* Has your life changed in unexpected ways?
* Has there been any change in the way you interact with strangers?
* Has the number of things you have to endure increased or decreased?
* And is "FU money" all its cracked up to be? e.g., is your life an order of magnitude more enjoyable now, or is it pretty much the same etc?
Life doesn't get an order of magnitude more enjoyable, because you
still can't buy your way out of the most serious types of problems,
but a lot of annoyances are removed.
The best part is what I thought would be the best part: not having
to worry about money. Before Viaweb I'd been living pretty hand
to mouth, doing occasional consulting. It felt like treading water,
in the sense that while it wasn't hard, I knew in the back of my
mind that I'd drown if I stopped. Getting rich felt like reaching
One thing you learn when you get rich, though, is how few of your
problems were caused by not being rich. When you can do whatever
you want, you get a variant of the terror induced by the proverbial
blank page. There are a lot of people who think the thing stopping
them from writing that great novel they plan to write is the fact
that their job takes up all their time. In fact what's stopping
99% of them is that writing novels is hard. When the job goes away,
they see how hard.
This resonates. I quit my dot-com job before the bubble burst and I had order 10^4 dollars in my bank account. I decided that rather than invest the money in an apartment house, or pay off debt from college, I would take some time off, and just... see what happened. I had enough money that if I wanted to get into e.g. videography, I could go out and buy a nice video camera and a computer to edit my movies (storage was a lot more expensive back then, no way to do this sort of thing on an iPhone!). If I wanted to get really into mountaineering, I could buy a bunch of gear and go wild. This was a first for me, my family and I had always been pretty broke as I grew up.
And what happened? Well, I rediscovered my enjoyment of life drawing, and went to some open sessions, the kind where you pay $10 and everybody draws from the model. And I hung out with friends a lot, and basically re-socialized myself to learn how to relax and have a good time with people. And I ate out a lot, and I partied, and I horsed around. Oh yeah, and I discovered that I really like to run in the woods, up and down hills on narrow trails.
But essentially, there was no 'passion' uncovered by that freedom. I discovered my passion when I went back to work. I was sick of programming for money, so I got a job in a molecular neurobiology lab. And that was 9 years ago, and I've been busting ass and totally engaged with science ever since.
FU money would be great, but in some ways I feel I already had an experience of it -- or at least, of some of the more interesting things that can come of it. I do feel like I'll drown if I stop treading water, it would be nice to be rid of that sensation.
I assume it means what it says. Tens of thousands of dollars in the bank. Nice to have, but far from FU.
It let me move across the country and not work for a couple years. Which was nice, and really it's ultimately been life changing what with a new environment, but it wasn't transformational or anything.
1) Shopping. For a few extra bucks, most large grocery stores will deliver.
2) Laundry. Pay a service to pick up / clean / drop off your clothes.
3) Travel. For long distances, fly first class (far more comfortable), or charter a plane (no TSA experience!). For in-city, take a cab.
4) Dining. Not in the mood to cook? Eat out whenever you want.
5) Taxes. Pay someone else.
6) Housecleaning. Hire a service.
7) If you want to get marginally obnoxious about it...never wait in line again. Just carry a big wad of cash and, if you find yourself stuck at the back of a long line, go to each person in turn and say: "I'll give you $50 (or whatever) for your place in line."
Then of course there are opportunities that aren't available until you have FU money:
1) Travel. A lot. To exotic places that you could not otherwise afford.
2) Invest your money better. Many financial instruments (e.g. hedge funds) are available only to rich people; normal folks cannot invest in them, which means they cannot achieve the same level of returns. This is one of the reasons the rich / poor gap keeps increasing.
3) Live in whatever neighborhood you want.
4) If you have really serious FU money, pay your local telecom to sling an OC-3 line into your house, even if it means paying off the city to dig up the street.
You don't need anything like FU money to hire a cleaning service to come in every one or two weeks. Any normal salaried job puts you into range. I've seen house-sharing students pool their money together to hire one to clean their shared living areas rather than fight over whose turn it is to scrub the bathtub. It also forces you to tidy up on a schedule, as most cleaners won't move stuff to clean.
After food, accommodation and broadband, I can't think of anything out of my paycheck that gives me more bang for my buck in terms of quality of life. I would definitely pass up a new TV or better car or most material consumption in order to have a cleaner.
1.) FreshDirect - $99 a year for free grocery deliveries
2.) Any corner dry cleaner - $10 a week to drop off two loads of dirty laundry on the way to work. Your doorman will have it when you return that night.
3.) Your company buys you refundable tickets when you have to fly, which I argue is more stress-relieving than 1st class tickets
(Dining and Taxes need no explanation)
6.) Whatever maid your doormen / super recommends - $60-90 every two weeks. A bit steep, but playing The Sims made me realize cleaning service is worth it.
