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A million dollars ain't what it used to be...
August 5, 2007 9:22 AM   Subscribe

In Silicon Valley, Millionaires Who Don't Feel Rich [NYTimes Link] Mr. Kremen estimated his net worth at $10 million. That puts him firmly in the top half of 1 percent among Americans, according to wealth data from the Federal Reserve, but barely in the top echelons in affluent towns like Palo Alto, Menlo Park and Atherton. So he logs 60- to 80-hour workweeks because, he said, he does not think he has nearly enough money to ease up.
posted by ThePinkSuperhero (142 comments total) 11 users marked this as a favorite

 
Silicon Valley is thick with those who might be called working-class millionaires

I don't think the reporter understands what "working class" means. It doesn't mean "people who work." $10 million is enough to retire on.
posted by delmoi at 9:25 AM on August 5, 2007 [2 favorites]


Um, fuck this guy.
posted by Cyrano at 9:26 AM on August 5, 2007 [27 favorites]


“But a few million doesn’t go as far as it used to."

Newsflash: People with a lot of money often have fucked up priorities. Story at 11.
posted by dersins at 9:28 AM on August 5, 2007 [4 favorites]


This'll wend'll.
posted by These Premises Are Alarmed at 9:29 AM on August 5, 2007


Whoever dies with the most toys wins.
posted by Krrrlson at 9:30 AM on August 5, 2007 [1 favorite]


Lessee here, even at the newly increased minimum wage of 7.25/hour, assuming that a person works from age 16-65, a lifetime of work at minimum wage equals $738,920, that's before taxes of course. Around 3/4 of a million.

This guy has, right this second, thirteen times the amount of money that a person working minimum wage will earn during their entire working life.

Cry me a river.
posted by sotonohito at 9:31 AM on August 5, 2007


Let me get out my violin.
posted by blucevalo at 9:31 AM on August 5, 2007


Right this minute I KNOW I am much richer than any of those people in that article.

I actually have a life.
posted by konolia at 9:32 AM on August 5, 2007 [7 favorites]


This is the sound of the world's smallest violin briefly considering playing its heart out for you, but very quickly deciding that a far more appropriate response would be hysterical laughter.
posted by foxy_hedgehog at 9:33 AM on August 5, 2007 [2 favorites]


Yet like other working-class millionaires of Silicon Valley, she harbors anxieties about her financial future. Ms. Baranski — who was briefly worth as much as $200 million in 2000 but cashed out only $1 million before the collapse of the tech bubble — returned to work in March.

Along with two partners, she founded a software company, Vitamin D, and already she is resigned to the sleepless nights and other stresses that await her. “I ask myself all the time,” Ms. Baranski confessed, “why I do this.”


I can hazard a guess. I think that if she stopped doing it, she might realize how empty and valueless her life accomplishments actually are, and she'd feel nothing but the enormous weight of regret for a life misspent.

Now, I'm not saying they actually are empty and valueless, but such people are often motivated by a fundamental insecurity in their worth as humans. Staying on the hamster wheel gives them validation.
posted by psmealey at 9:39 AM on August 5, 2007 [1 favorite]


I'm pretty sure that moving somewhere cheaper would cure all these people's "problems."
posted by fiercecupcake at 9:42 AM on August 5, 2007 [2 favorites]


Come on guys, you don't know what it's like. I only have a 14K gold Blackberry, while my boss has an 18K Gold and Platinum iPhone Deluxe.
posted by fungible at 9:46 AM on August 5, 2007


You'd be suprised how quickly .dot com 'wealth' can disappear. A friend of mine was, for a time, worth $25,000,000 or so, at the age of 22, much of it in options that didn't vest before the crash. He's back to working and has a fairly modest apartment in the city after spending a few years turning his life into a non-stop party.

Being a millionaire doesn't mean you've necessarily 'made it', these days.
posted by empath at 9:46 AM on August 5, 2007


In other sad news there's an outbreak of the 'second-homeless.'
posted by jonmc at 9:47 AM on August 5, 2007 [44 favorites]


Mefites, how about some empathy for these unfortunate people? I can't even imagine the horror of earning a couple of millions a year when the Joneses are tre-digit millionaires. It must be humiliating and, frankly, I don't believe that any American should have to live under such conditions.

Who's with me on setting up a pay pal account for these poor souls? Even $5 can make a difference, you know. We could call it the Poor Millionaires Fund.
posted by Foci for Analysis at 9:49 AM on August 5, 2007 [1 favorite]


liquify your assets invest in the euro or gold and shut the fuck up
posted by pinto at 9:53 AM on August 5, 2007 [1 favorite]


It's this kind of incisive, hard-hitting coverage of well-off coastal white people I expect, nay, demand, from my daily newspaper.
posted by killdevil at 9:55 AM on August 5, 2007 [5 favorites]


I don't think the reporter understands what "working class" means. It doesn't mean "people who work."

Point taken, but in many cases "class" and "income" are two separate things. Riffing off John Edwards, people in this country can be divided into "those who make money through wealth" and "those who make money through labor." Hedge fund managers, investment bankers, and anyone who makes a living by taking a "cut" of the money streaming past him makes money through wealth. Anyone who is paid on salary or by the hour or by the task (and this includes lawyers who bill out at $500/hr and doctors who charge $50,000 for heart surgery) are, for all intents and purposes part of the group making money of their own labor (the sad part being, of course, that they politically align themselves with the class that laughs at them for being so proletarian).

Until Kremen leaves his job and decides to start working for a private equity firm, he's still "working class." He certainly doesn't qualify as "middle income", though.
posted by deanc at 9:57 AM on August 5, 2007


LOLRICHPEEPLSUCK AMIRITE
posted by Sk4n at 9:57 AM on August 5, 2007


It's this kind of incisive, hard-hitting coverage of well-off coastal white people I expect, nay, demand, from my daily newspaper.

Did you think that the New York Times was targetted at anyone else?
posted by deanc at 9:57 AM on August 5, 2007


a marathon with no finish line.

"Here, the top 1 percent chases the top one-tenth of 1 percent, and the top one-tenth of 1 percent chases the top one-one-hundredth of 1 percent"
posted by bukvich at 9:59 AM on August 5, 2007


Heh. These guys are working very long days, paying truckloads of taxes, and yet most of Metafilter hates them anyway.
posted by Kwantsar at 10:02 AM on August 5, 2007 [3 favorites]


A million bucks just ain't what it used to be.
posted by cedar at 10:03 AM on August 5, 2007


These guys are working very long days, paying truckloads of taxes, and yet most of Metafilter the world hates them anyway.

Fixed that for you.
posted by dersins at 10:05 AM on August 5, 2007


Sue me, but I sympathize.

I live in one of the cheapest countries in the world doing work that pays me a salary well above the local average. Other than the housing market, nothing's expensive in Beijing, and anything below a car-level purchase is far more than affordable.

Not going off the rails on a spending spree is hard enough. I mean, I could go out tomorrow and have a new laptop. Lots of people tell me to, because this one's 4 years old. I recently bought a big fancy schmancy washing machine; it was 5% of my monthly salary (because that's just how cheap stuff is here). EVERYONE I know has a maid, and thinks I'm crazy for not having one. No, see, the problem is, once you take that upgrade, it's impossible to go back. That new washing machine is nice, and I'd never go back to that old two-sided half-automatic that I had to babysit every 15 minutes. But when I had it tending to it wasn't so bad. I still washed as many clothes. And now that I have a 2-bedroom apartment and get to keep guests, I probably wouldn't give that up. I'm considering moving, in fact, because there are better apartments in the same price range across the street.

Once you climb up that ladder, it takes a superhuman detachment from social status and all the fringe benefits to go back down. It's addictive, don't ever forget that. It's hard for me to not climb it, and the thought of giving up the little niche I've carved out here terrifies me. I think it's the same bug that makes people itchy about dipping into their savings accounts, y'know? I don't think I deserve pity, but this is an aspect of a life with more than you need than deserves understanding. I do my best to keep the upgrades from being more trouble than they're worth (why I don't own a car) and to do what I can myself (why I don't have a maid), but the temptation is always, always there.
posted by saysthis at 10:07 AM on August 5, 2007 [37 favorites]


I'm pretty sure that moving somewhere cheaper would cure all these people's "problems."
posted by fiercecupcake at 9:42 AM on August 5 [+] [!]


what and buy up all the property for their 'artist' studios and trendy cafe's raising the cost of living for everyone else... no, please stay in that hell-hole Palo Alto, PLEASE!

Anyone who is paid on salary or by the hour or by the task (and this includes lawyers who bill out at $500/hr and doctors who charge $50,000 for heart surgery) are, for all intents and purposes part of the group making money of their own labor

which is why all the Repub's have to do is point at a rich well-groomed lawyer and shout "TEH GAY" or as they say in the Times "$500 haircut"
posted by geos at 10:09 AM on August 5, 2007


just how much coke and dom perignon can you do in a day?
posted by bruce at 10:10 AM on August 5, 2007


Living in the valley is very expensive. Even more expensive if you have kids-- if you want to guarantee that the kids will go to a 'good college' then by definition they have to go to a high school program that sends kids off to the 'good colleges."

