Originally, I planned to title this post, “Getting Rich by Getting Lucky Doesn't Feel So Good.” However, after some time, I realized that getting lucky actually feels better over time! This change in sentiment has profound socioeconomic implications, as it may lead us to hoard our wealth and create more inequality. Luck may also lead us to delusion and subsequent experiences of disappointment.
On May 10, 2024, I got rich by getting lucky—not in a monetary sense, but in a feeling of richness from a USTA tennis league match. My doubles partner and I lost the first set 1-6, as we couldn't consistently return our opponents' big serves. During that set, I thought we would need a miracle to win the match.
Then, in the second set, a miracle came. Our opponents were serving at 2-3, and at 30-30, we had a long 12-shot rally. After the point, one of our opponents started hobbling. He went over to the fence to stretch his calf, and we gave him extra time to rest.
Our opponent said he heard a pop but felt no pain. Instead of forfeiting the match, he valiantly continued, limping around the court.
In the end, we beat them 6-2 in the second set and 10-3 in the tiebreaker. Although we were playing better before the injury, it was highly uncertain whether we would have won the second set and tiebreaker if our opponent had been healthy.
In other words, we got lucky. At this point, my record was 5-0 with half the season over, and I felt like it was time to retire.
Mixed Emotions Of Winning Through Luck
I've played over 100 USTA league matches since 2009, and I've never experienced anything like this. I have hoped to win by forfeit in the past, as playing at the 5.0 level against ex-college players was brutal, but my opponents have never given up.
Initially, I felt guilty about winning against an injured opponent. Then, over time, I felt relieved. As the days passed, I slowly started believing I deserved to win. I told myself things such as:
- I was 4-0 before the match, so I was already winning.
- To defeat your opponent, you must last to the end, not halfway through.
- The opponent could have retired, but decided to fight on.
- I practiced twice that week for the match and didn't just wing it.
- I was at 75% capacity when I played because I was sick.
- My opponents were 12 and 13 years younger than me.
- Eventually, I'll get unlucky as well, so I might as well accept my good fortune when it comes.
Isn't it interesting how we oftentimes justify our lucky breaks even if not fully deserved? Let's touch upon how justifying our victories can be dangerous.
A Similar Feeling To Getting Hired Based On Identity Or Legacy
I've touched on the diversity hire dilemma in a previous post.
On the one hand, you absolutely want all the benefits like higher pay and bigger promotions wherever you can get them. The world is brutally competitive enough. If an organization wants to pay you above market rate simply due to your identity, then great! It's a free market!
On the other hand, if too much of your reward is due to your identity and not enough to your merit, you might feel overwhelmed with guilt. In a small organization, where there's nowhere to hide, the pressure to perform will be immense. Eventually, you might start feeling like a fraud and an abject failure.
The beauty of sports lies in its strong correlation with merit. Sports doesn’t care who you are or what you look like. You either practice, strategize, and win, or you lose. It’s also why I love to continue competing. This clear and immediate outcome is why you don't see a strong movement toward more diversity in sports.
As a result, if you do not strongly believe in your own abilities, DO NOT become a solopreneur or entrepreneur. You will be exposed because business competition is too cutthroat. Do not join a start up or any other type of small organization either.
We already see that ~90% of venture capital-backed companies fail, and these companies employ the “best and brightest” people. If you're not one of them, your chances of success are infinitely smaller.
On Taking The Money And Running
During the pandemic, I spoke to someone who capitalized on the nation's mood by signing a $400,000 book deal. Based on her platform size, she should have received closer to a $50,000 book deal according to a couple of top literary agents.
Sure, she felt a little sheepish to get so far above industry standards. However, she told me, “If the publishing industry wants to pay me this much in a bidding war, who am I to deny them? I'll gladly take the money and see what I can do. If the book does well, then wonderful! Everybody wins. But if the book doesn't, then it's not my problem because the publisher decided to take a chance on me.”
In the end, the book was a commercial failure. It sold 1/20th of what the publisher had expected. She may never get another book deal, but it doesn't matter because she received 8 times what she should have received. So in reality, it was like getting eight book deals!
If you get lucky, take the money and run. If you don't, someone else will. Nobody is forcing an organization to give you more than you deserve.
