9 ms·

"Even if you'd eventually make $50m, your life wouldn't change much from a net worth of $14m to $50m. You could buy a nicer jet?" I know you're kidding around

"Even if you'd eventually make $50m, your life wouldn't change much from a net worth of $14m to $50m. You could buy a nicer jet?" I know you're kidding around here, but all kidding aside, whether your net worth is $14M or $50M, you can't afford a jet. (I mean, nominally speaking, you can front the sticker price -- but you'll get eaten alive on fuel and maintenance over the jet's useful lifespan, and the jet as an asset is depreciating all the while.) I say this almost as a reflex. I used to work in talent management many lifetimes ago, and I'd actually find myself having this talk with people in this specific situation. Explaining to someone who just made $10M on a single movie that s/he can't afford a jet is a surreal experience. Sorry for the tangent!

mrfusion 9y ago
Would a small helicopter make more sense?
- secondmod 9y ago
  Will bunch of Cessnas do? 50k to 150k per plane https://www.globalair.com/aircraft-for-sale/Cessna-172 https://www.globalair.com/aircraft-for-sale/Cessna-172
  - kevan 9y ago
    You don't even need a $500k net worth to afford a Cessna. Most guys I know that have them are firmly middle class. They have to make some compromises on houses and cars, but it's worth it to them because they love to fly.
    - lphnull 9y ago
      brb, launching cesna uber startup for rich folk.
      - JoeMalt 9y ago
        Somebody was asking about this on Reddit (/r/flying I think) a few months back. Short answer is that the FAA does not take kindly to receiving payment if you don't have a commercial license, and if you do then there's better work out there than Uber-for-cessnas.
      - sheppyc 9y ago
        https://en.wingly.io/ https://en.wingly.io/ Not allowed in US though.
- pfarnsworth 9y ago
  I worked with one of the cofounders of Intuit. He has what he described as the "Honda Accord" of helicopters. If someone worth many hundreds of millions only has an average helicopter, you probably need many tens of millions for a small helicopter.
  - cialowicz 9y ago
    I'd say that an R44 is the "Honda Accord" of helicopters, and they're around $500k brand new. With a net worth of hundreds of millions, I'd expect that he went for something safer (with a turbine), like a Bell Jetranger.
- cialowicz 9y ago
  Maybe a used TBM 850?
- jtraffic 9y ago
  Or this: https://www.iconaircraft.com/home https://www.iconaircraft.com/home
- halbritt 9y ago
  Privately owned aircraft are referred to as "that hole in the sky into which the money goes."
  - MrFantastic 9y ago
    ... and may be your coffin.
samstave 9y ago
I want more of this tangent.
chx 9y ago
At 14M you are already in the territory where a jet card is definitely something you could afford. If I had that sort of money, I would use a jet card for flights within a continent and go first class commercial for intercontinental (and definitely use VIP terminal or at least meet and greet services). But at 50M you might be looking at fractional jet ownership already. There is a difference and it's a big one.
- jonnathanson 9y ago
  Well sure, but OP used the word "buy," and I felt the need to clarify that full ownership of a private jet is really not a great idea until you've got that precious third comma.
- nugget 9y ago
  Let's pretend someone has arrived upon 14 million in after tax net worth (not the case in OP's scenario). You want to be set "forever" and not dependent on working again. You'll probably work, but may not be able to replicate the same financial success you experienced previously, so it's hard to count on future income. There's a debate around what's called the "Safe Withdrawal Rate" which is financial-market speak for: how much of my nest egg can I spend every year and never run out of money, ever? There's some debate about the exact number but I'll use 3% net of investment fees as a solid number. 3% of 14 million is $420k. You've got $420k pre tax to spend. Fortunately taxes on capital income are usually lower than taxes on earned income, so your tax rate will decline and probably end up somewhere in the high 20s. You'll end up with about $320k after tax to spend. Not bad. But not what most people think about as rich, either. I wouldn't be buying jet cards at that level. I'm not saying the money isn't important - to the extent it gives you control over your time in the future (a function of spending habits), it is extremely valuable. But there's often a disconnect between high 7 and very low 8 figure net worth and assumed income/perceived lifestyle that people can live, especially if they stop working or were in a field with one-time exits (some entrepreneurs, retired athletes, etc).
