At what point does money become irrelevant?

[itouchyou]

I have been looking at friends of mine who are in pretty high positions. Account Director, Chief of Product, Vice President @ Investment Bank, etc. These guys live in SF or NYC and their salaries are all $300-$500k. Meanwhile I'm working remotely making a mere $175k in comparison. We are all 34-35 years old.

Comparison is the thief of joy - while these guys didn't get to where they are without struggle, they're living a different life (I assume).

It makes me question, what are they able to do with their money that I'm not? I might be dating a doctor soon and I realized collectively if we married we would be pulling in $425-$500k. Crazy to think about, but even at my current income levels I'm able to afford expensive watches, cars, clothes, eat out, etc. Even if I dated a simple girl making $125k/year we'd still be pulling in $300k.

Does the money just become savings at that point? Does it significantly improve one's lifestyle? All I can think of is that at a certain point all you really get are bigger homes in better neighborhoods and potentially better vacations.. but I'm just not seeing what else it affords.

I ask because I'm not challenged in my career and am thinking of jumping to something else to reach higher income levels, but I have a feeling the juice isn't worth the squeeze at that point.

 

[Scaramouche]

Hi Touchy,
Like many I was once addicted to the Money Machine....Sure made a lot of Mazooma,then
my middle Son was diagnosed with Bone Marrow Cancer (A.M.L. Leukemia)...Sure changed my priorities!

 

[jaygreenb]

I have been looking at friends of mine who are in pretty high positions. Account Director, Chief of Product, Vice President @ Investment Bank, etc. These guys live in SF or NYC and their salaries are all $300-$500k. Meanwhile I'm working remotely making a mere $175k in comparison. We are all 34-35 years old.

Comparison is the thief of joy - while these guys didn't get to where they are without struggle, they're living a different life (I assume).

It makes me question, what are they able to do with their money that I'm not? I might be dating a doctor soon and I realized collectively if we married we would be pulling in $425-$500k. Crazy to think about, but even at my current income levels I'm able to afford expensive watches, cars, clothes, eat out, etc. Even if I dated a simple girl making $125k/year we'd still be pulling in $300k.

Does the money just become savings at that point? Does it significantly improve one's lifestyle? All I can think of is that at a certain point all you really get are bigger homes in better neighborhoods and potentially better vacations.. but I'm just not seeing what else it affords.

I ask because I'm not challenged in my career and am thinking of jumping to something else to reach higher income levels, but I have a feeling the juice isn't worth the squeeze at that point.

Money just to consume more isn't very satisfying other than some quick dopamine hits. This is why you see people in those income levels accumulating very little in net worth and ratcheting up to bigger liabilities like slightly nicer homes, cars, vacations as income increases. Every level you climb you will find a different group of people above you that you try to keep up with. It is an endless hamster wheel. I would suggest looking at money as a tool to acquire freedom and live a life you enjoy. You can do this by acquiring assets over time. Its a trap to associate material items with overall life enjoyment. Find things you actually like doing and not just a social flex.

 

[Bible_Belt]

It's Maslow's hierarchy of needs. You need enough money to meet your needs, but beyond that it doesn't do much for you.

 

[itouchyou]

Money just to consume more isn't very satisfying other than some quick dopamine hits. This is why you see people in those income levels accumulating very little in net worth and ratcheting up to bigger liabilities like slightly nicer homes, cars, vacations as income increases. Every level you climb you will find a different group of people above you that you try to keep up with. It is an endless hamster wheel. I would suggest looking at money as a tool to acquire freedom and live a life you enjoy. You can do this by acquiring assets over time. Its a trap to associate material items with overall life enjoyment. Find things you actually like doing and not just a social flex.

Well the guys I'm talking about aren't dumb with their money - I'm sure they spend intelligently. However, I'm just curious where that money actually gets spent. Is it really just more savings at some point? I know that one of the things they would be spending more on is rent and food, but beyond that I don't see anything productive to put that money towards except investments.

Even then, the idea of retiring by having lots of money in my 30s/40s doesn't appeal to me either, I would rather work as a result of having a purpose to my work rather than as a means to retire.

 

[Pierce Manhammer]

When I was married between my spouse and I we made ~750k US a year full comp, base salaries amounted to ~525k.

