What Constitutes “Wealthy” to Urban Boomers

Living paycheck to paycheck while making a combined $500,000 a year is considered “normal.”

No Seriously.

Financial Samurai ran an article not long ago titled “Scraping by on $500,000 A Year.”

It was a good start in defining “wealth” against “expenses” in big cities.

Here’s the aforementioned article:

http://www.financialsamurai.com/scraping-by-on-500000-a-year-high-income-earners-struggling/

~~~

In any major metro area of the United States, a reasonably priced older home in a reasonably nice neighborhood [read: reasonably nice, not top of the line] starts at around $1,000,000.

Anything less is either a small condo or a tear-down.

I know, right.

In order to qualify to purchase one of these homes, you’ll need an income of approximately $300,000 no matter what anybody tells you to the contrary, including yourself.

It also warrants noting that 6000 ft. lots are priced somewhere in the $850,000 range, and with construction costs for a custom home on the same lot running about $1,200,000, you have to double your earnings.

You’ve now in over 2.1 million and haven’t forked over a single electricity bill, not to mention property taxes that will run in the $55,000 range…and I haven’t even started calculating the cost of a gold-digger.

This is why so many homes around here [and in places like, say, Beverly Hills] are held in family estates, and then gifted to offspring in the form of nest eggs.

All the kids have to do then is cover are property taxes and upkeep, which means they can get by on $250,000, as long as they don’t have kids, own $100,000 cars, or take vacations.

Hell, private school education alone rivals property taxes, so you can see where this is going.

No wonder people who earn $500,000 consider themselves upper middle class.

Of course, if they earned $500,000 in income and had 5 million in a diversified investment portfolio, then they’d most likely consider themselves upper, upper middle class.

Doing the math, they’d be looking at a yield around $400,000 on the 5 mil taxed as capital gains, and $500,000 taxed at 39%.

Now they could take three vacations and still save the $7300.00 at the end of the year.

As for Financial Samurai‘s breakdown…

Interesting breakdown, but that “$7300” left over wouldn’t have a shot in hell of making it to the savings account for most people I know.

Why?

Because 3 vacations a year for a total of “$18,000 a year” is a joke. It’s easily twice that amount.

Round trip business class tickets alone from Houston to Los Angeles are in the $1500 range per person.

Hotel rooms in the “One king bed, no sitting area” will run $685.00 per night, with small suites starting in the $1700.00/night range at places like the Beverly Wilshire in Los Angeles.

You also must accept the fact that miscellaneous expenses are going to fall in the $1500.00 range even if you don’t happen to wander into Barney’s.

You can see where this is going.

HOW THE “AFFLUENT” SEE REAL WEALTH

The following is a letter copied verbatim from the web from a very successful couple.

While some of it may shock you, it’s representative of how many in my general demographic see real wealth.

“I have no idea how anyone could live on $500,000 a year. I make $1.0 million a year as an equity partner in a large international law firm and through real estate investing. My wife makes $1.5 million as a cosmetic surgeon. We live in DC. We have 2 kids. After all of the taxes, childcare, mortgage payments, car payments, etc., we are literally living paycheck to paycheck. Our house is about 2.5 million, nice but not exorbitant. We each drive 911s and we have a farm in the country and a house at the Eastern Shore. Again- nice, but hardly movie-star living and there are many people who have much nicer farms and shore houses than we do. I think that to live comfortably in a high priced area like DC, you really need $4 million a year. This will allow you to save some money and live an extremely comfortable life style. Fortunately, we are relatively early in our careers– early 40’s. Within the next 3-5 years, we will be at $4 million. There really is not a moment to lose in this game if you want to live comfortably without worrying about money.”

You can’t make this shit up.

Now you know why $500,000 a year is chicken scratch.

LESSONS LEARNED

1] Be an equity partner in a large international law firm or investment house.

2] Be a successful plastic surgeon.

3] Be an a-list celebrity.

4] Be a world-class pro athlete.

5] Be a member of the lucky sperm bank.