7)Having a local farmer's market deliver a basket of fresh vegetables to you every two weeks.
Having money makes you realize you actually didn't need as much of it as you thought you did.
Here in Tokyo a supermarket will charge about U$5 for delivery. I imagine the fee wouldn't be very different in North America. Hardly FU money. (Actually the delivery fee is waived for purchases over $50, so I buy groceries once a week and never pay for delivery.)
2) Laundry. Pay a service to pick up / clean / drop off your clothes.
6) Housecleaning. Hire a service.
These are very cheap in the Third World. You can make a living as a remote freelancer out of Mexico, Brazil, Argentina, Thai, etc. Of course most people don't want to move to Third World countries buy hey, it's way easier than ever getting FU money. ;-)
4) Dining. Not in the mood to cook? Eat out whenever you want.
I don't cook and I spend less than $22 a day for food. Not very frugal but again not even close to FU money.
5) Taxes. Pay someone else.
Filling my taxes used to take 5 minutes per year. Now that my name and address are pre-printed on the form, it takes me about 1. Everything else is done by my company.
On taxes if you make over 50k a year you should have a tax professional and not H&R Block or worse yet yourself. I resisted this for years and lost a lot of money because of fear that a CPA would be expensive. A good CPA pays for themselves. When I finally broke down and went to one it cost me $1600 for my personal taxes and I gains 10K over what I could find. He also refiled my last two years (I think it was 2 its been a while) and got me some more money back.
I saw something on HN a while back called the permanent portfolio which looked simple and conservative (25% stock, 25% bonds, 25% gold, 25% cash) and was curious if any rich folks out there are using that in practice.
Non-expert investors should basically just buy index funds and hold them, transitioning them slowly to less volatile bonds as they get older and are more vulnerable to risk.
Haha, so true. As a software engineer one might expect writing a book to be easy by comparison, but once you actually start working on it, you find that writing a good book is anything but.
Your answers to this are going to affect how much money is "FU money" for you.
If it means not having to work, you might also consider why you need to live in Silicon Valley. It's not a particularly great place to live other than the job opportunities, and a million dollar house there costs a fraction of that in most of the rest of the country.
Also, can I ask if you experience is first hand? If not, be careful with appearances. I just recently discovered that someone I've known for years has significantly more money than their lifestyle would indicate. Not everyone lives extravagantly just because they have money.
My experience with $5M is in fact firsthand, and it feels a lot closer to "middle class" than to "rich". Maybe it's because I live a non-extravagant lifestyle and I just need to buy myself a Ferrari :-) But seriously, what I'd like is to find out from people who actually know, if there's a financial level at which life changes qualitatively. E.g. is there a level at which it makes sense to stop working and spend your time managing your charitable foundation and hanging out at TED and Davos?
Not that I know from personal experience, but my best guess on that level of wealth would be 100s of millions. That's a different level of existence.
I know plenty of people with millions, they seem more or less ordinary, though their leisure activities exceed the norm. The couple of people in the 10s of millions range that I'm somewhat acquainted with have very nice living environments (think estates), but don't have foundations. The one person I know with foundation/ted/davos is in a family with the 9 figure range.
Don't really know silicon valley folks, though.
At least in the valley, most people still live below their means. I find that on the East Coast and Southern CA that those with expensive lifestyles are usually heavily burdened by debt. There are many many wealthy people in the valley who live in simple apartments and walk everywhere, not needing the flashy car or flashy clothes to justify their existence and place in society.
Having said that, there are an extraordinary number of genuinely wealthy people in Socal. It's odd at times.
I work with a lot of doctors that make $200 - $300k a year. And, I'd say that makes the comfortably upper middle class in the Bay Area. Couples where both are nurses can make $250 a year without working very hard.
Salaries at those levels make it very feasible to buy a house and take a nice vacation or two to Hawaii, Thailand or Europe. They drive nice cars and have lovely electronics to play with.
Do people treat you differently? Perhaps they are not as nice?
Most of you reading this site is either working extremely hard to get FU money or has it already. If you're not prepared for it, it will just amplify your worst nightmares and habits, and there's a good chance the meaning of many things in life, including life itself, will disappear. Plan for a use/purpose for the FU money.
The journey is sometimes better than the destination, so make sure that once you arrive at the destination, it is only one stop of a longer journey. Here's a story of a millionaire who liked the journey much more than the destination, so gave away all the money to restart the journey.
After you've bought/rented all your material wants, you will feel an empty feeling and ask yourself, "that's it?", unless you have a purpose greater than yourself. Belong to a higher cause, whether it's joining a local non-profit or helping others (or start a yc? ;-). Money is a means to an end, not the end itself. Beyond buying power, money has no value unless it is used/invested/earmarked.
