An enviable problem?

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An enviable problem?

Postby scylla » Mon Jan 28, 2013 12:11 pm

After reading a prior post about the Two Comma Club, I decided to take stock of my own situation. I'm 57 years old in advertising, which makes me practically ancient. I worry consistently about "aging out." And, frankly, if I had to do it over again, I would have picked a more stable (and less insane) profession, like medicine.

Through the great advice on this amazing site, plus living well below my means, I've been able to accumulate $4,400,000, not counting the apartment I own. Sounds like a lot, but I live in New York City, where a "starter" two-bedroom goes for over $1.2 million. And due to family and professional reasons, I can't leave to live somewhere cheaper.

Given all that, I don't feel particularly well off. In fact, thanks to some of the insanely wealthy people New York puts you in regular contact with, I feel like I'm just scraping by.

The question is, am I just being neurotic? And can you ever really feel comfortable in a place like New York, unless you're a gazillionaire?
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Re: An enviable problem?

Postby hicabob » Mon Jan 28, 2013 12:23 pm

I know exactly what you mean. The more you have the more you think you need. I found the concept of "enough" is the key. The 4mill can conservatively give you $150k+ of income per year for life + you own your own place - embrace "enough".
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Re: An enviable problem?

Postby coinflip » Mon Jan 28, 2013 12:24 pm

my reading suggests that "well off" is a moving target, requiring approximately twice whatever your net worth happens to be at a given point in time.

you may do better to consider whether you are financially secure, which depends on your net worth and expenses.
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Re: An enviable problem?

Postby VictoriaF » Mon Jan 28, 2013 12:32 pm

scylla wrote:After reading a prior post about the Two Comma Club, I decided to take stock of my own situation. I'm 57 years old in advertising, which makes me practically ancient.


You should create a new advertizing campaign for commas that will be so successful that it will put you into the 3-Commma club.

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Re: An enviable problem?

Postby wjo » Mon Jan 28, 2013 12:37 pm

I am reminded of an HL Mencken quote that goes along the lines of

"A wealthy man makes more than his brother in-law."

Everything is relative -- take more trips out of the city and broaden your comparison base. As long as you have enough to keep your lifestyle going, you'll be fine. NYC is one of those places where there will always be wealthier people....but as you move to retirement, think how nice it will be to get out of the rat race and have the money to enjoy much of what NY has to offer. So much of the culture there is remarkably cheap to access!
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Re: An enviable problem?

Postby ShowMeTheER » Mon Jan 28, 2013 12:41 pm

Very enviable position. I look at it this way - high cost of living area or not - what are your fixed expenses to live there once you hit retirement? Compare that to your nest egg and expected annual draw.

You're probably in a better position than 95% of people. And, worst case, you can sell your apartment and buy an $900K starter piece of junk! (midwest humor)
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Re: An enviable problem?

Postby TSR » Mon Jan 28, 2013 12:43 pm

I have lived in New York and I know what you mean. Keep in mind, however, that the "relative" analysis you're doing works both ways: although there are some very high highs in NYC, there are some very low lows. It sounds like you're doing great and will continue to do so assuming you don't try to keep up with the very high highs and all of their various "needs."
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Re: An enviable problem?

Postby Calm Man » Mon Jan 28, 2013 12:45 pm

You are by no means being neurotic. If you live in NYC, you are quite right. Many choose to move just over the river although it is expensive there too. You are simply going to have to ignore the ultra wealthy to maintain your sanity and they are very easy to avoid at least so far as the restaurants you choose. You do run into them at theaters and ball games but who cares? I certainly would be cautious about the real estate prices as I have seen several shocks after insane increases over the years and it looks like the bankers aren't going to earn as much anymore.
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Re: An enviable problem?

Postby Sam I Am » Mon Jan 28, 2013 1:04 pm

Message deleted.
Last edited by Sam I Am on Sun Oct 06, 2013 3:23 pm, edited 1 time in total.
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Re: An enviable problem?

