Becoming wealthy has never been easier in America. However, surviving as a wealthy person on the other hand, has never been tougher as the wealth gap continues to widen. This widening gap is why I’m a big proponent of practicing Stealth Wealth.
The government goes after you if you make much more than $200,000 a year (Medicare tax, AMT, deduction phaseout, credit eliminations, education tax, Net Investment Income tax, etc).
If the government doesn’t get you, regular citizens will. Who did you cheat or rob to get to where you are? Is the common attitude among those who feel left behind. This is a real problem for those who want to make it big in the land of dreams and hand guns.
Freedom is one of America’s greatest attributes. Yet, if you go too far on the income curve you’ll start feeling like a prisoner to society. Finally, hundreds of millions of Americans know what losing freedom is like due to months of shelter-in-place to combat the coronavirus pandemic of 2020.
Despite the rich giving more to charity in one year than many others will give in their lifetimes, people will protest their wealth and hate them forever. Despite paying more taxes each year than what the median household makes, the rich person will be demonized for not paying his or her fair share.
Class warfare is no fun, even if you do have the financial means to own a bazooka.
Practice Stealth Wealth
Most readers here are ambitious folks who want to improve their financial health. Thanks to disciplined savings and investing habits, in another 10 years, I’m sure everybody is going to be that much wealthier, if not millionaires.
But once you get to where you are going, you’ll wonder what’s next. Never lose site of the fact that it’s really the journey to financial independence that’s most rewarding.
When society turns their back on you for being successful, just recollect on all your struggles and take a deep breath. Be proud of your accomplishments because you know you’re not just doing it for yourself, but for your family as well.
You don’t have to be ashamed for not being the dumb ass in high school who thought it was cool to skip class every week to smoke weed. You shouldn’t feel bad that you worked summer internships during college while your buddies went off to play. And you should certainly not feel embarrassed by your frugal habits and smart investments once you found a job.
If you’re getting up at 5am every morning to make extra income before work, good on you! Feel proud of working more than 40 hours a week and not complaining why you can’t get ahead.
Unfortunately, society has a fantastic way of discrediting your achievements. “Nobody is self made,” and “You didn’t build that,” are my two favorite retorts. Just try taking yourself completely out of the equation and see where that logic goes when there’s nobody to think, dream, and execute. When you are outnumbered, resistance is futile. You must blend in and rage with the rest of them.
With the below suggestions you’ll be able to better walk amongst the shadows without fear of retribution any longer. Your family will be more guarded from bullies lurking to recondition your children every chance they get.
Once you finish reading this post, never speak of its matters beyond your immediate family and friends again. We’ve got to protect our own little community on the web.
A Guide To Stealth Wealth
As America attempts to reverse capitalism due to widening income inequality, blending in as a middle class citizen has never been more vital. Below are 15 Stealth Wealth recommendations to help you assimilate better in society.
Stealth Wealth Rule #1: Never drive a nice car to work or to any public setting.
Drive the most economical, safe car you know so that when you ultimately run into your co-workers, they’ll think you’re frugal or poor. Take public transportation and proclaim your love for buses and trains profusely. You don’t want to roll into the office in a Benzo and have your boss see you. His or her immediate thought will be to cut your bonus since you are doing so well.
Driving up to an employee salary negotiation meeting in a Bentley isn’t going to work in your favor either. Instead of choosing a new Range Rover Sport and deducting the vehicle as a business expense, consider a more moderate BMW X3 or Jeep Grand Cherokee instead.
When cops huddle for breakfast thinking about which car they want to ticket, do you think they are going for the guy in a 10 year old Toyota Corolla? Cops make $50-$60,000 a year on average and are on a mission to equalize.
Having a regular car is the #1 easiest way to practice Stealth Wealth.
Read: The 1/10th Rule For Car Buying Everyone Should Follow
Stealth Wealth Rule #2: Be careful who you give your home address to.
People love to snoop online to see what you paid for your house. Not only will they see what you paid for your house, they’ll also be able to tell whether you’re under water or making huge equity. Instead of giving an exact address, you can give them cross streets and a description of the house. e.g. I’m at the corner of Jackson and Teller. Brown wood shingle house. You can’t miss it.
Inevitably, they will find out your exact address if they pay attention, but delay that information for as long as possible. Your house is your sacred abode. Protect its privacy. I recommend claiming your house online and trying to make the house look as bad as possible. Property tax assessors look online all the time now to try and jack up your taxes.
Your home is now the easiest way to blow your Stealth Wealth cover. Be careful.
Stealth Wealth Rule #3: Always say it’s fake.
Whether it’s your Panerai watch, Birkin bag, Armani suit, or Louboutin shoes, always tell the person who asks that it’s fake. Resist the urge to brag about your material things. You’re already an established individual.
You can tell them you got it at Ross, Target, or at a flea market overseas and marvel with them how good knock-offs are nowadays. The quality things that you buy are for your own pleasure after all. Pretend you don’t know brands or how much things cost. Just say you like how it looks.
Stealth Wealth Rule #4: Never reveal your full income.
Without question, never reveal the full extent to how much you make. Only those who are insecure, seek adoration, or want to make money by teaching you how to make money enjoy flaunting their wealth. There’s definitely an inverse correlation with how much wealth you have and how much you show. You’re an invisible tycoon remember?
If you have a particularly high income level and you’re hanging around with people who make a fraction of what you make, be cognizant not to talk about your vacations or things you’ve bought. Be aware that the median national household income is $64,000 in 2020. Earning anything more than 2X your state’s median household income will put you under fire.
The people bragging about their income are people with the lowest self-esteem. They clearly do not know the importance of Stealth Wealth.
Stealth Wealth Rule #5: Spread your assets around.
Do not become one of the biggest land owners in your community. Do not become one of the biggest shareholders in a private equity deal unless you really, really believe in it.
Spread your investable assets around so people can’t really tell how much you have. Diversification also ensures that your wealth doesn’t take a beating in case of violent downturns either.
Chopping up your assets and putting them into different LLCs is one of the best ways the rich practice Stealth Wealth.
Read: The Recommended Net Worth Allocation By Age Or Work Experience
Stealth Wealth Rule #6: Get out of your bubble.
Once you know your State’s median household income and average net worth, adjust your outlook accordingly. Not everybody had nurturing parents, attended great schools, worked hard, got a lucky break etc. Some people are born into poverty, and it’s damn hard to get out because of negative influences all around. Believe that people truly want to do better.
When you start visiting other communities, you realize that despite all your hard work, you are probably luckier than most. The better understanding you have of others, the less chance you’ll come across as an arrogant snob and the better you can assimilate. Take every chance you get to travel internationally and live abroad.
Where I live in San Francisco is a bubble. The NASDAQ has rebounded to all-time highs in 2020, despite there being tens of millions of people unemployed due to the coronavirus pandemic. It would be unwise of me to think the rest of the country is also experiencing this sort of surreal prosperity. A good Stealth Wealth practitioner knows when he or she is living in a usual situation.
Stealth Wealth Rule #7: Pretend you do not understand.
You might be a brilliant person, but brilliant people are intimidating. Instead, pretend you don’t fully understand what another is saying by asking questions. Don’t think you’re better than others just because you see solutions easily. Guard your intelligence like you guard your full income and wealth.
It’s better to start your intelligence at a low level and dial it up if the occasion requires. Some of the smartest people I know have this eery look about them that screams stone cold aloofness. You know they are already thinking multi-variably, but from the outside it seems like they are a dull brick wall.
The expert Stealth Wealth practitioner has a high enough Emotional Quotient to understand that imposing one’s intelligence on someone else is not the right move.
Read: Are You Smart Enough To Act Dumb Enough To Get Ahead?
Stealth Wealth Rule #8: Praise others for their success.
Always be encouraging and positive of other people’s milestones. People who are insecure tend to be the ones who want to toot their horn the most.
You know the types who constantly post pictures of themselves online, name drop who they hung out with the other day, or constantly share how great they are. Once in a while is absolutely fine. All the time just cries for desperation and attention.
Try really hard to bite your tongue and not “one-up” someone else despite any successes you have. Give glory to them. Be happy for others and never belittle their achievements.
A Stealth Wealth practitioner knows there’s enough praise to go around for everyone.