Here are some example people who were unprepared and how they used their FU money:
EDIT: Not sure why I'm being downvoted. Yes, we can talk about the great positives of FU money and the awesome power/material good it brings, but not about the potential downsides it'll bring if you don't keep it in check or plan for it in advance? For what it's worth, I've started several companies, each did well, and the points I've raised above were important for me (for belonging to a higher purpose, I sat on the board of a non-profit and helped raise money). There was a time when I thought I reached my "destination", only to feel that I had arrived at an deserted island.
"Money is like gasoline during a road trip. You don't want to run out of gas on your trip, but you're not doing a tour of gas stations. You have to pay attention to money, but it shouldn't be about the money.”
Simple money management skills help as well.
That's the problem - assuming the readers are techies.... if I suddenly had my FU money - the last thing I'd want to do is start a technology company, unless it was something I was really super passionate about.
I'd personally rather go back to having my computers as my hobby, and work on my family, other hobbies, travel, maybe learn to write better.... and work on long term financial managemnet so I'll be set for good, as well as my family.
And yeha, maybe a fancy-ish car or two - but the money buys my personal time back- the last thing I'd want to do is dump it into work again...
We only get a short time on the treadmill, better to throw it out the window so the next walker get's a beautiful view.
The problem seems to be if you suddenly have x money, you start to live as if you have 10x.
Rational people usually don't indulge in lotteries.
Among lottery winners there will be disproportionally more people who are going to be really bad with money management.
[EDIT: I will add that IMHO FU money is /not/ a few million USD.]
I know that reality is a lot different. For example you start shopping for espresso machines and instead of buying the nice consumer model you go out and but the commercial model. The consumer model would have suffices but the commercial model is so much cooler looking.
It happen, everyone has something superficial that they are going to buy the top of the line of. For some it is cars for other it is a hobby but, yes this can burn up a lot of cash. I have seen a few though that have turned 2M into FU money, one of them actually decreased their standard of living because, not answering to other people, was the top priority in their life.
But, with a low amount like 2M it has to be your top most priority. Also keep in mind I am in Florida and not the valley so the economics are different. Here even at the peak of the land bubble a decent middle class house could be picked up for 200k and home ownership is a big piece of the FU puzzle.
After that was over, things went pretty much back to normal. There's now a low-level fear all the time of losing all the money (something PG's written about recently) and I'm constantly worried I've invested it badly. I didn't make any dramatic life changes so people don't really treat me differently.
The biggest thing is that it provides a sort of mental backup -- when I'm feeling bad about myself or about to do something risky, I can tell myself not to worry.
My sense is that it bears out what the happiness research says: dispositional factors are much more important than situational ones. PG was an abnormally happy person before he got rich and he's still abnormally happy. I was pretty miserable before and I'm still miserable. (The reasons are more complicated but the result is I prefer my misery.)
I think coming into money is pretty much like losing a limb or experiencing a tragedy. After a certain period of time, the person who has experienced the tragedy goes back to where they were, mentally, before the tragedy. Same with lots of money, eventually they return to their norm.
>(The reasons are more complicated but the result is I prefer my misery.)
Either way, that problem might be solved by a good Psychologist, that you probably should be able to afford. :-)
Aaron's company Infogami merged with reddit before it got acquired by Condé Nast.
I thought that money would allow me to increase my happiness1 by letting me choose what to work on. But it turns out all the things I've chosen to work on pay just fine, so in practice it hasn't really been a big deal. I think this ties in with something pg says above. Basically: if there's something you really want to do, just go do it -- don't wait for the money to roll in first.
In the desert
I saw a creature, naked, bestial,
Who, squatting upon the ground,
Held his heart in his hands,
And ate of it.
I said, "Is it good, friend?"
"It is bitter - bitter," he answered;
"But I like it
Because it is bitter,
And because it is my heart."
While at university I was pretty skint (as students are). Anyway, long story short I happened to "start a company" that never took off but did take the interest of another competitor - who then bought me out (it never came to anything from them - they were "super funded" and had a not-that-good team....).
Anyway; it wasn't a lot of cash considering - but compared to what I was living on...
I immediately went and bought a silly car which ate up petrol and insurance money (tip 1: don't buy a really nice car unless you drive a lot, now I run a 14 year old Peugeot and it is more reliable, economical and fun :)).
This sort of thing (silly spending) went on for about a month until I was stocked up on all sorts of technology porn (in fairness to myself I did splash money on my friends/flatmates quite liberally). I can't exactly remember what made me stop but did eventually realise that I was acting silly ;)
Even when I stopped spending it was hard to avoid buying stuff I saw and trivially wanted - there was no sense of ownership on the expensive items any more (compared to the 32" TV I had bought a few months earlier and saved for for nearly a year) and they never really made me happy.