Postby NYBoglehead » Mon Jan 28, 2013 1:08 pm

As a fellow New Yorker, I know that there are many uber wealthy folks trotting around. But that is not the majority of people and I think that with $4.4 million you are still much better off than the overwhelming majority of us NYC dwellers. As another poster already mentioned your portfolio should provide ~$150k/yr. That is without any social security added to the pot.

At 57 I'm not sure how much longer you plan on working, but when you've got $4.4 million even a year of mediocre returns will still be adding a significant dollar figure to your portfolio.

Trust me, you are doing just fine and I'm sure 99% of us would sign up right now for that kind of balance when we are 57.
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Re: An enviable problem?

Postby Watty » Mon Jan 28, 2013 1:17 pm

I live in New York City, where a "starter" two-bedroom goes for over $1.2 million. And due to family and professional reasons, I can't leave to live somewhere cheaper.



Once you quit working one option would be to move your entire family to someplace less expensive where you would be considered a gazillionaire.

Here is what a $1.2 million house looks like here in Atlanta.
http://www.realtor.com/realestateandhom ... source=web

it has both an inlaw-suite and a guest house if they wanted to live with you. For the relatives that don't want to live with you, you could buy them a nice modest house for around $150K or a McMansion in some areas for as low as $300K.

You could even do something like buy a 1/8th fractional ownership of an apartment in NYC so you or your relatives can visit regularly.

This is only slightly tongue in cheek. :beer
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Re: An enviable problem?

Postby VictoriaF » Mon Jan 28, 2013 1:27 pm

Watty wrote:
I live in New York City, where a "starter" two-bedroom goes for over $1.2 million. And due to family and professional reasons, I can't leave to live somewhere cheaper.


Once you quit working one option would be to move your entire family to someplace less expensive where you would be considered a gazillionaire. Here is what a $1.2 million house looks like here in Atlanta.


Or move to London, observe people with real money, spend some real money yourself, then return to NYC and live happily ever after.

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Re: An enviable problem?

Postby papito23 » Mon Jan 28, 2013 1:40 pm

Comparison is the thief of joy.

Unless in your situation you widen your comparison: (here are the graphs I pointed out to the chap curious about what $150K/yr brings you in the U.S.)

Here's how most people in your neck of the woods live (median household, mean, and % in poverty):
The Bronx $34,156 $46,298 27.1%
Brooklyn $41,406 $60,020 21.9%
Manhattan $64,217 $121,549 17.6%
Queens $53,171 $67,027 12.0%
Staten Island $66,985 $81,498 9.8%
New York City $48,631 $75,809 18.5%
New York State $53,514 $77,865 13.7%
United States $50,140 $69,193 13.0%

Needless to say, finances can't be considered much of an issue here. You obvious have good financial habits. I would focus on other very important areas: family, friends, art, science, religion, civic engagement, etc. Best wishes!

EDIT: That said, I can't imagine such a housing market. A 10% down-payment on the home you described would be enough to purchase outright a similar home in rural/small-city Indiana. I think I'll stick around here. I rented a one-bedroom in a bad part of town in '08 for $310/mo (with water), and my sister has a mortgage payment around $400 I believe. *shakes head again in disbelief*
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Re: An enviable problem?

Postby htdrag11 » Mon Jan 28, 2013 2:04 pm

Congrats. You sounds like you coudl afford to be neurotic.

Now if your annual expense budget is 5% or more of your portfolio and your body is in poor health, then $4.4m is not a lot of money.

For NYC, $1.2m 2-bedroom apartment is still nice. Enjoy it.
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Re: An enviable problem?

Postby exoilman » Mon Jan 28, 2013 2:23 pm

hicabob wrote:I know exactly what you mean. The more you have the more you think you need. I found the concept of "enough" is the key. The 4mill can conservatively give you $150k+ of income per year for life + you own your own place - embrace "enough".


+1, I retired 10 years ago after I decided I had enough

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Re: An enviable problem?

Postby Grt2bOutdoors » Mon Jan 28, 2013 2:32 pm

scylla wrote:After reading a prior post about the Two Comma Club, I decided to take stock of my own situation. I'm 57 years old in advertising, which makes me practically ancient. I worry consistently about "aging out." And, frankly, if I had to do it over again, I would have picked a more stable (and less insane) profession, like medicine.

