Mo' money, mo' problems?

In My Humble Opinion
1

I’m sitting here contemplating these timeless words (as spoken by the Notorious B.I.G. and Puff Daddy), and it occurred to me that I have never had a lot of money, and I would like more of it, but I would not truly expect that to solve my problems. Indeed, I would expect it to bring its own, new set of problems. Namely, more people trying to get said money away from me, and greater responsibility.

That doesn’t mean I don’t still want it, as I’m quite up to the challenge, but keeping this in mind is how I curb my enthusiasm, so to speak. I know there are Dopers who are quite well-off, so I’d just like to hear your frank opinions - mo’ money, mo’ problems: truth?

2

Just to preface: I wouldn’t say I’m well off, but I’m doing all right.

Sometimes it seems that way.

Do you have enough life insurance?
Are you saving enough for retirement and saving in the right types of investments?
Do you have the proper amount of homeowners insurance?

Back in the day, it seemed like all I worried about was paying the bills: getting the rent covered, buying some food, putting gas in the car. Now it seems like the more I have, the more it needs to be managed. And what keeps me awake the most: making sure I don’t lose all the stuff I’ve acquired.

Still, I should have such problems. As much as they aggravate me, I’d take them over extreme poverty any day.

3

When I was in my teens, I attended a fancy girls’ school on a full scholarship. All of my friends were rich, and some were super-rich. I came from a lower-middle-class background.

I don’t believe that more money causes more problems. It merely causes different problems.

4

Wealthy celebrities are different than being a civilian & getting a low key job that pays 200k a year. Celebrities have to deal with constant lawsuits, women trying to get pregnant to claim child support, fake friends, moochers, etc.

5

So fifteen years ago I was making…maybe $30k on the top end. I owned a home (well, the bank owned it). This made me significantly better off than many of my friends (I would have been 25), who were still delivering pizzas and living in rathole apartments.

I had an acquiatence, someone I’d met maybe five or six times through mutual friends. She was a single mom at 20, her exhusband (pregnant at 18, married at 19, divorced at 19) didn’t pay much child support, and, in my short association with her had gone through many jobs because she couldn’t figure out why she should show up on time, and why she wasn’t running the place. She’d quit if they gave her a “bad time” (which usually happens before they can you.)

She always dressed really well. She had the best boots, shoes, pursues, tops, jeans. So when she had money, it got spent. I remember meeting her, before I knew her circumstances, and envying her warddrobe.

One day I get a call from another friend. This aquaintence is currently unemployed (didn’t shock me) and about to get tossed out of her apartment with her child! Since I was rich and the only person they could think of with money ($30k a year, remember), they were wondering if I would pay her rent.

I laughed.

It isn’t how much money you have, its how audacious your acquantences are in thinking you should share it.

(Wesley, $200k a year isn’t wealthy. It does put you in the top 5% of U.S. wage earners (barely) - but that is a long tail. It lets you live comfortably, but doesn’t allow you to jet off to Europe. With taxes (about half that), daycare (daycare for 2 was $36,000 a year), and a mortgage, you may have enough to actually save for your kids college if you can avoid going out to dinner too often, don’t drive brand new cars, and watch you budget. I suppose its how you define wealth, but I don’t think most people would look at a $200,000 a year family (who is managing their money and not overspending) and tag them as wealthy - particularly in parts of the country where home values have gotten so ridiculous).

Wealth can be a burden:

  1. Keeping on top of your possessions can get demanding. One house that you live in is easy to make sure gets cared for. Have a second home, and now you are caring for two. And if you are “living wealthy” you aren’t actually mowing the lawn, but you are hiring a management company or someone to maintain your homes. Which means you need to make sure they actually do what you pay them for. The more “stuff” you have, the more “stuff” you have to maintain.

  2. When people perceive you have more money than they do, a small number of them expect you to share it according to THEIR priorities, not yours. You can lose friends (but they weren’t your friends anyway).

  3. You become a target for people who want to take your money. As my current accounting professor says, “the stupid rich guy market is really the place to be, unfortunately, its sort of small.” However, that doesn’t stop people from being in the stupid rich guy market and trying to take advantage of you. Get in a fender bender with your BMW and someone will sue you, where get in the same fender bender with your Civic and everyone walks away and files with insurance.

Now, I’d rather have the burden of firing a management company that keeps up the house in France than not being able to pay to heat the house. So burden becomes very relative at that point. And you can have a gazillion dollars in the bank and not own a second home and drive a Civic and live middle class and everyone will treat you like a normal person. So its a burden you are choosing. (Unless your wealth comes with fame, as wealth does for entertainers, athletes and - often - business executives, etc.)

6

My philosophy is there are big problems and little problems, and any problem that can be solved with money is a little problem. I’ve been homeless and living on the streets of New York City, and now I have more money than I use, so I consider myself well off.

7

A little over 5 years ago, I was unemployed and almost flat broke. For a couple of years after that, I was working multiple part-time jobs and occasional full-time jobs with companies that tended to go bankrupt if you looked at them funny. Things were bleak for a little while, and very uncertain for longer while.

Now, things have turned around completely, and I’m doing better than I or anyone in my family had even thought possible, though I still wouldn’t qualify as “wealthy”.

But anyway, back then, problems were problems. Now, problems are more like concerns, things that need to be considered and taken care of, but that would never cause me to lose sleep. Think of it as having had to carry a couple of boulders versus a handful of pebbles now: sure there are more of the pebbles, but they can be toted around without a second thought.

8

My husband now makes more than twice what he did when we first married, and we’re in the same financial problems that we were in back then.

Now, we do have a savings program (which comes right off the top of his paycheck, so we never see that money) good insurance, both life and health, so we’re in better position than many, but every month, we struggle to cover our expenses.

Every month, we vow to keep a budget. Every month, we vow to track our expenditures and find out just where the hell all of our money has gone. Every month we fail to do so.

I don’t think having more money causes more problems. I think that you just have problems no matter what your income level is. People sometimes seem to think that having more money will make their lives simpler, but it doesn’t work that way. You always have problems. Bill Gates may not worry about paying the electricity bill, but he still has worries-- lawsuits and the like.

Secondly, you tend to adjust your spending to your income level. In other words, the more you make, the more you spend. You think, “Ah, I can afford that,” and go ahead and buy the things you’ve wanted, so you’re just as broke as you were when you had a smaller income.

9

Poor money management skills can’t be overcome by just making more money. At some point you need to learn how to manage your money.

If you never learn this skill, then you will always have money problems, regardless of how much you actually make.

10

First of all, it’s not all that expensive to “jet off to Europe”. If you literally mean “take a jet to Europe for a little vacation” I just did that a few weeks ago and I don’t earn 200k. It is not something I can just up and do every weekend though, if that’s what you mean.

Secondly, 200k a year is, in fact, relatively wealthy. No, it’s not private jet wealthy, but compare it to someone making $45k a year.

Money can bring problems. What I sometimes see is what we in the business world call the “golden handcuffs”. You go to work for a prestigeous high paying company. You start getting used to the lifestyle of the appartment in the trendy part of town, the nice car, clothes, summer house and country club. Pretty soon you are stuck in that job or career track because a change would mean a lower salary and a major lifestyle change.

11

Relatively, yes. But someone making $45k is relatively wealthy compared to someone living in Camaroon making $600 a year. And I wasn’t literally meaning “take a jet to Europe” - as I suspect you know. I was meaning the bells and whistles of wealth, as opposed to upper middle class luxuries. (Paris Hilton never invites US over). I’ve done the cheap trip to Europe as well - I did it as a student when I didn’t make $10k a year.