That means, you live in an expensive neighborhood, because home prices (cue Elizabeth Warren) are driven by the quality of the schools. In the valley, what would be a 175k home in Nebraska is probably at least 600k. Now Steger (the subject of the article) is in a different category from the folks who drive the buses, clean the toilets and wait tables. They are in real dire straits here because of the cost of housing.

Realistically, because prices are so high here, people will have to give up the idea that they are going to own a detached single faimly home. There are a variety of economic drivers-- high salaries for some (like the subject of the article), great weather, easy access to transportation (highway, public transit, airports) to the rest of the USA and abroad, and a very tolerant political climate. Therefore demand is high for real estate.

In the long run, the Bay Area will look more like Hong Kong or Seoul--most people will live in condo/flat type arrangements. Slightly better off people may have a zero lot line townhouse, 2400 square feet in four stories. Only the very wealthiest will own a house.
posted by wuwei at 10:11 AM on August 5, 2007 [1 favorite]


MOAR WANTS MOAR!
posted by AwkwardPause at 10:11 AM on August 5, 2007 [2 favorites]


That guy can go hit himself in the head with a brick. Unless he wants to pay someone else to hit him with a brick. I would be fine with that, too.

[AM MILLIONAIRIST]
posted by YoBananaBoy at 10:12 AM on August 5, 2007


just how much coke and dom perignon can you do in a day?

Never enough, that's for sure.
posted by cmonkey at 10:16 AM on August 5, 2007


To all guys with a small penis and not enough money: Metafilter cares ...
posted by homodigitalis at 10:16 AM on August 5, 2007


No lower can a man descend than to interpret his dreams into gold and silver. &mdash
posted by carsonb at 10:23 AM on August 5, 2007 [1 favorite]


Cheap snark aside, it is interesting how real estate sort of magically absorbs as much money as is available based solely on its location. It seems to be part of the way our society is structured to keep people working full time forever: the price of a house is pretty much always "as much as you've got". (Unless you're really willing to kind of drop out and move somewhere that would be considered less desirable than where you started.)
posted by mcguirk at 10:24 AM on August 5, 2007 [5 favorites]


Heh. These guys are working very long days, paying truckloads of taxes, and yet most of Metafilter hates them anyway.

Kwantsar, In my travels, I've met the occasional investment banker/stockbroker/dot-commer, and they seemed like OK guys. And I don't have any real beef with someone getting rich, but if you expect this shopclerk to get teary-eyed over the fact that they can't afford solid gold underpants like their neighbor, it's not gonna happen.
posted by jonmc at 10:26 AM on August 5, 2007 [4 favorites]


What I don't understand in articles like these is the numbers. When they talk about an 18 hour workday, am I supposed to take this literally and understand they actually work eighteen hours, five days a week?
posted by goodnewsfortheinsane at 10:27 AM on August 5, 2007


mcguirk,

I see this all the time. Real estate agents here push people hard to buy the biggest they can afford. That's not what I want to do at all-- I'd rather buy something small and pay it off ASAP. In some ways, Steger is more a victim of his own lifestyle choices -- he OWNS his house, what's his problem?
posted by wuwei at 10:36 AM on August 5, 2007


I have never understood the psychology of people, especially billionaires, who seem to be hellbent on accumulating as much money as possible. Acquisition is an end unto itself it would seem.

But in my area, having 10 million would take care of just about anyone for life.
posted by chlorus at 10:36 AM on August 5, 2007


It must suck to work that hard and still have the stench of 'poor' permeating everything you touch.
posted by isopraxis at 10:39 AM on August 5, 2007 [1 favorite]


It used to be that totalising institutions such as medieval Christianity would have to spend many *centuries* figuring out social processes enabling it to colonise its subjects' internal lives. And even then, its control was regularly contested by theological schisms and nationalist frenzies. Given its relatively short tenure, it's amazing that Capitalism has managed to evolve such a powerful set of actualising technologies of the self that can take root within the minds of its subject and reign virtually uncontested. The development of the "work ethic" took place over hardly more than a century as a reaction against Enlightenment and the French Revolution, and has held sway, with minor interruptions, ever since. In doing so, these constraints manage to invisibly and apparently effortlessly constrain and retard the emotional and social development of its erstwhile clerks despite their economic advancement beyond the financial boundaries of their class. It trains them to be forever peons, and not owners, and so restrains the evolution and potentially destabilising rapid development of class boundaries and the authentic praxis. It's a casebook demonstration of the homeostatic nature of sociality, its mechanisms of regulation ramified and improved by comparison with earlier eras through our more connected, inheritance-based technologies of exchange. Impressive.
posted by meehawl at 10:42 AM on August 5, 2007 [16 favorites]


You’re nobody here at $10 million

as appalling as it sounds, it's true. these people are right, they're not making enough money if they want to keep living the way they do where they do. when delmoi says 10 million dollars is enough money to retire on what he's really saying is "10 million dollars is enough money to retire on if your standards are somewhat reasonable", and it's not these guys situation. obscenely expensive real estate, $30,000 a year kindergarten, trophy wives who can spend easily $50,000 shopping for clothes in a couple hours, very expensive country clubs you have to join because all your neighbors go there, flying only first class, etc, it's all crazily expensive stuff. and there's some justice there, really, because when out of simple greed you create a parallel class, and a parallel world really, for the rich, then there are some insanely rich people there, and if you're rich but not insanely so, you're relatively poor
posted by matteo at 10:45 AM on August 5, 2007 [2 favorites]


White man's burden.
posted by Blazecock Pileon at 10:46 AM on August 5, 2007 [2 favorites]


meehawl,

The woman profiled isn't a 'peon and not [an] owner." She's a equity partner in her own startup.

I can always count on the NYT to do a crap job describing the valley. East coast types never got it, still don't apparently.
posted by wuwei at 10:47 AM on August 5, 2007


What I don't understand in articles like these is the numbers. When they talk about an 18 hour workday, am I supposed to take this literally and understand they actually work eighteen hours, five days a week?

No, they usually work 18 hours a day, seven days a week. Often this is due to a sleep "disorder" that they have learned to work effectively with. They are usually extremely dedicated to their work, and may work multiple jobs (usually "projects") at a time. Not because they need the money, but because they derive a great deal of pleasure from doing what they do.

Don't tell Ayn Rand's fanclub, but these people would continue to work they way they do for less than minimum wage. It just happens that the stuff they do is in high demand right now. Only a few of them have good enough negotiation skills to get the millions this article suggests they are making.
posted by b1tr0t at 10:47 AM on August 5, 2007 [4 favorites]


The woman profiled isn't a 'peon and not [an] owner.

I'm sorry, how does this work for you:

It trains them to be forever think like peons, and not owners
posted by meehawl at 10:53 AM on August 5, 2007


wuwei, while she may technically be an owner, she is still beholden to the system she's a part of, and not able or willing to take advantage of the freedom her financial status should provide.

Agree with meehawl-- someone with a paid-off mortgage and flexibility about how (and whether) to work is a much stronger political force than someone in a situation (self-chosen or not) where they have to struggle to get by. Which is why there is social pressure to keep you in the latter situation, even if you seem ridiculously rich by most standards.

Also agree that most people are only going to be comfortable doing whatever they've already been doing their entire lives, even if their finances allow other options. Then, of course, they'll rationalize the negative aspects by saying things just "have to" be this way.
posted by mcguirk at 10:57 AM on August 5, 2007


Man, I know these people here in Silicon Valley and I always feel sorry for them. If it helps anyone here to feel better, they are some of the most unhappy people I know.

Forget the person worth 10 million who says they want to retire. (And do what? garden all day?) A lot of executives at any mildly succesful company around here are worth hundreds of millions. They could walk away tomorrow but they don't. Someone like Larry Ellison of Oracle is worth tens of billions but drives himself to work early every morning and spends long hours in his office.

They're all on this bizarre treadmill that they can't get off. Or...this is what they enjoy, this is what drives them. The 10m person will make 100m and still keep doing what they do...because there is always some new goal. And without a goal, something to strive for, they are completely lost.

Not everyone is like this of course. A friend of mine saved up some money and went to lose himself in Asia for a few years. Another friend, contracting in a lucrative business, only contracts for 1/3 of the year and spends the other 2/3 raising his kids, indulging all these great passions he has. These are just a couple examples of the happiest people I know...
posted by vacapinta at 11:04 AM on August 5, 2007


am I supposed to take this literally and understand they actually work eighteen hours, five days a week?

Not really. At a higher level of the organizaation you can think of it like this:

1. strolling at at 9 or 10 am.