Beat The Person Who Rejected Me
In my tennis match, the injured opponent was actually the captain. In early 2023, I had asked to join his public park team, but he said he didn't have room. I was disappointed because he was a good guy, and I had played on his 9.5 team in 2021 with a 3-2 record.
So, beating him felt special, but not in the way I wanted due to his injury. If he had accepted me on his team last year, I would have played on his team this year. And if I played on his team this year, he wouldn't have lost to me and my partner.
In other words, take what you can get, and savor the victory against someone who rejected you before. Because goodness knows, the more you put yourself out there, the more you will get rejected.
It's Nice To Get Lucky Some Of The Time, But Not All Of The Time
There's an old saying, “It's better to be lucky than good.”
I empathize with this saying because I'm no longer as good a player as I once was. At almost 47, my photoreceptors have declined, making it harder to see the ball at night. My power and quickness are also down by at least 15% from 10 years ago. As an aging athlete who still competes, it's sad to get old.
Given my disadvantage, I welcome some occasional lucky breaks to help level the playing field against younger opponents. However, I don't want luck to ever account for more than 10% of the reason why I made money or got a win. I'm good with the occasional lucky break that might give me a 10% boost during times of need. Otherwise, I'm happy to battle straight up in sports, investing, business, and the like.
It’s simply not as satisfying winning due to luck, connections, identity, or any other unfair advantages. This is why if you are born with a disadvantage and get ahead, you'll feel much better than someone who was already born with everything.
Life Is Never Going To Be Fair
However, the reality is, the world is rigged. People have unfair advantages all the time. And many of these people with unfair advantages also get lucky! As a result, don't feel bad when the occasional lucky break comes your way. Because goodness knows, there are a lot more lucky and undeserving people out there than you.
Trickle down economics doesn't work because everybody has enough greed in them to keep most of what we have, even if we gained most of it through luck. Just think of all the billionaires out there who are willing to hold onto their wealth even upon death while people on the streets suffer.
MacKenzie Scott, the ex-wife of Amazon's Jeff Bezos, is a rare individual who donates aggressively and frequently. It's quite apparent that MacKenzie recognizes how fortunate she is, as outsized wealth is mostly due to luck. She wants to share that good fortune with as many people as possible.
Take What You Can Get If You're Willing To Compete
As I come to the end of this post, I no longer feel guilty about defeating my opponent who got injured and rejected me. We all battled to the very end, and my teammate and I got a lucky break. Eventually, we will also get unlucky, and that's just the way things go.
The key is to recognize the luck we've had in our lives and not confuse brains or skills with luck, i.e. don't be delusional. Instead, try to take our good fortune and make it last as long as possible.
My luckiest financial break was buying a stock called VCSY in 2000 for $3,000, which then went up 50X to $150,000 in six short months. I knew I was lucky because the Dotcom crash wiped away all gains for almost all internet stocks over the next couple of years.
To extend my luck, I sold VCSY and parlayed the funny money into a real asset, a 2/2 condo in San Francisco that I still own today. The condo is paid off and every electronic rent deposit is reminder about getting lucky as a young lad, and not take the good fortune for granted.
Owning real assets that will survive long after we're dead is one of my favorite ways to preserve wealth. I suggest you do the same.
Extending The Luck That I've Experienced Online
Today, my luck may be running out with Financial Samurai.
I made a promise to publish three posts a week for 10 years starting in July 2009. Although we're well past July 2019, I continue to publish three times a week, partially because I sense my mortality. With fading eyesight and fingers slowly becoming more arthritic, I don't know how much writing I have left in me.
I need to type now while my brain still works, just as I need to compete in USTA tennis before my body no longer allows it. My window of opportunity is closing fast. Perhaps, like me, you become more sensitive to your mortality as you get older.
Financial Samurai has grown about 10X larger than I first imagined. However, with the emergence of artificial intelligence ripping off content creators and Google changing its algorithm to show more of their answers, the online publishing world is only going to get more difficult.
Investing Aggressively To Overcome Bad Luck
Given this recognition of change online, over the past three years, I've reinvested 96% of active online income into a new primary residence, private AI companies, Google stock, and private real estate funds.
Yes, that's right. Since I can't beat AI and Google, I might as well join them as a hedge. The battle for tech supremacy is fierce. I will not get left behind. By reinvesting my online proceeds, I'll be able to make my online luck last longer.
If you get lucky, you will feel richer. Embrace it. Everyone deserves some good fortune on occasion. As long as you are consistently trying your best at whatever you do and willing to battle, there's no shame in getting lucky once in a while!