Louis Vuitton Appeals to Upscale Baby Boomers With Music

Baby Boomers are the generation born between 1946 and 1964.

If you’re a member, you’re somewhere between the ages of 51 and 69.

So juveniles by today’s standards.

Many of us sit squarely in the middle, which means we’re either in – or fast approaching – our 60’s.

We’re in shape, financially independent, technologically savvy.

What better than to appeal to an affluent demographic that has become increasingly larger and more important as our population ages?

In an historical context, we’ve set new precedents, as people our age were, at one time, either dead or walking billboards for Mr. Rogers.

That was then.

Now, thanks to designers like Louis Vuitton [and others, like John Varvatos], we can finally buy clothing that feels the way clothing felt back in the days when we were young, rebellious and filled with hope and promise.

It was a brilliant move.

Louis Vuitton has strategically positioned itself as a classic, upscale choice for the affluent Baby Boomer generation.

No wonder my wardrobe collection looks a lot like it did back in 1978.

Brace yourself for an Aspen makeover, as people start looking a lot like they did back when when they couldn’t afford it – not to mention good concert tickets to see David Bowie.

Okay, so in addition to Vuitton, here are my top favorite designers for men [in no particular order]:

Vince

Alexander McQueen

Belstaff

Dolce & Gabbana

Armani

Prada

Gucci

James Perce

John Varvatos

Maison Margiela

Saint Laurent

Hudson Jeans

Ralph Lauren [Black label]

…and of course, Converse.

Do’s and Don’ts for Men Over 50 [According to the WWW]

Pooled from the WWW come the do’s and don’ts for older men, not that anyone pays attention to any of it…myself included.

Nonetheless – because I’m asked about it all the freaking time – I offer you the list:

APPROPRIATE:

1] Dye hair

Note: I started dying my hair at 18 and still do. Nobody cares.

2] Hair trimming

Note: I had to Google this. I assume it’s similar to a haircut.

3] Leather jackets

Note: I have 23, but only wear 6 of them.

4] Cardigans

Note: I had to Google this one just to see Mr. Rogers.

5] Sweater vests

Note: See #4.

6] Hair replacement

Note: No big deal. Many men I know do touch-ups on the hairline, some on their eyebrows.

7] Graphic tees

Note: Right on.

8] Cowboy boots

Note: Sure. But not in my closet.

9] Biker boots

Note: I have 5 pairs.

10] Get an annual physical

Note: Who doesn’t get an annual physical?

11] Dress for comfort

Note: In other words, dress like a teenager when we feel like it? I do it all the time.

12] Own and wear more than one pair of jeans

Note: I’ve lost count.

13] Use moisturizer

Note: I have so many damn products I have to use a Magic Marker on the products to remind myself of the order in which to use them.

14] Date women close to their age

Note: Seriously? The last time I dated someone close to my age was when I was a teenager. My girlfriend at the time was 17, which is 11 years younger than the woman I currently date.

15] Wear a good watch

Note: I don’t wear a watch, but have no problem with people who do.

16] Embrace baldness

Note: Embrace baldness if not embracing it means lacquered comb-overs and baseball caps that people begin to suspect are sewn into your scalp.

17] Be a silver fox and let gray go

Note: With enough money nobody will notice the color of your hair anyway.

18] Occasional jewelry besides wedding band

Note: Some men can pull off wearing a lot of jewelry. Others can’t. If you know yourself you know where you stand.

19] Sandals, no socks

Note: How about no sandals, period?

20] Flip flops

Note: See #19.

21] Baseball caps

Note: Sure. Why not? Just not all the time, unless you’re The Edge, in which case it’s totally fine.

22] Converse type sneakers

Note: If you don’t own Converse sneakers, I’d see a therapist.

NOT APPROPRIATE:

1] Spray tan

Note: What they’re referring to, I assume, is something along the lines of George Hamilton, so no.

2] Have/grow a soul patch

Note: I once had a soul patch, then I didn’t, then I did. Billy Bob Thornton looks good with one, but I’m still on the fence about mine.

3] Face-lift/mini face-lift

Note: If it looks natural, why not? Over-indulgence never goes unnoticed, and not in a good way.

4] Wax eyebrows for shape

Note: Finally, I agree.

5] Wax chest, back, legs or armpits

Note: Agree. Shaving it all is less painful.

6] Brow lift

Note: Why the hell not? See #3.

7] eyelid surgery

Note: I actually knew someone who’s eyelids were blinding him, so he had them lifted. See #3.