Stealth Wealth Rule #9: Volunteer to be on various charitable boards.
Although charitable boards are a breeding ground for some of the wealthiest people, it’s hard to get attacked if your name is prominently on the brochure for good. Your role as a charity board member is mainly to fundraise since it is assumed you are relatively well-connected.
Rich people attract other rich people, who enjoy rallying around a cause. The more money you can raise for the charity, the less bad things other people will have to say about your wealth.
Just be aware that usually only very wealthy people have time and the connections to land a board position at a charity.
Stealth Wealth Rule #10: Always stay humble.
Consistently mention your failures. Sooner or later, people will figure out you are not as poor as you make yourself out to look. When they do, they will realize how humble and unassuming you were all those times they were talking about their wealth and their achievements.
You know those movies where a girl falls in love with an ordinary guy she meets at a park, but he turns out to be a prince instead? You want to be that guy. They’ll love you even more and you may even affect their financial lives in a positive way.
Since 2012, when I retired from finance, I’ve been internet retirement policed for not being truly retired. People attack me because Financial Samurai has grown to be a large independently-run personal finance site with over 1 million pageviews a month. If Financial Samurai was a small site, nobody would say anything.
Instead of denying the Internet Retirement Police’s claims, I accept them. I give in. I can’t help that I love to write and connect with other like-minded folks on the internet. It’s one of my biggest joys in retirement. By writing, Why I Failed At Early Retirement: A Love Story, I’m no longer harassed by the IRP. And you know what? It feels quite liberating.
Stealth Wealth Rule #11: Donate aggressively to both parties or donate nothing at all.
If you donate aggressively to one party, you run the risk of being ostracized if another party comes into power. Think about all the senior government officials and big backers who were loyal to Obama when Trump assumed power. Their careers instantly got shut down.
Now think about all the loyal backers of Trump if Biden becomes president? All of Trump’s backers will be run out of town as well.
The solution is to donate to both parties equally and sing their causes for a greater America. Once you identify yourself as an American rather than as a Republican or a Democrat, it’s easier to justify being a patriot.
Stealth Wealth Rule #12: Set up trusts for your children and charities.
One of the great ways to hide and protect your wealth is by setting up revocable living trusts. You don’t want your heirs to go through a public and potentially messy probate court to fight for what they think they should get.
Trusts are all about leaving a legacy you desire without other people getting up in your business. Just be careful not to leave your kids too much, or else they might become spoiled brats with no purpose in life!
I also recommend putting businesses you own under someone else’s name (a proxy, usually a lawyer) or under the shelter of a trust. Keep the inquisitive eyes guessing and even play along if they start getting very aggressive. A trust within a trust, just like a dream within a dream.
Read: The Benefits Of A Revocable Living Trust
Stealth Wealth Rule #13: Stop smiling so much.
One of the biggest annoyances is being around someone who is always so happy when you are not. The happy person usually lifts your spirits up. Smiling is the #1 thing you can do to improve your chances of being liked.
But if you are always happy, some people start thinking what’s wrong with you. And more importantly, your constant happiness might make other people feel bad for not feeling as happy. People are much more empathetic to people who are feeling down and out. Misery loves company!
Instead of always being happy, develop a poker face in your daily life and practice your frump. Since money can’t buy happiness after ~$200k per person and $300,000 per household, society will be thrilled if you are worth multi-millions and sad.
Of course, if you are amongst happy people, smile and be happy as much as you want! The Stealth Wealth practitioner is highly aware of his or her surroundings.
Stealth Wealth Rule #14: Understand pop culture and sports.
The more you can connect with someone, the less they will hate you. Americans spend six hours a day on average watching TV instead of producing. If you don’t have six hours a day to waste, read the online synopsis of The Game Of Thrones, Keeping Up With the Kardashians, Strangers Things and more.
Make sure you know who are the top four contenders in the NFL and NBA. The more sports and pop culture you know, the more you are able to assimilate. The greatest thing I like about sports is that it breaks down all race, cultural, and economic barriers. It’s what you do on the field that counts.
Now that tens of millions of people are sheltering in place forever, you should also become familiar with all the top shows on Netflix, Hulu, Amazon Prime, and HBO Now.
Stealth Wealth Rule #15: Always attribute your success to luck.
Eventually, people might catch on that you are wealthier than you make it seem to be. When they confront you, it is vital you attribute your success to lucky breaks. Once you do, there’s nothing more than can say because you’ve already acknowledged your skills and hard work didn’t get to where you are.
Take the confrontation a step further and buy them a drink or a meal to share your luck. You will instantly gain an ally if you do.
I truly do believe anybody with a significant amount more wealth than average is lucky. Therefore, if you are wealthy and start claiming it was mostly your skill and hard work that got there, you will instantly make enemies.
Related: Your Wealth Is Mostly Due To Luck, Be Grateful!
The Benefits Of Stealth Wealth
1) Truer relationships.
When you’re powerful or wealthy, you’re never quite sure whether a person showing interest likes you for who you are or for the benefits they think you may provide them.
When it comes to romance, we’ve learned from a previous post one should look out for one’s mannerisms to unveil stealth wealth. A good life is all about genuine relationships that are not soiled by the taint of money.
2) Less people come out of the woodwork to bother you for money.
As soon as your old acquaintances and relatives find out you have money, you’ll inevitably get e-mails and phone calls from people who are looking for financial assistance. You might even get a call from your baby mama or baby papa to discover a child you never knew you had!
3) Lower expectations for you to always pay.
There’s a tendency to push the group bill on the wealthiest person in some cultures or circles. You may very well be the wealthiest person at the table, but it starts getting incredibly annoying when people who are not starving are always asking you to pick up the bill.
The same lower expectations go for when it comes time to donate to charity. People should pay or donate out of the goodness of their hearts, not because they are simply wealthier than others.
4) Lower chance you will look like a cheapskate.
People who don’t have as much money enjoy highlighting what a cheapskate some rich person is for not tipping more than he should, or buying up to the limit of what they should be able to afford. A large reason why people are wealthy is because of the financial discipline they’ve practiced all those years while working.
Wealthy people tend to save more and invest more of their money. Less wealthy people tend to take their extravagant spending habits and extrapolate them if they had X amount more money.
5) Less likely you will get ripped off.
If you are a foreigner landing in Mumbai, the taxi driver will easily try to charge you double because what’s an extra 200 rupees to you? You’ve got to spend your time haggling for the standard downtown fare for all passengers. Highway patrol officers tend to target fancy cars over beaters because they know fancy cars tend to move faster and there’s less guilt associated with giving a wealthy person a $250 ticket.
Sales people are trained to look out for wealthy customers. They’ll see what type of watch you’re wearing, what type of car you drive, what type of handbag you hold, and what type of shoes you wear all to size you up and see how much they can extract within an acceptable range.
6) Less likely to get kidnapped or mugged.
No kidnapper is going to bother kidnapping a person from the slums. They are going to go after some rich doctor’s son playing in the park after school one day. Muggers are wise to drive five minutes further to a wealthier zip code in San Francisco to mug unsuspecting pedestrians. Why mug in the Bronx when you can mug in the Upper East Side?
All one has to do is look up online those people in society magazines, or those who frequently report their outsized incomes to target. Kidnapping and mugging is a high risk business. Might as well get the most bang for your buck!
Related: My Beijing Abduction Saga: Never Risk Your Life For Money
Tip Toe Away From The Spot Light
If you have a substantial amount of wealth be grateful. You might feel ostracized by the world, and hence end up hanging out with only rich people who won’t attack you for being you. However, I encourage you to not lose sight of reality.
Learn to diversify away from those who spend $45,000 a year on private high schools, $2,000 on fund raiser galas, $85,000 on BMWs and $100,000 on fancy country clubs. Flashing your wealth is a sure fire way to get the hammer by not only the IRS, but by your fellow citizens who can’t stand your success.
It is much better to be rich and a nobody than be rich and famous. Trust me on this one folks. Having the freedom to do what you want in public is priceless.
If you are not wealthy based on your own definition of wealth, I encourage you to channel your frustrations at the wealthy by improving yourself.
The rich and powerful have a tendency to get more rich and powerful. Their children will likely have a huge head start over the average kid graduating from school.
