Obviously, this question can’t be answered without doing an audit of their personal finances, which would be illegal or impossible. But generally, how much cash do the super-rich like Bezos or Gates have at any moment? (Not necessarily physical cash, but like, money in a checking account in a bank - money that does not have to be first liquidated in some way or other.)
If Gates wants to buy a luxury yacht today, can he just log into an online bank account and transfer $100 million on the spot to the yacht seller, within seconds?
At some point you become the bank and your credit stands on its own. A luxury yacht would be an inconsequential purchase for someone like Gates, Buffet or Bezos. Their accountant would just handle it along with the grocery bill. Buying another company is a different matter and a team of lawyers, accountants and industry specific experts would get involved in making sure they had the funding to cover the deal.
If they just wanted to pay cash because it makes them feel like a common multi millionaire I guess he could get an American Express Black card.
First off, that’s not how you buy a yacht, but setting that aside…
Depends on the millionaire. Finance types like Buffett are all about “opportunity cost” and would rather have the money invested than just sitting in a bank. He’d have to liquidate some asset to pay that much.
An entertainment type would likely keep the FDIC limit in a money-market checking account so it earns a little something, but is readily available when they want to flex (as the young folks put it).
For everyone else, as the saying goes, there’s Mastercard or its equivalents.
According to this article, filthy-stinking-rich-and-everybody-knows-it-type-people generally have no use for cash. Either their credit precedes them or they are surrounded by an entourage of assistants who will take care of any gory details like paying the bill.
Not to mention the fact that when you’re filthy stinking rich and/or exceedingly famous, you frequently get comped, even though you’re someone who can very much pay their own way.
That is not a matter of cash. If he were super busy he would send an assistant out to fetch lunch (or groceries, clothes, or anything else he might need) so as to maximize his own productivity. He must be slowing down.
But the OP is asking about billionaires. I know we often lump multimillionaires in with multibillionares and call them all “super rich” but comparing Warren Buffett to even the wealthiest of wealthy “entertainers” is to compare apples and oranges. You need certain qualities, strengths and knowledge (as well as opportunity) in order to accumulate Bezos or Gates level wealth. I think that in the process of attaining those riches, they all must learn that “flashy” big purchases and “flexing” just to show how much money you have, is not conducive to building their empires. Even the wealthiest of “entertainment celebrities” that are technically billionaires (Jay-Z) accumulated most of their wealth thru non-entertainment business outgrowths from their successful careers as entertainers. Im specifically leaving out billionaires such as Spielberg and George Lucas as they aren’t in the same category of “entertainer” as is usually meant by the term.
One day, I was at a University of Washington cafeteria, and Paul Allen was in line ahead of me with a bunch of students (computing students I think, obviously an outreach/mentor thing). He pulled out a Campus card to pay for them all (one of those student/faculty ID cards that you can charge up with $) but it declined. The cashier said “do you have anything else? This one’s out of credits.” He kind of chuckled and said “do you know who I am?” (in a nice, self-deprecating way) and pulled out a credit card (I didn’t see it, but it didn’t look black or out-of-the-ordinary).
I’m forever kicking myself that I wasn’t fast enough to thrust my credit card forward so I could say I bought Paul Allen lunch…
Bezos, instead of buying a yacht, is buying his own spaceship company. But he didn’t actually buy it, he invested money into it, essentially building it from scratch. Some years ago he claimed he was putting about $1 billion a year into it. AIUI, the money comes from selling Amazon stock.
At any rate, it’s different than Elon Musk and SpaceX, since SpaceX has other investors who own large chunks of it. Bezos apparently owns Blue Origin outright.
Well below Bezos and Gates level wealth people will have credit cards with really high limits. You could buy most cars and some yachts that way. There isn’t much anyone needs to pay cash for that exceeds those limits. They will also have household bank accounts with ready cash in them, they probably never touch them personally though.
Either gentleman is likely to have a billion or more in a personal stock account. Unless they’re heavily margined, the spending power of such an account would be in the hundreds of millions even if there’s no cash. They only need to write a check, use a piece of plastic, or telephone in Swift and account codes.
I think we can assume these big players would pay interest near prime commercial rate, not the exorbitant rates charged retail investors. They might sell some stock and pay off the loan a few days later.
Bill Gates and Warren Buffett are duplicate bridge players, who often partner up to play in the Nebraska Regional. I suspect, but am not sure, that they pay pull out their wallets to pay their entry fees in cash. I’ll bet they stand in line to buy their entry just like everyone else.
I suspect that many ultra-rich businessmen who want a yacht or a private plane, or some other similarly extravagant object, would arrange for their businesses to buy it or set up a corporation specifically for the purpose of acquiring it. Then they can deduct it as a business expense and lease it to other slightly less rich people when they’re not using it.
I know of a billionaire who owns 15-20 business jets that he leases out, some of which (including a highly customized Airbus A-345) he uses for personal travel whenever he wants. He also has a $70 million, 300-foot yacht that is available for rent (only $2 million per week) whenever he’s not using it, which is probably at least 50 weeks out of the year.
Why own big-ticket items like these, which you will not be using most of the time, and not make money off them?
Rich people don’t need cash, because they have debt.
I’m not “rich rich” by any stretch of the imagination, but one thing I’ve found as my wealth entered “comfortable” territory is that cheap debt became very easy to come by. And why not? The bank that holds many of my assets is happy to give me a loan backed by those assets. It’s safer than a mortgage, because the value in a house can be more easily destroyed than a boatload of stocks.
So Gates doesn’t need cash, but he probably does have a 9-digit credit line with someone that he can use to pay any incidentals.
I live about 2 miles from Bill Gates, Steve Ballmer, and quite a few 100 millionaires. There is (or was) a Tully’s coffee in Medina WA, which is where these folks live, and is about the only public meeting place. Anyhoo, I was in there once with my family about 8 years ago, and in walks Steve Ballmer by himself talking on his mobile phone. I tell my family in Chinese that the CEO of Microsoft and a billionaire was in the shop getting something to drink. Eldest kidlet “he dresses worse that you do Dad”. SteveB was wearing ratty shorts and a well washed polo shirt. Unfortunately, my back was to the counter, and I couldn’t see if he paid with cash, credit card or was comped.