Reader Questions
Have you ever gotten rich by getting lucky? What lucky breaks have you had in your life that made you feel a little sheepish at first? How did you overcome any guilt you felt from the luck you received? What is the best way to make more people lucky? Have you ever decided to work harder, even when you didn't have to, just to feel like you earned your luck?
Get Luckier By Investing In Real Estate
Although luck plays a big part in building more wealth than average, you still have to take risks. Investing in real estate and the S&P 500 have proven to be long-term wealth creators.
Check out Fundrise, my favorite private real estate platform. Fundrise runs private real estate funds that predominantly invests in the Sunbelt region where valuations are lower and yields are higher. Its focus is on residential and industrial commercial real estate to help investors diversify and earn passive returns.
Fundrise currently manages over $3.2 billion for over 350,000 investors. I've invested $954,000 in private real estate funds since 2016 to diversify my investments and make more money passively. After I had children, I no longer wanted to manage as many rental properties.
Invest In AI And Private Growth Companies
Given I expect AI to wipe away millions of jobs and make life more difficult for my children, I'm investing ~$500,000 in various private AI companies. Check out the Innovation Fund, an open-ended venture capital fund that invests in leading AI companies like OpenAI, Anthropic, Databricks, and more.
Roughly 90% of the Innovation Fund has exposure to artificial intelligence, which I'm bullish about. The investment minimum is only $10 versus $100,000 or more for closed-end venture capital funds.
Financial Samurai is an investor in Fundrise funds and Fundrise is a long-time sponsor of Financial Samurai. Getting Rich By Getting Lucky is a Financial Samurai original post. Everything written is based off firsthand experience because money is too important to be left up to pontification.
Luck is part of the game. Life gives us so few advantages. Embrace Luck/Variance.
Life is like a game of tournament poker. Most of the hands dealt to you is trash. Some cards started good, and then turn into a cooler situation. But sometimes, you just hit a hot streak. sometimes you get the 2 outers. sometimes you just get runner runner.
There will be good hands, there will be bad hands. The key is not to lose too much when you get coolered, and get paid when your cards hit.
That’s the key. Trying to dismiss luck is simply not the way
The captain of the other team will have the last laugh when you get bumped to 5.0 and have to suffer a season there
Nah, no way am I getting bumped up as a 47-year-old male. But a week later, I did win two more matches resoundedly!
6-2, 6-1
6-3, 6-0
You can track your dynamic rating on tennisrecord.com. Once it gets above 4.5, you can purposely lose more if you want.
Nice! Might have to tap on the brakes a little, haha jk
This is a great article sam. Your comments on sports and DEI is spot on. Sports are competitive and the best players are chosen as starters, not some ridiculous fake equal representation of race and gender. Any sports team that used DEI as basis for a team would get crushed.
Well the same thing will occur in any field that continues to use DEI to hire and retain staff. Life is competitive. The most amazing thing about the United States is that you have a chance to succeed based on your own merit. DEI is a scourge, and so thankful that many schools and organizations are recinding and firing entire DEI units. DEI based hiring or promotion is also patently illegal as it violates Title IX by providing favorable treatment and discriminating based on gender, and Title VI which prohibits discriminating for or against someone based on race, color, or national origin. There are tons of lawsuits going around, and any organization that gets sued for DEI programs immediately closes them down because they are indefensible legally. Lets all open our eyes and see exactly what is going on… DEI programs look at the color of someone’s skin or their race and say ok we are going to hire you or promote you based on the color of your skin or race and your “diversity statement”. That is illegal.
You massively misunderstand DEI. At the 8 companies I’ve worked at, in HR, no one unqualified was hired. We developed diverse slates of candidates, and then hired the best candidate. We hired PLENTY of straight white guys. Still do. Senior executives are still nearly all white guys.
So y’all can just relax.
Sincerely,
A white guy
Probably true, but it is the perception that is created with such policies, which then unfairly hurts candidates who would have qualified without DEI initiatives. If we can’t change perception, then it can turn into reality.
Personally, I don’t want to be given exceptions as an Asian male. Because if I ever got anything, I would always wonder even just a little bit, whether it was purely due to merit or because the organization was trying to fill a quota.
But strategically, it is sound to work for a large organization if you have self-doubt.