Long story short; most of it went into Ebay, I put the money into a long term fund and finished up Uni as a poor student.
Two years later the money is still there; I managed to find a job that rocks and pays pretty good (considering). I've got over the need for money/items and have (in my mind) a much nicer outlook on life and "stuff" :)
So, yes, having "large amounts of cash" (relatively speaking) did change me - but not in the way I expected :)
And the best bit is that I have money for a house, wedding ring (hopefully :)), kids etc... in the future if things don't work out.
EDIT: Just to clarify, I'm not saying to be poor. I'm saying that the more your income becomes visible -- past just having a low-key life -- the more it gets in the way of things, both for you and your family.
That can either mean living in a room where they shove a couple pizzas under the door every day or living in a modest 4BR house in a mediocre neighborhood. It's the visibility and the host of hidden entrapments that come with that visibility. What I didn't realize when I was younger that this problem of visibility isn't just limited to how others view your wealth -- it's really more a problem of of you view it.
Kind of makes it hard to work or do other ventures.
I now work from my house, and have 3 small children. The ability to drop what I am doing to seize the moment when the kids are doing something eventful (walking for the first time, speaking there first word, playing video games with them, doing robotics with them) is an amazing freedom and blessing.
We frequently pick up and leave to go places on the spur of the moment, which also provides experiences that my kids would not otherwise have been able to do. The best part is I feel more creative than I have ever felt in my 17 years in the industry and I am far more productive and work longer hours without burnout.
I see a lot of people saying that achieving financial independence did not make them happier and I don't understand it. For me it gave me the ability to create an environment where I could have a more satisfying family life and a more creative work life. It has done wonders for my happiness.
Interaction with other people is more of a i-don't-give-a-shit-who-you-are anymore. Take it or leave it is much easier.
Life is more relaxed - that constant stress of being broke is gone. But there are other problems that come up when some problems go away. Stuff that appeared smaller before (how do I get people to like me, for example), now seem more important.
Wherever you are meeting girls, I want to go there.
My experience in an NJ bar a week or two ago: I was talking with a coder friend of mine about my job. This was a geeky conversation with words like "latency", "queues" and "atomic operations", as well as "lost $BIGNUM in half a second", rather than a manly conversation about "parachuting into darfur to deliver aid." A guido girl at the bar visibly perked up and came over to talk and asked if I was a trader within 5 minutes of conversation.
(Note: I don't have fuck you money, though my casual reaction to losing $BIGNUM might suggest I do.)
Incidentally, Brooklyn is hardly a panacea. A girl in Brooklyn once kicked me out of her apt at 3AM after, while discussing life I accidentally revealed the size of my savings ("enough to travel around India for a few months"). (This was when I was an academic.) While Brooklyn is certainly better than Hoboken, there is no shortage of "artistic" types hoping to meet a guy with enough money that she can live the "bohemian" life without ever suffering materially or worrying about selling her art (and similar stories).
I've always said (though only ever to myself) that rule one of having a lot of money is: never tell pretty girls how much money you have.
It might also be rule one of not having a lot of money.
As the reality sank in, she asked me something along the lines of "how can you only have $XXX [her guess as to my net worth] in the bank?" She kicked me out immediately after I said "I could live for a year on $XXX." Once she concluded I was just a middle class guy, she just said something like "I'd like you to leave, this isn't what I expected."
Maybe I'm not a great judge of character, but I honestly was completely blindsided by this. (I'd have been more annoyed if it happened at 2AM rather than 3AM, of course.)
Specifically, she says she thought it was: "bold," "courageous" and "optimistic." Personally, I thought it was a huge disaster waiting to happen, but better than sticking it out at a job I despised.
When I say latent, it means that you felt more confident for a while before the move already, but it took the move, which brought anonymity, for you to externalize it.
This is why tourists act crazy, and even introverted shy people can act exuberantly on holiday. Or like your case, after a move.
Society has come to view both genders' preferences as shallow, but for whatever reason makes a much bigger deal about it when it comes to women, which is really not fair. They can't help being attracted to a successful guy anymore than we can to a hot girl.
My guess is that in NYC, due to the financial industry guys are more sensitive to it, and as such women respond by being a bit more circumspect.
For whatever reason, the vast majority of golddiggers are utterly dishonest about what they are really seeking. This leads men to get into bad relationships (which they would have avoided if the woman were honest), and they often lose big when their career doesn't turn out the way they hoped or when they want to downsize their job (e.g., quit the $300k/year corporate law job for an $85k/year public defender job).
I've got no problem with that rare girl who openly admits her desire to trade sex for money. I don't want a relationship with her, but I won't condemn her.