I out earned her by almost 6 figs.

I left that career to pursue my current one which pays a fraction of the aforementioned, I am 1000% happier.

 

[itouchyou]

When I was married between my spouse and I we made ~750k US a year full comp, base salaries amounted to ~525k.

I out earned her by almost 6 figs.

I left that career to pursue my current one which pays a fraction of the aforementioned, I am 1000% happier.

Did you do anything with that money that you couldn't do on half of it?

 

[Redwood]

To me, it depends on what type of circumstance we're put in.

 

[Pierce Manhammer]

Did you do anything with that money that you couldn't do on half of it?

Yes, new German cars every few years, 3 week vacations yearly, two vacation homes (not condos), and just about anything we wanted otherwise. Deep 401ks etc.

 

[jaygreenb]

Well the guys I'm talking about aren't dumb with their money - I'm sure they spend intelligently. However, I'm just curious where that money actually gets spent. Is it really just more savings at some point? I know that one of the things they would be spending more on is rent and food, but beyond that I don't see anything productive to put that money towards except investments.

Even then, the idea of retiring by having lots of money in my 30s/40s doesn't appeal to me either, I would rather work as a result of having a purpose to my work rather than as a means to retire.

I think you might be surprised how bad the personal balance sheets are for some people considered smart and successful. 500k a year after taxes in a major metro area with a nice house, a couple luxury cars, a stay at home wife who likes to shop, maxxed out 401k, a couple kids in private school and eating out often. You can easily live basically close to check to check. You also need to factor in because they have such a high level of liabilities they need much more saved to get that freedom.

Just a personal observation as well. Just because someone is highly skilled in one area(career) it does not mean you know what to do with that money. Completely different skill set and takes a lot of time and experience to even try to get outsized returns. Almost worse since they are successful in one area that have an ego that it translates to another

 

[EyeBRollin]

Depends entirely on what you do with it. Tipping point for me as a single person was at 75K. Once I past that I had some freedom to save and do shvt.

 

[BeExcellent]

Agree with what others have said here. For me I wanted to buy my freedom and provide for my family simultaneously.

I’ve got the 6 figure income and the million+ net worth already. I drive a luxury car, which I have not to impress others but because going 125+ with the top down from time to time is fun. The car is for me (it’s comfortable for 2 but the backseat is a luxurious after thought, lol.) And my guy and I make combined around 500K.

I have friends and people I know who are worth tens or even hundreds of millions, they can afford most anything in a material sense, a yacht, a 40M SF house near the Battery, second homes, investments, you name it. It’s just stuff. I collect Art & love good jewelry and well curated nice things, but it’s still all just stuff.

My philosophy has always been to buy quality things because I like them, take care of them, and keep them. I also like timeless things that are designer but not logo adorned. I have several pairs of Gucci or Prada shoes that I bought 20+ years ago, worn them everywhere including walking all over NYC, had them resoled, still wear them & still get compliments on them. Ditto expensive timeless dresses & blouses.

We both work remote and have business travel, which we combine for pleasure as much as possible. I’m on a flight to MIA right now for a meeting tomorrow there. My guy is in FL on business already this week so he’s joining me in MIA and we’ll stay the weekend with 2/3 expenses picked up by business.
We have gear for skiing, gear for his sport, and travel for those things.

And two of my kids are grown & Ive given them each an entry level car & an education including private schools.

I’ve got an income real estate portfolio and could retire tomorrow altogether but at a reduced lifestyle, so I’m still working (but with a satisfactory arrangement) until I can truly afford my current lifestyle outright and have finished paying for college for my kids.

It is all about your personal priorities and quality of life. We live in a consumer driven lifestyle in the West. There’s always a new “it” thing. So what.

Your life is defined by the experiences you have and the quality of your relationships, friends, family, lover, etc. It’s not about things. Having money can buy you freedom & experiences, so it’s a great tool wielded wisely.

But to pursue it for sake of money alone is an empty pursuit, it’s an ancient issue, and is addressed in ancient religious texts including the Bible for that reason.

Food for thought.

