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When $1 Million Isn’t Enough

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Want to know how to make $1,000,000 a year and be stressed about not having enough? Read this post from one year ago by James Altucher about his friend Mike. It’s a quick read, very enlightening, and worth checking out (as is much of Altucher’s stuff). I’ll be here when you get back.

If you were like me, you probably started the article thinking – “Hmmm… I can’t wait to see why this guy is just getting by on a million bucks a year.” A million dollars is a lot but New York City is an expensive place, but a million dollars should still easily get your head above water right? Well, it is unless you inflate your lifestyle to match your salary. Then you get put on those self-imposed golden handcuffs, forcing you to work harder and longer (he can’t quit to make $250,000 because he’s committed himself to too many expenses like the $5,000 mortgage, the Hampton’s home, all the private education, etc).

Near the end of the article, I felt bad for the guy. The top line number, a million dollars, looks great but once you start itemizing everything out, the number is much smaller. Half goes to deferred stock, which vests over five years and he may never get; and half of what’s left goes away in taxes to the Treasury/IRS, the state, the city, and probably some to FICA, though that’s just a small sliver. It makes me realize that when the media says Joe CEO gets paid $xx millions of dollars, they don’t just get a wire transfer into their bank account for that amount.

The part where I went from feeling “he did this to himself” to “man that stinks” is when Altucher talks about what they used to do fifteen years ago during a simpler time. Before the 70+ hour weeks and the soul-crushing stress that comes with a $1 million year.

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16 Responses to “When $1 Million Isn’t Enough”

  1. Shirley says:

    That was a sad and troubling commentary on over-spending, over-working and living beyond your means. It’s further proof that money does not necessarily buy happiness. Peace of mind and a relatively stress free life are worth more than a million dollars a year to me.

  2. cubiclegeoff says:

    I have no sympathy. He has to work hard like everyone else to get by, but he has a lot of extra expenses that are not necessary. I can’t feel bad for someone that complains about a rental in the Hamptons and spends $140,000 for their children’s private school and other activities.

    • partee875 says:

      I agree, he can cut back on a lot of stuff very easily. 50k for his rental because his wife wants to upgrade? I can understand about the apartment situation and if his children’s education is a high priority – that’s fine. But that 50k right there could save him a lot of stress. He works for his money so I respect that and I’m sure he earns that 1 million. But everyone has expenses and priorities and his are no different from anyone else.

      • Courtney says:

        Yep, I don’t feel sorry for him either. He still has as much money leftover AFTER private school, rental upgrade and McMortgage every month as we have in just take-home pay alone. Oh and that cool half-mil he’ll take home in 5 years? He’ll only pay 15-20% capital gains tax on that since it’s not ‘income’. Sorry, you make choices about what to spend your money on, just like everybody else. You get to make a lot more choices than most of the country.

  3. Jesse says:

    Don’t feel sorry for him at all. He gets half a million if he stays at his current position for five years but doesn’t want to stay there for that long? Boo hoo hoo. What a horrible problem to have. I don’t know how this guy even gets out of bed every morning. [/sarcasm]

  4. David says:

    Pretty much wha everyone else has said. The man has choices, even if he can’t see them. I’ll save my sympathy for a family of 4 in New York getting by on $25,000 a year. Also, sounds like he has a pretty useless wife- doesn’t work inside or outside the house, but still needs a therapist?

  5. Anonymous says:

    wouldnt even read the article….anyone who cant live on a million and spends foolishly deserves no time to read or feel any sympathy.
    try living on 30k a year and write a better article worth reading.

  6. freeby50 says:

    ZERO sympathy. None. YOu can’t possibly make more than 99.999% of the world and whine about how bad you have it.

    The total income tax bill would not be over 40%. Even in NYC with city, state and federal taxes. The bill is likely much less than 40% given deductions.

  7. JoeTaxpayer says:

    As soon as saw half was deferred, I knew it would end badly.
    Look at his spending, of course he’s not happy. I’m actually sympathetic, not for his unmanageable situation, but his stress. His two shrinks should help him re-evaluate his lifestyle. You take ‘just’ the $500K, and pretend you ‘only’ earn $400K, budget just that, and you’ll live better than most.
    My family income is a fraction of his, but I’d not trade our lives, 70 hours a week? In my daughter’s 13 years, I’ve missed one basketball game and not one dance recital. On my death bed, I’ll be thinking about every minute I spent with my wife and daughter and not counting my money.

  8. cdiver says:

    pardon my french but what a little bit*@

  9. My feelings toward people in those situations are no different than those toward people who leave well beyond their means making $20K, $30K, $40K, etc.

    No matter how much you make, you can always overspend. We have plenty of Hollywood examples of people making a LOT more money, and still going bankrupt.

    I used to be shocked to see people living so far beyond their means, but it is much more understandable when we look at the outside influences that encourage the behavior. Our government operates with the same spending habits, we barely (if at all) teach any personal finance in schools, and we are constantly bombarded with commercials and marketing, designed to convince us that we “deserve” the newest, coolest things.

  10. I think it is a damn good thing that half the million dollars is deferred. If they gave it to him, he’d find some way to spend like upgrading the apartment.

    What’s the deal with the Hamptons place anyway? It’s $50,000 for the summer and his main residence for the whole year is $60,000? I think it’s time to drop the Hamptons place and maybe take a couple of weeks of vacation like a normal person.

  11. JoeC says:

    I might have a touch of sympathy if it was a working couple in the nyc suburbs with a gross of $150k paying the higher cost of living of the metro are, major league taxes compare to other areas, paying for a monthly commute of about $1,000 a month and if they’re really lucky some one to sit the kids from the family who’s thrilled about it. Don’t count the cost of 3 1/2 hours wear and tear daily from the commute. (my experience is common, less than $150k-a lot- and i have to listen to this whining. No doubt wants me to keep paying his taxes and i ll never get $$ in deferred stock or options. Far better to have deferred stock and its tax advantages than whine.

    then, there’s the $60k for the main residence. sound high? why is he getting off so cheap and not commuting. A family house in westchester – just the taxes can easily pass $2k a month. Find a family apartment in Nyc for a whiner like that, try 7-8 k – and he can spend $17k a month for the hamptons. Plus i-m sure the credit card bill for hanging out.

    it sounds like he has a big break on housing as it is. Maybe he ought to grow up and stop complaining -as lazy says live like a normal person. Poor little rich boy. I can sympathasize with those who have less and don’t complain as much or buy a political party’s agenda just to have a lot more than a lot.


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