Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
Why do you not need home insurance and life insurance?

Not PP, but I think the answers to these are straightforward.

Home insurance is a requirement levied by your mortgage lender. If you don't have a mortgage, you don't really need homeowner's insurance. You may choose to, but that's up to you.

Life insurance is intended to replace your income or provide your family with financial stability in the event of your death. If your family is not dependent upon your income to make ends meet then you don't really need it. There is no mandate to have life insurance, and a lot of people who would like to have life insurance are rejected and can't get it.

Yep that's my thinking

It's not a legal requirement to have home insurance, obviously. But it is stupid not to, unless you have a huge pot of money to replace your house if it burns down. And if you are living on $25,000 per year, you obviously don't have a huge pot of money.

Same with life insurance. There is obviously no requirement that you have it. But if you have a family and do not have a huge pile of savings, it is incredibly irresponsible not to have life insurance.

If the point is that you can life on $25,000 if you shirk important responsibilities to your family, I suppose that is true. But should that the be the point?

I live off of $36,000 and have over $1 million saved.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
Why do you not need home insurance and life insurance?

Not PP, but I think the answers to these are straightforward.

Home insurance is a requirement levied by your mortgage lender. If you don't have a mortgage, you don't really need homeowner's insurance. You may choose to, but that's up to you.

Life insurance is intended to replace your income or provide your family with financial stability in the event of your death. If your family is not dependent upon your income to make ends meet then you don't really need it. There is no mandate to have life insurance, and a lot of people who would like to have life insurance are rejected and can't get it.

Yep that's my thinking

It's not a legal requirement to have home insurance, obviously. But it is stupid not to, unless you have a huge pot of money to replace your house if it burns down. And if you are living on $25,000 per year, you obviously don't have a huge pot of money.

Same with life insurance. There is obviously no requirement that you have it. But if you have a family and do not have a huge pile of savings, it is incredibly irresponsible not to have life insurance.

If the point is that you can life on $25,000 if you shirk important responsibilities to your family, I suppose that is true. But should that the be the point?

I don't know a single person that has lost a house and had to use their insurance to replace it. The odds of that happening are incredibly small.
I am drawing $36k per year off my investments. If I kick the bucket life goes on for my family with one less person. Money stays the same, no insurance needed.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

Maybe this will be handy to take a look at:

https://www.mrmoneymustache.com/2017/05/19/2016-spending/

$42 TOTAL on pharmacy things like aspirin and toothbrushes in 2015, then zero in 2016? How long do they use toothbrushes?! Jeez. Guess no expenses for things like tampons or OTC allergy meds, either - my OTC allergy meds run me at least $40 a month. I suppose I could go without them but that would not be much of a life.

^ sorry, I didn't mean to be negative. This is helpful for explaining how this kind of budget works. It just seems not all that feasible for someone who isn't willing to give up, like, toothpaste and going away for the weekend every once in a while. Probably helpful tips for cutting down, though. Thank you.

He mentioned his clothes are partly in Costco line item. Maybe toothbrushes , etc were moved to another line item.

Anonymous wrote:
It's not a legal requirement to have home insurance, obviously. But it is stupid not to, unless you have a huge pot of money to replace your house if it burns down. And if you are living on $25,000 per year, you obviously don't have a huge pot of money.

Same with life insurance. There is obviously no requirement that you have it. But if you have a family and do not have a huge pile of savings, it is incredibly irresponsible not to have life insurance.

If the point is that you can life on $25,000 if you shirk important responsibilities to your family, I suppose that is true. But should that the be the point?

If you are sitting on investments that generate more than $25,000 in income every year then you ARE sitting on a pile of savings. If you look back at the first post of this thread, it's not supposed to be about people working hard and only bringing in $25,000 a year. It's supposed to be about people who are choosing to live off their investments.

Expected value on all insurance is negative. It exists almost exclusively for people who are NOT sitting on a pile of money and cannot absorb the costs of a catastrophic event.

The PP who FIREd has investments that throw off something significantly more than $25,000 a year. If he dies tomorrow his investments are not going anywhere, and that income will continue.

There are a lot of situations where having a lot of life insurance doesn't make a whole lot of sense. That's part of the reason that term life insurance exists. If you are working and have people depending on your income, then YES, you should try to have life insurance if at all possible (again, some people get rejected). If you don't have people depending on your job income, then there's really not much reason to have it.

Anonymous wrote:18 holes of golf then an afternoon at the beach. Come back and throw some steaks on the grill. Life really is good

More power to you man. I'm inspired.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
Why do you not need home insurance and life insurance?

Not PP, but I think the answers to these are straightforward.

Home insurance is a requirement levied by your mortgage lender. If you don't have a mortgage, you don't really need homeowner's insurance. You may choose to, but that's up to you.

Life insurance is intended to replace your income or provide your family with financial stability in the event of your death. If your family is not dependent upon your income to make ends meet then you don't really need it. There is no mandate to have life insurance, and a lot of people who would like to have life insurance are rejected and can't get it.

