The Millionaires Who Don’t Feel Rich

Dear Readers,

I didn’t comment on this when it came out in August as I was on vacation when it was published and I just never circled back to it.  The author of this article is a journalist.  Remember this.  He’s writing to sell newspapers, not educate you.  His job is to entertain you.

There is an assumption here that those that already have a few million are working to keep up with their neighbors but this is not how I see it.  For example, if Celeste were to retire today with $5M capital at work, current accepted financial thinking is that she could safely withdraw 4% of her money to live on.  This is a $200,000 gross income annually to support her current lifestyle.  I am very sure that this is not enough.  So Celeste is probably not hustling to work to keep up with her neighbors, she and her husband need more capital at work to produce a higher income so she can sustain her standard of living through a long period of unemployment (commonly called retirement).  It isn’t politically correct to say that $5M isn’t enough but that doesn’t make me wrong.

http://www.nytimes.com/2007/08/05/technology/05rich.html