Their reflexes are too fast. They would catch it. (Guardians of the Galaxy Movie Reference.)
Last edited by coachd50 on Sat May 27, 2023 10:44 pm, edited 1 time in total.
strummer6969
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by strummer6969 »

BH is about investing principles. What does it have to do with how you earn your money?
stupidkid
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by stupidkid »

Ditto to strummer. I never interpreted bogleheads as saying "don't be an entrepreneur". It's "for the money you make, here's an investment philosophy/approach". I owned a business, recently sold. I always took it as: I'm good at business x, I should do that to make money. The money I make I should invest in low cost index funds. I shouldn't try and make "more" money in the market because I'm not an expert in all those other businesses.

But I never thought I should only work in a W2 position.

All the real estate land lord posts for example don't say: don't invest in real estate.

They say; recognize owning real estate and being a land lord is a job. Do you want that job? Does that job pay more than a different job you could have?

So yeah, if you think you can run a business, go for it. Like klangfool said, it's a lot of work...
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by CRC_Volunteer »

Wanderingwheelz wrote: Sat May 27, 2023 7:41 pm You sure aren’t the first 33 year old whose never invested through a big recession who thinks their way is better than a simple total market index fund based portfolio.
Anyone can make money in a up market, however hubris is usually their downfall. John Bogle had a significant NW by following his principles, but that was only after hubris bought him down to Earth.

Many here have done quite well following those principles...
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Watty »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
There is a Winston Churchill quote that seem vaguely relevant to this.
“Democracy is the worst form of government – except for all the others that have been tried.”
There are all sorts of problems with college education both now and in the past especially with non-career oriented degrees.

That leads up to the follow-up question of what is better if college is not an option for your kids? For example if one of your kids just graduated from high school then what should they do?

There were not a lot of details but it sounds like you used your college to find work for the last ten years while getting enough money to start your businesses and now are ready to try to being an entrepreneur and using your nest egg and likely some skills you have gotten experience with while working for someone else.

Ironically I suspect that you would not be where you are at now without your college degree. :oops:

It sounds like you are doing well in your work and finances now but your path may not be your kids path so it would be good to have money saved for your kids to go to a state university if that is what will work for them. That does not mean that you would give your kids a blank check for college and you could help them avoid the worst problems with colleges that you are concerned about.

Having college money saved up for your kids might be especially important if your try at entrepreneurship does not go well and you cannot give your kids a leg up in trying to be entrepreneurs too.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by unwitting_gulag »

There are two kinds of wealth; middle-class wealth, and spectacular wealth. Middle class wealth (a handful of millions, maybe $10M) is buildable in today’s dollars within a normal career-length (call it 30-40 years), a “normal” professional’s salary, and the S&P 500 index fund. $100M is however unreachable with that strategy. A different strategy would be needed. Unfortunately, that strategy has high chances of blowing-up… not just underperforming, but failing… spectacularly.

Perhaps a core BH tenet would be, to settle for mere middle-class wealth, lest one end up doing worse, by aiming for spectacular wealth?

Most of us would presumably concede, that some small amount of “play money” is acceptable…. Whether it’s invested in individual stocks, private equity, or some kind of greater-fool-theory type of investment (or gamble). But how much? If one doesn’t feel squeamish about losing the entire amount, then said amount is probably OK to stake.

As for W2 vs. business-owner – that’s entirely a matter of personality. Currently I work in a start-up, as a co-founder… and hate it. Utterly not for me. I was happier formerly, as a government employee.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by invest4 »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm
In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.
Data from the Bureau of Labor Statistics (BLS) shows that approximately 20% of new businesses fail during the first two years of being open, 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more.

Maybe you will do better…or worse. Just go in with your eyes wide open to the risks and trade-offs.

broncocountry25 wrote: Sat May 27, 2023 7:21 pm
I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
Education is rarely a waste of time or money and provides one with more options to navigate life. Be cautious that your recent “enlightenment” does not blind you from seeing the many risks and potential outcomes from such a plan that is also a bit far into the fuzzy future.

Best wishes.
Last edited by invest4 on Sun May 28, 2023 12:01 am, edited 1 time in total.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by halfnine »

Over your adult life taking risk has largely been rewarded as the tide has essentially been rising for the last 15 years. Quite frankly, it's really been hard to go wrong. So you need to be careful of confusing strategy with outcome.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Marseille07 »

broncocountry25 wrote: Sat May 27, 2023 8:21 pm Yeah I guess I am looking for BH's who were on "the track" and decided to take a risk and change their course to pursue business for themselves.
The BH portfolio and your business stuff are orthogonal. There is nothing wrong with your business driving home your income. The BH port is there to get your income invested.

