This is just anecdotal evidence but my experience is just the opposite. I have worked with quite a few people who would be close to the average (and above the median, whatever it is). They definitely are not lavish in their spending. Most live in the suburbs and have left the city. Houses get paid off early. Cars are not the latest. They also tend to give to charities. I'm not saying you're wrong, just that there is a spectrum of outcomes.
Drew Ntforest....If the distribution of happy/unhappy people is somewhat similar between wealthy and poor....then wouldn't you rather be unhappy and rich than unhappy and poor assuming the same level of unhappiness? Of course... like I said, who could argue with that? I wasn't saying poverty was better than wealth, quite the contrary. No one should have to live in any kind of poverty. I was saying that the dogged pursuit of wealth for wealth's sake, purely for wealth's sake, ONLY to be rich, ONLY because rich is better than poor, ONLY because one has the illusion that wealth equals instant happiness, seemed one-dimensional at best. I've seen people literally obsessed with wealth acquisition to the point where they can't conduct a normal existence. That was the convoluted point I was trying to make... see what I mean? If money is all you think and care about, if it consumes you to the point of being dysfunctional or socially inept, and if you believe, des pite al that, that this makes you somehow better than everyone else... my point was that that in itself is weird... and kind of gross. It's interesting because some people who have made it big, or whatever, like the google folks, seem really quite uninterested in what you would think they would do with their big bucks. Doesn't one of htose google guys still live in a rented apartment? For him, my assumption is that his wealth is a side effect of being a brilliant entrepreneur, computer science guy, whatever he is. Anyway, whatever. You see what I mean.
Very true - Warren Buffet being an example of the type you mention. One reason for that difference might be that I am speaking specifically about people in international finance (i.e. investment banks and the buy-side on Wall Street, the City, Tokyo etc) rather than about high earners in general. It's a pretty warped industry. Suss
Not at all offended, simply suggesting that retiring early doesn't seem to be a practical strategy even for Wall Street. I was being slightly facetious about middle age by the way; I'm 37. [Edit] On second thoughts, maybe I was right the first time - 40 in 3 years... Help... Suss
My sample is mostly from a hodgepodge of people in derivatives trading at a large NY bank -- traders, analysts, IT managers, etc. There are three private schools in my neighborhood. I checked the tuition at one of them, $12K to $24K/year. With three kids, who could afford a new BMW every year?
Who indeed? Maybe that's why nobody around me seems to retire early! I have all this to come - first baby due next April. Suss
I would focus on where you are trying to get to rather than what others have got. I work in an investment bank where everyone at the moment is bitching about pay rises and bonuses because everyone have been told what is going to happen and they are not happy about it - 50% of the floor will get something and the others won't. Luck is a factor which is greatly underestimated along with competition. For those who are talented and lucky, they will always be in the top half of performers, whilst the others will have to fight it out to stand out. How does this fit in with the title of this thread you may ask? Quite simply, if you get offered a job, you will start at the bottom of the hierarchy, and it will be quickly established where your potential is because the underlying question is how do you earn 300k and of course is it easy. Here there is the element of luck on how good you are compared to everyone else. It may be very unfortunate but your potential maybe the lowest in the team and no matter how hard you work everyone else is a step ahead of you. The company will recognise your hard work but you won't get paid for it as there are others who have worked harder relative to you but not for them. And how would you feel when the team recruits a new member and their potential outshines yours and they get paid more than you yet have less experience? You will know already if you have the talent as the key indicators are that you will have shot the lights out academically, yet it was a stroll in the park for you, and all the investment banks you have applied for have given you an internship or a job with the usual golden handshake, though however you don't really care as it is well within your ability. To round this off nicely, it is like trading at the end of the day - you need manage the downside more than the upside. And remember the winners don't care what the losers have to say. Make sure you know which group you are in sooner rather than later so you can do something about it. I hope everyone who reads this finds this helpful and uses it positively to make better decisions.
Having worked for several IBs in the frontline for a dozen or so years I agree with a lot of this - luck especially. However, although you have to be smart I don't think a sparkling academic track record is the main determinant of success or even a good predictor. I'm not intending to patronise people here (I'm in no place to do so) but my feeling is that to survive longer term you need to have good people skills. At some point in their career everybody makes mistakes, even stars. The strength of your relationships with others will determine how many people - if any - rally around you and help you survive. Or, if you're really unlucky and find that it's just easier to quit the firm and move on, your relationships determine how many people will help you find another place to work through nudging their friends and contacts. I know a guy who was an analyst pulling down seven figures. He was frequently (and unnecessarily) abrasive and not well-liked. But, the firm thought it desperately needed an analyst for that position and replacements were hard to come by, so it took a couple of years to persuade him to move on of his own accord. This he did, to a management position in another firm. That lasted 18 months, then suddenly he was gone. Two years later, despite an apparently glittering CV, he still hasn't found a job in the same industry, despite strong demand for experienced people. That's because in this industry the second or third thing that potential employers do is pick up the phone and start asking clients and ex-colleagues what they think of Mr. X and in this case the opinions employers were hearing were clearly not encouraging. The unsurprising conclusion is: be pleasant in your dealings with those around you and avoid the temptations of arrogance. It will come back and bite you. Most people realise this mundane fact at some level, but it's surprising how many intelligent people you see making this mistake. Like I said, not intending to patronise anybody, just offering my two pennies worth. Suss