There is a curse of making too much money that I want to talk about. So many of us are caught up in this cycle of wanting to make more and more. This desire is making us unhappy. We need to learn to let go.
The luckiest people on earth are perhaps those who don't make a lot of money. They've got very little downside and can really pursue their childhood dreams.
Imagine if from the moment you graduated college, you landed a plum corporate job that paid just enough to keep you motivated, but not enough to enjoy your freedom.
The longer you work the more you realize there's really no escape, because there's simply too much at stake. This is the problem that plagues my friend, Lyndon.
The Curse Of Making Too Much Money: A Strategy Consultant Who Makes Bank
Lyndon just turned 30 and is having a mid-life crisis. He's worked for eight consecutive years at McKinsey & Co, one of the prominent management consulting firms in the world, and makes roughly $300,000 as an “Engagement Manager.”
Obama says he's rich, but Lyndon isn't buying it when his 1,200 square foot, two-bedroom apartment in New York City costs $5,000/month. If he wanted to buy the condo, he'd have to shell out over $1,600,000. To add further injury, $300,000 is really only $180,000 or so after federal (33%), state (7%), and city (4%) taxes!
All Lyndon ever thinks about is being a National Geographic nature photographer. Every single vacation is planned around some remote destination that takes two days to reach, and therefore another two days to return. Yet as a consultant, Lyndon is at the mercy of his clients. Instead of traveling to Mt. Kilamanjaro, he's on a plane to Minneapolis in the middle of winter.
In five years, Lyndon knows he'll probably continue to make more money and perhaps make millions as a partner in his 40s. But what's the point if he's not completely happy? The 65 hour work weeks and minutiae are wearing his soul thin. He wants out.
Yet, how does a 30 year old, who's on a straight path to multiple-six figures rationally decide to quit his job and try and make it as a nature photographer?
No Sympathy
An ant is playing the world's smallest violin somewhere underground. While millions are unemployed, Lyndon is on a path to financial freedom, with one of the most prestigious companies in the world. Yet he's still unhappy. He has the curse of making too much money.
He see the less fortunate as those in temporary dislocation. Everything to Lyndon is logical. When markets crumble, people get dislocated, but eventually get relocated when the markets rebound. Oh, how Lyndon too, wishes he was dislocated.
Unfortunately, nobody will give Lyndon much sympathy, except for his fellow well-to-do friends. Ironically, it's the sympathy that Lyndon seeks, which makes him only hang out with people of his same socio-economic class. He understands that most of America won't understand him so he shuns most people.
One Temporary Solution
In two years, Lyndon will have served 10 years at McKinsey, a long enough period of time for him to not feel guilty about taking a sabbatical. He's never taken a 2 week vacation at once, and he's never taken more than 4 weeks off for the entire year. How could he, since the firm is paying him so much? It wouldn't be fair to his clients he justifies to himself.
The problem with taking a sabbatical in two years is that he still has to work for another two years! He wants to see the world now. He's restless, with unwavering confidence that he can always come back to the industry of advice and fortune. If he can't and ends up spending most of his money, he can always get a temporary loan or work part-time to extend his dreams.
Walking Away
Lyndon decides that one of his New Year's resolution is to reboot. After his bonus hits his bank account, he wants out, but is afraid to pursue his dreams.
He'll have $250,000 in savings with no debt to his name if he quits. Remember though, that if he works another year, he'll save another $80,000, and then another $80,000+ every year forever. The key issue is the word “forever.”
Lyndon has broken free from the curse of making too much money. Now he will live life on his own terms.
Related: Overcoming The Downer Of No Longer Making Maximum Money
Solutions To Lyndon's Dilemma
* Build your brand online. Lyndon should start his photography website ASAP before he negotiates a severance. Own your own brand online through your own website and potentially reach 3+ billion people online. I started Financial Samurai in 2009 and was able to make a livable online income after 2.5 years to permanently leave corporate America.
If you feel you're not getting paid what you're worth and want to boost your income, start your own business online on the side. It used to cost a fortune and a lot of employees to start your business. Now you can start it for next to nothing with a hosting company for under $4/month and they'll give you a free domain for a year to boot. Skip all the unnecessary add-ons.
Connect with like-minded people, find new consulting gigs, and potentially make a good amount of income online one day by selling your product or recommending other great products. Not a day goes by where I'm not thankful for starting Financial Samurai back in 2009.
* Negotiate a severance package. After 10 years of working at McKinsey, it's clear Lyndon is on good terms. He should be able to negotiate a severance package worth 20 – 30 weeks of pay, or up to $130,000. I negotiated my severance after 11 years at one firm, which paid for six years of living expenses. Never quit your job, get laid off instead!
Updated for 2020 and beyond. If COVID-19 has taught us anything, it's that tomorrow is not guaranteed. It's time to live our lives to the fullest. I just want to say that even in 2020, I feel the curse of making too much money is still around now that I'm a parent. I need to learn how to relax more and let go. Don't always try and hustle and keep growing FS.