2. Yelling at subordinates to do what we normally would call work.

3. An hour or networking.

4. A few catered meetings. Possibly off-site with a paid driver to take you there.

5. A "business" lunch at a place most of us wouldnt go to unless it was a special occassion.

6. A meeting or two.

7. A "business dinner" with drinks.

8. Strolling back home at 8 or 9pm to avoid the wife and the non-existand marriage.

I dont think its fair for the privileged to call what they do "work." It would be a dream job to most people. even without all the money.
posted by damn dirty ape at 11:06 AM on August 5, 2007


I also question how smart these people are. First off, they are publically exposing themselves as huge crybabies, which certainly can't help their careers. Secondly, they are ignoring the most consistant piece of financial advice: live below your means.
posted by damn dirty ape at 11:17 AM on August 5, 2007


I don't think anyone has pointed out that this is really indicative of the anti-intellectualization of the upper classes. I mean what value are they adding for the amount of work and risk they put into their business? Surely their wealth is less indicative of what they are doing (Web 2.0!!!!21111!!) and more indicative of the short-term growth aspects that Wall Street loves. I am not saying there is no value to this, but to keep working instead of cashing out is somewhat silly.

Indeed, it seems ingrained that these people have to work. It is like they took the WASP aspect ingrained in them in whatever school they went to and flew with it.

Quite frankly they're crazy for never being able to say when. Really, if you cannot buy a few houses on either coast, and work part time as a consultant or professor to keep the cash flow coming. Christ there's a multitude of things I'd rather due (the amount of books! the traveling!) that I would put as "intellectual" or self-improvement than work for a dot-com for 80 hours a week.

Not working for capital does not mean not working. It is like the whole nation turned into a bunch of Chad and Trixies who were never taught what to do after they got the brass ring, so they keep working for another brass ring and just make the class divisions needlessly worse. Just look how uniornically the NYTimes reported on not only $250,000 parking places but $50,000 mattresses! It goes beyond silly new rich spending to where materialism is a means and an ind unto itself.

When middle America finds out that "safety schools" are now charging $50,000 a year and you either need a elite private school or a "coach" to make your resume to their liking (after all when you get that many applicants test scores become increasingly meaningless) and that any sort of advancement and betterment is impossible unless you want to start aiming for that goal in high school and ending it somewhere around 65, there will hopefully be a revolt.

Anyway if I ever walk into another Palo Alto apartment where there isn't a single book, the only magazine is Entertainment Weekly and their TiVo is set to "Friends" and then complaining that they have to keep working because they feel poor I will just smile as it will just be easier to identify which will be first against the wall.
posted by geoff. at 11:25 AM on August 5, 2007 [1 favorite]


here here damn dirty ape. It's a level of 'work' that is aggravating to watch from the outside, when you're one of those subordinates.

Don't know which I hate more - the subjects of this, the writing behind it (the now breezy Society Pages like tone of the NYT) or SillyCon Valley in general. I live here, I work here, and but wonder if I can 'share' a place with so many rich people with such empty lives. Judgmental, I know, but as konolia says, at least one knows one has a life other than by one's material wealth.
posted by rmm at 11:27 AM on August 5, 2007


These are just a couple examples of the happiest people I know...

Right, I have to totally agree (beyond by quasi-philosophical rant) that there are both the types that have no idea what to do with themselves if it is not in a cubicle and those who can live a balanced and happy life. Unfortunately I see less of those who can step away and realize that they can get the same return with 1/3 the effort.
posted by geoff. at 11:29 AM on August 5, 2007


I worked for people like this when I first moved to Silicon Valley. I used to fix their computers and teach their children (not at the same time). Of course I envied their money, I'm not stupid, but the kids of the rich are the most fragile, self-absorbed, worthless people I ever met. What galls me is that they're all going to get into top-tier colleges, not because they have even a stick of talent, but because mommy and daddy will just keep on spending money until it happens.

I think of it this way: it's good that these people so obviously identify themselves and cluster together in rich neighborhoods like Atherton and Palo Alto. It'll make it easier to loot and burn down their houses when the revolution comes.
posted by 1adam12 at 11:32 AM on August 5, 2007 [1 favorite]


"People around here, if they have 2 or 3 million dollars, they don’t feel secure"

Fuck those people. Right in the ear.
posted by mr_crash_davis at 11:36 AM on August 5, 2007 [1 favorite]


It seems to me that the way people comfort themselves by saying being poor makes you more morally worthy (your life is more meaningful, you are well-read, well-rounded and not self-absorbed, only your relationships are real, etc.) is a big part of the reason the rich are able to maintain the status quo.
posted by mcguirk at 11:40 AM on August 5, 2007 [6 favorites]


Whoever dies with the most toys love wins.
posted by ZenMasterThis at 11:41 AM on August 5, 2007 [6 favorites]


A working-class millionaire is something to be.

I really shouldn't judge, though; hell, I don't play the lottery unless the jackpot's $10 000 000+. Yeah, I know, higher jackpot=even more astronomical odds against winning the stupidity tax, but who knows how much higher the price of cigarettes are going to get? Not to mention the new set of lungs I'm probably going to need...
posted by Alvy Ampersand at 11:49 AM on August 5, 2007


delmoi: $10 million is enough to retire on.

Its funny: yesterday I was talking with my mom about home prices here in West Houston. You can buy a fairly decent middle-class house (three bedrooms, built in the 80's, central heating and air) in a fairly decent neighborhood (quiet, no crime) for less than $100,000.

I'm a college student who will probably be working part-time until I get my degree, and I'll still be able to save the 7 to 8,000 down payment eventually. Once I get my career going, making the ~$400 per month payment should be a cakewalk.

If I had 10 million, I really could live at that standard of living forever.

But millionaires would never want to live at my standard of living. And thats why they whine about having "only" 10 million.
posted by Avenger at 11:50 AM on August 5, 2007 [1 favorite]


is a big part of the reason the rich are able to maintain the status quo.

Interesting, but that certainly does not fit in with my experience. Some people I know is very career-minded and have some kind of side-gig/software/project aimed at nothing else but to make money. That is on top of being well-read and the rest.

The mechanisms of maintaning the status quo have always been about where you end up is where you start. If some of these talented and enterprising people I know had wealthy parents who paid for school, grad school, had connections, and tossed it a few k for the first couple of business projects then I have no doubt they would be successful people today. Instead, they needed to wait until their 30s or so before they have the freedom and capital to even attempt anything like this. Essentially, the well off get 10 or so years youth, money, and security for nothing but being born into the right family or circumstances.

I think this dynamic has more real world effects than feeling smug.
posted by damn dirty ape at 11:52 AM on August 5, 2007 [1 favorite]


Well, my point is if you've already decided that the people who are able to provide those advantages to their children are all jerks, you will tend to preemptively exclude yourself from that group, even if you would otherwise have the opportunity to join it.

Also, you won't protest much (in a serious way, not just bitching on the internet) when the rich receive better treatment, etc., because you know they are morally worthless and you derive a sense of personal virtue from not having the advantages they do.
posted by mcguirk at 12:04 PM on August 5, 2007 [1 favorite]


If people like those in the article are driven to work harder for some psychological need to work harder or for fear of failure, I've got some landscaping that needs to be done. I figure a week of 18 hour days should do the trick. I can't pay them $1,000 Gs, but a week of hard work away from the office would do wonders for some of these folks.
posted by infowar at 12:33 PM on August 5, 2007 [1 favorite]


Whoever dies with the most toys love me wins.
posted by ROU_Xenophobe at 12:49 PM on August 5, 2007


boo fucking hoo.
siphon some money from the accessories on the new SUV to get a good therapist. check your priorities, travel more, and things should refocus.

how big can a midlife crisis get with $10MM to bankroll it?
posted by Busithoth at 1:11 PM on August 5, 2007


It's interesting how little many of the rich in the US have really benefited from from the policies that have made life more miserable for the working class.
posted by washburn at 1:12 PM on August 5, 2007 [1 favorite]


We live in a school district in which 98% of children meet or exceed state testing standards. The school building is gorgeous and new. In the next district over, the school is built on a hill overlooking a perfect, blue lake.

Crime, in our town, is nearly non-existent. There was a shooting a few weeks ago, but it was the first murder in years. The roads are well-maintained, even in the snowy winter. Lakes abound, and recreational fishing is apparently pretty good, as well as opportunities for many other types of outdoor recreation, including skiing. Wetlands and marshes make even a drive through the country into a delight for wildlife lovers.

There aren't tons of jobs, true, but the unemployment is pretty low, and if you want a job you can definitely get one that matches your skill level within, say, a 45 minute commute at the outside.

A reasonably nice home costs about $60,000 to $70,000, and I recently saw a completely restored Victorian mansion on the market, 7 bedrooms, 4 bathrooms, 4 fireplaces, for $142,000 asking price. Property taxes are around $500 a year.

It occurs to me that these people who feel financially "insecure" at a net worth of $2-3 million could easily live off the interest of their wealth in this area. An investment with a 5% yield would give an income of $100,000 to $150,000 per year without dipping into principal. Around here, you could live like a king for that. You could retire on it if you wanted and buy that Victorian mansion and live in the biggest house in town, and spend your life going fishing or working on your garden or the Great American Novel. Or, alternately, you could work at a job that held actual meaning for you or do volunteer work. Your options would be incredibly open. With $100,000 in income, here, you could afford travel fairly frequently, a nice car, and a beautiful home.

