So how would your dad feel financially if he had to pay 3-4x that in rent for the rest of his life?
Nice try turning that around.
He'd be thrilled if he took the difference in home ownership over renting for those 30 years and invested it in a low cost diversified mutual or index fund. My dad, while financially secure, isn't the most financially savvy guy. His 30 year old house, while appreciating in value, has probably averaged a little less than 2% from the purchase price. While I see your point it's nice for him to have a house to live in, it's not like they could live off that money and be comfortable or live in the house and be comfortable without having made significant investments otherwise. Not to mention, the high property taxes, the roof that needed replacing in those 30 years, figure a hot water heater ever 7-12 years, tiling, wall papers, carpeting/hardwood renovations; it's not exactly a cheap place to own. (Amazingly, I think their Maytag washer and dryer are from 1985 - my dad is pretty handy!)
For all of what you're saying, my parents own two homes, one is a duplex rental. They thought they were buying at the bottom of the market in 2008 and would be fine, not to mention, it's suburban NY with 2 colleges immediately nearby in a pretty good neighborhood. If they sold today, they'd take a 55k loss on the property and that's before counting the past 12 years of expenses or my dad's time fixing laundry machines, hot water heaters, shoveling snow, building steps, painting the house, or my mom's time mowing the lawn or doing yardwork.
I can get behind what you're saying WRT to different goals for different people, but ultimately, real estate as an asset class does not match the stock market historically, and for our new Ensign or Seaman, buying a home at one of their first duty stations makes little sense given they are extremely likely to move, be deployed a ton in their early years, and be consumed with the job that would make them a terrible landlord, all the while losing out on potential gains in the stock market.
WRT to what you're saying about not being able to save enough in TSP until it was too late to have made a difference I certainly don't live frugally, but I do choose how to spend my money wisely and by the time I was a mid-level and 29 or 30, I was maxing out TSP, my Roth IRA, wife's Roth IRA, and funding a taxable brokerage account with $700-$1000 a month. Yes, I recognize that's 40-50% of my income depending on location. I frankly don't understand where people's money goes: we dine, my wife wears new clothes, my kids have toys, we cook good food, we had a house with a pool at our last duty station, I go flying in GA airplanes on my off time (when back CONUS at least), and both the cars I bought, I bought new and either put a ton down or paid off extremely rapidly with an extremely low interest rate; I just pay myself first. The one thing we've skimped on has been long or expensive vacations, but that's mostly been a function of my children's age than anything else; we've set aside a good amount of money in more liquid accounts for the day we actually take one.
Your 22k a year example I think is fine. You have to look at multiple income streams. If said officer gets 22k a year from TSP (and OBTW that's tax free withdrwals if he did ROTH), 13-18k from Social Security, saved a similar amount from his civilian job's 401k - so let's just conservatively ballpark it that it's enough to withdraw 44k annually since we'll say he worked another 25-30 years at a similar income and savings level. Suddenly we're looking at him having an income stream of 79k annually and that's figuring conservatively: primarily - he gets no raises past LT and never saves more than 10% of his income.