For more nuanced personal finance content, join 100,000+ others and sign up for the free Financial Samurai newsletter. Financial Samurai is one of the largest independently-owned personal finance sites that started in 2009. Everything is written based off firsthand experience.
When I was in uni all I wanted was a job, I would have worked for free in my final years. When I graduated I got ‘lucky’ (proved myself) and got a job as a developer. I was making 50k/year but that was a huge amount to me compared to 0k/year. In less than a year I got ‘lucky’ (worked my ass off) again and weaseled (negotiated) my way to 100k/year as I took on more responsibility and started working more hours.
I might just be having a bad day as I stumble across this website but right now I’m miserable. I feel like the stress has already gotten to me after only a few years. The late nights, the ass kissing, the dealing with incompetence while braving a smile. I feel people where I work look down on me because I’m young and I drive a nice car in a key position. All they see is my suit and nice car and don’t think about how much shit I had to eat to get to where I am.
Now I sit here and I ask myself why the f do I bother? I can live an easy life with not much money. I have goals but I feel like my emotions are more powerful than my aspirations. I just bought a house and can afford the repayments for the next 2 years on my own. Maybe I’ll quit, re-evaluate when I’m poor again, still technically poor compared to Lyndon.
I hear what you mean. I was getting miserable in my finance job for years, so I finally decided to negotiate a severance in 2012 and pursue my own dreams.
It’s 2020 and I have to tell you i don’t regret making way less money to focus on Financial Samurai. You only need so much to survive and be happy.
Good luck!
I’m a Lyndon. I am a young partner at a large professional services firm making $500K a year. The raises keep coming, and in a few years, I will be making $1M a year, which is the average salary for a partner at my firm. I love what I do, but I hate the stress that comes with being “on call” 24/7. It’s easy to say “just quit,” but when you are providing for a family and maintaining a certain lifestyle, you are literally trapped. Would I love to walk out tomorrow and pursue my dreams? Yes. Am I prepared to give up a salary that most people only dream about? No. Maybe things would be different if I didn’t have a family to provide for. I understand why someone might say “shut up and be grateful for your financial freedom.” But my mind is consumed on a daily basis by thoughts about being absolutely miserable and wishing I could find a way out.
Get to the peak. Earn a mil for several years, bank as much of it as you can, then retire early.
I have NO regrets leaving FT work grind at age 34 in 2012. Time is so precious. I love spending time with my family.
I can’t believe what I just read…but maybe I can. With that type of money why not just by a house in another state somewhere then get a different job?
If you don’t like your job and make that much just save up enough to quit…seems pretty easy to me.
People think money is everything until they have it and realize that you don’t need much money for survival you need food, water, and shelter for survival…after you have enough money for desired food, water, and shelter the extra money might not matter much at all.
He won’t go homeless if he quits his job so he should just do it…I’m sure lots of other people would love to be his position making the same income and I’m sure lots would love that type of job.
I don’t really like my job either it pays ok but once I save up enough I’m just going to see what happens…
Traded my time for money as well. I m 41, make a decent 6 fig income, but have never enjoyed my work. However, I don t feel trapped. I ve had an epiphany a few years back, where i started to “work on myself”, improve myself etc.. I think it gave me the confidence I needed ; allowed me to acquire qualities that now I know I could use in every situation to make a living. It s liberating to feel that you have enough resources in yourself to pull out of any situation. It means I don t have to aim for the mythical amount of cash to achieve “self-sufficiency”. And social status means increasingly less now that I m unafraid to be poor. That s the key i think. Imagine that something happens that wipes out all your material possessions in one big swoop. Just imagine that this thing that you fear the most is happening *right* now – if you can face this with equanimity, and stay cool headed, then you have achieved what you needed the most and no amount of extra cash will make you feel any better ; feel the social expectations you’ve heaped upon yourself melt away and embrace the moment..!
I’m kind of trapped as well. Today, a colleague that leaved the firm and entered again this year (few months later after quitting), was promoted over me. I stayed, worked hard, earned my position and was the next in line, and he, who was supposed to start from zero, jumped to a position too high for his lack of loyalty.
I felt they just have kicked me in the face. I’m considering to quit…but I need the money, not just for paying rent, but also to save for a master’s degree… I feel I will have to swallow it about 7 months just for the money….but in the meantime, I feel drained…I feel walked over and must definitely underpaid.
I had a rough morning today, when my managers called me over to the office to tell me this…I cried in front of them and said it was not fair. Then I cried in the bathroom, then on my desk, I just could not get over it. Eventually I was allowed to come home… and now I’m writing this, because this whole “meritocracy” thing, is just lies. How could I remain in a company that let me down like this, and showed me this lack of professional ethics and thoughtfulness for their workers?
No sympathy from me. There are a billion people who don’t even have access to clean water, and this guy is complaining about living the high life but doesn’t like his job? So quit, you are not trapped. We live in a free society, you don’t have to work in any particular field – or work at all for that matter. You have to lay in the bed you make. It’s all about choices. Do I love my field? No, decidedly not. But I love my family, I love being able to provide for my wife and kids – and being able to provide little luxuries like nice vacations. I could have my dream job and take a 70% paycut. While I could live like that (I am still a poor college student at heart), I wouldn’t want my kids to live like that. They’ll have to face the real world later. Let them have fun now. Get ahead – get that xbox game you want, it’s on Dad.
