So, anyone with less than 15-20 million in the bank is financially insecure.
Depending on your age, yes. If you are old enough you can draw down your savings, though that's a tricky game because if you live too long you run out of money. If you can't stop working and maintain a comfortable standard of living for the rest of your life, you are financially insecure.
Is it just me or is there a serious lack of perspective going on here?
There is, you should really try to figure out what you would actually need to live the rest of your life comfortably if you were unable to work. Maybe you want to live like a college student forever, in which case, you would probably need less than $10 million, but if you don't, taking 70% of your salary as an assumption, then multiplying that by 100 wouldn't be a terrible estimate.
I'd contend that yes, techincally, "Financial Independence" (or "Fuck You" money), is a whole lot. I'd also contend that it varies, and 15-20 million would actually be towards my upper bound, personally.
There's a good book on this topic called "Your Money or Your Life" and one of the nice things they do there is focus not just on the supply side (how much money you need), but also on the demand side (by reducing what you think you need). For example, I like fine meals (like, multi-course meals upwards of $250), but I could probably go without another one for the rest of my life, or cut back. Heck, if I was retired, I could probably teach myself to make just as good food.
Pretty much, yeah. Security is modeled using two terms, what you're trying to protect, and what threatens it. You're either secure against a certain threat or you're not, that's the idea.
Financial security is the model of protecting lifestyle with cash. If you're protecting your lifestyle with something else other than cash, then you don't have financial security, but you still may have security.
Basically it's very simple. If you have a big enough chunk of cash in the bank, you can generate enough income from it to secure your lifestyle. (defined in terms of expenditures) You can then use your cash to protect yourself in ways other people cannot. Cash is a cool thing to be able to use because everybody you're going to want to deal with accepts it. If instead you're using skills to protect your relationship, or even worse, a job, then you'll only be protected so long as you can derive cash from those assets.
Personally, I protect my lifestyle with my web development skills which I can take with me to any of a large number of companies who will give me cash. This affords me a great amount of security against hardship, but it isn't financial security. For one, I still have to work.
Also the world could decide that web development blows and it could suddenly be much more difficult to find a job. I would be forced to take whatever job I could find to secure my lifestyle, and then my security would only last as long as the job does.
Financial security is best because cash will (probably) never go out of style.
People use the term "financially secure" to mean different things. You can say you're secure because you earn enough to support your current lifestyle as long as you continue to work. That is as secure as most of us get.
But you can also consider the term like this thread to mean that you are totally secure financially for life - even if you were to become unable to work.
So in you're case you may be secure for now, but you're not yet secure for life. Very few 25 year olds are already financially secure for life, though.
We obviously just have different definitions of security. That nightmare scenario of having to live the rest of your life on exactly what you have now is extremely rare. There are so many people who manage to live comfortably* throughout their lives without such a massive nest egg. I don't think it makes sense to describe them as financially insecure (which to me says that they are in a bad or dangerous position) because they don't have the most extreme contingency covered.
* Note that I define this as owning a house and supporting a family without having to worry about money, not living a jet-setting life of extreme luxury or whatever.
Depending on your age, yes. If you are old enough you can draw down your savings, though that's a tricky game because if you live too long you run out of money. If you can't stop working and maintain a comfortable standard of living for the rest of your life, you are financially insecure.
Is it just me or is there a serious lack of perspective going on here?
There is, you should really try to figure out what you would actually need to live the rest of your life comfortably if you were unable to work. Maybe you want to live like a college student forever, in which case, you would probably need less than $10 million, but if you don't, taking 70% of your salary as an assumption, then multiplying that by 100 wouldn't be a terrible estimate.