We’ve just got to try harder to get ahead by studying more, coming in earlier, leaving later, taking more risks, and being steadfast in our resolve of never giving up until we find success. Practice Stealth Wealth!
Related: The Stealth Wealth Compendium Of Useful Phrases to deflect attention.
Stealth Wealth Management Tool
To manage your stealth wealth, try using Personal Capital’s free financial tools. It helps you track your net worth, control your cash flow, and growth your wealth on stealth mode for free.
One of their best features is their Portfolio Fee Analyzer, which runs your investment portfolio(s) through its software in a click of a button to see what you are paying. I found out I was paying $1,700 a year in portfolio fees I had no idea I was hemorrhaging!
Their second amazing tool is their Retirement Wealth Planner which is the best on the web because it pulls in real data you’ve linked up, and runs thousands of algorithms through a Monte Carlo simulation to give you a financial picture of your future. You can run multiple different scenarios with different spending, income, and life events to help anticipate your future.
Updated for 2020 and beyond
More than once I read about buying a new car reveals someone’s wealth. Whether or not buying a new car is smart, is a different story but I don’t see how buying a new Lexus or so breaks your stealth. According to the stats, 9 out of 10 new cars are financed (or leased). The far majority of cars on the road are driven by “borrowed” money. When by old Toyota quite on me after 300K miles, it was time to let go and I bought a brand new car, good deal, year’s end model at zero percent/60 months. And this car will also stay in the family. With the cash I have I can do other stuff that generates money, so I was ok with the zero percent loan. And if people ask me about the financial how-what, I am not lying: Zero percent and I show them the website. If I see a Benz or Cadillac etc on the road, there is no way this makes me think that person is rich. Because the majority of those cars are driven by people who are NOT rich at all. And if some of them happen to be rich, good for them. Nowadays, anybody with reasonable good credit can finance a luxury car, and people do as the price of a new car is around 35K. To me, cars mean nothing to assess how successful someone is in terms of financial independence and certainly driving a nice car is not breaking any stealth. Just say you took a loan, just like all the others because that is the standard. Only YOU know you didn’t have to take out a loan. If somebody thinks a person is rich because he drives a Jag, this person is a fool.
Great info and tips, of course the ones that read too much of anything
will complain about the article.
Buying a small home is also a frugal paradise way.
Interesting read, I would like to add:
1. You are not going to find many people to relate with. It’s okay, get used to being in your own company and learn to enjoy it.
2. Don’t spend anytime trying to figure people out.
3. Spend money on a good smartphone, laptop/tablet, earbuds/pods, etc. Even in poor countries they are either going to take your device regardless of it’s total value or they will have the latest tech anyway because their priorities to spend now. And good tech is far more productive.
4. Agree with travel…while there scout out a second location or three you like to spend time. The more time you spend there the more you will get out of the location. It’s an investment. I can live for months overseas and manage my assets while keeping my cost of living way down and quality of life up.
5. You probably have a built in b.s. detector. This article was written off the cuff. On the surface it seems in depth but there wasn’t a lot of deep thought or experience in it. The thing it left out the most is to trust your gut instincts. If you’re unconscious is telling you something is wrong then something is wrong. Don’t trust anybody who is too nice.
6. There are too many things on the list..and the list above is 3/4 useless. There is power in wealth, use it wisely and you will have an easier time. Abuse it and you may get blowback. The guy in the 50’ is just as nice as the 300’ – or just as much as a dick. But if you have 0’ feet you may not ever get to meet interesting people.
Good luck everyone.
I’m sorry, I won’t comment on your suggestions to do things such as not smiling.
Your investment advice is just plain wrong. I balance trust portfolios for a living, and there should at least be a warning before telling people financial advice. There are simply too many variables to consider. One example is not having to have the assets you put in a trust fund included in your estate taxes if you use an irrevocable trust. While a revocable trust does allow you to take your assets back, it will be taxed heavily upon death. What is your reasoning behind this?
What ever you do realize that if you are older there is a chance you would be vulnerable to the whimsy of the old days…..no you are not a silver fox. Protect your children – Consumer Sentinel had more than 21,000 reports of romance scams – sill rising. Higher loss than other fraud types. In 2015 people filed 32 million in losses. Bottom line – discuss separate non revocable trusts for your kids, or a “springing trust”. A basic trust won’t help as the sweetheart will convince him to change his will and get married. I lost about 500,000 because my dad was 97 and she would not let him have a cognitive test – she got a new attorney and changed his will. Romance speaks to our desires – be logical and
prepare. Why would you chance working all your life then having your widow marry again – he would be driving “your car”
Sam,
We are similar. I was in college and almost didn’t go to a interview that landed me a Fortune 500 accounting job. I also don’t understand how people will work 40 hours a week, and then expect to get promotions. I’ve gotten a promotion every year because of my reputation while people decades older than me are in lower positions me. I am a bit of an extremist though because I couldn’t imagine spending more than 20k a year. I also plan to continue to not own (or rent) a car at all for several years.
Keep up the good work, Sam. You are a great writer and have no doubt helped thousands of people get their financial lives together.
Also, if you are interested I would love to have a discussion regarding whether renting or owning where you live is better financially. If you do want to have the discussion, reply with your reasoning that owning the place you live is better than renting. Based on your writing I know that you believe owning is better than renting. Hint: I believe the opposite.
I enjoy the discussion here. I was having this chat with several friends the other day whether investing in property is a better bet than other investment types. There are some platforms these days that allow everyone to invest in property even in small amounts such as $200. The angle here is to encourage everyone to invest versus money just sitting in useless banks not making anything. Unlike other investment platforms that offer only a “slice” which has counterparty risk. I came across this company that is fighting the good fight. The company is called TellusApp. Their platform says that your investment is secured by the actual house. All of the investment opportunities are asset-backed.
I like the idea of Stealth Wealth a lot and agree with 90% of this, but I take two issues with this article personally:
1. I think the type of person who buys something fake projects an incredibly poor image. Essentially it says to the world “I am not willing to work hard enough to be able to afford nice things, but I care what people think about me because I am superficial, so I’m going to buy the bootleg version.” I think the better alternative would just be a lower-cost substitute,
i.e. Seiko > Rolex, or Target > Neiman as the author sort of alluded to.
2. I think in terms of “Stealth Wealth” you really need to play to your crowd. Some work-cultures will not respect you if you don’t project a certain image. Some clients may not take you seriously if you don’t have the traditional trappings of a successful business man. i.e. Do we really want to bring an investment opportunity to a guy who can only afford to drive a Honda? What could he know about business? Or..Do we want to hire this guy for $250k + bonus who is dressed like he’s been making $100k? Is he lying about his last salary? Is he overreaching in this negotiation? (I am not saying this is right, but it is the way of the world in a lot of my experiences)
If you have the luxury of UTTERLY working/relying on yourself for money, throw what I said out the window…but I do think the “aw shucks” routine could have some unintended negative consequences. PLEASE feel free to comment agree/disagree. I think the sweet spot is, as crazy as this sounds, inadvertently allowing people to find out how much money you have, but show a concerted effort to be humble. This way, people take you seriously, but don’t think you’re a piece of crap.
The article did not state, “Buy Fake Items”. Instead, it suggested that if you are asked to identify the specific brand of a personal item, you should deflect, minimize the value, or claim that “it’s fake” to hide it’s worth.
Yes – and my point is…if you tell someone an item you have is fake…you’re projecting an image that “I am not willing to work hard enough to be able to afford nice things, but I care what people think about me because I am superficial, so I’m going to buy the bootleg version.” You’re not understanding my point. Even if it is real, if the outside world thinks it is fake (i.e. because you are telling them), you look like a fool. If you are afraid of projecting wealth, don’t buy the item at all.
I think stealth wealth is extremely important. I think it is a fairly universal principle even outside of money, which boils down to “present a humble, nonchalant self”. It’s like when you talk about showing up to work in regular clothes instead of a suit and tie. I think it’s very important that you prevent people from thinking you can be a target of any kind.
The vast majority of people are indifferent about you. The majority of the remainder probably actively wish for your success. However, there’s a small portion of the population that would happily let you suffer if it meant a slight edge for them. It’s important to remember that they exist and prepare ahead of time for them.
