Practice stealth wealth if you know what's good for you. Showing off how much you make and how much you have is not the way of the Financial Samurai. You will be crucified by the public if you show of your outsized wealth. People will also not give you credit for the risk you took and the hours you put in to get rich.
Becoming wealthy has never been easier in America. Both stocks and real estate have performed phenomenally well since 2009. However, feeling comfortable as a wealthy person on the other hand, has never been tougher.
The pandemic created a K-shaped recovery where the investor class has widened the wealth gap between the working class. The longer the bull market goes on, the richer the investor class will get.
The investor class crushed it in 2020, 2021, 2023, and 2024. Both the stock market and housing market boomed, making millions of investors much richer.
Suggestion: In addition to building stealth wealth through stocks, also invest in real estate. Real estate provides the powerful one-two punch of principal appreciation and rental income growth over time Fundrise manages over $3 billion in private real estate investments, mainly in the Sunbelt region where valuations are lower and yields tend to be higher. With the Fed embarking on a multi-year interest rate cut cycle, there should be increased demand in real estate in the coming years. I've personally invested over $270,000 with Fundrise so far.
Be More Humble During Difficult Times
But a bear market hit in 2022. Many people with inappropriate asset allocations got crushed.
To be open about your income and wealth gains would be completely foolish when so many people are hurting. Instead, if you are rich, it's much better to convince people you are middle class. This way, when the revolution comes, you will be spared.
Further, just look at how the government taxes your money. The government taxes you based on income and much less so on wealth. Taxes are likely going up under Joe Biden as well. Therefore, stealth wealth is paramount.
Stealth Wealth To Avoid The Government
Once you make much more than $250,000 a year, you will face an abundance of taxes or tax phaseouts: Medicare tax, AMT, deduction phaseout, credit eliminations, education tax, Net Investment Income tax, etc.
With Joe Biden as president, he has promised to raise taxes on households making over $400,000 a year. Therefore, I argue that in 2024 and beyond, the best income to earn is around $180,000 per individual. Thankfully, Biden hasn't been able to raise income taxes, but Vice President Harris might in 2025+ if she wins.
However, you can pass on $13.61 million per person in wealth, tax-free to your heirs in 2024. This sounds like a lot of money, however, you already paid taxes on the $13.61 already. So don't think the high estate tax threshold is really a great benefit, plus it's set to decrease in 2026 unless changes are made.
President Biden has proposed raising the top capital gains tax rate. He might also abolish the stepped-up basis if he has his way. Therefore, the government is clearly targeting the wealthy to try and better distribute some of the wealth.
I can understand targeting centi-millionaires and billionaires. But if you're a six-figure income-earning household working 60 hours a week, I'm not so sure this won't cause disdain. You're already exhausted from working so hard and paying so much taxes, to pay even more sounds impalpable.
You must practice Stealth Wealth to avoid the government's growing reach for your money.
Stealth Wealth To Avoid Anger And Resentment
If the government doesn't get you, regular citizens will. Who did you cheat or rob to get to where you are? Take your millions and shove it! 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. Hundreds of millions of Americans know what losing freedom is like due to months of shelter-in-place to combat the coronavirus pandemic.
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. The last thing you wanna do his face and angry mob full of resentment.
Practice Stealth Wealth To Be Happier And Free
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 5 am 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. Alas, stealth wealth is important because the minority won't put that type of effort into their work.
It's OK To Be Proud Of Your Achievements
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.
In my viral post, Blew Up My Passive Income, No Longer Financially Independent, it engendered a lot of hate from readers on my platform and other media articles who said I was greedy. There was not a lot of empathy. All I want to do is take care of my family of four in an expensive city the best way I can. And one way is buying a nice house while my kids are still living with me.
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. Going on Twitter or Facebook to boast about your financial accomplishment is really stupid. 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 and safe car you know, so when you run into your co-workers, they’ll think you’re frugal or even struggling financially. Publicly express your love for public transportation—buses and trains included. The last thing you want is to roll into the office in a Mercedes and have your boss notice. Their immediate thought might be to cut your bonus since you seem to be doing so well.
