
How MacArthur Geniuses Handle Their Money Windfalls - astdb
https://www.nytimes.com/2015/09/26/your-money/how-macarthur-geniuses-handle-their-money-windfalls.html
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jmathai
Most people who are passionate enough about something to receive these
fellowships will take the opportunity to pursue their passion.

I had a Shuttleworth Fellowship for 2 years which is very similar to the
MacArthur Genius grant. They are both often enough to not worry about having
to work a job to pay your bills and feed your family. (The Shuttleworth
fellowship includes enough to pay for legal, financial, travel, contractors,
etc)

I worked harder during my fellowship than I can recall otherwise. I knew it
was a once in a lifetime opportunity and that I only had a finite amount of
time to do something great.

I wrote about my experience as a fellow here.

[http://jaisenmathai.com/articles/shuttleworth/](http://jaisenmathai.com/articles/shuttleworth/)

~~~
cantrip
These seems like very different programs to me. The MarArthur Fellowship is a
no strings attached financial grant to nominated individuals in any field,
they do not allow applications. The Shuttleworth is by application and
specifically funds individuals working on projects related to "openness".

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teddyh
Most people who randomly get a windfall of money were previously poor. If
you’re poor and suddenly get lots of money, you most probably can’t handle it;
“ _#4. Extra Money Has to Be Spent Right Goddamn Now!_ ”:
[http://www.cracked.com/blog/the-5-stupidest-habits-you-
devel...](http://www.cracked.com/blog/the-5-stupidest-habits-you-develop-
growing-up-poor/)

MacArthur winners have two advantages: First, they are probably good at
something, and therefore are likely not poor. Secondly, even if they _are_
poor, they are probably _very_ focused on their thing which made them get the
prize, and any money goes to _their thing_ , not to themselves, which makes
most people a little more rational when deciding things.

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Jack000
I think this depends on your poverty culture. Growing up poor as an Asian
immigrant, my experience has been "Extra money must go in the savings account,
no luxuries EVER!", which is bad in its own way.

~~~
teddyh
I’m not sure I would call it bad.

[http://www.mrmoneymustache.com/](http://www.mrmoneymustache.com/)

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sudhirj
The article misses the point that people who’ve achieved enough to warrant the
award needed to have a financial system in place already that allowed them to
focus on whatever they’re doing. For people with such a system the award money
itself is a relatively minor change, which is pretty much what the article
reports.

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blinkingled
>Steve Coleman, a saxophonist who won last year at age 57, said he had created
a life over decades that required little money to maintain and could be
supported with even less when times were tough.

I spend quite a bit of time thinking about this but it doesn't appear to be a
solveable problem for people with kids/family even if their earnings as an
IT/SDEV person are well above average.

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jdietrich
Renowned indie games developer Jason Rohrer raised his family for several
years on a budget of $10,000 per year. It's possible to live on very little if
a) you're prepared to move to somewhere cheap and b) you're prepared to
examine your definition of the word "essential". Possible, but not necessarily
pleasant.

[http://hcsoftware.sourceforge.net/jason-
rohrer/simpleLife.ht...](http://hcsoftware.sourceforge.net/jason-
rohrer/simpleLife.html)

~~~
ComradeTaco
Doable as long as nobody gets sick and requires the attention of a doctor.

~~~
humanrebar
And as long as you don't plan on retiring, paying for college, leaving town to
survive a hurricane, etc. "Living on" 10k typically doesn't include
responsible levels of savings.

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pc86
You don't think it's possible "living on" refers to day-to-day expenses and
retirement/emergency savings are in addition to that?

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astura
Yes, that's how I always understood it.

Living on $10k doesn't have to mean only having income of $10k. I personally
say "we live on $50k" but our income is more than 3x that.

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pc86
Currently in the process of cutting our "living on" budget from 110% of our
yearly income to 50% or less. It is a painful process for sure.

~~~
astura
Good luck! I really wish you the very best.

It might be easier to start with a goal of maybe 80% first before moving to
50%? Seems overly ambitious to start with.

~~~
pc86
Yeah just one bill at a time at the moment, 50% is the ultimate goal.

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Asparagirl
There was no mention in this article of Lin-Manuel Miranda (who won a
MacArthur genius grant in 2015), but he reported on Twitter at the time that
he had used his grant to pay off his and his wife's student loans.

~~~
blinkingled
Maybe because they covered one case of a grantee repaying their $180k(!)
student loan.

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labster
The doesn't seem all that large for someone with a professional degree, like a
M.D. or J.D. America is the land of the free until you get to university.