Thanks for Sharing Sam. Can you please elaborate on business structure layering with trusts? Very interesting.
Great read. Your post reminds me of a Chinese proverb. It loosely translates into “Never show your wealth”.
Interesting. As far as not let others know your address, I did something different. I bought an old, single-wide trailer on a lot in the Trailersville section of town. I use that address for nearly everything: my drivers license, my mailing address for bills, voting records, etc. Once at work, somebody was trying to figure out where I live. I said I was just trailer-trash. I really didn’t want people to know that. They didn’t believe if until the office gossip stated, “Oh yeah, she’s right. Trailer trash. I checked it out. She lives in an old trailer, complete with turn signals and trailer hitch.” I secretly smiled as I walked away from that statement.
Did that actually happen, as in they said that in front of you?
Yes, it actually happened. Hard to believe but it’s true.
And then everyone stood up and clapped.
No none of that actually happened.
And Nancy pulled off her mask, and revealed she was actually Albert Einstein!
Then Einstein cart wheeled out of the room and into his Maybach never to be seen again!
Nice read. It reminds me of Robert Greene’s 48 Laws of Power. Lying about the authenticity of your luxury items just because you might engender jealousy in the person asking seems absurd to me.
The thing with being rich is to hide it. Don’t even mention the wealth. That’s a recipe for disaster for those wanting to move up. If you have the means, keep an average car and house and just pretend that you are middle class like everyone else. It makes it much easier that way.
On a side note, what is middle class in California is considered rich in the Midwest, where I am from. Of course, we pay for it in other ways with lower incomes overall.
I disagree about nice cars. While don’t drive a Bentely, get newer SUVs with packed safety features. The world is full of distracted drivers, and your 10 year old 4 door sedan will not protect you and your family. Splurge on a big car every few years with better safety all the time.
My bosses at the hedge fund I have worked for are both probably worth >$20MM each. If you met them, you would absolutely no idea. They walk around in flip flops, not shaven, wear the same clothes basically every day, and do not really own anything valuable.
They are extremely frugal as well, probably because they are distressed focused investors and are running their own business.
So easiest way to not look rich is just don’t care about how you look or dress. Drive a cheap car (<$30K) and wear normal people outfits. You should spend your money on a nice house, but your outward appearance should be the same as the average joe.
I like the idea of stealth wealth, but my one problem is my car hobby. There just is no realistic way to both buy/drive nice cars, and have everyone not know about them.
Sure, I could only drive them to car events or race tracks, but then I would not be enjoying them 99% of the time, and I think that largely defeats the purpose.
I really hate the stigma that people attach to driving nice cars, aka the whole “must be nice” mentality. Yeah, it was nice to make good career and financial decisions to be able to buy this car lol, you could have done the same.
If people know it’s your passion I think you can get away without it seeming like you are loaded.
Even in low-income neighborhoods, there are people with thier passion car, like an old mustang they like working on. Tim “the Toolman” Tayler did it and I don’t think he was loaded. They have the ability to be poor AND have a nice car.
Just joke about how you wish it was cheaper, took regular gas, or wear an oily shirt and rub your tools with a shop rag all the time. I’m super into stealth wealth and I think anyone can pull it off who wants to.
That’s pretty much what I do now, but to no avail unfortunately.
I’ve basically just accepted that I’ll never financially fit it with a certain group of friends, but I still don’t think it is worth alienating them.
It was kind of funny actually when they all wanted to do Financial Peace University with me. I was kind of like “I will feel much more financially at peace by not giving someone $50 to tell me what I already know about money”. lol
Tim the Toolman Taylor was a fictional tv show host. Do fictional tv show hosts make bank with the wife holding a full time job? That analogy is flawed. Where did they live? CA, NY or maybe MI or even WV. Was the show network or public access?
Most people will eventually become the victims of their own successes or failures, especially, in the area of financial.
They do not have the proper framework to measure their life long efforts.
Memorable comment.
I ate my first T-bone steak in my life at the age of 57, when I realized, that our 401 and 457 are 1 mil and I took my wife to the Longhorn steakhouse. 16 years of max contributions.
Was I too flashy??? I didn’t care.
In 10 years we are going to retire. Social Security check will pay taxes on RMD.
Live was good.
Wow…. that is a long time to wait! Guess I’ve been spoiled since I was a teenager, b/c my dad took us to a steakhouse once and I was hooked. As soon as I got clients at work and a corporate card, I’d try and take a client out for steaks at least once a month. So good!
Figuring out how to consumption smooth is huge.
No, Sam, I just did’not know. Moreover,I don’t like to give 20% tip and my wife insist on 20%. As I told before, I felt rich on $6/h and I miss that filling now.
Bitcoin made me rich. When I say rich, I’m not saying I’m worth millions. I’m saying it gave me the freedom to say no when I wanted and to speak my mind without caring. My SUV is 11 years old and has dog hair in the back seat because of my labs riding to the park. It’s my everyday car. I like to wear mostly jogging outfits that come from Wal-Mart. My church clothes are business casual from the outlet store. I live in a middle-class neighborhood and my home is paid off. If I go to the movies, it’s the Dollar theater. If I buy a blue-ray movie, it’s from the used book store down the street. I will typically only splurge on tech stuff like top tier computer parts, audio and video production gadgets and I enjoy going on road trips on the weekends once a month when my work schedule allows. Yes, I have a 40-hour job and it has good healthcare and it pays for my online education. I’ll probably quit in a few years or if somebody really pisses me off but so far so good. From the outside, I look like Joe punch clock or Joe Average and nobody knows I’m rich. It’s a source of comfort and pride. Not pride in that I think I’m better than somebody but pride in myself and that I have peace of mind along with some options. I couldn’t afford to live in the zip code two streets over because those are where the hedge fund people live but I’m very happy living among everyday people and I’m sure some of them are secretly rich. I’ve got enough.
Curious. 23 yr old here. I was thinking about Bitcoin today, it’s so popular now that I’m skeptical in purchasing it. Do you think it’s still a good deal now or we’re you lucky mostly from early on?
Great advice sam, even the recommended lifestyle for stealth wealth seems upper middle class in India.
Great article. Great blog.
I think one thing to help is to be the lower net worth person in the higher net worth area. In my town, my home is below the median, although quite fine and not small. We have good schools, and a good community. So being in such a community, helps one to blend a bit.
You guys are all breaking rule here of not trumping that your’re wealthy. You should not post here if you’re wealthy.
Anonymity has its privileges.
People buy stuff like Armani suits to show off. Who’s going to buy expensive name brand items just to lie to everyone and say they’re fake? Might as well just buy a lesser known expensive brand so people don’t even ask about it.
Sam,
Great article – I always seem to come back to it whenever I visit your page.
To extend the conversation, isn’t there a spiritual and psychic cost to saying what is essentially untrue. For example, if you attribute your wealth to luck instead of to hard work, aren’t you basically telling a deliberate untruth?
Generally speaking most religions dictate that you should avoid this, for obvious reasons.
Second, if you tell a deliberate untruth, are you basically putting yourself in a situation where you could believe what you are saying? E.g. tell a lie enough and you start to believe it.
It seems to me that a polite refusal might be far more appropriate than a deliberate falsehood.
Perhaps. Or simply speak with vagueness and humility. It’s up to you however you’d like to speak about your very personal matters.
I just say I’m blessed or fortunate! Thank God
Good information, overall, but I strongly disagree with #7: “Pretend you do not understand. You might be a brilliant person, but brilliant people are intimidating. Instead, pretend you don’t fully understand what another is saying by asking questions.”
If you have to hide your intelligence, than you need to reconsider the company you’re keeping. No two individuals have the same exact intellect. While one might be considered more “book smart” and can carry, for example, stronger academic type conversations, the other might, let’s say, have a particular expertise in a trade craft. Both individuals could share their knowledge in their respective areas of understanding, which would be beneficial on both ends.
The key is to not judge and to understand that intelligence comes in many different forms and can be achieved regardless as to whether or not, for instance, you obtained an MBA from an Ivy League school.
I agree. Show respect for everyones level of intelligence. You acquire the ability to talk with anyone and that can give tremendous satisfaction.
“When you are outnumbered, resistance is futile. You must blend in and rage with the rest of them.”