Pulling up to a salary negotiation in a Bentley won’t work in your favor either. Instead of opting for a flashy new Range Rover Sport and writing it off as a business expense, consider something more moderate like a BMW X3 or Jeep Grand Cherokee.
When cops are deciding which car to ticket, do you think they’re targeting someone in a 10-year-old Toyota Corolla? With many officers earning $50,000 to $60,000 a year, there's often a desire to level the playing field.
In addition, many car collision stagers target nicer cars to try and get you or your insurance to pay money for damages. I was in a brake check scam where I could have been carjacked with my 4-year-old daughter inside. Luckily, there was no bumper damage and we agreed to part ways. You are most vulnerable to public dangers as a driver.
Driving a regular car is the easiest way to practice Stealth Wealth. Save the luxury vehicle for events where everyone else is driving one. Always read the room.
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 and see what you paid for your house. Not only can they find out the price, but they can also gauge whether you're underwater or sitting on a pile of equity.
To protect your privacy, avoid giving out your exact address. Instead, offer cross streets and a vague description. For example, “I’m at the corner of Jackson and Teller. It’s the brown wood shingle house—you can’t miss it.”
While they may eventually figure out your exact address if they’re persistent, delay that as long as possible. Your home is your sanctuary—protect its privacy. I recommend claiming your house online and making it look as unappealing as possible. Property tax assessors often look online now to find reasons to raise your taxes.
Your home is the quickest way to blow your Stealth Wealth cover. Be careful. Keep your perfect house under wraps by not boasting about it. People will get envious of your large lot, stunning views, and remodeled interior!
Robbers target homes in rich and famous neighborhoods. Living in a rich neighborhood may be safer due to more police support and better deterrent systems. However, famous neighborhoods can attract outsized attention, especially if you have a famous neighbor. Here are more thoughts on how to protect your family from harm.
Stealth Wealth Rule #3: Don't flash your bling
Whether it's your Panerai watch, Birkin bag, Armani suit, or Louboutin shoes, keep them at home if you want to maintain your Stealth Wealth. People who practice Stealth Wealth don’t flaunt their luxury items. If someone asks, you might even say you’re wearing a replica.
Resist the urge to boast about your material possessions. You’re already established, and the high-quality items you buy are for your own enjoyment. Pretend you’re indifferent to luxury brands or unaware of their prices—just say you like the way something looks.
Only wear your luxury items in appropriate settings. If you’re attending a billionaire’s mansion party, by all means, show off your jewelry and watches. You’re among peers who won’t resent you—they’ll appreciate your refined taste.
But always read the room. If you’re in a low-key environment, you should remain low-key and practice Stealth Wealth accordingly.
Stealth Wealth Rule #4: Never reveal your full income or wealth.
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 about $75,000. 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.
Just know that if you are signaling to the public about your averageness, make sure you signal consistently. Here is a Stealth Wealth case study on what not to do to blend in. The Tweeter made herself appear middle-class, when she was anything but.
In addition, if you want to be more empathetic towards others who have less, adopt a Broke Mindset. If you force scarcity onto yourself, you will feel more stress and aware of the financial situation other people with less experience daily.
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 supportive and positive about other people's milestones. Insecure individuals often feel the need to boast the most.
You know the types—they constantly post pictures of themselves, name-drop who they hung out with, or frequently share how great they are. Occasionally, it’s fine, but doing it all the time screams desperation and a need for attention.
Resist the urge to “one-up” someone else's achievements, no matter how successful you are. Give them the glory. Celebrate their success and never diminish their accomplishments.
A true Stealth Wealth practitioner understands there’s enough praise to go around. Compliment others, and credit your own success largely to luck.
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. And when it comes to your charitable givings, stay consistent and keep those donations a secret as well.
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. One year, I decided to share with people that I got a job as a high school tennis coach making $1,000 a month.