Exactly. The writer of this blog gives awesome advice, but makes far more than most people – that he really can’t relate to the true Average American Joe. I love this blog, and I make a 6-figure salary myself as an entrepreneur; and as much as I love the advice given, I also understand the reality of most people’s lives :)
You are correct. I definitely don’t know what it’s like to only make six figures a year. How do you live on so little? :)
Related: Achieving financial freedom on a modest salary
How does one negotiate a layoff? I’m approaching my 3 year mark and am ready for a change. My bonuses are based on employee performance, but I have no control of who gets hired or let go of, and we have huge turnover which makes it hard to operate effectively or plan. I’ve got heaps of savings, real estate, etc as well as an employment opportunity that should allow me to find better balance yet stay within my field (wealth management). My department and role are quite important, there’ll be no downsizing.
I wrote a 150 page book on how to do it here. It’s newly updated for 2017.
You can also read these posts:
Never Quit, Get Laid Off Instead
Why Negotiating A Severance Is Possible: Absolute Reputational Destruction
Old post but I’ll type out my thoughts anyway maybe to clear them up for myself. It’s a tough situation and you won’t get any sympathy, and worse you won’t even get understanding from most people. Even people close to you don’t understand the pressure. And you just can’t go talking about getting out to co-workers that may understand but may just think you’re gonna quit and start finding your replacement.
Making mid six figures means (I think) your job is stressful. Nobody is going to pay you half a million outside of entertainment to do something that’s fun. There are parts of my job I love but really after 9 years the stress is taking a toll on my health. So now you’re mid 30s and want to do something else. I could certainly do that, at a much lower pay scale but you have people depending on you. Colleagues that would have to pick up the work load. Wife, that says it’s no problem but likes not working, spending a sh*t ton on lamps (seriously it’s a lamp should be like 80 bucks max right?), big house, vacations. I’d trade all that but it’s not just me. I’m trading that life for my kids and wife as well. And kids… That’s another thing. I look at my kids and don’t want them to be burdened with loans and all that. I don’t want them to wonder how they’re going to retire and kill themselves with stress. Basically I don’t want them to do what I’m doing. So I need to make enough to get them out of the race too. So you’re stuck. Not the best for you but again, nobody cares to hear you complain.
So for what it’s worth I live “frugally”. My wife and kids live nice off one paycheck a month, the second and any bonus goes to real estate and investments. I drive a 11 year old beat up car (get a lot of comments on that from co-workers), wear old clothes when not at work and have a hard stop date at 45yo that I hope to hell I can stick to. One older mentor with a lot of health problems now who’s on his way out just laughs and says “yeah I thought that too”. It’s scary cause you how it can end but the beach house and the Maserati are calling. Trying to stay strong. Financial freedom for myself and my kids at 45. So far so good. Just 10 more years. Just 10 more years.
Some of the posters here are fools. There is no way Lydon would fit in with McK&Co culture by “renting a studio in Queens’, and many have obviously never had high pressure jobs. I get why a guy in his shoes would be digging a change. Retire forever at 40 or lose your 30s? Hmm, I guess it depends. I’d like to cross-reference the posts that recommend he gut it out and stay miserable against poster age and true net worth. I bet there are many here who aren’t as far along as they’d like to be and feel that “retirement at 40” and “making a lot of money when you are young” are indeed the most important things in life. I personally make a buck and a half running a software application, work 40-50 hours per week and don’t feel the need to strive to make $200-$250K like my MBA classmate, who is now burned out after 2 years at EY and trying, but so far failing, to conceive a child (due largely to stress). I’ll bet most of those who “have no sympathy” have never earned CLOSE to what Lydon makes nor had that opportunity. With that kind of income comes a stress and need to kiss so much ass that not many can take. I for one understand Lydon, and while I wish I wish that I wanted that kind of job, I would rather work/save and enjoy my life. You know, a little thing called BALANCE. Sounds like Lydon’s out of balance and needs to find his center. Good luck to him. And to the rest of the jackrabbits who “hate”, worry about yourself first, not some hypothetical strawman that FS set up for you to tear down, knowing in advance what your responses were likely to be so as to validate this blog.
/Out.
Funny, it is almost as if you wrote that article about me. I work in a job I hate and have saved pretty much exactly the mentioned amount, 250.000 (CHF). The only serious goal I have is getting out! I have already taken a sabbatical (8-9 months) to recharge. Amazing how guilty I felt the first 2 months or so for not being productive. Productive in a sense that I have spent enough time in an office to bill it to an employer. Not productive like producing something of value, because my IT jobs seem to consist of 80-90% sitting and waiting and maybe 10% producing. I have great sympathy for Lyndon, I hope for him he can make the transition to a meaningful life soon.
Btw, how much savings is enough to live off passive income? By my calculation 250.000 will not be sufficient.