[edit: I'll similarly condemn a guy who lies to honest women to get them into bed. I'll giggle when a guy lies about money to sleep with dishonest golddiggers.]
The interesting question is why is it so? Maybe because money-making ability is a somewhat less intrinsic quality. Maybe it's the undeniability of the biological response when you see someone beautiful. Some would call it sexism and leave it at that.
If you'd condemn a man behaving the same way (e.g., making friends in order to use a playstation), it isn't sexism.
Unless appearances are some better indicator of a person's quality than wealth neither is more or less shallow than the other, but one is judged to be moreso. If that's not sexism nothing is.
This is also the difference between gold-diggers and normal women: gold-diggers are conscious of the fact that they're trying to score with rich men.
Would they? Maybe I've just been hanging out with too many women (in a non-sexual context), but they complain about guys that talk to the obviously-prettier girl at the bar all the time. Meanwhile, talking to the more successful-looking of two guys is pretty normal, as long as you aren't blatant about it (eg. asking how much they make).
I think it's more that girls will judge guys for going solely for attractive girls, and guys will judge girls for going for richer guys. Both sexes are shallow, both sexes complain about shallowness in the opposite sex, and most people of both sexes will recognize that basically everyone is shallow - in private. But public discourse tends to feature more males, so we hear more about how golddiggers are evil than about how babewatchers are evil. Either that, or it's just because we're male and girls tend not to share their real opinions for fear of offending us.
Similarly, men are statistically more likely to exhibit violent behavior (and there is an evolutionary basis for this). Therefore, condemning violence is sexism, since the condemnation has a disparate impact on men? Um, no.
One may or may not be a better indicter of long term compatibility.
As rational and moral beings, aren't we supposed to transcend some of our evolutionary instincts?
It's a subtle subconscious leaning. A similar example: doctors routinely prescribe things that get them paid more (for instance neurologists whose practices own their own MRI machines prescribe 4x more MRIs than ones who do not) however when examined under a polygraph, both groups say that the money is not an influencing factor. The money clearly is the difference, they just don't know it.
(FWIW, rape is not believed by most in the field of evolutionary psychology to be a behavior that has evolved into "normal". It's gotten a lot of coverage in the field due to the controversial nature of the idea of rape as an adaptation, but there is no clear evidence for it in anthropology or studies of closely related primates.)
The argument you pose about morality is dangerous. Who defines which of our genetic attributes are ok and which are not? Why is it perfectly fine to have brown hair, but immoral to want a rich husband (if only subconsciously) when you can't help either of them? If anything the latter is universal, the former occasional.
Counter-example to your thesis that women only want money: Musician's that only gets gigs in dive bars, firefighters that receive a municipal-level salary, and tons of bro's you would see at "bro-bars" with no financial prospect but a rabid enthusiasm for alcohol, local sports & Amerrrica.
I'm not saying women aren't superficial. They are just as superficial as men except that they lie about their intentions to preserve their ego for themselves and to others. But that's no reason for men to be resigned about it. There's nothing more sad than a man who accepts the superficial reality of society and proceeds to go about "nest-building" and "peacocking" to attract a superficial trophy wife, and give up his freedom and personal goals in return.
The system is easily hackable and I dare say, men are justified to hack the system as the whole mating-seeking thing is based on deception and dis-ingenuity. And there are tons of literature available online and in print about PUA for anyone who cares to explore that route.
Whereas in NY, yuppie culture surrounds either the high-finance/media-fashion/hipster type, Boston's culture is more on academic/engineering/townie-pride. In some sense, I prefer NYC because at least everyone's honest and at least it's a meritocracy of superficiality. You either gotta make six figures or have the American Apparel attitude and look to be in the group. In Boston, it's more like "of course, we are a open & accepting people," but "oh? you don't go to grad school at Harvard/MIT/BU? You are involved in software/allied health professions and don't have the holier-than-thou attitude? You are not WASP or a white-washed minority and don't drink the vegan-hippie-liberal ethos?" Haven't lived in Seattle/Portland extensively but my own superficial judgment of these two cities while traveling there, is that the latent vegan-hippie-liberal superficiality is even more rampant there.
Maybe girls are evolutionarily wired to seek more "successful" men, and then "success" is defined by the culture surrounding them.
Tech startup founders are a dime a dozen around here. In fact, I've found the best way to get a girl interested is to say "Hi, I'm not a software engineer!"
There are definitely areas of NYC where the predominant culture is, "are you doing something interesting/neat/cool" instead of, "are you working for Goldman Sachs;" be it art, programming, music, technology, food, whatever. The key, of course, is to make what you do sound sexy ;).
In some areas, dropping an employer name like Goldman might even get you scorned.
There are definitely diminishing returns -- being able to afford an occasional meal at a decent restaurant is worth a lot, but being able to buy out the bar every night is not necessarily any better.