I can't quite understand what's so appealing about coastal zip codes.
posted by InnocentBystander at 1:15 PM on August 5, 2007 [3 favorites]


A reasonably nice home costs about $60,000 to $70,000, and I recently saw a completely restored Victorian mansion on the market, 7 bedrooms, 4 bathrooms, 4 fireplaces, for $142,000 asking price. Property taxes are around $500 a year.

WTH?!? Tell me where you live, and we'll be drinking margaritas at a meetup in 2 months, tops.
posted by ThePinkSuperhero at 1:17 PM on August 5, 2007 [1 favorite]


We live in a school district in which 98% of children meet or exceed state testing standards... Property taxes are around $500 a year.

Who pays for your fire department/rescue squad/hospitals/police/schools/teachers?
posted by Kwantsar at 1:32 PM on August 5, 2007


And you may ask yourself
How do I work this?
And you may ask yourself
Where is that large automobile?
And you may tell yourself
This is not my beautiful house!
And you may tell yourself
This is not my beautiful wife!
posted by ludwig_van at 1:34 PM on August 5, 2007 [1 favorite]


The real problem in wealthy western nations is the failure of the populations to come to terms with wealth in real terms.

We. You. Nearly every person here on Metafilter. All of us. We are rich.

We have lifestyles and creature comforts previously reserved for Sultans, Emperors, and Kings. We have entertainment at the touch of our fingers. Music. Theater. Literature. And magical moving pictures. We have any sort of exotic food from the four corners of the earth — as much as we want... more than is even good for us. The shelters we live in are safe, warm, dry, and have indoor plumbing. Hot water. We don't have to walk in knee high mud to get where we need to go. We have more possessions than we know what to do with... in fact we pay to store them. Our possessions are largely well made and when quality is miss represented we have some redress. We have so much material wealth that it threatens the fabric of sustainable living. We are SO wealth we wipe our asses and litter our streets with paper... paper that two hundred years ago was too expensive to even make into MONEY.There is an expectation that our possessions are guarded or at least there is recourse and redress available to us if our possessions are stolen. There are mechanisms besides our own wits and brawn to safe guard our liberty. Our work is, by and large, not back breaking, crippling, hard physical labor we are forced to spend every daylight hour doing. Where it IS there is an expectation of compensation and safety so rare is the contrary in the west that we are horrified when we find this is not so.

These things, for the bulk of human civilized history were ONLY available to the aristocratic classes.

And here we are. Rich. And you guys bitch about some loser who has a sociological illness (that is what it is) driving him to need more to the point of sacrificing actually LIVING. Bitching about him is pure hypocrisy. Instead. Pity him.

Worry about you. Worry about controlling your own life.

Worry about power not richness. Real wealth is power over your own life.

What we commonly don't have is access and control over the actual resources our wealth is derived from. The people that DO are MEGA WEALTHY. And they count on us squabbling over inconsequential stuff.

The most important thing for you to gain control of is one resources all of us only will ever have a finite amount of:

TIME.
posted by tkchrist at 1:42 PM on August 5, 2007 [73 favorites]


InnocentBystander you have to understand your life style is largely possible BECAUSE there are over valued economic engines and people willing to feed them elsewhere.

The dead give away is the word "commute." In ten years when gas is $8 buck a gallon most town like your will be lucky to be retirement communities. Not thriving towns.
posted by tkchrist at 1:45 PM on August 5, 2007


Yeah, I know, higher jackpot=even more astronomical odds against winning the stupidity tax

No, the higher jackpot has no bearing on your chances of the lottery. It only affects the chances of you being the only winner.

posted by inigo2 at 1:49 PM on August 5, 2007


I can't quite understand what's so appealing about coastal zip codes.

The short trip to the beach.
posted by inigo2 at 1:50 PM on August 5, 2007


And fresh lobster.
posted by joannemerriam at 2:15 PM on August 5, 2007


And hurricanes. Oh, wait.
posted by ColdChef at 2:22 PM on August 5, 2007 [1 favorite]


Rich man's burden.
posted by Brandon Blatcher at 2:23 PM on August 5, 2007


Historically investments in the US stock market have made 10% earnings a year. You could put $10M away in a moderately conservative stock fund and make a cool million every year. And only have to pay 15% capital gains on it. So you'd have $850,000 clear to play with. If you can't live a seriously wonderful life on that kind of money, than there is something seriously wrong with you.
posted by octothorpe at 2:25 PM on August 5, 2007


The most important thing for you to gain control of is one resources all of us only will ever have a finite amount of:

TIME.


precisely. our household (of 2 adults, 2 kids) makes less than 30K a year. we own a 3 br Victorian on a double lot in a beautiful old neighborhood full of mansions in the cemetery district of our small city on the greatest of the great lakes. we work from home--scoring SATs, online professoring, writing, running a non-profit. once or twice a week during the school year i substitute teach. but i can wake up whenever i want, go for long walks in the woods every day, garden, read leisurely for whole afternoons, meditate.... we eat locally grown organic food and homeschool.

i would never trade my life for the one this man has. not for 10 million dollars, and even if i got to go to three hour lunches every day.

and my trip to the beach takes about five minutes, inigo2.
posted by RedEmma at 2:27 PM on August 5, 2007 [4 favorites]


Chances are these people spent a large portion of their early life studying technologies. Their careers are certainly not ignoble. Generally they seem, IMO, to have decidedly better social and political values than other high wealth generating occupations. So, they can stay in their fields or as some have mentioned, choose to pursue more 'intellectual' goals, or volunteer work. Thing is they're not young and they'll be behind the curve on both of these. Chances are they won't be writing any ground-breaking thesis. And would be of less use to society volunteering rather than using their skill-set (unless of course they were to volunteer in what they know; creating software for some organization perhaps).

The point I'm trying to make is that to some degree it is reasonable and isn't some psychological disorder that drives them to stay where they are. Given that, they are going to be associating with the upper crust and unfortunately people of any class are stuck competing for basic social pleasantries with other members of their class whether they want to or not.
posted by kigpig at 2:35 PM on August 5, 2007


I dont think its fair for the privileged to call what they do "work."

To those complaining about how the boss class just turn up at the office and sit around in meetings all day: they're working hard. I'm sure you have a bitter anecdote about a megaboss you once saw taking a two hour lunch break, but seriously, management is real work. So how do I say this politely? If you don't understand what they do, then maybe that's the reason you're not rich.
posted by hoverboards don't work on water at 2:48 PM on August 5, 2007 [6 favorites]


Seriously, stop watching television. Once you stop absorbing all the consumer culture it's jamming at you, it becomes much easier to back off status-based purchases. It takes four to five years, really, before you can really start seeing the messages for what they are, but once you do it's amazing how prevalent and insistent the urging is to spend money = become happier.
posted by seanmpuckett at 2:55 PM on August 5, 2007 [4 favorites]


hoverboards Middle management works its ass off. Upper management? Not so much, in fact, not at all.

Tell me what Mike Eisner, for example, did that was worth all the millions Disney threw at him. Or any of the truly upper management. They give orders to lower management, and lower management sweats blood to try and make their orders work. Big whoop.
posted by sotonohito at 2:58 PM on August 5, 2007 [1 favorite]


This guy's got it easy! I work 190 hours a week for $20 million dollars, it takes me half an hour each morning to decide between my four Ferraris, my wife and child have never worn the same clothes twice, I shit every evening in a Ming vase that's rinsed clean with the tears of babies, and I eat caviar for breakfast everyday off a supermodel's taint, and yet I somehow feel as if I could be doing better.
posted by ColdChef at 2:59 PM on August 5, 2007 [9 favorites]


Tell me what Mike Eisner, for example, did that was worth all the millions Disney threw at him. Or any of the truly upper management.

I have no idea what Michael Eisner did or does. I know zilch about movie studios. His bad press does seem to indicate that he gambled and lost. But come on, he's one guy, and the only reason you've heard of him is because his failures are remarkable. Upper management is wildly successful at the money making game in America, and they do it by being lucky, smart, and hard working. They are not picked out of thin air; they (mostly) get to the top by working up through middle management, where you correctly point out they have been working their asses off.
posted by hoverboards don't work on water at 3:22 PM on August 5, 2007


Middle management works its ass off. Upper management? Not so much, in fact, not at all.

I don't really know how we can settle this argument, but I can assure you that a majority of public-company CEOs typically work 80-100 hours per week.

They don't work as hard as, say, roofers, but they usually work longer days-- surviving meeting after meeting, and enduring constant abuse from regulators, shareholders, employees, etc.. I wouldn't trade my job for George Buckley's, even if I got to keep his paycheck.

And Michael Eisner was the one person (who mattered) in the entire Disney organization who realized that the firm was charging way, way too little for park admissions. He created more shareholder value in acting upon that realization than he collected in salary for many years.
posted by Kwantsar at 3:35 PM on August 5, 2007


Heh. A quick look at Google Finance suggests that Eisner drove Disney's stock to return about 20x over 20 years before dividends!*

*end dates not exact, but that's a broadly correct number
posted by Kwantsar at 3:40 PM on August 5, 2007


The recent book "Richistan" states that rich people almost unanimously say that they would be financially secure if they had... twice what they have now. $1 million? They need $2 million. $100 million? They need $200 million.