Now, since the business requires some capital investment, it might be that the BH portfolio is smaller than non-business owners. But I don't see anything wrong with that. Sometimes you prioritize capital investment outside of equities / bonds.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Marseille07 »

halfnine wrote: Sun May 28, 2023 12:01 am Over your adult life taking risk has largely been rewarded as the tide has essentially been rising for the last 15 years. Quite frankly, it's really been hard to go wrong. So you need to be careful of confusing strategy with outcome.
What? The OP is not talking about equities. They're talking about leaving a W-2 gig and going full time running their own business. It's very easy to go wrong, although the reward could be greater.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by halfnine »

Marseille07 wrote: Sun May 28, 2023 12:21 am
halfnine wrote: Sun May 28, 2023 12:01 am Over your adult life taking risk has largely been rewarded as the tide has essentially been rising for the last 15 years. Quite frankly, it's really been hard to go wrong. So you need to be careful of confusing strategy with outcome.
What? The OP is not talking about equities. They're talking about leaving a W-2 gig and going full time running their own business. It's very easy to go wrong, although the reward could be greater.
My spouse and I are both self-employed (when we work). The last 15 years has been a great run. We have a rental property (see OPs post). The last 15 years has been a great run there as well. Like I said, it has really been hard to go wrong the last 15 years. Those who haven't experience the dot-com era or the GFC have a skewed relationship with the risk/reward curve.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Marseille07 »

halfnine wrote: Sun May 28, 2023 12:33 am My spouse and I are both self-employed (when we work). The last 15 years has been a great run. We have a rental property (see OPs post). The last 15 years has been a great run there as well. Like I said, it has really been hard to go wrong the last 15 years. Those who haven't experience the dot-com era or the GFC have a skewed relationship with the risk/reward curve.
I mean...if they want to put their effort in, landlording isn't terribly difficult. I know some folks who run 40+ units and doing super well. I don't know how they got to 40+ units but apparently it's possible to do.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by sf_tech_saver »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm Hello BH's,

I was a finance/real estate major in school and graduated in 2013. Found this blog when I started my own (should have continued it). As much as I love the simplicity of a BH strategy I am getting tempted to take more risk.

While I have a portion of my families net worth in the BH strategy for the long term I have drifted from the core principals and it has accelerated our wealth.

We own three rentals, invest in PE, and then the remainder is in the BH portfolio (no bonds).

I love the BH strategy for those who are looking to have a traditional retirement. I think it has a great probability for success. I am starting to drift from the strategy personally though for anything beyond my BH portfolio. I want to have CONTROL and OWNERSHIP, not be at the mercy of the shareholders to approve compensation increases.

Currently we are doing employer match for 401K's, ROTH IRA's, then some extra in a 529. The rest is being invested in taxable and short term savings to start new business ventures.

In the last 3 years we have "seen the light" with getting away from W-2 and moving to business ownership. The amount of money we have made in business vs. the time and effort we have put in at W-2's is laughable.

We are type A people and dedicated to anything we do. I am leaving my W-2 next year and diving into full time entrepreneurship.

What other Bogleheads have done this in the past in their 30's?

I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
In this scenario I don't think you are driving away from BHs, it sounds like you are drifting away from your full-time job and W2. Being a full-time active business manager isn't competitive with BHs. BH's is just where you invest the output of your work.

At some point though I think you'll find if you do well enough in your business ventures there will be comfort and value from having a good portion of the proceeds flow into a BH portfolio.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Yukon »

Middle 40's small business owner, here. I could never go back to working for someone else as a W2 employee! Does your current W2 job offer any flexibility to slowly shifting away from your current work schedule? (work from home, part time hours, etc) Perhaps you can shift that role into a consultant/client relationship as you continue dipping your toes into full time entrepreneurship? Perhaps keep it open as a possibility when you discuss leaving your job with your employer. I'd guess you are completely replaceable but key employees in some business' would be worth retaining from a owner's perspective.