  - xapata 9y ago
    $320k disposable every year is very different from $320k post-tax income. With the latter, you'd probably be stashing nearly half of it away for various reasons. The annual spending of a person drawing $320k post-tax from their investments is more comparable to someone earning about $500k post-tax from work.
weaksauce 9y ago
In a somewhat crude and related note. felix dennis (the week weekly magazine founder) once said, “If it flies, floats or fornicates, always rent it.” Not completely bad advice for most rich people that want to stay rich.
- justboxing 9y ago
  so Felix Dennis is the 'Old Wise Person' refereed to elsewhere in this thread with the same quote? Or is this another one of those quotes like the ones attributed to Einstein i.e. no-one know who said it.
  - weaksauce 9y ago
    It was in his book "how to get rich" or something similar to that title. Half memoir half advice. It's actually a pretty good read... title notwithstanding. I am not sure if he was he originator of that saying though.
    - SyneRyder 9y ago
      The Audible version is extremely good. The narrator makes it sound like Monty Python, which seems to be an accurate tone for the book. It isn't a parody, but it's definitely irreverent and thoroughly entertaining.
      - charlesdm 9y ago
        One of the better books on wealth building I've read. Also very amuzing!
    - jonnathanson 9y ago
      I don't think he coined the phrase, but his book is a strong read for sure.
- jedberg 9y ago
  It's ok to say "fucks" on HN, especially if it's a direct quote (and in this case fairly relevant since he was a fairly crass man).
champagnepapi 9y ago
"If it flies, floats, or fucks rent it." ~ Old wise person.
osteele 9y ago
I dined once with a billionaire and a couple of multimillionaires. The billionaire owned a jet. The multimillionaires were envious of him because they only owned jet timeshares. (If you own your own jet, it's always where you want it, you can decorate it the way you want, and you can leave your stuff in its bedroom and living room. It's like having a pied-à-terre in a city instead of renting a hotel room each time you visit.) The operating cost of a jet that's actually ready at your beck and call also includes its crew. That's maybe another $200k/year, or 4% annual interest on $5M principal, so add another ~$5M to the wealth required in order not to go broke this way. (Disclaimer: I unfortunately have neither the practical experience nor finance knowledge to know if I've used the right fully burdened labor costs and multiplier, but it's going to be in that ballpark.)
- hexadecimated 9y ago
  Such hideously wasteful extravagance, and how sad that these people who are already absurdly rich are still greedy for more.
  - T2_t2 9y ago
    Not really. Buffett bought a jet, after calling it indefensible for years, and actually named it The Indefensible. I reckon it is a good investment for many CEOs. There time is worth FAR MORE to their companies than whatever a jet costs to run, the saved time is invaluable as is the clarity that comes with better conditions when flying.
    - dwaltrip 9y ago
      How much time does owning a jet actually save?
      - bilbobagends 9y ago
        Door to door from NYC to NC is about 4hrs best case commercial and 2hrs private (Teterboro). Longer distance saves less as a percentage.
flamedoge 9y ago
Uber for jets... for millionaires?
jrs235 9y ago
Yep. You're better off just chartering private flights when you need to.
austenallred 9y ago
Nah, you can get a small four or five seater jet (eclipse) for pretty cheap these days - https://www.controller.com/listings/aircraft/for-sale/17875507/2008-eclipse-500 https://www.controller.com/listings/aircraft/for-sale/178755.... Maintenance is expensive, but it's doable. Not saying it's a wise purchase, and not a 747, but my very conservative father-in-law is in that realm and loves flying his jet around (he lives in the middle of nowhere and owns a lot of farms, so it's almost a necessity). All in you're probably looking at $1,000/hr to fly it. But then no TSA... That said, point taken, most people wouldn't buy a jet if their net worth was $15m. I might.
sokoloff 9y ago
If you cleared $10MM on the sale, you could absolutely buy and operate a baby jet (a 501, 525, 510, Premiere, etc, maybe even a 560) without going broke. I'm likely to buy one if I ever crack $7MM. $5MM is a bit too snug I think though to contemplate owning a jet personally (unless it's a business enabler).
Eric_WVGG 9y ago
I’m reminded that when Jobs returned to Apple, he had a weekly salary of $1 — and a $90 million corporate jet.