Through the great advice on this amazing site, plus living well below my means, I've been able to accumulate $4,400,000, not counting the apartment I own. Sounds like a lot, but I live in New York City, where a "starter" two-bedroom goes for over $1.2 million. And due to family and professional reasons, I can't leave to live somewhere cheaper.

Given all that, I don't feel particularly well off. In fact, thanks to some of the insanely wealthy people New York puts you in regular contact with, I feel like I'm just scraping by.

The question is, am I just being neurotic? And can you ever really feel comfortable in a place like New York, unless you're a gazillionaire?



You need to view this with a bit of perspective. Take a ride uptown - like 125th or the stretch from 105-145St. - given your means, you would be considered to be the 1%. Now, take a ride over to 5th Ave by the Park - maybe you live there, but in terms of wealth you likely don't register, those folks are likely worth 10x to 20x your wealth or head over to 79th St where an infamous resident is a billionaire. Does it matter? why no, what matters is you've accumulated enough to provide for your retirement whether it be early or planned. You have options, whereas many of the city's occupants do not. Stop the comparison model running through your brain, short of winning the lottery you may feel like you never will have enough. If you must, compare yourself to your colleagues - starting out in the advertising industry most make minimum wage, if that - you are leaps and bounds ahead of them, even if they are thirty years younger than you. Take comfort in your good fortune and remember to pay it forward.
Last edited by Grt2bOutdoors on Mon Jan 28, 2013 2:38 pm, edited 1 time in total.
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Re: An enviable problem?

Postby Grt2bOutdoors » Mon Jan 28, 2013 2:35 pm

Sam I Am wrote:It is 77 degrees right this minute, heading to a high of around 80 degrees, even warmer I imagine further south. I'm on the west coast of Florida, Tampa Bay area.

Sam I Am


It was snowing here a few hours ago.
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Re: An enviable problem?

Postby Toons » Mon Jan 28, 2013 2:41 pm

scylla wrote:After reading a prior post about the Two Comma Club, I decided to take stock of my own situation. I'm 57 years old in advertising, which makes me practically ancient. I worry consistently about "aging out." And, frankly, if I had to do it over again, I would have picked a more stable (and less insane) profession, like medicine.

Through the great advice on this amazing site, plus living well below my means, I've been able to accumulate $4,400,000, not counting the apartment I own. Sounds like a lot, but I live in New York City, where a "starter" two-bedroom goes for over $1.2 million. And due to family and professional reasons, I can't leave to live somewhere cheaper.

Given all that, I don't feel particularly well off. In fact, thanks to some of the insanely wealthy people New York puts you in regular contact with, I feel like I'm just scraping by.

The question is, am I just being neurotic? And can you ever really feel comfortable in a place like New York, unless you're a gazillionaire?



Give this some thought,,,How many people on the planet have accumulated 4,400,000 excluding their residence ,this should give you some idea as to the exclusive minority you are in ,regardless of where you live.Kudos to you for making it happen :happy
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Re: An enviable problem?

Postby damjam » Mon Jan 28, 2013 2:53 pm

I live in NYC also, Brooklyn actually, and I feel the high cost of living everyday.
I own my house, a brownstone, and the maintenance is a lot of work and money. I'm sure that even thought you own your apartment your maintenance fees are high, just like your still paying rent. So I feel your pain.
I will also never leave the city to cut my cost of living. Not going to happen.

Having said all that I agree with Grt2bOutdoors. The key is you (and I) have options which many do not. Trying to keep up with the Bloombergs will only make you unhappy.

Maybe you could do a little good work as a volunteer to get you in contact with those less fortunate or earlier in the game?

Oh, and I feel very comfortable here in Brooklyn. It's my city now and I wouldn't want to be anywhere else.
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Re: An enviable problem?

Postby jon-nyc » Mon Jan 28, 2013 3:48 pm

I don't think you're crazy, I also live in NYC. I've spent my career in investment banking and management consulting, and am accustomed to having friends that spend hundreds of thousands more than I do every year.

