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When $1 Million Isn’t Enough

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 [3] 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.