Yep that's my thinking

It's not a legal requirement to have home insurance, obviously. But it is stupid not to, unless you have a huge pot of money to replace your house if it burns down. And if you are living on $25,000 per year, you obviously don't have a huge pot of money.

Same with life insurance. There is obviously no requirement that you have it. But if you have a family and do not have a huge pile of savings, it is incredibly irresponsible not to have life insurance.

If the point is that you can life on $25,000 if you shirk important responsibilities to your family, I suppose that is true. But should that the be the point?

Anonymous wrote:

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

Mine is $36k. Car insurance is $40, don't need home insurance, don't need life insurance, taxes are cheap in Alabama, I have an emergency fund for major home repairs, kids college funded with 529, they will go to a state school, emergencies are funded from my emergency fund.

For reference, my $189,000 house has an annual property tax bill of $660 in Alabama

Anonymous wrote:

Anonymous wrote:
Why do you not need home insurance and life insurance?

Not PP, but I think the answers to these are straightforward.

Home insurance is a requirement levied by your mortgage lender. If you don't have a mortgage, you don't really need homeowner's insurance. You may choose to, but that's up to you.

Life insurance is intended to replace your income or provide your family with financial stability in the event of your death. If your family is not dependent upon your income to make ends meet then you don't really need it. There is no mandate to have life insurance, and a lot of people who would like to have life insurance are rejected and can't get it.

Yep that's my thinking

Anonymous wrote:
Why do you not need home insurance and life insurance?

Not PP, but I think the answers to these are straightforward.

Home insurance is a requirement levied by your mortgage lender. If you don't have a mortgage, you don't really need homeowner's insurance. You may choose to, but that's up to you.

Life insurance is intended to replace your income or provide your family with financial stability in the event of your death. If your family is not dependent upon your income to make ends meet then you don't really need it. There is no mandate to have life insurance, and a lot of people who would like to have life insurance are rejected and can't get it.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

Maybe this will be handy to take a look at:

https://www.mrmoneymustache.com/2017/05/19/2016-spending/

$42 TOTAL on pharmacy things like aspirin and toothbrushes in 2015, then zero in 2016? How long do they use toothbrushes?! Jeez. Guess no expenses for things like tampons or OTC allergy meds, either - my OTC allergy meds run me at least $40 a month. I suppose I could go without them but that would not be much of a life.

$0 on home and car maintenance. No life insurance. No college savings for his kids. Sure thing, Mr. Money Mustache

Anonymous wrote:

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

Mine is $36k. Car insurance is $40, don't need home insurance, don't need life insurance, taxes are cheap in Alabama, I have an emergency fund for major home repairs, kids college funded with 529, they will go to a state school, emergencies are funded from my emergency fund.

Why do you not need home insurance and life insurance?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

Maybe this will be handy to take a look at:

https://www.mrmoneymustache.com/2017/05/19/2016-spending/

$42 TOTAL on pharmacy things like aspirin and toothbrushes in 2015, then zero in 2016? How long do they use toothbrushes?! Jeez. Guess no expenses for things like tampons or OTC allergy meds, either - my OTC allergy meds run me at least $40 a month. I suppose I could go without them but that would not be much of a life.

^ sorry, I didn't mean to be negative. This is helpful for explaining how this kind of budget works. It just seems not all that feasible for someone who isn't willing to give up, like, toothpaste and going away for the weekend every once in a while. Probably helpful tips for cutting down, though. Thank you.

Anonymous wrote:

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

Maybe this will be handy to take a look at:

https://www.mrmoneymustache.com/2017/05/19/2016-spending/

$42 TOTAL on pharmacy things like aspirin and toothbrushes in 2015, then zero in 2016? How long do they use toothbrushes?! Jeez. Guess no expenses for things like tampons or OTC allergy meds, either - my OTC allergy meds run me at least $40 a month. I suppose I could go without them but that would not be much of a life.

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

Maybe this will be handy to take a look at:

https://www.mrmoneymustache.com/2017/05/19/2016-spending/

Anonymous wrote:All these $25,000 budgets seem to leave out car insurance and car maintenance on the cheap car you own, home insurance real estate taxes, and home maintenance costs on the fully paid for house, college savings for kids, life insurance, and any kind of emergency spending, like if a relative dies and you need to fly to a funeral.

This is the OP - and that's how it seemed to me, too. These things that are a pretty regular part of life - tickets to go see family or to go to a funeral, car expenses (which come up even if you have a cheap, pair off car, like we do), etc. I totally see how you would forego some of these things if you had no choice - if you just did not have the money. But I have a hard time imagining how you tell family you aren't coming to see them this year, or you are missing a funeral, because you're spending as little as possible so you can retire early.

I guess as the previous posters said, it's priorities. I suppose I'm more of a grasshopper?