Three classics from Quora may be relevant:
I completely agree with the not needing to always watch yourself around others just in case they could potentially 'make your life better'.
Not really. The most unexpected thing is how much the same life is after FU money than before. The main difference is that a lot more people line up to try to take your money from you. One way or another you pretty much have to deal with the same old shit.
> Has there been any change in the way you interact with strangers?
I probably feel a little less insecure, especially when I talk to other people with money. But I don't think anything else has changed, at least I hope not.
> Has the number of things you have to endure increased or decreased?
The number of things I have to endure has definitely decreased. In particular, I don't have to stress out over making the choice between "enduring" a job that I hate or going without a salary. But other problems have arisen to replace those. I call these "nice problems to have", but they are still problems.
> And is "FU money" all its cracked up to be? e.g., is your life an order of magnitude more enjoyable now, or is it pretty much the same etc?
Neither. Life is definitely better with FU money, but it is no panacea. FU money gives you extra options, but the fundamentals have not changed: you are still faced every morning with a choice of what to do with the resources you have at hand. And even FU money has limits. It's amazing how fast you can learn exactly where those limits are.
1. Getting rich makes you more of who you really are. If you're a jerk underneath it all, you'll be a bigger jerk when you hit it big...and vice versa.
2. In terms of problems, you're squeezing on a balloon. It's easy to pay the bills, but a whole new set of problems and hassles will present themselves. It's just a new set of irritants. There's just as much pain, it just comes from different sources.
3. When you can have everything you want, you have to learn to control your appetites. You can't imagine how much crap you buy when you can afford everything. It's surprisingly hard for most people to control their spending once they hit it.
4. You'll turn into the First National Bank of Bill, but your loan standards will be lower...and few people will ever pay you back.
5. Old friendships will wither and some of them will die, no matter how hard you try to maintain them. Jealousy is one reason. Subtile changes in your own personality will be the other.
5. If your pals aren't all in the same boat, and similarly rich, you'll have no one to play with.
In short: Money is a tiger. You master it, or it masters you.
Both Adams and his interviewer knew that the author was about to come into A LOT of money, but he didn't have it yet. The interviewer asked how he expected his life to change and Douglas Adams said one of the most prescient things I've ever read:
"The only thing that money changes is the size of your bills."
For instance, my wife and I always talked about traveling more, but after selling my company, we continued to mainly talk about travel. It's just not something we do a lot, even though money isn't an issue. Meanwhile, I've got friends who managed to backpack around Asia and Europe all summer in college when they were totally broke.
Money doesn't change who you are or how you live all that much.
For example, if you spend hours coding at the computer (because you love it), that is now YOUR choice and it affects how the rest of your family will perceive it because you can no longer claim that you NEED to spend that much time. In fact, if you are not careful, you may end up with your family controlling more of your time than you want.
You also go through a bit of an identity crisis. So much of your identity is tied up in what you do. All of a sudden when you are at your kids soccer game, casual conversation becomes more awkward as people inevitably ask "what do you do?".
Put these together and you clearly need to come up with your next purpose because otherwise you will have a heck of a time deciding how to spend your time.
In the process of figuring out the planning and investing piece I became a CFP and registered investment advisor (more of a multi-family office). I have now seen a number of others go through the transition and can offer the following observations for different levels of FU money.
< $10 million -- The focus stays mostly on the individual and family with the money supporting their pursuits.
$10 - $50 million -- At this level there starts to be a strong pull between wanting to support the family and wanting to create a lasting legacy. The pull from these two directions can create a lot of stress depending on the person's values and the values of the rest of their family (mainly spouse).
$50 million+ -- At this level the legacy becomes the focus. The responsibility of making that money improve the world becomes paramount. You don't see someone with this kind of money deciding to become a math teacher. In this sense, someone with this much money is less free than someone with only $10 million who wont feel as strong an obligation to ensure their money gets put to good use improving the world.
The short answers are yes, yes, decreased, no and different.
The longer ones will take me a bit of time to put together.
1. I laughed when the gentleman said that $3mm would be enough money for him. Anyone who says $3mm is enough will realize that whatever number they say is "enough" is not enough once they reach it.
2. Money doesn't make you happy. But if you're already happy and you have money, it can make you happier.
3. Money makes people pay more attention to you- especially people who didn't pay attention to you before. People will say, "well Barack Obama would never have shown up to your wedding before you sold your company for $1bb". Well no sh!t. Why would he? Charities will call you. "Well the University never paid attention to you back when you were poor". Universities and Charities are in the business of raising money from individuals.. Why would they? This will be tough for people without money to understand.
