4 ms·

Thought this bit was interesting: "... actors, recording artists, producers, writers, and athletes with personal net worths ranging from $1 million to $50 milli

by godot 8y ago

Thought this bit was interesting: "... actors, recording artists, producers, writers, and athletes with personal net worths ranging from $1 million to $50 million..." I kind of feel bad for the low end of her clients whose net worth is only $1 million. Don't get me wrong, it's a lot of money. But it also doesn't go that far nowadays, especially if you live in SF Bay area (though most of her clients are probably in the LA area; slightly better but not by much). You can't even afford a decent house with cash for that amount of money. I feel bad for the client who has $1m but thinks he/she has a lot of money, and needs to pay a financial adviser (5% even!) to manage it for him/her. In this day and age and in California, if you have $1m, you'd better be working hard still and save up for retirement.

charmides 8y ago
I would guess that those clients are young and with high income, so their net worth may not be that meaningful yet. Otherwise, they would be well-advised to fire their financial manager, take their million dollars and live somewhere less expensive.
- rurban 8y ago
  That does not work, because you are out of work then. Nobody will meet you or call you out of the blue.
  - charmides 8y ago
    That depends on your age and what you do for a living.
    - caseysoftware 8y ago
      Since they're "actors, recording artists, producers, writers, and athletes" they're often in LA, NYC, and a handful of other places that are expensive to live. They usually have to be near their projects, sets, studio, or team for a significant part of the year. We're not talking about remote software developers or launching a new startup here.
      - charmides 8y ago
        I don't disagree, but you are having a conversation about something completely different. This was my comment: >I would guess that those clients are young and with high income, so their net worth may not be that meaningful yet. Otherwise, they would be well-advised to fire their financial manager, take their million dollars and live somewhere less expensive. When I say "otherwise," that means that you are either old or on a low salary. Let's spell that out: i) If you are young, on a low salary, but own a million dollars, you would be well-advised to change careers and move somewhere else, otherwise that million dollars won't last long, especially with an expensive financial manager. ii) If you are old and own a million dollars, you may as well consider retirement. Thanks for your comment anyway, but since I don't feel super invested in this argument, I'm going to end my participation here.
walshemj 8y ago
You normally ignore your first home in these sort of calculations. Even a TV series regular doesn't get a huge amount (when compared to a google engineer) at first - and they normally sign for 5 years
- codingdave 8y ago
  > You normally ignore your first home in these sort of calculations. I was under the impression that you subtracted your mortgage from its value when calculating net worth, not just ignore it. It makes a difference in your life decisions -- In my case, I have a home with no mortgage. I could sell it to move to a cheaper area and end up with enough cash out of the move to fund a new business. It would be a high risk move, but the option is not nullified just because I currently live in that home.
siruncledrew 8y ago
To us, $1M doesn't sound like a lot in areas like SF/LA, but, generally speaking, most nouveau riche in this demographic typically don't even think COL upfront. In the ESPN "Broke" documentary, it was said something like 50-60% of athletes end up broke (essentially back where many of them started). Young, financially uneducated, popular, and newly rich is a perfect storm for wealth mismanagement. If a 20-something actor/artist/athlete lands a lot of money, the first thing they go to is immediate lifestyle "improvement". Fancy cars, nice clothes, luxury amenities. "I'm rich now, so I gotta look the part, right?". Scroll through a few Instagrams of rookies who got their first payday, and you'll see them driving in an S-class Benz with an LV handbag. The novelty of saying "I'm a millionaire now" imprints the image that they will be a millionaire forever - and that short-term thinking is what runs the well dry.

by godot 8y ago

charmides 8y ago

I would guess that those clients are young and with high income, so their net worth may not be that meaningful yet. Otherwise, they would be well-advised to fire their financial manager, take their million dollars and live somewhere less expensive.

rurban 8y ago
That does not work, because you are out of work then. Nobody will meet you or call you out of the blue.
- charmides 8y ago
  That depends on your age and what you do for a living.
  - caseysoftware 8y ago
    Since they're "actors, recording artists, producers, writers, and athletes" they're often in LA, NYC, and a handful of other places that are expensive to live. They usually have to be near their projects, sets, studio, or team for a significant part of the year. We're not talking about remote software developers or launching a new startup here.
    - charmides 8y ago
      I don't disagree, but you are having a conversation about something completely different. This was my comment: >I would guess that those clients are young and with high income, so their net worth may not be that meaningful yet. Otherwise, they would be well-advised to fire their financial manager, take their million dollars and live somewhere less expensive. When I say "otherwise," that means that you are either old or on a low salary. Let's spell that out: i) If you are young, on a low salary, but own a million dollars, you would be well-advised to change careers and move somewhere else, otherwise that million dollars won't last long, especially with an expensive financial manager. ii) If you are old and own a million dollars, you may as well consider retirement. Thanks for your comment anyway, but since I don't feel super invested in this argument, I'm going to end my participation here.

walshemj 8y ago

You normally ignore your first home in these sort of calculations. Even a TV series regular doesn't get a huge amount (when compared to a google engineer) at first - and they normally sign for 5 years

codingdave 8y ago
> You normally ignore your first home in these sort of calculations. I was under the impression that you subtracted your mortgage from its value when calculating net worth, not just ignore it. It makes a difference in your life decisions -- In my case, I have a home with no mortgage. I could sell it to move to a cheaper area and end up with enough cash out of the move to fund a new business. It would be a high risk move, but the option is not nullified just because I currently live in that home.

siruncledrew 8y ago

To us, $1M doesn't sound like a lot in areas like SF/LA, but, generally speaking, most nouveau riche in this demographic typically don't even think COL upfront. In the ESPN "Broke" documentary, it was said something like 50-60% of athletes end up broke (essentially back where many of them started). Young, financially uneducated, popular, and newly rich is a perfect storm for wealth mismanagement. If a 20-something actor/artist/athlete lands a lot of money, the first thing they go to is immediate lifestyle "improvement". Fancy cars, nice clothes, luxury amenities. "I'm rich now, so I gotta look the part, right?". Scroll through a few Instagrams of rookies who got their first payday, and you'll see them driving in an S-class Benz with an LV handbag. The novelty of saying "I'm a millionaire now" imprints the image that they will be a millionaire forever - and that short-term thinking is what runs the well dry.