Yet the other good thing about NYC is its easy to find a circle of friends that lives more modestly, as the OP said you don't have to hang out with the Bloombergs and Paulsons of the world.

And LBYM works here too - I'll be pulling the plug this year, and I'm 44.
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Re: An enviable problem?

Postby Watty » Mon Jan 28, 2013 4:31 pm

Toons wrote:How many people on the planet have accumulated 4,400,000 excluding their residence


621,714 in the US according to this link. That would be in the top 0.2%

http://www.forbes.com/2009/10/01/net-wo ... lator.html
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Re: An enviable problem?

Postby jon-nyc » Mon Jan 28, 2013 4:43 pm

Watty wrote:
Toons wrote:How many people on the planet have accumulated 4,400,000 excluding their residence


621,714 in the US according to this link. That would be in the top 0.2%

http://www.forbes.com/2009/10/01/net-wo ... lator.html


Too high, the calculator is dated and driven by a model rather than real data. I think the Fed put out some data last year that showed ~5MM required to be in top 1% (asset-wise)


(edit: just googled an NYT piece from 2012 that said entry into top 1% starts at 8.4MM. http://economix.blogs.nytimes.com/2012/ ... ot-income/

That piece referenced this Fed study: http://www.federalreserve.gov/econresda ... f_2007.htm)
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Re: An enviable problem?

Postby NYBoglehead » Mon Jan 28, 2013 5:24 pm

Re: the OP's net worth, he said that he had a $4.4 million portfolio WITHOUT the apartment that he owns. What the apartment adds to his net worth has a very wide range depending on the size and neighborhood. Bottom line he's comfortable though.
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Re: An enviable problem?

Postby Fallible » Mon Jan 28, 2013 5:49 pm

damjam wrote:I live in NYC also, Brooklyn actually, and I feel the high cost of living everyday.
I own my house, a brownstone, and the maintenance is a lot of work and money. I'm sure that even thought you own your apartment your maintenance fees are high, just like your still paying rent. So I feel your pain.
I will also never leave the city to cut my cost of living. Not going to happen.

Having said all that I agree with Grt2bOutdoors. The key is you (and I) have options which many do not. Trying to keep up with the Bloombergs will only make you unhappy.

Maybe you could do a little good work as a volunteer to get you in contact with those less fortunate or earlier in the game? ...


I also was thinking of something like this for the OP, something to bring things into perspective, thinking of those less fortunate instead of those more so, being grateful every day for his wealth rather than wishing for more.
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Re: An enviable problem?

Postby NYBoglehead » Mon Jan 28, 2013 6:58 pm

^Alright, let's not beat the guy up over it. In regards to "wishing for more" I think he has earned what he has accumulated, likely forgoing what would have felt better 10, 20 or 30 years ago and set it aside to get where he is today.

While I certainly think he is comfortable and should enjoy it, I'm not so inclined to say that he's "wishing for more" by merely mentioning that being a multi-millionaire does not provide the "fat cat" lifestyle in NYC, for lack of a better term.
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Re: An enviable problem?

Postby damjam » Mon Jan 28, 2013 7:34 pm

damjam wrote:Maybe you could do a little good work as a volunteer to get you in contact with those less fortunate or earlier in the game?

When I said the above, I in no way meant to "beat the guy up." I hope it wasn't taken that way. I wasn't making any judgements, just trying to offer a constructive suggestion as to how the OP might reframe his/her perspective.
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Re: An enviable problem?

Postby NYBoglehead » Mon Jan 28, 2013 7:37 pm

damjam wrote:
damjam wrote:Maybe you could do a little good work as a volunteer to get you in contact with those less fortunate or earlier in the game?

When I said the above, I in no way meant to "beat the guy up." I hope it wasn't taken that way. I wasn't making any judgements, just trying to offer a constructive suggestion as to how the OP might reframe his/her perspective.


I gotcha, and my post was pointing to fallible's post. I'm sure fallible wasn't making any judgments either, I just felt the need to address the wording. I wasn't trying in any way to suggest that volunteering wouldn't help add some perspective, I just didn't like that the OP was ungrateful or "wishing for more."
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Re: An enviable problem?