4. Those who have sold their companies find that money is sometimes harder to hold onto than it was to make in the first place. If you don't have enough money (to never work again), become complacent due to your original ability to make money (particularly those in tech world), you could find yourself broke.
5. Speaking of broke. Minimize your borrowing. The majority of very rich people who suddenly file for bankruptcy are over-leveraged and/or not diversified in their investments. An example: Let's say I have $20mm. I could go to a bank today and get a $40mm house. However, my taxes, upkeep, mortgage, and other lifestyle expenses would likely cause me to deplete my original 20mm within a few years.
6. When you're rich, its very difficult to deviate from an expected lifestyle. Once you spend 60k on a car, 90% of the time your next car will be more. This is true of houses and everything else you purchase. My advice is pace yourself.
1) I view money differently than I did before. Not because I don't have to care about it, because I absolutely do, or it wouldn't last long, but everyday worries around "how can we pay bill X" go away, and are replaced by worries about long term strategy and, at least in my case, not getting caught up in long term strategy. Life goes on.
2) It takes some effort to adjust your thought process with regards to how to treat others. Talking about my exciting trip to europe with my friends comes across to some people as bragging or showing off - and while it's absolutely NOT - it's just me being happy and sharing it with friends - after some time you learn to read people and pick up on this - and remember that money isn't the same thing for everyone, and can be a sensitive topic.
- FU money is no more or less than what you make of it... and it can run out as fast as it came if you aren't careful. Plenty of people are in the "FU" financial stage and don't even realize it, and plenty of people who wish they were there wouldn't do any better - your financial practices largely dictate your long term financial well being - whether you have a little or a lot.
I know a number of people well further into the FU money than me - and I'd say they're an even mix of people who became happier, struggled and are still unhappy, or even worse, or who pretty much just stayed exactly the same (as far as I can tell).
Remember, when most people say they wish they were rich, what they mean is they want the lifestyle they think rich people have - which isn't, in reality, what they envision it to be. (Rap stars on MTV don't sit around smokin blunts surrounded by hotties 24/7 and driving sports cars - they spend time working on new albums, hanging out with friends, and doing the scene)
Eh, this just doesn't ring true to me. I'm pretty sure that everyone I know would do much better with an extra $10M, not the same or worse.
> * Has your life changed in unexpected ways?
One change has been that I haven't worked for the last 2 years and don't plan to in the near future. I love programming so just spent my day working on some hobby projects and watching stocks. The risk is that as there isn't any hard deadline for delivery I end up taking things easy which is not good and probably something I should be changing.
One problem I face is that much of the money is just lying in either accounts or investments so its not really visible - no flashy cars or toys for me. And I tend to be frugal in my living so most people think I am good for nothing and feel bad for my wife. Some of her concerned friends have been asking here when I plan to start working. My wife doesn't have any problem with my lifestyle as she knows about my financial situation.
> * Has there been any change in the way you interact with strangers?
Social interaction is one thing I miss about having a job. It provides a clear structure in which you interact with other people. So my interaction is now primarily with existing friends and family.
If anything, my previously average social skill have probably become below average.
> * Has the number of things you have to endure increased or decreased?
I would say life has started appearing much simple to me. With money not a factor in my choices, I sit around doing exactly what I want to do. As of now I have nothing to show for my last 2 years (except my investments going up but thats a passive activity) but I am hoping that will change in a year or two.
> * And is "FU money" all its cracked up to be? e.g., is your life an order of magnitude more enjoyable now, or is it pretty much the same etc?
I would say that I put up with less crap but its less enjoyable. To explain the contradiction, when my wife comes home from work and talks about "management is making X mistake", "my product was not highlighted in our newsletter" etc, the usual office activities. I understand that but its been a long time (2 years to be precise) since I experienced these things. These basic experiences (good or bad) did keep me occupied and made life interesting. Now with all that gone, its HN, hobby projects, stocks and after that I am pretty much on my own do something that would make me feel worthwhile.
Overall I would say that I am much more comfortable and happier than I was but my social interactions have become pretty minimal which I don't think is good.
In any case, it's enabled me to step out of a regimented life, I'm going back to school for a masters in an interesting field and my hopes of making a significant contribution to the world have not died down yet :). I'm on track to accomplishing some life goals. Social interaction-wise, I've taken up a few language courses and find the people I meet there a lot more interesting than those from my previous life.
All in all, I'd say not having to worrying about money ( although I didn't worry much, earlier either) or the future is very nice and definitely very good health-wise.
I initially had a small startup but that didn't quite work out for various reasons, so for about a year I have been prototyping various projects alone. One thing about the no-deadline situation is that for the last year I have basically been experimenting with different ideas and technologies. I suspect if I have some sort of a deadline I wouldn't have spent so much time on it. But then again maybe the time was well spent as the architecture and ideas are more precise now.