The IRP on Twitter went into an uproar and attacked me because Financial Samurai is a relatively large site that earns money. However, 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. The IRP have moved on to harass other people to work out their own issues.
Stealth Wealth Rule #11: Donate 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 once Biden became 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.
For a real-time case study, Sam Bankman-Fried donated $40 million each to Democratic and Republican politicians. He also donated to many media organizations. As a result, he still roams free and gets invited to speak at The New York Times and other institutions, despite misappropriating client funds.
The collapse of FTX has lost its clients ~$10 billion. But if you donate aggressively to powerful people and institutions, you can be more stealth and last longer than you should.
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.
Stealth Wealth Rule #13: Stop smiling so much and acting all happy.
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. Ideally, you learn how to smile internally.
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. Accept that your wealth is mostly due to luck.
The Benefits Of Stealth Wealth
Here are some of the key benefits to 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.
Remember this equation: Happiness = Expectations – Reality. If people are always expecting great things from you because you're rich, you might close up and experience a trough of sorrow.
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. If you don't practice stealth wealth, people will judge you for the things you buy.
A large reason why people are wealthy is because of the financial discipline they've practiced all those years while working. They saved and invested aggressively, eschewing the trappings of wealth.
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.
Home contractor and auto mechanics will most definitely want to charge people with nicer homes and cars more. That's just the way things go when people see others with more money.
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? Stealth wealth prevents kidnappers and muggers from targeting you.
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 With Stealth Wealth
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 $50,000 a year on private high schools, $2,000 on fund raiser galas, $85,000 on BMWs and $100,000 on fancy country clubs. Hang out with regular public school people.
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. As a human being, I underestand may want to flex about all the things you have to society. But flexing just invites disdain and scorn. Instead, be comfortable and proud of what you have because you're driven by intrinsic motivation to do well.
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.
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Invest In Real Estate For Financial Independence
Every stealth wealth practitioner I know invests in real estate. Real estate is a tangible asset that is less volatile, provides utility, and generates income. The combination of asset price appreciation and rental price growth is a power combination to create stealth wealth.
In 2016, I started diversifying into heartland real estate to take advantage of lower valuations and higher cap rates. I did so by investing $954,000 with real estate crowdfunding platforms. With interest rates down, the value of cash flow is up. Further, the pandemic has made working from home more common.
Take a look at my two favorite real estate crowdfunding platforms. Both are free to sign up and explore.
Fundrise: A way for accredited and non-accredited investors to diversify into real estate through private eFunds. Fundrise has been around since 2012 and manages over $3.3 billion for almost 400,000 investors. For most people, investing in a diversified eREIT is the way to go.
CrowdStreet: A way for accredited investors to invest in individual real estate opportunities mostly in 18-hour cities. 18-hour cities are secondary cities with lower valuations, higher rental yields, and potentially higher growth due to job growth and demographic trends. If you have a lot more capital, you can build you own diversified real estate portfolio.
Investing in online real estate is one of the easiest ways to stealth invest. Unlike owning physical property, it's extremely difficult to figure out what real estate stock, ETF, or private syndication deal you invested in.
Both platforms are sponsors of Financial Samurai and Financial Samurai is currently a six-figure investor in a Fundrise fund.
Stealth Wealth Management Tool
To manage your stealth wealth, try using Empower'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. It is the best on the web because it pulls in real data you've linked up and runs thousands of algorithms 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.
Join 60,000+ others and subscribe to my free weekly newsletter. Since 2009, the newsletter has helped people achieve financial freedom sooner, rather than later. Embrace stealth wealth and live the life that you want without scrutiny!
Hi Sam. First time commenting and I enjoyed the article, especially the line about skipping school. I must admit I did that a few times but figured out how to make multi six figure income in spite of it. With my business I have a general idea what my customers income is. I always find it interesting the ones with very average incomes have a lot of toys in the garage and are leveraged to the hilt. The ones with net worths north of 5 and 10 million drive Buick Enclaves or maybe a Lexus RX350. My wife and I have lived modestly and yes, we drive a Toyota. My son-in-law actually calls me the riches poor guys he knows. I’ll take that as a compliment.