~~~
TheAdamAndChe
Really? This is an incredible amount IMO, regardless of profession. That is a
massive amount of debt that can't ever be absolved without paying, and an
incredible amount of interest.

~~~
astura
I just looked it up and according to a nerdwallet survey (highly unscientific)
the average debt for new physician is $166,000.

~~~
h1srf
That's lower than I would have guessed.

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scoobydoo12345
Richard Stallman made good use of his $240,000 grant when he used it to fund
the Free Software Foundation.

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chengiz
I found it a little disconcerting that the most selfish usecase (spent it on
"her children") among the 5 or 6 reported got a picture. Apparently looks
matter even in the genius world.

~~~
cantrip
I don't follow this at all, what are you saying?

First off, there are two pictures in the article, so the idea that "looks
matter" as pertains to selfishness, whatever that means, is in question.

Secondly, the idea that "looks matter" doesn't make sense. She seems rather
regular looking, not picked out specifically because of her looks.

Lastly, spending money on your children to me is far less selfish than paying
off your personal debt, which did not get a photo.

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S_A_P
The TLDR of this is basically that the MacArthur Geniuses have a solid
trajectory/purpose in life so the sudden windfall does not seem to affect them
in the way that the lottery does to some people.

However, while this is certainly a windfall and I wouldn't turn it down its
not a lifestyle changing windfall. I would say this is enough money to do
anything for at least a short amount of time, but it is certainly not enough
to do nothing. I think that combined with the fact that the awards are given
to people who are pursuing their passion is a large differentiator to those
who've won the lottery and aren't rooted in some cause.

~~~
chrisparton1991
For me—in my 20's living at home—this kind of money would mean I could buy a
house/apartment without needing a mortgage.

It would be a huge kickstart to my independent adult life, and the savings
over the decades from not having a mortgage would absolutely be lifestyle
changing. I'm not talking about yatchs and lamborghinis, but it would
certainly provide the freedom to live on less income in exchange for more free
time to pursue hobbies and side projects.

Not that I have any reason to complain, I'm very grateful for who and what I
have in my life right now.

~~~
cantrip
I get the sentiment, but I'd just like the point out that with current
interest rates it makes sense put 20% down and invest the rest in mutual
funds. You get mortgage interest deduction and are paying 4% interest while
making 7% market gains. Buying a house all cash is not the way to do it.

~~~
Retric
You get an interest deduction, but you need to pay taxes on capital gains. The
added flexibility is probably worth more in theory but risks spending that
money on other things.

A larger issue IMO, is condo's / houses have large upkeep costs and reduce
mobility. So, simply renting while investing 90% of the money for a very early
retirement is probably the best bet.

~~~
astura
They, yes, the nebulous "they," say you should expect to spend around 1% of
the house's value a year for repairs, upkeep, and maintenance. This rule of
thumb doesn't quite work when the local housing market is in a bubble though.

Of course, there will be years you spend much less and years your roof needs
replacing so you'll spend much more, so that's why you amortize.

~~~
Retric
Not just repairs. Depending on what you get your facing everything from condo
fees, taxes, lawn care, etc and it can all add up quickly.

The real savings from renting is the flexibility to up size, downsize,
relocate etc as needed and with minimal transaction costs. Thinking of
starting a family some day? That does not mean you need to pay for more space
today, unless your planing to stay put for 15+ years.

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oceanghost
In all seriousness, what does it take to get a Macarthur grant?

~~~
dsr_
You don't apply. You get nominated; and nominators are invited by the
foundation.

[https://www.macfound.org/fellows-faq/](https://www.macfound.org/fellows-faq/)

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Kyragem
What a nonsensical article. Similar to Malcolm Gladwells revisionist podcast
(episode: My Little Hundred Million) these awards predominantly go to well
connected faculty at elite schools who are already well funded and who don't
need the money (other than to add to their palmares). Many of these awardees
are already millionaires. They should just split this award into smaller
grants and give it to faculty/teachers at smaller unknown schools in the
midwest. You don’t have to be a genius to see this would do more good.

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alister
> other than to add to their palmares

I learned an interesting, though obscure, word today:

palmarès: a list of races a (bicycle) rider has won. (French, meaning list of
achievements or list of winners).

~~~
jdmitch
I don't think it's that obscure in British english usage, even outside of
cycling contexts (source: American living in the UK)

~~~
FabHK
Interesting. It's not in the Oxford Dictionary of English powering the
Dictionary bundled with macOS, and it's not known to dictionary.com, so I'd
say it's fairly obscure.

[http://www.dictionary.com/misspelling?term=palmares](http://www.dictionary.com/misspelling?term=palmares)