The book came at a point when I desperately needed a reminder of the emptiness and futility of desire for stuff.
posted by Jeanne at 4:17 PM on August 5, 2007


Upper management is wildly successful at the money making game in America, and they do it by being lucky, smart, and hard working. conniving

Fixed that for you.
posted by delmoi at 4:25 PM on August 5, 2007


To those complaining about how the boss class just turn up at the office and sit around in meetings all day: they're working hard. I'm sure you have a bitter anecdote about a megaboss you once saw taking a two hour lunch break, but seriously, management is real work. So how do I say this politely? If you don't understand what they do, then maybe that's the reason you're not rich.

Oh, good, here are the waterboys for the stratospherically rich, making sure their putative bosses (who no doubt laugh them the way they laugh at all us lower classes) aren't too badly maligned.

Don't worry. It's only a matter of time before you're just as rich as these guys!
posted by John of Michigan at 4:33 PM on August 5, 2007 [1 favorite]


I'm torn. I AM upper management. In that my wife and I own our own company. But I am also labor. So. As management I try to get away with as much money as I can while doing the least amount of work possible. As labor I am forced to compensate for my lazy management attitude. But then again as management I spend many, many, hours worrying, planning, and strategizing about the business. "Management me" has social obligations that nearly always involve schmoozing and networking. While "labor me" is there just fucking around getting drunk.

I often stick it the man, er... me, by taking off work early or going to work-out on company time. Then, in revenge, I scam to rip off "labor me" by not giving me raises... and instead I take more profit.

The hard part is arbitrating between me. That and the fact that all the other employees make more than me. And I should know. I write their checks. With out me there would be no jobs for me in the first place. Ungrateful bastards.
posted by tkchrist at 4:37 PM on August 5, 2007 [10 favorites]


With out me there would be no jobs for me in the first place. Ungrateful bastards

Well, without them, you'd be some overfunded capitalist with dreams of glory, dollars jangling in your pocket and a dream glinting in your eyes. It really is a two-way street.
posted by John of Michigan at 4:40 PM on August 5, 2007


"Richistan" states that rich people almost unanimously say that they would be financially secure if they had... twice what they have now.

As someone who just doubled his salary in a single negotiation, I can attest that it's not just the (very) rich who feel this way. I spent about a week thinking I had it made. Then I started realizing all the ways I was even more screwed. Not that I'm complaining.

Mind you, we're talking good middle class money here. 10 million a year is a whole 'nother thang. I'd live poor for 10 years while making it, and spend the rest of my days living rather rich.

But man, when I was a kid I never even thought about money much, and I wasn't rich. I just made what I needed to keep pushing forward. If you'd have told me when I was 24 what I would be making today I would have choked on the absurdity. Today, it feels like barely enough.

(Having kids changes all that, though.)
posted by spitbull at 5:37 PM on August 5, 2007


Everything is relative.

It is cliched to say it, but 99 percent of the world would love to have the material wealth of almost everyone here on Metafilter. And they would ridicule us for complaining about our wages, connection speeds, cars, etc.

I find it is worth reminding myself of that periodically.

I did not pass the Bar Exam the first time I took it. I was upset and distressed. Then I asked myself this question: What percent of the world's population (or even the US population) would love to have failing the Bar Exam (which you can take again in six months) be their biggest problem?

I read about these people and understand where they are coming from. I have the same inane concerns, but on a smaller scale. I would like to be rid of those concerns at all.
posted by flarbuse at 5:47 PM on August 5, 2007 [3 favorites]


Most superrich people seem weird to me. They spend money on stupid shit. I came across VH1's Rich and Famous show or something like it and it was fascinating: so so spent ten million on a house or 20 million on a 125 yacht etc, etc. To me, a 10 million dollar house should be built on the side of Mt. Everest, with its own helipad and satellite broadcasting station or some such. Something cool that no one else has, but 10 million for a mansion in LA?! Who the hell wants to leave in LA? A 20 million yacht should be able to invade, I dunno, something or catch whales.

Interesting fact: Nick Cage bought his own island for 3 million, which sounds totally cool. Just being able to say "Hey, drop by my island" or "get the fuck off my island" sounds fun.

and Oprah was cool for spending a million taking her company on a week long vacation in Hawaii.
posted by Brandon Blatcher at 5:48 PM on August 5, 2007


Upper management is wildly successful at the money making game in America, and they do it by being lucky, smart, and hard working. conniving

Fixed that for you.


Bullshit. How many upper management do you know well on a personal level? The ones I know are decent, hardworking people. Some of 'em have aligned themselves with the Bushies for economic reasons which is a huge strike, but some of them haven't.

I suggest that if you think upper management aren't decent or hardworking you either only know what you read on the internets, or you work in the wrong goddamn industry. Try old school stuff instead of the flashy new tech and movie places that attract the sociopaths.
posted by Justinian at 5:51 PM on August 5, 2007 [1 favorite]


It is cliched to say it, but 99 percent of the world would love to have the material wealth of almost everyone here on Metafilter.

I'm sure there's plenty of places in the world where owning three goats seems reasonable but, dude, twenty goats? Quit your bitchin'.

It's a matter of scale. I totally agree with you, but by using your scale, I stand by my first comment.
posted by Cyrano at 6:06 PM on August 5, 2007


Who pays for your fire department/rescue squad/hospitals/police/schools/teachers?

funnily enough, China.
posted by matteo at 6:11 PM on August 5, 2007 [3 favorites]


I don't think you get to $10 million without always reaching for the next level in the first place, which is probably how these people became so successful - they've been willing to work hard to get there. They just can't or don't turn it off at a point when most people who don't have that much money think it would be "enough."

And I think it's easy to judge them, and yes we'd all love to have their problems, but I think most people would fall quite easily into this trap were they to be in the same position.
posted by bijou at 6:13 PM on August 5, 2007 [1 favorite]


I feel bad for them.

I pity them because they have failed to live consciously. They have failed to make choices about how they want to view the world, about what they value and what their legacy will be when they die.

Let's run through the usual catastrophe scenarios: The economy collapses. The oil runs out. Mushroom clouds rise over America's cities.

No more toys. No more networking. No more 80-hour workweeks. No more SAT coaching. No more gourmet groceries. No more golf. Game over, my friend.

Who are you now? What have your thirty, forty, fifty odd years of life amounted to? What do you want people to say about you when you have shuffled off this mortal coil?

It's amazing the lengths that people will go to to avoid confronting these questions.
posted by jason's_planet at 7:06 PM on August 5, 2007


jason's_planet - considering such questions is a luxury of the upper middle class. The poor are too busy trying to get by to bother with bullshit like "what has my life amounted to?".
posted by Justinian at 7:14 PM on August 5, 2007


What have your thirty, forty, fifty odd years of life amounted to?

If you take the long view, I'd say the exactly the same as yours, mine, and everyone else's. In the shorter view, they have the resources to do heck of a lot more good than I and presumably yourself ever will. I'm not saying that philanthropy is or should be practiced solely by the rich, but venting your resentment through reverse snobbery and perpetuating the fallacy of Dignified Poverty and writing off everyone in a certain tax bracket as being soulless is just silly.
posted by Alvy Ampersand at 7:24 PM on August 5, 2007 [3 favorites]


venting your resentment through reverse snobbery and perpetuating the fallacy of Dignified Poverty and writing off everyone in a certain tax bracket as being soulless is just silly.

Sir, you misread what I say.

I do not think that poverty is inherently dignified and noble. I grew up around too many poor people to believe that.

I also do not write off everyone in a particular tax bracket as being soulless; I'm sure that there are more than a few people in this world who use their financial freedom to create rich and fulfilling lives. But this article doesn't focus on that type. My comment refers to the people in the article and only to them.
posted by jason's_planet at 8:21 PM on August 5, 2007


Fair enough, sir - even though I still think the SAT coaching is a good thing. ;)
posted by Alvy Ampersand at 8:44 PM on August 5, 2007


He should take up cocaine.
posted by Burhanistan at 8:45 PM on August 5, 2007


$10 million is enough to retire on
...
Newsflash: People with a lot of money often have fucked up
priorities. Story at 11.
...
Whoever dies with the most toys wins.


etc etc

I feel most of these comments are pretty short sighted. There may be a superficial attractiveness to the idea that these people should stop working. (And possibly have the living shit retroactively taxed out of them for good measure)

But then... what? Take up knitting? Play warcraft?

And why? So that they don't become "too rich"? So that they stop making you feel uncomfortable? So that their priorities in life might look more like yours, and therefore that they might be deemed to have a soul?

Forget about the numbers. The point isn't whether Mr Kremen has $1m or $10m or $100m. The point is that he is still driven to keep going. He's not becoming landed gentry. He's still working his guts out advancing an industry of the 21st century. He gets paid well for it, he enjoys it, and the generation that comes after him may incidentally have a better life for his efforts.

