This one has been bothering me since December.
Someone I know was invited to a wreath-making class, given by the friend's investment firm.
The firm has events regularly, but he had not been in the habit of going, let alone bringing a guest. Since he pays them $100,000 annually to manage his investments, he was trying to start taking advantage of it.
It took me back at the time; my total earnings in any year of my life have been less than half of that. Finding out that someone makes that amount is one thing, but that an annual expense is that amount is a little mind-boggling.
While that world is beyond me, I do know some rules of investing and things like minimum yields and such for it to be worthwhile, especially given the expense of having someone handle it for you.
He has to have more than $2 million. I would say considerably more.
That is actually in line with what would be recommended, especially considering that he is not that far from retirement age.
I also happen to know that he is likely to inherit significant wealth at some point. His investment strategy may be more aggressive than needed, but that is his money, and his choice.
It still bothers me.
One reason is that I had recently read that paying a homeless person $750 a month for one year generally gets them off the streets. Things like being able to pay for housing application fees and deposit and first and last month's rent, maybe being able to update some clothing... those things work in a way that shelters don't. Maybe the key is personal autonomy.
Now, I don't know if that would hold true everywhere. Oregon specifically has such a housing shortage that it might take more money and certainly more housing. However, I can't help but think about other things that $100,000 annually could do.
It is considered very irresponsible not to plan for retirement. Paying into Social Security all one's life does not count because that's not how rich people do it, and rich people are really anxious to plunder it. That's only because of greed, but greed messes up a lot of things.
However, I also know of people who planned to travel during their retirement, but then the wife had to go with her second husband, because the first one died. Or the man was going to be very comfortable with his second wife, because really it was all his and why shouldn't he get someone younger?
Or knees went bad. There's a lot to be said for traveling when you are younger and more energetic.
There are a lot of reasons to fear not having enough, but the "wise" strategies can't guarantee the results you want.
If you are rich enough, eventually a stock market crash will rebound and you will end up with even more. If you are not rich enough to wait it out, it's a completely different story.
People with stock portfolios and contributing the max to their 401Ks are not as much the problem as billionaires addicted to grabbing up more of the available resources. However, what part is ours?
What part of the damage are we contributing to?
What good can we do that we aren't doing?