~~~

Obviously, all of this is complete crap.

Nobody cares what others think about what they do but themselves.

This notwithstanding, it either works or it doesn’t.

The good news is that it won’t take long for you to hear about it if it doesn’t.

Why Wealthy Divorced Women Don’t Remarry, But Men Do

http://www.marketwatch.com/story/first-wives-say-i-dont-to-second-marriages-2013-10-24

Why are wealthy divorced women more likely to decide to remain single? “It’s much harder for divorced males to be alone than females,” says Fran Walfish, a psychotherapist in Beverly Hills, Calif. Unlike men, she says, “a woman’s ego cannot bear to tolerate a man using her for her money. She needs to know she is loved—rich or poor—flaws and all.”

~~~

Wait for it!

More than 83% of divorced men back on the dating market would consider marriage within the next five years, according to a survey of 5,000 millionaire members of the dating site MillionaireMatch.com.

Only 5% said “never again,” and 11% said they would consider remarrying after five years.

Divorced female millionaires were at the opposite end of the scale: A mere 32% said they would consider remarrying in the next 5 years, and 70% said they’d never marry again or would wait 10 years or more.

Shocked?

I’m not.

Here’s why:

1] Women bond, while men isolate.

2] Older men can date women any age, regardless of motive [both motives], while women require a specific motive.

3] An older man’s vitality is replenished through exposure to youth and beauty. For women, it’s the opposite. Youth and beauty remind them to check their wills.

4] Love is not at the top of an older man’s list of must-haves in a relationship. It is the opposite for women which is why they bond with other women and call it a day.

5] Men need challenges. Without them there is no purpose to live.

Why [some] Middle-Aged White Americans Are Dying Before Their Time

© Credit: Peter Hince/Getty Images Man at Sea Side Holding Bottle of Beer, Mid Section Credit: Peter Hince/Getty Images

What you’re looking at is a cliche that massacres every tenet of urban survival.

You know what I’m talking about.

This notwithstanding, I know very few middle-aged men who look like this guy.

Most of us have too much self-respect to allow ourselves to fall into complete ruin.

I might also add that I live in a very small world, given the the preponderance of obesity in America.

http://www.msn.com/en-us/health/medical/middle-aged-white-americans-are-dying-more-than-they-should-be/ar-BBmLBvP?li=BBgzzfc

In a nutshell, this study [see article] concludes that middle-aged Americans, classified as those between the ages of 45 and 54 – emphasis on those with less education – were more likely to die in middle age due to suicide or alcohol and drug poisoning.

The culprit, according to the study, is the 2008 financial collapse.

But the study also found that black, Hispanic and all other older Americans (65 and up) have continued to see longer lives.

Why is this?

The article doesn’t address it, but I can: Money.

In other words, if you weren’t screwed completely in 2008, you’re probably going to live a long healthy life.

6 KEY ELEMENTS

It’s been my experience that 6 key elements must be in place in order for an older man to stay at the top of his game.

…and all of them are tangentially related to money.

So here goes [surprise surprise]:

1] Financial security

Notes: Money is always thicker than blood. It’s first in line followed closely by everything else.

You’ll need enough to cover the cost of a nice place to live, a reliable car, a health club membership…and, of course, Whole Foods.

The rest of your life can take care of itself if Whole Foods doesn’t break you first.

2] Supportive wife or partner

Notes: If you’ve been married a long time and your wife is out of shape, she will probably want you to be out of shape so she doesn’t have to worry about being dumped.

This is a bigger problem than you might imagine and a bigger hurdle than many of you will even want to consider after seeing #1.

3] Healthy lifestyle

Notes: Wife/partner or not, a healthy lifestyle is the only way to age well. Not aging well is not worth the ride. It’s also 10 times the cost.

4] Culture group that supports and encourages your objectives

Notes: People who live healthy lifestyles tend to hang around others who share their values.

If the group you’re in begins to remind you of your own demise, find another group.

Remember, life doesn’t give a crap what you do. It only sees the bottom line.

Any psychiatrist will tell you this for $200.00, but you’ll have to be able to fork over $200.00, plus additional therapy if coping with not having enough becomes a problem.

5] Comfort with technology

Notes: Generally speaking, the older men I know are very comfortable with technology.

While this may stand out as incongruous with the previous 4 bullet points, it’s everything but.

While technology helps keep us relevant, being on a first name basis with the people at the Apple store can be as expensive as gambling addiction.

6] Don’t isolate

Interacting with others is crucial to one’s mental health.

Some guys talk about leaving everything behind and heading off into the sunset on a wing and a prayer.

Of course, Icarus tried the same thing and it didn’t end well.

I guess he couldn’t afford therapy.

Mining for Truth and Destiny in the Middle Years

The world’s greatest erotic art of today, Vol. 5 features one of my images shot 10 over years ago after a failed relationship pushed me to the brink of madness…before pulling me back in with twice the strength.

Middle age is not for the faint of heart.

Let’s talk.

Up Next!

John Varvatos Sparks Revolution in Fashion Nostalgia

John Varvatos was born February 1, 1966, which means he missed the Baby Boom by 2 years.

Note: Baby Boom lasted from 1946-1964.

This notwithstanding, he captures the spirit of my generation better than any designer in memory. Period.