Be well.
It’s a good complement! At the end of the day, if you have wealth and financial freedom, letting other people know you have wealth and financial freedom takes away from your freedom.
Hey Sam, long time fan, first time poster. Appreciate your articles over the years on personal finance and especially enjoy your stealth wealth and 1/10th car buying articles you wrote a while back. Keep up the good work!
Lol good post. I learned this the hard way.
My wife and I sold our company and did pretty well. For some time after that when new acquaintances would ask “What do you do?” I would answer some variation of “We’re on indefinite sabbatical after selling our business.”
Learned pretty quickly no one wants to hear that. The eyes and non-verbals were quite clear.
Now we say something vague like “Online marketing” and change the subject.
Envy is a real human thing. No one wants to know that you made it huge and don’t have to work when they are clocking into the corporate grind and worrying about bills every day. It makes them feel bad about themselves. They project that negative feeling on you. There is zero upside. None. Let others think you are struggling just like them, or better yet that they’re doing better than you are.
Now I understand why a friend of mine who runs a family business always said “Oh, things are tough!” when I asked him how his biz was going. I later discovered he was making money hand over fist, and good for him. Smart man.
I also understand the rule that “Whoever in the room is most vague about what they do is the richest” lol. It’s true.
A better answer would be MLM…. They would run away.
I’ll agree that extreme income/wealth income inequality is a problem. Total income/wealth equality would also be a disaster. Like most issues in life, the question is, where to draw the line, and then how.
The estate tax is stupid. 40% above the exemption level. It’s not even graduated. Given that at a 10% ROI you can double your money in 7.2 years. That does very little to limit the growth of generational wealth, especially as the heirs, if they are the children, will typically have at least 3 times that long before they pass it on. It needs to be an inheritance tax, not an estate tax. (And close out the trust dodges.)
That means the tax would be paid by the inheritor. Why not? They haven’t paid any tax on it yet. And it needs to be steeply enough graduated that even Musk, Gates, and Buffet would have trouble bestowing much more than, say, a billion dollars on a single individual even if they lobbed a 100 billion at them in the will. But at the same time, go ahead and raise the exemption way on up, maybe 50 million (and that’s a lifetime total, to prevent games), and tie it to an economic indicator so it doesn’t require fresh legislation every time it needs to be adjusted.
What this means is that someone with a 100 billion dollar estate could settle it on one beneficiary and they might get 1.2 billion after the estate (not the individual) paid 98.8 billion to Uncle Sam. Or they could parcel it out 2000 ways, in blocks of 50 million, and none of the inheritors would pay a dime in taxes on it. Either way, society is served, and no one loses anything they already had.
Except for this particular form of income tax, however, all the rest need to be replaced with a consumption tax. Unfairly regressive? Sure, it would be. Except that the government figures out what people at the lower end of the working class (upper end of the poverty class) would be paying in consumption taxes for food/shelter/utilities/clothing and whatever, each year. They divide that in 12 and send everyone a check for that amount every month.
Bonus: And if it ever gets to where you really need and want a UBI (dole) and the country can afford it, it becomes very easy to adjust the monthly repayment.
In hopes of preventing my young kids from joining the angry crowd in the future I’ve been intentional about discussing that having expensive toys/cars/houses only proves the person spends money. It does not prove they actually have the money to spend. Hopefully they’ll also learn that having expensive stuff to impress other people isn’t impressive to the people actually worth impressing.