My new favorite quote. And great article. Being a Trump loving vegan atheist, (unfortunately not gay), I’m usually on the wrong side of the argument (by a lot)–so I just saved your quip to post:)
“You shouldn’t feel bad that you worked summer internships during college while your buddies went off to play. And you should certainly not feel embarrassed by your frugal habits and smart investments once you found a job.”
Well put. Recently, I was thinking about how I put in more work and effort during each chapter of our lives. It takes hard work, continuing education, self control, and financial discipline to really grow and move up to a better place in life. (Not saying I am the best at any of these. But that’s what I work towards.)
Sometimes I think about friends who have chosen the easy route and think “that would have been nice”. But then I see where my efforts brought me, where I am headed, and the reason behind all the this.
The goal, for me, is increasing freedom and opportunity we I go forward. Eventually, I want to have the option to travel freely and live where I want. As that goal gets closer it starts to become more and more of a reality.
Sam – nice article. We share a similar past. Disagree with your comments on real estate crowdfunding (“CF”). Yes there is an arbitrage investing in secondary vs primary markets but CF often offers higher risk investments. This is because established real estate investment firms shy away from CF – privacy, liability, reputation, relationship, etc. concerns. Instead, established firms are adopting technology in the same way but keeping it to their network of accredited investors (Incl institutions). CF is left with smaller managers, increasing risk both of the skill of the manager and of the investment.
RealtyShares has caught on which is why they are courting private equity firms with access to quality deal flow and professionally managed properties. Perhaps phase 2 will be an improvement but by that time, many instituional firms, like Advalurem Group, will be using similar technology.
More interesting bet is investing in the SaaS that serve as the engine for the investment managment platform. Happy to share some firms to look into. Some are doing financing rounds.
Wishing you and your community continued properity!
Sounds good. Are you in real estate private equity? I was speaking w/ Ed Forst, who is now the CEO of RealtyShares, and ex-CEO of Cushman & Wakefield about the future. Lots of big things are in store for 2018 and I do believe institutional money will be flowing in now that this is year 5-6 since the JOBS Act passed.
Everything new always has more risk. Hopefully the return will be commensurate. I’d love to hear about your background.
I really like all the details you put into your post. This was hilarious and insightful at the same time. I too have learned not to flaunt anything because it may come back to bite you.
I have also seen how different people treat those with money. The first thing many do is hit them up for money. Stealth is definitely the way to go.
I prefer to keep my head down and work. Easier to stay humble that way.
Thanks,
GBM
# 2..A thousand times this ! For my (soon to be ) home we purchased the home using an LLC – with my lawyer as the registered agent. The mailing address is a box rented at a UPS package store. All utilities will be listed under the LLC and my financing was done privately..no banks involved.
# 5. Also excellent advice. Being heavily invested in real estate ( mostly raw land) all of them were purchased under LLC’s..again with one of my lawyers listed as the registered agent. The parcels are also spread out over a tri-state region.
That was an interesting article, not because the idea of keeping your wealth stealthy is new, but because of your specific suggestions. I found the “pretend you do not understand” and “stay current on sports” suggestions quite intriguing. Thanks!!!
Thanks for your post Sam. I totally agree with you for the stealth wealth because we can achieve more freedom.
Financial freedom is important but personal security is much more important I have to say. Keep low profile is way to go for wealthy peoples.
Since Social media is popular nowadays. personal particulars exposed easily than ever before. Everyone is knowing each other. Although I was not rich guy yet, I was once shut my Facebook account before for personal security.
Recently I make a decision that I want to change my life instead of wasting my life time for just working. I decided to learn how to blog and you know what?
I type ” how to be a invisible millionaire” in Google search bar and eventually found your post about stealth wealth.
This post had made certain of my decision and I would like to thank you for this. By the way, I also like your profile photo that you wear a black T-shirt with chinese character “侍” on it.
Glad to hear it Peter. Social media is one big echo chamber, where so many people use the channel to pronounce their fabulous lives. But I definitely see a correlation with unhappiness and the more people boast about their lives.
The happiest people are secure with themselves and focus on what matters most.
This is my favorite post by you Sam. Stealth wealth is the way to go! Someone close to me that is fairly wealthy is very stealth wealth and I admire him for it. It’s one of the ways he’s been able to become wealthy, flashy toys and trying to posture was never his thing. He just likes being a smart businessman and uses his money to have the freedom he needs to live how he wants.
Thank you for this post Sam.
I definitely feel that stealth wealth is the way to go. I have seen so many high net worth people and celebrities get sued it is not even funny. If no one knows you have money, than I say keep it that way. Less is more. In that the fewer the people who know you have money, then the more you are able to live your life happier.
Thanks, all the best from your friendly neighborhood financial freedom blogger greenbacksmagnet.com
My wife and I practiced stealth wealth until age 47 when we built a custom home. We also bought a vacation home and a luxury sedan the following year and as a result, some of our friends acted started acting differently, some of them outwardly so with strange snide comments about our vacation home.
As my dad told me decades ago, friends and neighbors want you to do well, but not too well! My wife and I both agree that it helps sort out your true friends from your acquaintances once your wealth becomes a bit more obvious. This is especially true in places like California where more importance is placed on material things. We can’t wait to permanently move out of this state next year!
Where do you plan to go? I just sold a house I bought in 2005, this year. I’m thinking of going to Hawaii!
“… a vacation home”
Tell ’em it’s owned by all of your extended family.
So that when they want to use it (for free) it’s “not available because that’s cousin Bob’s week.”
I think in having lots of $$ has a form of power to it, but in saying this you have to be a strong person to direct this power in the right direction. Not everyone can be rich and smart. Find a balance and with life and wealth and respect both.
Hello Mr. Samurai,
Thank you for starting this blog and for putting all of the information out here. I am a 34-year old woman living in Los Angeles with my husband and puppy. Rent was raised for the 2nd time in 2 years, I have $15k in credit card debt, $28k in student loans, and live check to check. Both of us have bachelors/masters degrees and are now stuck in the 9-5 rat race. The credit card debt grew when we were both looking for jobs in LA.
Recently, I was approached by a friend about a “network marketing” opportunity and even though the people in the “board plan” meeting were nice and the potential for long term financial freedom were all there…I just didn’t feel comfortable doing it. I started googling “passive income” and after TONS of websites that felt like scams, I stumbled upon yours. I just binge-read 10 of your posts and bought your book. I feel like you are genuine in your mission and I hope to be successful just as you are. My first mission is to pay off the credit cards (avalanche/snowball method) within the next 11 months and then look into all of the savings / investment, Personal Finance tracking, and other items you talked about in your blog.
All I want in life is to travel the world, learn foreign languages, do martial arts/yoga and spend time with the husband and puppy.
Cheers,
KLD
Hi Kristina,
Thanks for buying my book! Not only is the book about how to negotiate a severance, it’s also a book that can help you get paid and promoted as well.
I had your dreams before. They are very worth while. Everything starts with saving until it HURTS each paycheck. Then properly paying down your highest interest rate credit card debt and investing a portion as well. Please read the following posts:
Pay Down Debt Or Invest? Implement FS-DAIR
Achieving Financial Freedom One Income Slice At A Time
A Debt Optimization Framework For Financial Independence
It’s difficult to find a wealthy man in stealth. Love and samurai with stealth sounds more like war games than love for money. If you dress down and find a woman who you think loves you for you-but discover she just wanted a comfort life- it can be hurtful. Why play these games with yourself. Get use to giving money like you got the money. Everybody wants something. There is no such thing as something for nothing. A true samurai knows that and accepts the power of pleasure. At the end of the game. be lucky that you got the chance to play. That is humility!
Excellent article Sam! Stealth wealth can be a difficult thing. When someone asks me what my mortgage payment is, I am always like, “Uh…… I don’t have a mortgage….” Am I supposed to lie? If I tell the truth, people are shocked. As you mentioned, relationships are much better when wealth isn’t mentioned.
Sam, great post.
I would add-in the judicious use of a PO Box for most mail to your point #2. I never give HR a physical address at work.
In addition to claiming your Zillow address and loading a trailer photo of choice, I have found that Googling your address and then requesting ALL of the many realtor sites that cache images of prior for sale listings should be deleted, as well.