~~~

As I gotten older I seem to grow closer to my roots.

I guess it’s true what they say about early impressions being the strongest.

Most therapists would be willing to corroborate this for $200.00, by the way.

Anyway, my deepest passions were those rooted in music, specifically, rock ‘n’ roll.

Why this is I don’t know, because while others were off playing soccer, I sat in dark rooms with electric guitars and vinyl records, playing and replaying Clapton licks, among others.

My dorm room was plastered with glossy posters of Ozzy, Zeppelin, The Who, Cream, Hendrix and other musical gods of the day.

Empty packs of guitar strings were scattered all over the place, picks even worse.

I think it’s safe to say my adolescence was experienced through the fulcrum of music.

Then time passed, decades, and here I find myself with the same music, the same string and keyed instruments, and library of music I can’t live without.

So one day I’m walking through The Galleria in Houston when I happen upon the new John Varvatos store.

Feeling transported back to a place where it all started is to grossly understate the experience.

Joplin’s “Down On Me” was in the air, rock biographies neatly stacked on shelves under framed film photographs of rock stars.

…and the clothing!

Wow.

Seriously?

Could this really be?

Did I actually find my long lost home in the world of John Varvatos?

At this writing my closet looks like his showroom, with a few exceptions, very few.

Once I got my hands on those threads 90% of my clothing went the way of the wind.

Finally a designer was channeling the same vibe.

Though my career has been spent as a photographer and writer, nothing keeps me more tethered to myself than music.

Obviously, I’m not alone.

Brilliant ad. Generations merged.

Ronnie and Sally Wood at The Races

I’ve covered this couple in another blog [search bar], but I thought it was worth further mention, given Sally Wood’s illuminating comments.

Among them:

Speaking of their age gap, Sally told the Telegraph: ‘Um, well, I know it’s there. And I wish it wasn’t, but it is. I think I had to say “I can’t do this because of the age”, or I just had to let it go and take it all on board. At no point, years ago, did I say to myself: “I think I’ll go out with someone twice my age”, but that is what has happened.’

http://www.dailymail.co.uk/tvshowbiz/article-3288914/Wild-horses-couldn-t-Rolling-Stones-rocker-Ronnie-Wood-68-away-wife-Sally-37-cheer-stallion-Cheltenham-races.html

Up Next!

Without Savings Boomers Totally and Completely Screwed [with a few exceptions]

As everyone this age already knows, life is not exactly a joyride in the absence of cash.