One fear I have is my project becoming a Duke Nukem Forever :)
If you're in an urban center you might want to try a co-working space if one exists.
Everything in digital format, I either could get, or had.
At first, I was extremely excited - and naturally told a few people (who subsequently told a few people) and before I knew it I was the 'go to guy' for anyone that wanted any media.
This experience scarred me. To the point where now I am ultra private and if I get a new album or new movie or something (even through legitimate means) I hoarde it and tell no one.
I have always imagined that this is what getting FU money would be like. Relatives, old friends, etc. would come out of the woodworks...especially once you start spending and travelling, etc.
For those that have experienced FU money, and the transition from not having to having it, can you shed a little light on how your interactions with close family, other relatives, close friends, etc. changed. Did you tell them? Who did you tell and why? Also, who surprised you by the way they view you and your money?
Anything else interesting about how you manage your wealth and why you decide to tell who what, would also be appreciated.
P.S. I have since given up said access, because I got bored and the maintenance required was stressful. I wonder if this is a precursor to unimaginable wealth.
This assumes he was integrated at or near the top. Otherwise, he would be further down the trickle.
Oh...and this was also a few years before and...leading up to the launch of TPB.
Why would having axs to TPB be 'stressful' as indicated in my original post?
I didn't make "FU money" from an exit, but rather from the ongoing success of a couple of online businesses, which have been earning me far more than I know how to spend. When this started happening, my initial reaction was to be perplexed, because I no longer had a financial motivation to get up in the morning and work. Money had been the most salient part of my motivation for as long as I could remember.
But I found that I still wanted to work, and it took me a while to understand why. It turns out there are lots of other good reasons to create useful things that people will pay for, like self expression, connecting to others, a sense of achievement, and a feeling of contributing to the world. The money was still nice but became secondary. Still, it allows me the luxury of working on interesting things that I think people will like, even if I doubt I'll ever make much money from them.
I found that the main challenge of being rich is finding a way to spend the money in a way which contributes to my happiness, rather than detracts from it. This is harder than it sounds. The most obvious way to spend money is to buy an oversized home. But this is a really bad idea. First of all you have to spend a lot of time maintaining that home. But most importantly it will likely alienate your (presumably not so rich) real old friends who are still working daily to pay off the mortgage. How will they feel about inviting you over to their condo when you live in a palace?
The solution I found to the "friend alienation" problem is to spend money on personal experiences rather than visible possessions. You can eat out at fancy restaurants, travel the world and enjoy the best shows without your friends knowing what you're up to, at least not in detail. It really helps if you have a spouse and/or children that you can do this with, since they can make these experiences all the more fun.
BTW this also neatly dovetails with recent research on happiness:
The one rich guy possession I'm allowing myself to buy is a second home in a foreign country that I like to visit often. This will (hopefully) make those visits less hassle and more enjoyable, and again, none of my close friends need to know.
And yes, I worry about losing the money a little, and have taken a self-propelled crash course in personal wealth management. But luckily I find the subject quite interesting anyway, and I don't let myself lose any sleep over a couple of percentage points in yield. In the long run, we all die anyway.
To summarize, getting "FU money" been a net benefit in my life, but it took a lot of careful thought and planning to ensure it worked out that way.
Finally if anyone out there who's suddenly landed FU money is feeling a little disorientated by their new situation, I highly recommend reading "Escape from Freedom" by Erich Fromm, which is a wonderful book about the psychological and existential challenges that freedom brings.
Initially I was broke.
When I got my first real job (after undergrad in India), I felt like I had all the money in the world. In the first few months, I bought myself a nice camera, motorbike, smartphone, gifts for family and my girlfriend, started eating at nice restaurants etc. But then I figured I already had whatever I needed and things I enjoyed most didn't really require any money (except the camera and motorbike, I guess).
Then I quit my job and went to grad school for which I had to pay for (Masters, not a PhD) and went into debt (US schools are sooo expensive), and drastically cut down my expenses (ate cheap Thai food almost every day).
After that I got a well-paying job again, paid off all my loans, and am now back to my earlier lifestyle i.e. I spend on things I enjoy, give a modest amount of money in charity regularly, enjoy the occasional expensive dinner, buy nice gifts for my family and close friends, but I still save a good amount.
I am definitely happier than I would be without any money, but I don't think I would be any happier if I suddenly started earning 2x.
By some people's definition, having 'fu money' means you can tell people to F off without risking your financial security. So... if I'm a homeless and broke person, or someone with really low financial standards - that's true - isn't it.
I understand that people on HN want to be rich; I'd rather see an HN filled with articles that help materially in getting there, not one talking about how great (or not?) it is to be rich.
Imagine the let-down of working your ass off and getting the big payday only to screw it all up because you were psychologically unprepared.