mrfusion 9y ago

Would a small helicopter make more sense?

secondmod 9y ago
Will bunch of Cessnas do? 50k to 150k per plane https://www.globalair.com/aircraft-for-sale/Cessna-172 https://www.globalair.com/aircraft-for-sale/Cessna-172
- kevan 9y ago
  You don't even need a $500k net worth to afford a Cessna. Most guys I know that have them are firmly middle class. They have to make some compromises on houses and cars, but it's worth it to them because they love to fly.
  - lphnull 9y ago
    brb, launching cesna uber startup for rich folk.
    - JoeMalt 9y ago
      Somebody was asking about this on Reddit (/r/flying I think) a few months back. Short answer is that the FAA does not take kindly to receiving payment if you don't have a commercial license, and if you do then there's better work out there than Uber-for-cessnas.
    - sheppyc 9y ago
      https://en.wingly.io/ https://en.wingly.io/ Not allowed in US though.
pfarnsworth 9y ago
I worked with one of the cofounders of Intuit. He has what he described as the "Honda Accord" of helicopters. If someone worth many hundreds of millions only has an average helicopter, you probably need many tens of millions for a small helicopter.
- cialowicz 9y ago
  I'd say that an R44 is the "Honda Accord" of helicopters, and they're around $500k brand new. With a net worth of hundreds of millions, I'd expect that he went for something safer (with a turbine), like a Bell Jetranger.
cialowicz 9y ago
Maybe a used TBM 850?
jtraffic 9y ago
Or this: https://www.iconaircraft.com/home https://www.iconaircraft.com/home
halbritt 9y ago
Privately owned aircraft are referred to as "that hole in the sky into which the money goes."
- MrFantastic 9y ago
  ... and may be your coffin.

samstave 9y ago

I want more of this tangent.

chx 9y ago

At 14M you are already in the territory where a jet card is definitely something you could afford. If I had that sort of money, I would use a jet card for flights within a continent and go first class commercial for intercontinental (and definitely use VIP terminal or at least meet and greet services). But at 50M you might be looking at fractional jet ownership already. There is a difference and it's a big one.

jonnathanson 9y ago
Well sure, but OP used the word "buy," and I felt the need to clarify that full ownership of a private jet is really not a great idea until you've got that precious third comma.
nugget 9y ago
Let's pretend someone has arrived upon 14 million in after tax net worth (not the case in OP's scenario). You want to be set "forever" and not dependent on working again. You'll probably work, but may not be able to replicate the same financial success you experienced previously, so it's hard to count on future income. There's a debate around what's called the "Safe Withdrawal Rate" which is financial-market speak for: how much of my nest egg can I spend every year and never run out of money, ever? There's some debate about the exact number but I'll use 3% net of investment fees as a solid number. 3% of 14 million is $420k. You've got $420k pre tax to spend. Fortunately taxes on capital income are usually lower than taxes on earned income, so your tax rate will decline and probably end up somewhere in the high 20s. You'll end up with about $320k after tax to spend. Not bad. But not what most people think about as rich, either. I wouldn't be buying jet cards at that level. I'm not saying the money isn't important - to the extent it gives you control over your time in the future (a function of spending habits), it is extremely valuable. But there's often a disconnect between high 7 and very low 8 figure net worth and assumed income/perceived lifestyle that people can live, especially if they stop working or were in a field with one-time exits (some entrepreneurs, retired athletes, etc).
- xapata 9y ago
  $320k disposable every year is very different from $320k post-tax income. With the latter, you'd probably be stashing nearly half of it away for various reasons. The annual spending of a person drawing $320k post-tax from their investments is more comparable to someone earning about $500k post-tax from work.