Back home we used to have people envy us, although we were not rich by any means. We did work a lot, earned a pretty decent buck, which made others feel aggravated with our success. Once we immigrated we kept a low profile. We are not rich (now more than ever), but we do have a home (got a mortgage approved 2 years after immigrating), my daughter does performance tennis (which costs more than the mortgage itself), we do go back to Europe every year. In our case we prioritize the kid and travels, while keeping a very low profile otherwise. We drive two old cars, never dress fancily etc. I’d rather have people consider us to be one of them (which we are), then to look and envy us for a flashy car of for thinking we are rich. We do better than many of our neighbours, but this comes with a lot of prioritization and sacrifices.
Come on man – you’re really recommending to follow SBF’s example in donating to both parties? Really? And being on charitable boards is good advice but not solely to hide your wealth. This is just so cynical and assumes people don’t have any values or principles by which to live their life. How about: try to be a good person, give generously, and stand up for causes you believe in? Isn’t that authenticity infinitely more rewarding than living a life defined by trying to blend in and hide wealth? I feel sorry for anyone who actually follows this or thinks this way, it just seems like a sad way to live.
I think SBF may have followed my recommendation instead. After all, I wrote this post a decade ago and have been constantly updating it since.
Being a good person is the ultimate goal. That said, you can be a good person and still get hated on because you have money.
Cynicism tends to grow with age b/c you see more good and bad things happen. I don’t think ANY politician who has accepted money from SBF/FTX has publicly stated they have returned the funds. And SBF is out on bond for 10 months while pilfering $10B in depositor funds.
What is sad is how some people treat you for saving aggressively, being frugal, starting a business, and ending up having more wealth than average. Hence, to keep the peace, it’s best to blend in.
I’d love to hear your experience about how people treated you once you grew your wealth above average and how you were able to stay humble and below the radar. thx
And yet none of your advice will save the rich person from the deterioration of their own prefrontal cortex. You can write all this to tell them to escape judgement from humans and the IRS, but you failed to tell them the brain damage they’re doing or what those consequences mean. Since this article reads like comedy, with an utter lack of self awareness of how paranoid it is, then I’m going to assume your brain is already started to atrophy quite some time ago. Perhaps you should see what rich folks MRIs start to show, no empathetic accuracy. The reason people think the rich need to go isn’t out of only jealousy, it’s just that they’re an existential threat to society by consolidation of wealth and power. You see, evolution and the brain are taking care of that way faster than any government will. Rich people will figure out how to destroy themselves through addiction, depression and suicide after the cortex rots. Their inability to get along or gain acceptance isn’t a coincidence, it’s a side effect of a damaged cortex. Being rich will eventually erode impulse control. You maybe ought to tell the rich that if they actually wanted to protect themselves, they’d stop being rich.
Can’t run and hide from your own brain.
This is an insightful comment, thank you. Are you neurologist by any chance? I really appreciate the insights on brain atrophy and would like to learn more about the correlation between wealth and brain deterioration.
What is your financial situation? Always good to know where people are coming from.
You are a model of restraint, Samurai. Tks for the chuckle.
Try living in a fifth-wheel! We moved into it after we sold our Colorado home, and couldn’t find exactly what we wanted. More than 3 years later, we’re happily ‘caretaking’ at friends’ ranch — and now looking more seriously for bargains, since real estate prices in the West.
This decision let us spend a year in Michigan helping take care of my mom in her final illness. It also has let us volunteer for a group in Arizona, and do some travel while taking our home with. Since the fifth-wheel is pulled by a used Ram truck (with a few dents), we don’t look well-off. But it does mean we can make these choices, while our money in investments continues to grow.
Family members have expressed the idea that we’re “broke.” We smile and say nothing. (My mom thought it was hilarious, since we knew exactly how much we were worth.) Meanwhile, we know another family member has a lovely, expensive home — and is hundreds of thousands of dollars in debt. Why would we prefer this to our current mode of action?
P.S. Staying low lets you be generous to people who need the help — but do it anonymously, or through another group. (Like a church) You’ll feel wonderful. You won’t get pestered, either.
Has to be one of the strangest pieces of “financial” advice I’ve ever read. I suggest being yourself and enjoying life in the way you see fit. Devoting so much behavioral management to how others see you is a great way to put your happiness in the hands of other people.