It's basic economics, but I really have to recommend Adam Smith to some people here.
posted by magic curl at 9:26 PM on August 5, 2007 [3 favorites]


Once you climb up that ladder, it takes a superhuman detachment from social status and all the fringe benefits to go back down.

This is v. insightful.

Seriously, stop watching television. Once you stop absorbing all the consumer culture it's jamming at you, it becomes much easier to back off status-based purchases.

Seconded. This really does make a difference.
posted by magic curl at 9:28 PM on August 5, 2007


I feel bad for the kids - and for us who will have to live with them. Related thread from January: "I just like to have the hottest of the hottest. Whatever's hot at the time".
posted by madamjujujive at 9:45 PM on August 5, 2007


magic curl -
if working for tech companies is what they love, great, keep doing it.

But the people in the article seem to be working far harder than they really want to, largely for the sake of greater financial stability, because they perceive themselves to financially insecure.

I don't see anything wrong with working hard, even eighty hours a week, if that's what you find satisfying (I personally would rather have a more balanced life with time for friends and other activities, but I accept that others may not). But I don't see the wisdom of sticking with such a workload, feeling trapped by it really, just because of the ever-escalating demands of your consumerist lifestyle.
posted by mai at 10:26 PM on August 5, 2007


And you may tell yourself
This is not my beautiful wife!


No, no, no. You clearly wanted this song.
posted by sparkletone at 11:13 PM on August 5, 2007


HURF DURF LIFE IS ALL ABOUT SAVING UP FOR YOUR TOMBSTONE
posted by tehloki at 12:34 AM on August 6, 2007


>A reasonably nice home costs about $60,000 to $70,000, and I recently saw a completely restored Victorian mansion on the market, 7 bedrooms, 4 bathrooms, 4 fireplaces, for $142,000 asking price. Property taxes are around $500 a year.

>>WTH?!? Tell me where you live, and we'll be drinking margaritas at a meetup in 2 months, tops.


Seconding this. Are there places like that still left in (I'm assuming) North America?
posted by stavrosthewonderchicken at 12:46 AM on August 6, 2007


wuwei says "In the valley, what would be a 175k home in Nebraska is probably at least 600k" which is true, but it's worse than that. In Palo Alto, the absolute cheapest three bed two bath single family home is $1.15M (down from $1.4M over the past year), and it's kind of a crappy little Eichler (flat roof, no insulation, rusted out radiant heat in the (cracked) concrete slab it's built on, electrical wiring kind of an afterthought, etc.) The next one up IS $1.4M.

If you're willing to live in Mountain View, on the corner of two expressways, in a neighborhood with mediocre schools, where they ain't no Mountain and they ain't no View, you can get the minimum 3/2 for $800K.

In Omaha, there are 20 3/2s under $70K, and for $175K, you get a 5/3 with a three car garage and a shop, and half again as much square footage as the Palo Alto house. That would start around $2.5M in Palo Alto.

The payments on Palo Alto properties are pretty punishing. Already saved up $220K for your down payment? Then you'll only need $7,100 a month more for your Palo Alto mortgage plus at least $1,500 a month for property taxes, $300 a month for homeowner's insurance and another couple hundred a month for flood insurance (you have to buy it -- the feds say you're in a flood zone). Now we're up to $9,100 a month. You probably ought to make at least $270K/year before taxes to afford that, and you won't get a full mortgage interest (or any other) deduction because you'll be subject to Federal and California AMT. So a family making $270K basically lives in a Palo Alto crapshack.

I'm (barely) in the AMT bracket, but I still can't afford a 3/2 anywhere near work right now, so my little family is stuck in a 900 sq. ft. 2/1 with a 45 minute commute. But maybe someday I'll get a few hundred $K (or more!) out of stock options or bonuses if I'm lucky, and my two kids will be able to go to decent schools. And maybe I can sell the house and move to Omaha to pay for their college when it's time for that.

I would keep working even if I had $10M (like many of my luckier friends do), but I would definitely get a 3/2, increase my charitable giving by a commensurate amount, and probably take a vacation. Having a net worth of $1M just gets you a lower middle-class existence here.

I often wonder how people with ordinary salaries get by here, but one answer is that they bought a house a long time ago and still own it. If they didn't do that, then they rent, mostly pretty shabby places. Or they have the commute from hell.

At least it's nice weather here!

[Consciousness disclaimer: I realize that I am in the top half-percent of world income (globalrichlist.com says top .01%, and that I'm in the top million earners in the world), and that we are all really lucky to even be alive. I have already made the world a slightly better place for millions of people, but I still would like a house with a bedroom per person or so.]
posted by Hello Dad, I'm in Jail at 12:54 AM on August 6, 2007 [5 favorites]


Really interesting thread, by the way. I didn't spend more than a few minutes thinking about money for the first 3 decades of my life or so (whether I was dirt poor or rolling in it or somewhere in between), but (and probably because of that) I do spend a lot more time thinking about it these days. Hypothetically, like.

Having a net worth of $1M just gets you a lower middle-class existence here.

This fascinates me. If I could liquidate my assets and have $1M (no time soon, but eventually, I hope), I'd be putting it in insured investments that'd bring me back an average 5 or 6%. Leave the principle alone, live on the interest.

There are an awful lot of places in the world we could live for $50 or $60K a year, renting and living simply and happily and well.

I guess the big question is always where you're willing (or want) to live.
posted by stavrosthewonderchicken at 1:09 AM on August 6, 2007


I can always count on the NYT to do a crap job describing the valley. East coast types never got it, still don't apparently.

I moved to NYC to get away from these types in the Valley. If the people in the article represent "getting it", I'm glad we East Coasters don't get it.
posted by anildash at 1:53 AM on August 6, 2007


Well, at least I know I'll always be a Dollar Menunaire.
posted by Vic Morrow's Personal Vietnam at 3:15 AM on August 6, 2007


I moved to NYC to get away from these types in the Valley.

And anyway, our rich (NYC) are way richer and crazier than your rich . . . . There are circles in NYC where $10M is chump change too, plenty of them. And if you'd like to spend a million on a 2 bedroom apartment, easy to do. Hell, you can spend a million on a one bedroom apartment.

I've spent enough time in both places to know which place I'd be happier being either rich or poor. At least NYC has fucking public transportation so the middle class poor can get to work.
posted by spitbull at 5:20 AM on August 6, 2007


[barf]
posted by designbot at 7:56 AM on August 6, 2007


I agree with Mai. I don't think Steve Jobs is nuts because he's obviously doing what he wants, what fulfills him. But being that loaded & still being so stressed & obsessed about money, status & security? That's nuts.
posted by Wood at 10:33 AM on August 6, 2007


I live and work in Palo Alto. I've been to these places and mix with these folks a lot. It's interesting; the money has swelled things so badly here, that a typical lower middle-class home in Menlo Park or Palo Alto is a multi-million dollar home here (a few hundred K in most any city outside California). And the places in Atherton and Woodside are in the tens of millions.

I've always observed that the millionaires are caught in aggregation by the time they reach that level...and they can't turn it off--it's never enough. And they also seem to be much more concerned about losing what they have than they ever were about getting it in the first place. This occurs constantly on the carping about charges for parking, bridge tolls, how much tomatos cost in the store, etc. Their biggest fear seems to be paying retail for something....

To be fair, I *do* know a (very) few people who made their million bucks through the Valley and just retired (in their 30s and 40s). They say, "a nice prudent investment will return 10% for me...I can live well on 100k a year and never work again." Kudos to them....
posted by PhiBetaKappa at 10:35 AM on August 6, 2007


Disclaimer: I live in a leafy town in southwestern Connecticut that's considered by some to be "tony". I suppose there are some wealthy people here, but mostly it's a town of modest-sized homes, manicured lawns and very little ostentation. Since it's far enough away from New York, it's not terribly expensive to live here (at least not yet).

What blows me away is that, a couple towns to the south of here is a mythical place called Greenwich. Greenwich is a large town/small city of about 60,000 people that is fairly or unfairly the archetype of snooty New York bedroom community. Although it was a few sprawling areas where multi-billionaires live in 10,000 square foot castles, it overwhelmingly has the look of a very solid middle-class looking town. Small cape cods, colonials, split levels and such packed closely together on small lots (1/10 to 1/4 of an acre).

When my wife and I first started looking for a home, we started there, because it seemed to have everything: a nice downtown, a public beach, great public schools and a 45 minute train ride to Grand Central Station. However, nothing could prepare us for the sticker shock we were about to experience.

We say 1300 square foot colonials, not only listed at, but SELLING FOR $1.2 million. A smallish three bedroom colonial needing a lot of work went for as much as $1.75 mil.

I just can't conceive of the sort of person that would lay out seven figures for, essentially a dump fixer upper*. I could not only not imagine who these people were that were buying such places, but that there were seemingly so many of them.

So, while I don't particularly empathize with the people in this article, I can at least back them up that if you live your life aspiring to something that conforms to the expectations of people you don't really know, your millions just don't stretch as far as they used to.