I’ve worked on DEI initiatives in a Tech organization before, and I can tell that it is greatly misunderstood in your post. We had no quotas, but we did measure diversity. Your sports analogy is also misleading, as the NFL did some pioneering diversity work. We used something like the NFL’s RISE rule to make sure we had diversity in the interview pool.
If you listen to Clarence Thomas talk about DEI initiatives like Affirmative Action, he will say that it creates a stigma and self-doubt. IOf course, I believe this can happen, but at the same time, you can’t use to sweep under the rug the realities of unconscious bias. My point is that you can’t talk to the thousands of would-be Clarence Thomas because they were rejected early, sometimes for unconscious bias. Having hired hundreds of workers, I can say that my eyes would sometimes glaze over in the resume screening process. Even in our merit-based hiring practices (like high-stakes coding interviews), decisions can be arbitrary.
One experience really stands out. There was an African-American candidate who was young, enthusiastic, and obviously very talented. I had to intervene during one such hiring decision because interviewers rejected the hire, who was otherwise stellar, complaining that the candidate’s published open-source code might have had some bug in a locking algorithm. I can imagine that unconscious bias came into play in their decision. I had to point out how ludicrous this was; that none of the interviewers had such a project to even present. I have to point out now that this candidate went on to be a very successful entrepreneur.
All of this is to say that if you are dismissive of DEI, you’re going to be suffering from blind spots. As an entrepreneur, there is a wealth of talent to tap into that you are going to miss.
For sure about the blind spots. Have you started a business and hired based on DEI? If so, how’s it going? If not, what are some of the things you are doing to promote DEI today? For the NFL’s DEI initiative, have you seen results? It doesn’t seem like the NFL is any more diverse.
As an Asian American, why do you think Asians are not considered a minority or part of the DEI initiative worth helping? Not only does DEI initiatives not help Asian Americans, it seems to hurt Asian Americans after the Supreme Court affirmative action case showed massive test and grade score differentials among races who got in.
I totally get how white Americans wants to do all they can to help black Americans get ahead given the atrocities of the past. But what about the Chinese Exclusionary Act, the fact that Asians account for only 7% of the population, and face discrimination as well? Why not fight for all minorities too?
Thanks!
I worked at a company that was about 400 employees when I started that went to over 10,000 as a mid level manager and hired hundreds of engineers over 8 years. I’ve since left the company so that’s why I’m referring to it in the past tense. In the first years, it was difficult to hire underrepresented minorities in engineering, which we defined as women, latino, and black for several reasons. First of all, early hiring was all done from within our professional networks, which tended to include people who looked like us (white and asian males). Then, once you have an environment like that, it’s not that attractive for, let’s say, a black woman, to come in and be a pioneer. This isn’t speculation, this is what my black female friends told me when I tried to hire them.
Other things we did include inviting local high school students to the office for visits, seminars, and workshops. We also reached out to local colleges (not just the top tier schools, even though I worked for a top tier company) for hiring events. We had a special internship that targeted women as freshmen in college to try and give them more experience and to beef up their resume to make them more competitive.
We took these measures to target increasing the representation of URM in engineering and management. At no point did I ever attend a hiring discussion where we said “we should hire this person because of (their race or gender) even though we have a better candidate.” By tracking metrics, we made progress toward our goals for equity without resorting to quotas, favoritism or lowering our bar for quality.
If you are looking for a job in the US in finance or tech and you are a native English speaking Asian male, I hate to tell you but the stereotypes are working for you, not against you. I have Asian relatives that get teased about being too smart, regardless of their academic achievements. I’m not saying it’s a “good” stereotype. None of them are. But hiring isn’t an even playing field by default. It takes effort to try and make it that way.
The political and cultural pendulum will swing back and forth on this issue, but it just makes sense to try and attract the best talent you can and create some diversity of thought even as you try to create a company pursing a common goal. A diverse team is a professional team, and provides you some insulation from groupthink and corruption. Even if you don’t actively pursue a diverse workforce, I advise you to keep your company culture open and welcoming.
Why do you think Asians are not underrepresented minorities and finance and tech? Do you think Asian people are smarter than other races? And what are you doing now?
I think it’s important to be given a chance, especially if there is a homogenous work environment with blinders on by people who only hang out with people who look like themselves, and who have similar backgrounds.