This took a few e-mails to realtors and their office managers, but I found that expressing a “fear of bad things happening, with them being at least partially responsible” seemed to get even the most reluctant to finally comply with the request to remove all images and descriptions.
Last thing I want up on the web is a video tour of my house, after I have bought it!
Your friend The Wease!
Man, I’m gonna upload my house’s Zillow photos with only the finest beaten down homes I can find on the web! Good call!
It is extremely important to be careful – I have personally seen close relatives targeted by what seemed to be every scammer & huckster out there, because it was obvious that relative was “rich,” i.e. high income.
Unfortunately they had a high-consumption lifestyle, so they were never particularly wealthy, but had they had the wisdom to enjoy the perquisites of their success in private their life would have been much less complicated.
Wow I really like this post! I have talked to people who just can’t stop talking about how well connected or wealthy they/their parents are. After living on this earth for three decades, I’ve realized that only insecure people like bragging about themselves. If they’re insecure about their intelligence, they will talk about how smart they are. If they’re insecure about their wealth, they will talk about how much money they make/will make or what their family has. I know because I’ve been there.
Mr. FAF and I always adore the friends who have helped us out when they didn’t have much (and still don’t) and were in difficulty. They are our true friends.
We’re really allergic to people who want to be close with us just because we have something they can take advantage of. We don’t have a lot to begin with, but for some reason some people just think we’re dumb enough not to realize what we are up to.
Very true, although most of the wealthy people I know do this like its second nature. Evidenced by the the fact that a lot of wealthy people I know Drive american cars if they have a german car it’s usually a classic. I just get fed up with the people who are first generation wealthy and have a chip on their shoulder, hence the fact they need to broadcast to everyone how much they make or what they have. They also don’t even make that must (100k-250k) and they think there really wealthy or something
Wow, we (my family) can really relate to this. Financially we are doing very well, but we are humble. Years ago we had a rather large custom home. We found out years later that the kids that would visit my daughter, as well as the parents, were intimidated by our large house. My daughter found out that some kids were embarassed to invite her to their house because they “just” lived in an average house. Or that parents never invited us over because they felt that they could not possibly live up to our supposedly expensive standards after having visited our house. All this is silly, of course, but perception is reality. As I near early retirement we have since downsized to a modest ranch house (more for convenience of one floor) and we notice a marked difference in the conversations we have with people. So, yes, stealthy wealthy is the way to go, because people judge by how much you have and don’t have – either way it is people either feeling 1) inferior or jealous or 2) superior and gloating. Go figure…
Omfg. This article made me want to puke. I’m in the 1%, but I sure as H know how lucky I was – yes, worked hard, sacrificed and all the rest, but I’m not so stupid as to think that was the source of my success. I know plenty of people who worked as hard, studied as hard, but were given bad advice. Extremely intelligent (Mensa types) who became Physicists instead of Physicians – barely able to live a middle-class lifestyle while I retired at 40 and will pay top-bracket taxes for the rest of my days. I know a kid who couldn’t afford to attend Harvard because his father bought a boat instead. And what if one was born in South Sudan? All else being equal, you think their success would have been the same? Of course not.
The older you get, the more you’ll realize LUCK is an incredibly powerful life force that often overwhelms all else. Yes, some say the harder they work, the luckier they are, but that’s only on the margins.
Question: Why does the advice of being low key and humble about your money make you want to puke?
We all realize that we’re lucky living in America. That’s a given.
Related: Abolish Welfare Mentality
This is an important article, and I’m glad for the reminder to reflect on “Stealth Wealth.” Besides being self-protective of what you have managed to achieve and who you have managed to become, it’s also essential not to water down your drive and goals when you realize other people, including friends and family, like you less for having them.
One of my biggest shocks in life was the dismay registered on the faces of people close to me upon seeing our new home for the first time. A friend’s wife barely concealed her resentment. Another friend later accused me of valuing wealth over people! It wasn’t that expensive a residence, but it did have class and style together with a lot of sweat equity. And the furnishings and inexpensive objets d’art we had gathered and taken care of for over a decade–and artfully arranged in our new setting, because my husband and I share those sensibilities–were the last straw!! People who came inside invariably congratulated us, but still I had the feeling many were almost depressed by seeing our pleasant setting. Over time, the people comfortable with our house and our success are people with similar or nicer homes and similar to greater success. I can’t help noticing that our 10 and 12 year old cars seem to make everyone’s day a little better.
A harder lesson, because I have a cheerful nature, was to learn that it’s best to hide your good mood as well. Yes, people love having someone smile at them–and short term your energy lifts their own mood; but then, it begins to wear on them. It starts to seem unfair that you get to be in a consistently good mood and they don’t. Never mind that it stems from your being disciplined about food, exercise, sleep and taking care of business. Or that you work at being good company and enjoying life. “IT ISN’T FAIR.”
Human nature being what it is, it’s easier to adapt yourself to reality than to modify the reactions and feelings of most of the people you encounter. Part of being successful in life is to protect and secure what you’ve worked so hard to achieve. You keep your wallet close to you and lock the doors to your house and car. Stealth Wealth is just an extension of these precautions.
This is the method of operation of a freak-in-the-face genius. If you’re cogitating the best ways to stealth it out, talk to your local freak. They live their entire lives by a totally different mindset from “normal” looking people. They usually have very little to do with society, and when they have successes of any type, it was almost always very sneakily and calculatingly done. Who is after them? Everyone, all the time, no matter what, naturally. Who is after the rich? Everyone, all the time, no matter what, naturally. When you get in the minds of people in your region, you must withstand an incredible onslaught at some point of time, and it never goes away even if you’ve parried your way to flawless victory. The most important tip is to keep your name out of people’s mouths, and this goes without saying….womens’ mouths especially. They will talk about a snowflake falling for hours, just imagine if they talk about a wealthy person. They will seek to ruin from the most vulnerable and disadvantaged to the sweetest and capable people without thought. It doesn’t matter if you’re an incredible asset or not, cavepeople do not care. Now when you bear the one ring and are already “the man” or “the it”, use the invisible trick, and often.
You make very good points in regards to being smart about not flaunting wealth, however I think you are restricting yourself too much in regards to not allowing yourself to enjoy your wealth. Not everyone who buys expensive homes and wears expensive clothes and drives expensive cars is wasteful with their money nor should they feel the need to downplay their affluence. I am a Gen Xer, so I am sure I am much older than many of you reading this article. I earn a modest middle class salary but because I am smart with my money and frugal at times, I am able to live in an affluent way because I am fortunate to live in an area of the US where the standard of living is lower. However, if I was earning within the 1 percent or even .5 percent category, I would also be even more careful with my distribution of money because I understand how difficult it can be to acquire large sums and to keep it longterm.
Something the under 30 generation might not fully realize yet, is that throughout your remaining lifespan, there is no guarantee that the type of work available to us now will be in existence within 10 or 20 years. I went to college to become a journalist, then when I discovered it didn’t pay adequately, I changed careers to an elearning content developer, which earned me a higher salary but was still quite modest in comparison to what people under 30 living in San Francisco for instance might now be earning within the tech industry. That career in online learning lasted me the past 12 years, and now I am planning to branch out beyond that into other areas. Elearning, creating online instructional multimedia content and writing for the web did not exist as paid careers prior to the early 2000s! Now this niche is considered one of the top paying careers for either full time or freelance at an average of $50/hr. A modest income but enough to live on (as a single person or with a supplemental income from a spouse, friend or relative) where the standard of living is lower.
Opportunities to blog on the Internet have been big game changers so now it is more possible for people to earn six figures or more. However this is not guaranteed to last forever. Therefore the most important life lesson I have learned is we must be adaptable, and learn how to keep generating an income throughout our lives without tying ourselves to only one method. We are not guaranteed a posh retirement income no matter how much money we have saved. If you are only saving, scrimping, and living frugally because you are actually afraid you aren’t going to have enough in your retirement, then you are missing out on the opportunity to live your life more wealthy now. That doesn’t mean you need to flaunt your wealth or overspend. It means live your life in a way which you are happy living. No one knows how many years they will be living. You don’t want to regret not taking that trip you have the opportunity to go on because you feel you need to save all your money for when you are 80. Besides, not everything needs to cost alot of money in order to live a good and happy life. Learn from the frugal and budget conscious in regards to how they are able to go on vacations such as renting homes or condos for a week. I have been able to go to Hawaii several times because I co-own a deeded timeshare condo, saving me several thousand dollars in accommodations and I can stay at five star resorts. There are a myriad of ways to live an affluent lifestyle without needing to accumulate millions of dollars. Decide what life experiences are valuable to you and then plan your finances accordingly.