weaksauce 9y ago

In a somewhat crude and related note. felix dennis (the week weekly magazine founder) once said, “If it flies, floats or fornicates, always rent it.” Not completely bad advice for most rich people that want to stay rich.

justboxing 9y ago
so Felix Dennis is the 'Old Wise Person' refereed to elsewhere in this thread with the same quote? Or is this another one of those quotes like the ones attributed to Einstein i.e. no-one know who said it.
- weaksauce 9y ago
  It was in his book "how to get rich" or something similar to that title. Half memoir half advice. It's actually a pretty good read... title notwithstanding. I am not sure if he was he originator of that saying though.
  - SyneRyder 9y ago
    The Audible version is extremely good. The narrator makes it sound like Monty Python, which seems to be an accurate tone for the book. It isn't a parody, but it's definitely irreverent and thoroughly entertaining.
    - charlesdm 9y ago
      One of the better books on wealth building I've read. Also very amuzing!
  - jonnathanson 9y ago
    I don't think he coined the phrase, but his book is a strong read for sure.
jedberg 9y ago
It's ok to say "fucks" on HN, especially if it's a direct quote (and in this case fairly relevant since he was a fairly crass man).

champagnepapi 9y ago

"If it flies, floats, or fucks rent it." ~ Old wise person.

osteele 9y ago

I dined once with a billionaire and a couple of multimillionaires. The billionaire owned a jet. The multimillionaires were envious of him because they only owned jet timeshares. (If you own your own jet, it's always where you want it, you can decorate it the way you want, and you can leave your stuff in its bedroom and living room. It's like having a pied-à-terre in a city instead of renting a hotel room each time you visit.) The operating cost of a jet that's actually ready at your beck and call also includes its crew. That's maybe another $200k/year, or 4% annual interest on $5M principal, so add another ~$5M to the wealth required in order not to go broke this way. (Disclaimer: I unfortunately have neither the practical experience nor finance knowledge to know if I've used the right fully burdened labor costs and multiplier, but it's going to be in that ballpark.)

hexadecimated 9y ago
Such hideously wasteful extravagance, and how sad that these people who are already absurdly rich are still greedy for more.
- T2_t2 9y ago
  Not really. Buffett bought a jet, after calling it indefensible for years, and actually named it The Indefensible. I reckon it is a good investment for many CEOs. There time is worth FAR MORE to their companies than whatever a jet costs to run, the saved time is invaluable as is the clarity that comes with better conditions when flying.
  - dwaltrip 9y ago
    How much time does owning a jet actually save?
    - bilbobagends 9y ago
      Door to door from NYC to NC is about 4hrs best case commercial and 2hrs private (Teterboro). Longer distance saves less as a percentage.

flamedoge 9y ago

Uber for jets... for millionaires?

jrs235 9y ago

Yep. You're better off just chartering private flights when you need to.

austenallred 9y ago

Nah, you can get a small four or five seater jet (eclipse) for pretty cheap these days - https://www.controller.com/listings/aircraft/for-sale/17875507/2008-eclipse-500 https://www.controller.com/listings/aircraft/for-sale/178755.... Maintenance is expensive, but it's doable. Not saying it's a wise purchase, and not a 747, but my very conservative father-in-law is in that realm and loves flying his jet around (he lives in the middle of nowhere and owns a lot of farms, so it's almost a necessity). All in you're probably looking at $1,000/hr to fly it. But then no TSA... That said, point taken, most people wouldn't buy a jet if their net worth was $15m. I might.

sokoloff 9y ago

If you cleared $10MM on the sale, you could absolutely buy and operate a baby jet (a 501, 525, 510, Premiere, etc, maybe even a 560) without going broke. I'm likely to buy one if I ever crack $7MM. $5MM is a bit too snug I think though to contemplate owning a jet personally (unless it's a business enabler).

Eric_WVGG 9y ago

I’m reminded that when Jobs returned to Apple, he had a weekly salary of $1 — and a $90 million corporate jet.