 

[Sigmapocalypse]

I work part time 25 hours a week and take home 2k a month. I am what amounts to retail management. However I also currently own 2 vehicles, acreage and land, have a double digit savings as well as alot of physical assets.

I did my best with my $ the last decade so I am in a low level comfortable position. In comparison to guys banking 400k a year in nyc or even a guy like you making 175k working remote, then I must be considered a broke piece of trash. LOL

I do feel that with the right moves made I could be banking like that, my priorities have mostly been dedicated to leisure, fitness, scholarly activity with study and reading and research as well as just focusing on living life and not selling out to career. I have always worked and been in management position making 40-50k a year for the last decade. I guess ive been building up slow.

I think resources matter more then money. If youra city dweller banker with 700k in the bank in a nice condo, what are you going to do when the grid collapses or there power outage or war or civil unrest. all that money is just numbers in a computer.

you only really ever truly own what you have physically and what you can defend. If your identity gets hacked and your bank accounts are depleted or you lose that crypto, its nothing its in the ether, vapor.

 

[FlexpertHamilton]

I used to hear that any additional earnings past $70k doesn't produce additional satisfaction/happiness...but that figure is outdated. Adjusted for inflation I believe it's around $120k or so, which I think is a reasonable goal. Crazy thing is that $120k isn't even that much nowadays...

 

[jaygreenb]

My philosophy has always been to buy quality things because I like them, take care of them, and keep them. I also like timeless things that are designer but not logo adorned. I have several pairs of Gucci or Prada shoes that I bought 20+ years ago, worn them everywhere including walking all over NYC, had them resoled, still wear them & still get compliments on them. Ditto expensive timeless dresses & blouses.

Completely agree with this and wish I learned this lesson a little sooner. Anything you use frequently or over an extended period you will be served well to spend a little more up front and learn to properly maintain it. I have worn dress shoes every day for work for the past 20yrs. I used to buy department store shoes for around $100 and have to replace them every 6 -12 months. A while back I started buying higher quality shoes that can be resoled, usually in 300-600 range. With proper maintenance like using shoe trees and taking care of the leather, they can literally last forever. Just got a few back from being resoled, with the patina they are better than new. I have the same philosophy with cars, tools, furniture etc. Also something to be said about the appreciation you develop for something when you take the time to really take care of it.

 

[Kotaix]

Well the guys I'm talking about aren't dumb with their money - I'm sure they spend intelligently. However, I'm just curious where that money actually gets spent. Is it really just more savings at some point? I know that one of the things they would be spending more on is rent and food, but beyond that I don't see anything productive to put that money towards except investments.

Even then, the idea of retiring by having lots of money in my 30s/40s doesn't appeal to me either, I would rather work as a result of having a purpose to my work rather than as a means to retire.

There is a threshold where you achieve what can only be called fvck you money. That has a power all it's own when it comes to your freedom.

 

[jaygreenb]

There is a threshold where you achieve what can only be called fvck you money. That has a power all it's own when it comes to your freedom.

If you do not have any or very minimal debt, that amount doesn't even need to be that high. Takes some discipline to hold off on debt to acquire some items when young but as you get older becomes a little easier. Those dreams of lambos when young seem to dissipate for most when you actually reach those levels financially. You lose that insecure need to flex.

 

[BadBoy89]

I have been looking at friends of mine who are in pretty high positions. Account Director, Chief of Product, Vice President @ Investment Bank, etc. These guys live in SF or NYC and their salaries are all $300-$500k. Meanwhile I'm working remotely making a mere $175k in comparison. We are all 34-35 years old.

How does a 35 year old man know the salaries of his friends across the country? Very strange.

Chief Of Product isn’t a high position.

What you mean, “etc”? Very strange,

 

[Redwood]

There is a threshold where you achieve what can only be called fvck you money. That has a power all it's own when it comes to your freedom.

I can't wait to get to that level , throughout all the speedbumps of course...

 

[itouchyou]

How does a 35 year old man know the salaries of his friends across the country? Very strange.

Chief Of Product isn’t a high position.

What you mean, “etc”? Very strange,

Because we talk.. and even if we didn't, salary information for such jobs is easy to estimate based on area/title.

Not sure what you mean about Chief of Product not being a high position. That's pretty much at the VP level.