Postby Fallible » Mon Jan 28, 2013 8:18 pm

NYBoglehead wrote:
damjam wrote:
damjam wrote:Maybe you could do a little good work as a volunteer to get you in contact with those less fortunate or earlier in the game?

When I said the above, I in no way meant to "beat the guy up." I hope it wasn't taken that way. I wasn't making any judgements, just trying to offer a constructive suggestion as to how the OP might reframe his/her perspective.


I gotcha, and my post was pointing to fallible's post. I'm sure fallible wasn't making any judgments either, I just felt the need to address the wording. I wasn't trying in any way to suggest that volunteering wouldn't help add some perspective, I just didn't like that the OP was ungrateful or "wishing for more."


I thought the OP was wishing for more because, although he’s a multi-millionaire, he said he doesn’t feel “well off” and feels he’s “just scraping by” when in regular contact with the “insanely wealthy.” Some other posters here made similar comments and most, if not all, of us suggested ways for the OP to gain perspective. I’m not certain why “wishing for more” seemed to stand out here, but that is my explanation for it. If the OP is offended, I am sorry and will gladly delete the reference; he needs only to let me know.
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Re: An enviable problem?

Postby jon-nyc » Tue Jan 29, 2013 4:21 am

scylla wrote: I'm 57 years old in advertising, which makes me practically ancient. I worry consistently about "aging out."



My wife is 46 and works in advertising. She believes she already did "age out" of the boutique firms she used to work for. Now she's at a big agency and feels a bit more comfortable.
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Re: An enviable problem?

Postby z3r0c00l » Tue Jan 29, 2013 8:33 am

Let me be blunt, having $4.4 million in NYC makes you wealthy. Lower upper class. You have more money than the vast majority of people in New York, and are a member of the so called "insanely wealthy." You are the one who makes a middle class person from NYC feel like they are "just scraping by" and, considering that 1 in 5 people in NYC are below the poverty line... well I wont beat the point to death. Just that it is quite possible to live in NYC on a wide range of incomes. I would not suggest being poor here, or anywhere, but the several million middle class people (really middle class, earning about the national median income) do just fine.

Simpy put, you have reason to be happy with what you have. More than enough money to retire now if you wanted to. Perhaps you stay in for another few years, make that an even 5 million, and call it a day. I assume you will get decent SS in 6 years, maybe you can work part time before then even if you are forced out of your industry due to age.

I am comfortable in NYC and have far less than you do. It is possible that money will never fix these feelings you have.

*My father worked in a similar industry, and retired early enough. But he continued to work part time freelance after leaving an agency, and did pretty well at that too. Took SS recently and now is old enough to work part time again and earn as much as he wants, and does get a few jobs from time to time. Not sure your role in the industry but some people can make 50K a year with just a few jobs.
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Re: An enviable problem?

Postby hand » Tue Jan 29, 2013 9:29 am

scylla wrote:Given all that, I don't feel particularly well off. In fact, thanks to some of the insanely wealthy people New York puts you in regular contact with, I feel like I'm just scraping by.

The question is, am I just being neurotic? And can you ever really feel comfortable in a place like New York, unless you're a gazillionaire?


The challenge here is that there are two definitions of "comfortable".

The first is an objective definition corresponding roughly to being reasonably certain that you will have a place to live, food to eat and the care and quality of life you require for the rest of your life. As many have pointed out, $4.4M + owning your own residence in NYC makes you objectively comfortable unless you have extreme needs - and quite well off in most of the rest of the world.

The second is a subjective definition roughly corresponding to doing well compared to your peers. The bad news is that at 57 in advertising, it sounds like your future earnings are limited, so you are unlikely to change stations in life at this point. The good news is that you're in a pretty good place objectively.

Clearly you've been successful not only earning, but also living below your means. I would echo some of the suggestions above and suggest you invest some time re-framing who you think of as your peer group (hint - probably not the Bloomburgs!) and what you consider success. Personally, when I take the time to reflect, I am amazed at how much more fortunate I am today than I ever could have imagined when I started my career. I would be surprised if thinking critically about how you measure your success doesn't have the same impact for you.

Good Luck!
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