Also, don’t restrict yourself because your boss is judgmental and you think they won’t pay you more because you “don’t need it”. That is straight up discrimination. They should be only paying you based on your work contributions to the company. Don’t buy into these messed up mind games business people try to play. You don’t want to work for nor be around those kind of people, and you don’t have to. There are plenty of other good natured people you can work with elsewhere.
Be proud of your financial and career achievements. The American Dream has always been the dream of people to go from “rags to riches” and our history is full of important and valuable people who have obtained wealth in honorable ways. They didn’t hide their wealth. They shared it, used their wealth and knowledge to help others, and were an inspiration to anyone who also wanted to achieve financial independence. There is a reason so many people like to watch TV shows like “The Rich and the Famous” and read magazine articles about wealthy celebrities because it uplifts them and gives them hope.
It’s true in the past people didn’t hide their wealth, and shared it. But now, due to the internet and the information age, people are much more envious and hateful than ever. Do you feel as safe today as 20 years ago? I don’t. Hence, the world has become smaller, and that has invited more danger, unfortunately.
Good point about our worlds changing. I say, always build your BRAND, so that no matter what, you will rise above.
You’ll also enjoy this post on why blogging is the best business in the world, for now. https://www.financialsamurai.com/why-blogging-is-the-best-business-in-the-world/
I think the reason why it was different in the past is because a greater percentage of the American population was Christian. Attending church and reading the Bible in public school had a significant yet underestimated impact on the collective psyche of the nation.
Protestant work ethic was coined by sociologist Max Webber to explain the ethos that produced an unprecedented era of prosperity in Protestant-majority nations. Maybe that’s why people were less disdainful of others’ success and more willing to be inspired by it instead.
Moreover one could argue that sermons promoted a sense of noblesse among the higher classes as well. No one can argue with the cultural imprint that Christianity has had on modern society, especially philanthropy which exists at much lower levels in non-Christian countries.
I agree 100% Michelle. The moral compass and ethos of this country has certainly become much more ambivalent. While some bad things from the past have ended or diminished…the country as a whole seems much more amoral.
Noblesse oblige
I think the reason why it was different in the past is because a greater percentage of the American population was Christian. Attending church and reading the Bible in public school had a significant yet underestimated impact on the collective psyche of the nation.
The Protestant Work Ethic was coined by sociologist Max Webber to explain the ethos that produced an unprecedented era of prosperity in Protestant-majority nations. Maybe that’s why people were less disdainful of others’ success and more willing to be inspired by it instead.
Moreover one could argue that sermons promoted a sense of noblesse oblige among the higher classes as well. No one can argue with the cultural imprint that Christianity has had on modern society, especially philanthropy which exists at much lower levels in non-Christian countries
Great post Sam !!!
I can’t believe I never read this particular article of yours. It was funny but so too the point. As I have spent more time in last 5 years in saving, frugality, and investing, I have noticed that knowledge like this is VERY IMPORTANT. Knowledge of What NOT to do is equally important as What to do.
Thank you so much. Some were really funny BUT so true.
Sonny
I agree with statements 1 through 5. In the book The 48 Laws of Power , rule number one is “Never Outshine The Master. Always make those above you feel comfortably superior.” Wearing expensive clothes and driving a luxury automobile to the job will only foster jealousy and envy from your boss and co-workers. Mastering anonymity is your greatest source of safety for your family. I do not let casual acquaintances know exactly where I live. I receive my mail at a post office box and use it as my address as much as possible. I do not have vanity license plates on my cars because I do not want everyone to be able to identify my cars and my location. I do not use my professional title unless it relates to my job or in a professional situation.
I think of money as a vehicle that allows me to have choices. Money allows me to improve my quality of life and my family.
Extremely good article. My most important tip is never to let your work know you aren’t living paycheck to paycheck.
Psychologically once they realise you’re saving 30-50% of your income I’m sure they would be much less inclined to give you that pay rise next month as ‘you don’t need it as much’.
Always preferable to act excited on payday or to complain if it falls on a Monday instead of a Friday.
You may need to amend this text under “15) 15) Understand pop culture and sports.”……
“The greatest thing I like about sports is that it breaks down all race, cultural, and economic barriers. It’s what you do on the field that counts.”
Colin Kaepernick took care of that for us.
In recent years I have been trying live by the “stealth wealth” concept… Not that I would say I was throwing that info out there. But with so much information on the internet, I have trouble with making me less obvious out there on the internet and through public information. Luckily I have a somewhat common name. Do you have advice on removing yourself from Google searches, public info, real estate holdings, etc?
You can rent a specialist or a company specialized in this area. You can start with something simple: try in Google with something like “how to clean my tracks in internet” or “how to remove all info for me in internet” etc.
Have a happy day from faraway friend
And yes, I have lived at different countries and within diverse social classes, and can testify that it is almost always the case that those who are only to keen to show big stashes of cash when paying a bill, wearing big and flashy watches, showing off their smart phones, etc, are far less wealthy than they’d like you to believe. On the other hand, those who appear to be far less well off in life might give you the surprise of your life. A long lasting lesson, should we say.
“…The government goes after you if you make much more than $200,000 a year (medicare tax, AMT, deduction phaseout, credit eliminations, education tax, etc)…”
So true! For the last few years I was no longer able to qualify for the “home office deduction” because my income level was too high, even though I own a home based business and literally use one of my spare bedrooms 100% as a home office. It’s hard for me to understand not allowing a business expense to be tax deductible.
I really liked Ted Cruz’s “10% flat rate income tax plan” that he put on the table during the republican primaries. To me that seemed very fair for everyone. I forget the cut off he proposed, but it was something like exempting the first $36,000 of income that a family makes from income taxes. So the poor are simply not taxed at all… and everyone else has a fair flat tax rate. The rich still pay much more than everyone else, but in proportion everything is fair.
One good thing about Trump’s tax plan is that he proposes that “no business will pay more than 15% in taxes, whether you are a large public company or a home based sole proprietor freelancer.” This certainly would be a good incentive for big companies to stay here in the US since it would be a very competitive corporate tax rate.
At the same time it would convince many people to start their own businesses! Imagine how many people who are currently making $400,000 per year and up (who are currently in the 39.6% tax bracket) who would start their own company so that they could now enjoy just a 15% tax rate! Think how this would stimulate the economy and how many jobs it would potentially create.
I also liked the flat tax concept but we’ll never get rid of the progressive income tax code because it’s primary mission is to shift income from those who the government thinks has income to those the government thinks don’t have enough income. Collection of the taxes is secondary. Such a huge waste of taxpayer time and money trying to keep the government from stealing the results of your work.
The best thing about Trump’s tax plan is earning BUSINESS INCOME. If you slashes that to 15%, it’s going to be HUGE for the economy, since business income from LLCs and and S-corps get taxed at ordinary income.
https://www.financialsamurai.com/the-best-things-about-the-trump-tax-plan-earning-business-income/
Fast forward to 2018 and majority of Americans are not happy with the new tax law. The great majority of savings going to the top 1%, as well as the billion dollar corporations, and a huge additional deficit being created.
I think it can be telling to ask yourself if you’d rather look like you have money and be poor, or look like you’re poor but have money. I know where I fall. :)
Never let liberals know your wealth. Chances are they are wealthier than you but themselves camouflage their own wealth to legitimize their criticism of other people’s wealth. Liberals don’t think wealth is bad. They just don’t like people other than themselves who have earned wealth to be wealthy. Wealth is an asset to be acquired and managed by an enlightened individual. Liberalism is that enlightenment.
@Hillary’s Bad Dream, wait…..is that you, Paul Ryan? I thought I recognized you!
Just found your blog today. Loved this article. You have new devoted subscriber!
This is a very helpful article. I hope to keep a low profile if I get wealthier. The one point I would disagree with is serving on boards. It might have the benefits you mention of people thinking you are so nice but it has the drawback of possibly leading to media exposure. Then some criminal will see you in the newspaper and decide you would be a great target.