*The town of Greenwich has some pretty strict zoning regulations that dictate what you can put on an lot, so there are very few mcmansions in the area on tiny lots, that are so common nowadays.
posted by psmealey at 11:01 AM on August 6, 2007


It is cliched to say it, but 99 percent of the world would love to have the material wealth of almost everyone here on Metafilter.

This is too true of all wealth-related discussions on the blue.

If you make $25k/year, you're in the top 10% of all people in the world.
If you make $50k/year, you're in the top 1%.

And yet most of you are busy deriding people who happen to make more than that, simply because they have more money than you.

I make more than $50k/year, and I certainly didn't read the piece and think "oh, those poor fellows", but I certainly could relate. In many areas a million dollars will buy you a reasonable house, but leave you with $10-20k of property taxes each year, on top of regular maintenance.

If you couldn't afford to move into a premium school district, you might decide that you want to send your children to private schools, which can easily eat up $30k/year/child.

Sure, we all know that it's possible to move to the country, to live more simply and at lower cost, but there's also an innate desire to do the very best you can to provide for your children. And if you can given them Exeter, Yale and Harvard Business School, then why wouldn't you want to, at a minimum, give them the option.

Sure, they might end up preferring public school and turning a wrench for a living. But I find it amazing how consistent MeFites are in denigrating those who work hard to provide for their families, and happen to be a little bit better or luckier than some others.
posted by Tacos Are Pretty Great at 12:57 PM on August 6, 2007 [1 favorite]


Or to be more snarky and succinct:

ZOMG MILLIONAIRES ARE TEH WORST, AMIRITE??
posted by Tacos Are Pretty Great at 12:58 PM on August 6, 2007


Sure, we all know that it's possible to move to the country, to live more simply and at lower cost, but there's also an innate desire to do the very best you can to provide for your children. And if you can given them Exeter, Yale and Harvard Business School, then why wouldn't you want to, at a minimum, give them the option.

I think the point is, "Not the Bay Area" does not necessarily mean you're living in the sticks. There are dozens of places these single-digit millionaires could go to have great lives. But they're so caught up in the Bay Area rat-race that they can't even bring themselves to realize it.

If you need to live on the coast, Seattle and Portland are great options. If you need nicer weather, some of the communities in SoCal are downright affordable compared to the Bay Area. Las Vegas has great housing too. Plus there's a ton of other nice places: Minneapolis, Phoenix, Austin, San Antonio, Tampa, etc, etc etc. You could have a home in two of those places and commute for cheaper than the Bay Area.

We make money to live, not live to make money. No millionaire with 2 kids should be "splurging" on a 1000 sq ft house.
posted by b_thinky at 1:56 PM on August 6, 2007


Am I the only one who's noticing the rash of stories in the NY Times about the "plight" of the rich?
posted by any major dude at 2:47 PM on August 6, 2007


It's an on-going series: Age of Riches: Articles in this series are examining the effects of the growing concentration of wealth..
posted by ThePinkSuperhero at 3:01 PM on August 6, 2007 [1 favorite]


Am I the only one who's noticing the rash of stories in the NY Times about the "plight" of the rich?

I don't think this can be read as the plight of the rich.

I read it as a "gawk at the rich" article.
posted by Tacos Are Pretty Great at 4:34 PM on August 6, 2007


Saysthis: EVERYONE I know has a maid, and thinks I'm crazy for not having one. No, see, the problem is, once you take that upgrade, it's impossible to go back.

Uh, right. Very virtuous of you.

From your post last month:

I have.. an amazing girlfriend who actually comes to my house to cook, clean, and deliver medicine

Why not ask your girlfriend whether she'd like it if you hired a maid? If you have someone cooking and cleaning for you, I'm not sure your opinion should be considered the final word on the topic.
posted by ikkyu2 at 4:57 PM on August 6, 2007 [5 favorites]


I found the reaction here somewhat surprising, because I recognize these worries. I see the same set of attitudes in most people I know, regardless of their worth or income. The LOLRICH tone of the thread is foolish, because the real take home here is that this sort of attitude is endemic to our society, that getting more money doesn't change things, and that anyone with this set of attitudes should look long and hard at the conditions that are generating them, whether they are worth millions or making minimum wage.

Now, of course not everyone is going to come out of that introspection the same: there are people who genuinely need more money to get by comfortably, and there are people who are genuinely superrich and just haven't come to terms with that. But I think most people are somewhere in the middle.

So I sympathize with the people in the article. They're in a genuinely difficult situation, and different elements conspire to make it difficult to see and pursue alternatives. Much of our society is the same. The reactions I see here I think stem from the fact that these people are in the class of income that people here think of as above what they would need to feel secure. If you work your way up there though, the message here is that you would, in all likely hood, still not feel secure in that.

This doesn't mean that the people in this article are necessarily unhappy. Poorer people struggle with the same issues and are nonetheless happy. The people implying that these rich are soulless because they deal with these issues aren't going to say that everyone who struggles with money issues is soulless. So I take a certain amount of solidarity out of this article, which is something that I think everyone could stand to get more of.

I'm near the end of my undergrad career myself, so I've been looking at these sorts of issues from a still abstract point of view, while also taking them deadly seriously in a way that was never necessary for me before. What do I do with my life? How much money do I really need? Can I be happy doing X?

I don't have the answers for myself yet. I don't think there are many who really do answer these questions for themselves. They just get by.

And that's life.
posted by Arturus at 5:37 PM on August 6, 2007 [2 favorites]


You'd be suprised how quickly .dot com 'wealth' can disappear. A friend of mine was, for a time, worth $25,000,000 or so, at the age of 22, much of it in options that didn't vest before the crash.

Unvested options aren't "worth" anything. By that measure, at the same time as your friend, I was worth about 3 million dollars. I've never thought of those unvested options as wealth I ever actually had.

With a need to be discrete on this subject, I'll say that I did manage to "cash out"—that means, literally cash in my bank account—something more than two-hundred thousand dollars and less than six-hundred thousand dollars. And now I'm disabled and broke and live on disability income of less than a thousand dollars a month. How's that for a change in fortune?

The thing is, there's something weird about having a lot of money. It's all very relative is the first thing. After having hundreds of thousands of dollars in a money market account available to write checks on, and thus buying everything I needed, including my BMW, by writing a check for the total amount, one's sense of how much money is "a lot" becomes distorted.

And the main reason I'm broke is because when you have what seems, based upon prior life experience, an unlimited money to spend, then it becomes very easy to spend vast amounts of money. I was spending 20K a month in 2000 on, well, just stuff. Really. I have so few big-ticket items from that time, it was mostly stuff in the sub-thousand dollar range. I ate out at nice restaurants every night and paid for everyone else's meals that I ate with. When I went on a trip anywhere, I stayed at the nicest hotel in the nicest rooms. Stuff like that. Also, I was pretty generous, and I paid off my sister's medical debts and my partner's old debts, as well as moved an old friend to Austin and let him live with me and stuff free for a year. Mostly, though, I just bought stuff. You'd think you'd need to be buying drugs or something to spend 20K a month, but it's not so.

And, honestly, I did this all without going into debt by buying a big house and things like that. For the people who take substantial wealth and use that as a basis to live beyond their means, then they end up running that same rat race that poorer people do, using a huge amount of their montly income just to service debt.

So all that is to say that, speaking from experience, the assumptions that we have about what it will feel like if we were to have "a lot of money" turn out to be false. In the end, it feels an awfully lot like what it feels like to not have a lot of money, except that you probably eat better and have nicer stuff. But it doesn't make you a different person and it doesn't make you happy.

It did make me feel, for a time, free from financial worries. That's because I had a bunch of money and I spent it. In that way, it was probably like what people expect. I felt rich. But most people are either wiser than me or have different values than me, or both, and don't do what I did. They don't really enjoy their wealth by spending it, they worry about it and try to nurture it and such. So, for them, it really probably feels a lot like the same old thing, only the numbers are larger.

I don't know. I'm broke now mostly because money doesn't mean very much to me rather than my foolishness, though that's part of it. I thought I had a nest egg of a few hundred thousand worth of unsold stock that I watched reduced to being worth 30K in the span of two years. That's part of it. And I was foolish to spend so flagrantly without saving for my future. But, on the other hand, I've never had a need to have money and the security that it, apparently, provides other people. And I think that's the real thing that's going on in what this article described. It's all about pursuing that sense of "security". And if everyone around you is a millionaire and they're all working and they all, like you, have bills and debts, then I don't really think that the normal American is going to feel all that "secure". So they keep chasing that security. That's what this is about.

Speaking for myself, none of the things I'm unhappy about these days have anything at all to do with not having any money. My own happiness, in retrospect, was almost entirely unaffected by my having a lot of money and then being broke.
posted by Ethereal Bligh at 6:07 PM on August 6, 2007 [5 favorites]


jason's_planet - considering such questions is a luxury of the upper middle class. The poor are too busy trying to get by to bother with bullshit like "what has my life amounted to?".

Justinian, I used to think that way. I used to be an economic determinist. A commie, in fact. I used to say, with a straight face, things like "circumstances determine consciousness."

