Khe Hy has a negative piece on The Number, which is the amount of investable assets needed to allow you to live independently. However, despite his 15 years in finance, he doesn't seem to understand why it's a commonly used financial tool.

First, let's establish some basic shared understanding of the problem. When we're in our 20s or 30s, there are a lot of physical things we can do, that we're not going to be able to do when we're in our 60s or 70s. However, as we get more experience and learn more, we earn more. So as we age, we simultaneously can afford more, but can do less.

We also don't know our future earnings or when we'll be forced to stop working due to death, disability, or dismissal. So on one hand, we want to spend money as soon as possible so as to maximally enjoy what life has to offer, and on the other we want to save as much as possible so as to ameliorate all that life can drop on our heads.

One way to cope with this dilemma is to derive Our Number:

First, they figure out the amount of money they’d spend annually in their dream state of retirement. Then, they divide that number by the annual investment return they can expect on all of their savings and investments.

So, to keep the math simple, if you could live your dream life on $150,000 a year, and you assume cautious investment returns of 2% annually, your number is $7.5 million.

-- Khe Hy

Since we probably can't earn all that money tomorrow, we need to make a plan to accumulate it over some time. In that plan, we need to find our personal balance point for how much we save, and how much we spend.

Choosing to spend more now just means that we will have to work longer; alternatively, we could save more now and retire earlier. The power of The Number lies in forcing us to contend with this core problem of how much do we party today versus tomorrow, which then calls into question how we architect our lives.

Given Khe Hy's perspective, it seems likely that he probably would be miserable for the first part of each year or month until he had reached his savings goal. But then he could have relaxed, except that relaxation doesn't seem like something he could have actually done in his corner of finance.