Agree. One of the best benefits of financial freedom is being able to do what you want.
Unfortunately, if you accumulate more Wealth than the average person, there is a chance your increase other peoples envy of you. Hence, the importance of Stealth Wealth and staying humble.
Maybe your view on the subject will change as you build more wealth. And if they do, please let me know why they did. After all, you somehow stumbled upon this article in a Google search because you have some question or issue to address.
I needed this article. But I’m keeping my BMW. It has a great car and driver review.
I love that Stealth Wealth has become a “thing” recently.
You specifically mention a Panerai in your post as “bling” but the reality is that unless you’re wearing a Rolex, no one really knows anything about watches, which is what I love about them. My buddy wearing a Fossil has received just as many compliments on his watch as I have while wearing a Breitling.
Not too long ago I was driving my rusted 2008 Tahoe with 200k miles to work and was cut off by a guy in Tesla. When we got up to the stop light, he had the nerve to give me the finger (even though he cut me off) and proceed to yell about how I “should get that rusted piece of shit off the road” as he sat so proudly in his brand new Tesla Model 3. I couldn’t help but smile to myself knowing that I was wearing a watch that I could trade in for his exact same car.
Most people wear their finances on their sleeve, so they assume everyone else does too. Let them think they’re better off than you while you quietly build your wealth.
Love the story. I live in a $250K house , which I paid $118K for in the early 90’s. We have a net worth of over 10M in investment money and live way below the radar. From a small town but live in a Metro area and everybody shows all they have. It humors me. They keep trying to get me to buy a Rolex. I guess being an outsider has its advantages.
I have noticed that people tend to stay away from you more when they think you have no money. You can get lots of privacy, learning time and planning done when people would be disrupting everything you are trying to accomplish.
I saw this today. Another reason to practice stealth wealth. Scary stuff: nypost.com/2022/03/22/duo-follows-man-into-nyc-building-robs-him-of-100k-cops/
Don’t worry, you got a lot of criticism for your “$300k is poor” article, but you and I being in the Bay Area are comfortably in the middle/upper-middle class but we’re not sniffing the ultra wealthy levels typical here in the Silicon Valley where we’d have a lot to hide yet.
$300K is not poor in the Bay Area. It is a middle class lifestyle.
Stealth wealth is what actually whispers. It is invisible but does make an appearance when required. I have seen many families which live in a modest house and drive modest cars but are actually wealthy.
Stop smiling soo much? I was loving this post until I saw that. Dude, at that point you’re living a life based on what others think. I can’t get behind that.
Well, that’s exactly what you’re trying to do with Stealth Wealth. Blend in, so you don’t draw too much attention. If most people are stressed and unhappy, they don’t want to see a person all smiley and happy.
Related: Emotional Intelligence Is Key
This is the truth. I talk from personal experience. Years ago I used to smile at everybody all the time, thinking that by doing so, everybody was going to like me… it usually produced the reverse result, many fellow men used to assume that I was weak and many women pressumed that I was insecure and many others probaly despised me. Reserve your smile for when a proper occasion deserves it. This world truly hates rich, happy and smiley people. People pretend to pity sad, bankrupt and miserable people, but in reality, many people deep inside rejoice when others are failing, poor and struggling. And envy those who are thriving, happy, cheerful and smiley. As the author of this article put it, “Folks, trust me on this one”. I’ve been there.
I used to know a person that was always upbeat and “happy”.
Do you want to know what bothered me? When you have the same demeanor day in and day out, both in the morning and in the afternoon, then you are wearing a mask. An happy one, but still fake as hell.
Also, I highly value silence and quiet. This person was the opposite of that. It gets tiring really fast.
Your post reminds me of something I read about the 1800s. At one time Americans aspired to modesty, and that was the topic of popular “self help” books at the time. For whatever reason flamboyancy has replaced this and we now let extroverts run everything.
Huge fan of doing stealth wealth. I feel like the more I make, the less I feel inclined to impress to begin with, which is nice.