Personally, even though there seem to be no DEI initiatives for Asian people, I’m glad. I would find it insulting that I need special treatment when I’m an able-bodied person.
The minority group, I wanna fight for the most are people with disabilities, roughly 15% of the population. Having a disability can make getting a head versus someone who doesn’t have a disability, harder. I feel my dark brown skin is a benefit for a living longer and avoiding skin cancer a bird.
You may enjoy these posts:
Three White Tenants, One Asian Landlord: A Story Of Opportunity
Why Is Asian Income The Highest Among All Races?
I don’t want to speculate why Asians aren’t under represented, just to state the fact that in proportion to the general share of the population, White and Asian men are over represented… by a lot. Also, despite news of layoffs, demand for high tech workers outstrips supply, so it makes sense that businesses should be developing talent wherever they can and creating an inclusive atmosphere.
Thanks for the segue. I decided that I wanted a more personally rewarding job and now work in a K-12 public school and help teach digital fabrication and engineering, and generally help teachers incorporate physical making into lesson plans. After having my time as the boss, I’m finding this to be a fantastically fun job and I get to do more hands on work than I did as a manager.
I’ll say this: if you hold young people to high standards, you’re going to be impressed with the results. Maybe some get it at home from their parents. Maybe some people get that from their culture. I don’t think there’s anything wrong with that. I’m just trying to provide some of that mentorship in a public school setting. Those kids are showing they are capable of working in these exciting and rewarding careers. I am lucky to be working along side some great educators and an administration with the vision to have such a position on their payroll.
Teaching K-12 sounds like a whole lot of fun! The author, Arthur C Brooks, talks about the second life of being a mentor and teacher, to feel reward, and meaning in his book, from strength to strength.
Enjoy! I plan to do the same, and Honolulu, when my oldest goes to high school.
One more thing I meant to address in your comments is that indeed, it seems the NFL is becoming more diverse in leadership. (I mistakenly called the Rooney rule RISE above.) I don’t want to make more mistakes or be overly general. You can search around and find articles like this one if you search for “NFL diversity in leadership” https://www.usatoday.com/story/graphics/2023/11/02/nfl-coaches-diversity-report-statistics-2023/71383386007/
Rick
Interesting you did not mention orientation.
I see a significant increase in white male homosexual orientated men who are surpassing all other categories with promotions in the Department of State.
Personally I love the men I have encountered and they are my closest companions, but it does suggest that there might be some cronyism in the process for promotion and assignment of Federal Jobs!
As a woman, I feel as if I won the lottery by being born in this country in this century. Absent the specific circumstances, my life would have been so different and much less satisfying. I am grateful for that luck, and I try to keep it in mind as I deal with others with less opportunities. I know I couldn’t have taken full advantage of those opportunities if I hadn’t worked so hard. So, taking a short cut in thinking, that I must deserve my success because of all of that hard work. However, had those opportunities not been present, it wouldn’t have mattered how hard I worked because the level of success would not have come close, nor would I have the choices or freedom that I have today.
Great attitude! Having this type of appreciation makes life a whole lot better no matter what happens.
I never feel bad about being lucky. The most fundamental luck I had was being born in a rich country (England) with good parents. I don’t feel good or bad about it apart from being proud of my parents. I try to help people coming from poorer places in my career as a professor… Most of the other luck I’ve had came because I positioned myself to benefit from that luck. For example, I just bought a stock recommended in a newsletter I read. Am up almost 10% in a day. But if I didn’t read the newsletter and take action I wouldn’t have that luck…
Yeah, the more people I meet who don’t feel bad getting rich or winning thanks to luck, the less bad I feel as well. And then, as a result, I think the cycle perpetuates to the point where the winners don’t do enough to help the losers.
Anytime you can catch a lucky break, hey take it! I got lucky avoiding a hefty property tax penalty one year. I paid right at the deadline, and then my transfer bounced! I felt like such an idiot because I completely forgot to transfer enough funds into my checking account to cover some other expenses that were going out.
I was expecting a three to four digit penalty for not having enough funds on time and for then paying late. But by some miracle, I was never charged any fees! I don’t know if the person processing the payments had pity on me or if the computer wasn’t smart enough to tack on a penalty to my balance due, but I happily took the win and didn’t worry about finding out the details.
I guess that’s lucky! But did you really win if you simply avoided a penalty? Maybe! But yes, catching some lucky breaks feels great.