I have also drifted from the boglehead strategy as new investments have gone towards more risky yet diverse investments. Private real estate rentals, RE syndications, farm land and recreational land (admittedly speculative) has all become a significant % of our portfolio. I'm even considering dropping my 401k contribution as I believe having more control and ownership of our assets is essential. Perhaps cynical, but I believe the rules for 401ks, capital gains taxes, etc may squeeze the middle class and look much different in 30 years than they do today. I'm not ready to liquidate my 401k but my mentality has definitely shifted away from 20 years of BH philosophy. Tracking net wealth and making sure none of our asset classes gets to be too large of a % seems to help.

I also agree that "college" will look much different going forward and potentially worthless for many careers. I encourage and discuss owning business and investing in business' with our children all the time. Entrepreneurship isn't for everyone but having the instinct to wonder why your working as a W2 is a thought process that most employees do not consider. Best of luck!
Don't Work Forever.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Yukon »

halfnine wrote: Sun May 28, 2023 12:01 am Over your adult life taking risk has largely been rewarded as the tide has essentially been rising for the last 15 years. Quite frankly, it's really been hard to go wrong. So you need to be careful of confusing strategy with outcome.
Amen! Although I suppose the question is W2 or small business owner ...who is more likely to control their destiny? Which has more upside? Downside?
Don't Work Forever.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Carguy85 »

broncocountry25 wrote: Sat May 27, 2023 7:21 pm I also have started saving for my kids to go to college but feel like college is now a complete waste of money and in 16+ years it will only be worse. Does anyone feel the same!? I really think there is massive upside for families willing to start a business right now who have the smarts from a decade + of business experience.
I’m just a little older than you and both my wife and I have professional degrees that were indeed required for our fields. The cost for my training alone has gone up well past 50% just in 10 years…yet insurance reimbursements in my field have stayed relatively the same. I would not recommend my career path to my kids although it’s been very good to us….I know enough to know I got lucky. Aside from very specific paths, yes, I feel like it’s a massive racket and will only get worse indeed for a number of reasons. I know it may hurt some feelings but honestly no one will care where you went to school nor will you get a high paying job just because you went to a high cost university. Btw I live in a low cost of living area and was talking to a tanker truck driver about how they can’t find help that will stay. They pay $5-6k to train young adults getting their CDL and start out over $100k and I guess that’s not enough. On the flip side my wife’s coworker has spent nearly a half million that they had to mostly get loans for on her oldest 2 to go to an east cost “prestigious”university to get what amounts to left handed puppetry degrees because the name mattered so much (even though we have never heard of it before). I ALMOST feel sorry for them. Do I plan to pay for kids training post high school?…maybe but not for feel good nonsense…. My wife and I agree that they will basically be presenting a “business plan” to the bank of mom and dad that must make sense as far as ROI….our money, our rules. Yes I know, I’m old fashioned. BTW, why is “now” specifically a good time to start a biz?
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by smitcat »

coachd50 wrote: Sat May 27, 2023 10:10 pm
KlangFool wrote: Sat May 27, 2023 9:49 pm
CletusCaddy wrote: Sat May 27, 2023 9:20 pm
Ah right, so let me just quit my job and go back to school for my computer science degree so I can come out and found the next billion dollar cloud computing company. Why didn’t I think of that?
CletusCaddy,

Why do you need a computer science degree to start the next billion dollar cloud computing company?

My older brother jointly started 3 companies and sold two while being full-time employed. The founder of those companies need a marketing person with the right business contact to partner with them. My older brother was the marketing/business person for them.

It takes more than technical expertise to create a start-up. You need marketing and funding too.

KlangFool

P.S.: I am not saying that you should do it. But, do not limit yourself.
Nothing goes over KlangFool's head. Their reflexes are too fast. They would catch it. (Guardians of the Galaxy Movie Reference.)
What KlangFool says is not what KlangFool does.
Taken from KF's posts on the Bogleheads.
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Re: 33 - 1.4M Net Worth Drifting From Boglehead Strategy

Post by Flashes1 »

If I ran my own business, and had plans of my kids one day running it, I would want them to go to college: (i) they need to get out of the house, (ii) college will teach them basic business principles they will need in accounting/finance/economics, and (iii) while a diploma may not mean much to an entrepenour once they're successful, it still matters to their bankers (when the business owner is still on the path to be successful). Every business owner has a bank behind them that they need to impress.

I'd guess +75% of the country's wealthiest business people started out working for a big company only to later form their own company in their 30's-40's when they saw a need in the marketplace that wasn't being met.
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