I definitely need to work on #7 though and be a lot better at asking dumb questions or just not trying to be the best person in the room.
RE: older comments above, I am definitely OK with lying about my wealth to have more meaningful relationship and to prevent harm. I definitely know richer folks who actually are stealth wealth but since some people know they’re wealthy try to break into their house and do kidnappings, etc.
Though I think a good way to have an honest approach to this is just to only surround yourself with rich people. When I surround myself with rich people, I never feel like they need to pay because they have more money than me. In fact, I’m just glad to hang out with people who are already at the place where I want to be and so I almost always offer to pay.
My great uncle just died. I was one of many heirs that received 100k-200k. Overall his estate was 4-5 million. He lived in a shack with a bunch of land. He wore old clothes and drove an old car. Stupidest thing I’ve ever seen.
How much did you guess he was worth before your inheritance? That does seem overly frugal indeed.
When the revolution came to Cambodia the Khmer Rouge identified the upper class… doctors, lawyers, teachers, etc… by whether or not you wore glasses.
Perhaps you should add rule $16; Get Lasik.
Another example where “stealth” is very useful is in academics. When fellow students know you are smart and get good grades, they want to “work with you” and they want to borrow your notes etc. Now when it comes to notes, I have always been a good note taker and it is because of my notes that I got nice grades. I never used to hide my grades when people asked and more than once I lent out my notes to other students if it would benefit them, only to figure out that sometimes I didn’t get my notes back. Like I had to almost beg to get my files back. By the time I was midway through my undergrad, I kept quiet as much as I could about my academic performance and kept my “clean worked out” notes away from the rest. Only my “rough” class notes were with me at College. By the time I entered grad school, I was as “anonymous” as possible when it came to grades and general academic performance. Best choice ever. I only worked with a few fellow students who were as solid and helpful as I was and that’s it. They essentially had the a similar philosophy
I used to make copies of my notes, not giving the originals to anybody. Also you can be “rude” and not lend them / not help.
Sometimes sharing ain’t so bad. I used to group study with friends who were poorer students than me and as a result had to do a lot of coaching instead of studying. But more than once, the topic they asked for help with would come up in the exam paper and because i coached them on it, i knew it 10x better than if i had just read it myself. I also shared notes freely as it didnt make a difference to my score (luckily we had photocopy machines so i didnt have to lose mine). Knowledge can never be taken away from you so share it when you can and you will have the good deed repaid back, sometime sooner than you think.
Financial Samurai,
I just stumbled upon your website when I am looking online for tips on net worth by age. I commend the research you put on your post. My goal is to become the first millionaire (multimillionaire based on my mathematical projections/calculations) in my family (Humble Millionaire) and not depend on anybody including the government for income which is why I am saving aggressively (maximizing 401k and Roth; saving around 40% of the net income and investing them to growth stocks and real estate).
Thank you for this specific post about staying under the radar when it comes to wealth.
I always wondered what percentage of millionaires practice stealth wealth. There’s a tipping point where you cannot hide money anymore but you could probably look pretty poor with $10M in the bank if you wanted.
Not sure how old this blog post is, its my first from the FS. The whole tone is BS, you don’t need to change your personality just because you become rich (if you change your attitude you may become rich sooner – especially when you realize that rich is not associated with money), the tax rate in the US is ridiculously low at this time, the US is one of the countries where both becoming rich and being rich is easy and not associated with stigma – the whole whiny tone is just silly, no one is after you when you have money – stop playing the victim.
I will read some more posts, but if this is the extend of the blog – forget about it.
I don’t want people to know how well off I am because there is no benefit for other people to know how well I do. That’s the crux of this tread. It says nowhere you can’t spend any money, but unfortunately we live in a society that when you live in a huge house, drive a big car and wear expensive clothes, that you have money (even if you don’t) and then some people (even within the family) start parasiting on you. Blending in as a common average guy while you have millions is better than ever.