I was, of course, wrong. On so many levels. But the main error of mine that I'd like to address here is my failure to recognize peoples' ability to overcome their immediate circumstances, their societal programming and direct their minds (and lives) in the way most pleasing to them.

Everyone has a mind and everyone can use that mind to wonder, to think, to dream, to evaluate options. Here I am not trying to say that all minds are created equal. But the powers of reasoning and imagining belong to everyone except, perhaps, in the most extreme cases of emotional pain or derangement. Class has nothing to do with it. Everyone is a philosopher in his own way; some are much more articulate about it than others. Everyone out there has drawn some conclusions, usually on an unconscious level, about what life means, what people are like, what the world amounts to. Philosophy isn't some rich man's luxury. It's what we do as conscious human beings. Everyone does philosophy. And I wish we were better at it.

And if philosophy is a luxury, why are these affluent professionals so reluctant to indulge in it? They seem to be as blind and bound by their immediate environment as the poor people you cite who are too harried to think.
posted by jason's_planet at 7:09 PM on August 6, 2007


This all reminds me of an anecdote about Joseph Heller:

There's a big cocktail party on Martha's Vineyard. Someone comes up to Joseph Heller, and says, "Joe, see that guy over there? He's a hedge fund manager, and he made more money yesterday than you made on all the books you have ever published." Heller looks over, pauses and says, "Yeah, but I have something he'll never have: enough."

Cheers to that. I don't make a lot of money, and I only work part-time to make what I do, but I take home enough to buy almost everything I want (and everything I truly need) and salt some away for a rainy day. I don't own my place of residence or have it filled with fancy shit, but I spent last Wednesday afternoon going for a swim at the beach and then having a nap under a tree. When I woke up I felt like the richest man in Toronto.
posted by The Card Cheat at 9:03 PM on August 6, 2007


Seconding this. Are there places like that still left in (I'm assuming) North America?

All sorts of places like that in central Canada. Hell, you can buy a four-bedroom house a half-hour outside Winnipeg or Swift Current or in Kenora or Portage La Prairie for $25,000 or less.

I considered buying an $8,000 house in central PEI a couple of years ago, having the electricity connected, digging a well and putting up a satellite dish for the Net and working from home for the rest of my life.

If you're willing to give up urban living, one can easily retire, not on ten million or even one million, but on almost nothing.

I wasn't willing to give up the urban lifestyle. I'm still not. But the option is still there for the people who want it.
posted by solid-one-love at 9:20 PM on August 6, 2007


I considered buying an $8,000 house in central PEI a couple of years ago, having the electricity connected, digging a well and putting up a satellite dish for the Net and working from home for the rest of my life.

I've been considering holing up and raising a tribe of little wonderchickens in PEI or Nova Scotia myself (which are cheap as chips, relatively, at least compared to BC (*cries*), but I'm not seeing livable houses for anything less than about 10 times that on mls.ca (where I spend far too much time webdaydreaming). Of course, 'livable' means very different things for different folks, I know.
posted by stavrosthewonderchicken at 9:51 PM on August 6, 2007


Also, I loathe urban living.

As long as I can get broadband, that is.
posted by stavrosthewonderchicken at 9:51 PM on August 6, 2007 [2 favorites]


This was a couple of years ago, Stavros. Prices have gone up. I wish I'd bought one of those places just to resell it today for double.

But right now, there are (to me) livable homes in the sub-$20K range, including a lovely fixer-upper for $15,900. And if you like blackflies and don't mind living alone, there's a 600 sqft house outside Swan River, MB for $6,000. A better deal, perhaps, is a 800 sqft house in New Waterford, NS, for $7,000 -- and it has utility hookups.

Jeez. There's a firm in Sydney looking for someone with my experience, too.
posted by solid-one-love at 10:18 PM on August 6, 2007


You know, I realized after I posted that that I haven't really looked much at the supercheap end of things when on mls.ca, assuming there wasn't anything there. I'm going to go look around. Wish I knew somebody who'd hire me out that way...
posted by stavrosthewonderchicken at 10:22 PM on August 6, 2007


I started my own business about a year ago, and I can see this happening to me. I think I've been trying to ignore it. For example, if you asked me if I work 18 hours a day, I'd probably say no. It doesn't feel like I'm working 18 hours a day. And yet, here I am, sitting in my office at 12:30am. I don't live nearby so I'll probably just sleep here tonight. I desperately need to move closer to the city.

I don't think I can stop. How can you quit your own business? What about my partners? One of my best friends put everything he had into this business (so did I). What about everyone else who works here? Two of them are here on visas.

I guess I could quit. I'm sure everyone will find other jobs. But there are good reasons to stay. Besides, I'm doing something I love and the pay's not too shabby either.
posted by ryanrs at 12:54 AM on August 7, 2007


Clearly I've given up something to get where I am, but I don't think it was my soul.
posted by ryanrs at 12:55 AM on August 7, 2007


Unvested options aren't "worth" anything.

"Not true." They are usually valued by a bit of "ledgerdemain" called the Black-Scholes method.
posted by ikkyu2 at 10:33 PM on August 7, 2007


Most of the time, employee stock options can only be exercised. Since they can't be sold, Black-Scholes has nothing to do with their valuation.

It is best to assume that your employee stock options are worth nothing. In some cases, you could argue that they are worth something, if you believe that management genuinely wants to share the wealth. But you can also argue that they have negative value, if you believe that management is offering you worthless options so that they can pay you less.
posted by b1tr0t at 11:03 PM on August 7, 2007


“‘Not true.’ They are usually valued by a bit of ‘ledgerdemain’ called the Black-Scholes method.”

That may be so, but as b1tr0t points out, if you can't do anything at all with them to turn them into money, then they aren't worth anything in the real world.

Now, you will argue that the article you linked to is an example of people turning unvested options into money. And, sure, unvested nontransferrable options are worth something in the sense that they are at the very least a form of expected earnings (though their value as expected earnings is uncertain), and thus they at least can be leveraged into access to debt.

But, really, the bottom line is that in the real world, just because there's an accounting line for the value of untransferrable, unvested options, means squat.

I mean, the problem is in the other direction. Too many people think that their unvested options are part of their "wealth". Which is silly.

The one thing that readers of this thread may not know about the option regular employees get is that exercized options are seen by the IRS as work income, where the amount of income is whatever would be realized as a gain if the stock were sold immediately after the options were exercised. In other words, whatever that amount they're being valued at. It doesn't matter if you've sold the stocks you've bought or not, you've incurred that tax liability the instant you exercise your options.

This has some big consequences. It means enormous amounts owed to the IRS at tax time because the value of those exercised options are reported to the IRS as wage income and show up as your wages. For 1999, I filed a simple 1040A and wrote a mind-boggling check to the IRS for taxes owed.

But the real problems come for the people who don't sell the stock because a) they're hoping for larger gains (which that portion which is the difference between exercise date price and eventual sell price will be capgains), and/or b) they hold them long enough to turn that income tax liability into a capgains liability through some mechanism I don't recall how it works. Both those reasons were thought to be savvy financial planning in those days. But the result is that a bunch of people I worked with ended up after the crash with six or even seven figure tax liabilities with little or no actual money to pay it because they never sold the stock and it became relatively worthless. Many people I worked with that did this went bankrupt.

This happened to me with a portion of my exercised options, which was bad, but I had sold about 3/4 of what I had vested, so that was good. But I felt a little foolish at the time when I sold. And, in fact, that first few-hundred thousand that I vested at the end of '99 would have been worth about three times that had I waited just five months. A coworker that started right when I did and probably had about the same option grant I had never sold anything she had vested or that she got through ESPP or the IPO setasides until that April, right when our stock was the highest. By my estimation, she should have cleared about five million dollars from it.

Those were weird times. And don't even get me started on the perqs we got as employees of a high-flying Internet software company.
posted by Ethereal Bligh at 1:21 AM on August 8, 2007


I wrote: “...whatever that amount they're being valued at.” To be clear, what I meant is what they're being valued at when folks say “I'm worth 25 million dollars” and they're referring to their unvested options. Not what that block of stocks is worth on the market, because you have to deduct the strike price. On the other hand, back in those days and in my case, the strike price was something like a couple dollars a share for stocks that were priced over 150 dollars a share. So it might as well have been the simple value of the stock.

I don't think you see big differences like that these days. That's a product of pre-IPO option grants and then the heady days of enormous runups in Internet stocks.
posted by Ethereal Bligh at 1:26 AM on August 8, 2007


"Not true." They are usually valued by a bit of "ledgerdemain" called the Black-Scholes method.

This is silly.

First of all, one generally has no legal rights to get value for unvested shares. The only place I could envision it happening with any regularity is as part of a wrongful termination lawsuit.

Secondly, hefty option packages are most common in high-risk situations where Black-Scholes fails anyway (at least not without some significant modification). Black-Scholes makes lots of assumptions about the movements possible in the stock, but it basically doesn't work in situations where the outcomes aren't balanced. (e.g. slight chance of a huge success, large chance of failure)
posted by Tacos Are Pretty Great at 9:51 PM on August 8, 2007


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