Love this article. Where I live (South Florida), it’s all about the bling. So many people rent their showy lives here and I’m pretty sure they have massive debt to go along with it. It is completely normal to see the average person driving a (leased) luxury vehicle. As Dave Ramsey would say, big hat, no cattle. Meanwhile, the owner of the company I work for has a net worth probably somewhere north of $20MM and drives a 10-year-old Toyota. I also drive a 10-year-old car, bought used and paid for in cash. One of your points in this article is a good reminder that when he sees me in the parking garage, he won’t be thinking that he’s paying me too much!
I appreciate that Dave Ramsey ism as well. My dad was a doctor and always drove the crummiest car to buy better cars (in cash) for his wife and daughters. He had several dozen sticky notes from management warning to tow his car if he didn’t stop parking in a doctor’s parking spot. Dave Ramsey has a model of a truck in his office in his live shows. He told a caller that it was the exact truck that Sam Walton drove throughout his lifetime.
Exactly. And if you do have a car 2X-3X nicer than him, HE WILL not want to pay you as much, b/c it is even more of a ridiculous situation given his wealth and your wealth.
Don’t one up your boss folks!
A small point – I disagree with your assumption about fancy cars get pulled over more because actually they don’t. Statistically they actually get pulled over less because there is an unspoken generalization about the importance of the person in such a car, traveling at such a speed.
This is an area where the well to do get the benefit of the doubt and yet another way that such ‘favors’ are quietly meted out. The well to do are treated differently, it just is.
By the way, I live next to Greenwich, Ct. I see this all the time.
BY A MILLION MILES you are better off in a modest car. Regardless of how often one or the other gets pulled over. If you want to awake the envy within your “friends”, people in general as well as (believe it or not) some of your own family members, then go ahead and start driving expensive cars. You see, in life you wanna appear as poor as possible, that will save you from so many headaches and sorrows. On a personal note let me share this with you, some direct family members of mine have pretty much stopped talking to me simply because they wanna keep on messing around, working as little as possible and wasting pretty much everything they ear, and then expect me to foot the bills for their lifestyles, while I, on the other hand, do pretty much the opposite to them.
I would second this. For me SUVs have always gotten pulled over more, in fact a jeep grand cherokee.
There may be some of the cops wanting to pull over Ferraris speeding and such, but I think in SoCal you are less likely to get pulled over in any of the “mid range” luxury cars like BMW, Benz, Tesla, etc as opposed to regular cars.
The cops think you are just going about yor business, but if the car looks frumpy they think you are up to something. And specifically Black people are even more better off in luxury cars as far as not getting pulled over. Cops are racist, but way more so againt lower income Black people.
But who needs a car anyway with uber (especially now with flat fares) been over a year no car for me, and its easier! Plus you can work on the go.
Interesting perspective and very good about people getting pulled over more in BEATERS! That totally makes sense actually, especially beaters that have smoke billowing out the exhaust with broken taillights. Something may be up if you don’t feel responsible enough to fix. Or, perhaps the driver is just poor.
Related: The 1/10th Rule For Car Buying Everyone Should Follow
In life, the general rule of the “thinning of the herd” is best. In other words, the pack gets shaved from all sides, so stand in the middle to be safest. The dirty, ratty, suspicious car is going to get pulled over just like the flashy, speeding lambo is.
That said, living in the middle, gets you the middle. So only use this rule when safety is the priority. Investors who prioritized safety over growth generally have poor returns, or at least not as great returns as those who take the leap.
There’s a great saying, “Fit in, STAND OUT.” But, that’s an American saying. In China, you stand out, and you get decapitated. So many of the China’s Richest list have gotten thrown in jail or persecuted since the 1990s. Why? B/c they stand so far out of the median. This always happens in every society.
May be true but we have to take a person’s skin color into account. It’s a statistical fact that Black people get pulled over at a much higher rate. Also, if they happen to be driving a luxury vehicle, it’s even worse.
“14) Stop smiling so much.”
sounds kind of wrong, don’t you think?
When you look miserable, nobody will mess with you. If you are happy, that’s when they start hating you! Be happy inside :)
Absolutely true!!! I am saying that from personal experience…. the happier you seem, the more some people will try to break your spirit, make you feel ashamed for this and that about yourself, will certainly try to damage your self esteem, self confidence, positive self imagine and self positive concept. You see, weak (envious and jealous people) will certainly attempt to bring you down instead of them trying to drawn on inspiration from you for them to go higher and become better, wiser, stronger and happier. That my friend, is the truth.
We live in a very artificial society. It’s possible that some of the people flashing their bling, fancy rides, and clothing are putting on a show—- do you know how easy it is to RENT any of these things, even for a short time? Are you privy to people’s credit card debt? Americans tend to ASSUME things and make judgements on superficial appearances. Thank you for your article which spells out in reverse how to use that information to your advantage by appearing to live below your means. There also becomes a time in life when having too much ‘stuff’ just is such a burden. I’d much rather be financially free to travel and live a life full of experiences instead of a life surrounded by ‘stuff’.
First of all, great article! We have been doing these things for a long time and didn’t realize there is a name for it. “Stealth Wealth” has a nice ring to it!
I’d wager that the *majority* of “bling flashing” people are putting on a show. I wonder if there is any data anywhere to support this claim.
As you mentioned, this is basically an article about living below your means. If you do that, most of the items the article discusses come naturally.
Along those lines, I once knew a family who would rent a nicer car than they owned to go to family reunions. Their own car was acceptable, I thought. I guess their relatives were the showy type.
Great article! I agree with most of them and live by most of the rules.
I do like nice things with good quality and under the radar with no logos. I wish I was not. I would be able to save a lot more. It’s very conflicting feeling I have to say.
Rather importantly: never advertise your wealth to women. Investigate the term “hypergamy” and all of its ramifications. Do not shy away from your friend’s stories of how the divorce destroyed his life. Look at Johnny Carson, Robin Williams, and all the other successful men who wound up paying millions of dollars to women for NOT being their spouses.
Choose a mate that is not materialistic or someone of the same economic status as yourself.
Coming from a woman who achieved substantial net worth as a youngish, single, software developer, don’t tell men you’re dating how much you make/are worth either. They start asking for loans or become children when expected to go Dutch on the more frugal restaurant choice you insisted upon.
Sometimes it’s not an us vs them thing, sometimes people are people. And some people are jerks, regardless of what hangs or doesn’t hang between their legs.
Puts “First World Problems” in whole new context.
An intriguing article. I live in SoCal where there are a lot of wealthy people. Some are truly vain and cant think of anything better than to flash their cash, while many others adopt the stealth mode. Each to their own, but your observations are spot on. It is such a shame that envy and jealousy play a part in how we treat each other. Success should be celebrated and encouraged, after all there has been a lot of sacrifice and discipline to get there.
Absolutely one of the best articles I’ve read on this subject. I think the older you are, the more you realize how little ‘stuff’ matters and how much people do. Money can and does do wonderful things but it can also turn family and former friends against you even though you did everything right. The awareness up front of the effect people knowing your net worth can have is key to avoiding many of the mistakes you point out. Unfortunately, many who accumulate wealth learn it the hard way as we have. Great job!
Thanks for reading! You will enjoy this post as well: https://www.financialsamurai.com/rich-or-free/
Good article. Had I read this years ago I may not have understood but I certainly get it now. I am building wealth but was careful, obviously not careful enough. If there was anything I really wanted was a nice house and doing that was the tip off. Unfortunately although my family is happy about my success I found that even them knowing isn’t good. When my mother became ill and we needed around the clock care they all looked at me to pay, not one offered money to contribute, not a dime. I’m not wealthy but trying to build enough passive cash flow so we can take care of ourselves when we can no longer work.
So yes, it is best to stay low profile. It’s as if people think you have a printing machine.
How are things going now? Yes, the nice house and the fancy car are the key tipoffs. I’m facing this now as my great aunts and uncles are getting into their 70s and 80s with health problems. They are looking around to see who will take care of them. The logical answer should be their kids or nephews nieces, but they inquired with me too b/c I worked in finance. The thing is, I don’t know them well at all.
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