You look down the road and there’s nothing to see but a tunnel and a light because there is nothing else.

http://www.fool.com/investing/general/2015/06/07/baby-boomers-face-it-if-youre-not-rich-now-youll-n.aspx

As everyone by now knows, the most important thing in the world is health followed closely by money.

The rest can wait.

According to Vanguard’s How America Saves 2014, which provides statistics about the more than 3 million people who have a defined contribution retirement plan managed by Vanguard, the median 401(k) balance for those over 55 was less than $75,000 in 2013:

How

Please explain to me how the hell you’re going to hang out in Cabo or Aspen without a large career income or passive income from investments?

You’re not.

You’re going to stay home with your cats and hope your death is swift and painless because the rest isn’t worth the journey.

TWO EXCEPTIONS

1] Yogis

2] Tenured University Professors

In the first case, the senior yogi may live in a tree, but women in his classes find his acetic existence and peaceful vibe an extraordinarily attractive alternative to the wolves of Wall Street.

So he can expect to get laid by beautiful women who don’t care what he doesn’t have until they do, at which time they go back to the wolves for another round.

Tenured university professors make a couple hundred grand a year, never lose their jobs, get Summers off, and hold the destinies of their students in their hands.

It kinda’ sells itself.

The only problem is that most women at ivy league schools envision large homes in nice neighborhoods, expensive cars, private schools for their kids, and at least 3 vacations a year.

Needless to say, his salary won’t cut that, nor will his eventual savings which are destined for social security support.

So we’re back to square one.

With this as a backdrop, how exactly do Baby Boomers acquire enough capital to retire comfortably without robbing the Federal Reserve or winning a slip and fall against Kroger?

First, they have to have something of value to sell that offers windfall potential.

What about their homes?

Yea, I’m laughing because homeowners between age 50 and 65 are most likely to carry a mortgage.

The percentage rose from 60% in 1992 to more than 70% by 2010.

What about saving more money?

For guys 50 and older looking at potentially 20 more years of putting whatever away, if you can invest an extra $5,000 per year for the next 15 years, you would have an extra $146,000 at age 65:

Returns

If you can leave it alone until 70, you could have approximately $220,000 in added net worth based on historical stock market averages.

But what kind of life are we looking at here?

Most people in better neighborhoods spend $200,000 in 6 months just maintaining their lifestyles.

You’ll be watching every single solitary bill, praying your roof doesn’t leak, and clipping coupons while annoying the people in line behind you at Whole Foods.

You’re better off dead.

The sad truth of the matter is that your priorities were ass-backwards back in your 20’s when you thought you were immortal because you could nail dates at the drop of a hat even if you couldn’t afford to take them to Jack-In-The-Box.

It didn’t take long to notice that no matter what you looked like all the wealthy older men were taking your girlfriends to the Bahamas for the weekend.

Then it dawned on you that youth and beauty only work for highly-precisioned gold-diggers of exceptional beauty; actors, models and entertainers with the wings of angels; and singers like Robert Plant.

And since you couldn’t find a niche for yourself in any of the above, you were screwed.

After all, what’s the point in getting old if you can’t afford to enjoy it?

People are always talking about people pursuing things they love.

But understand that love is always secondary to common sense.

If piano tuning does not pave the way for millions in an investment account by age 50, do something you hate.

You’ll love yourself in the end.

POSTSCRIPT

For you older men of average means who have daughters of exceptional beauty, please explain to them how to leverage what they do have in exchange for everything you don’t so you can piggy-back on their success.

You’re welcome.

~~~

A FEW TRUTHS ABOUT MONEY

1] Lots of money won’t make you happy, but not enough of it will make you miserable.

2] One million dollar homes in large cities are often tear downs situated in up and coming neighborhoods.

3] 250k/ year is considered upper middle class.

4] When politicians talk about raising taxes on “millionaires and billionaires” they’re including everyone who falls in #3.

5] The average 0ne bedroom suite at a luxury hotel property is $1000/night and everything else is a la carte.

6] Dining out in a big city usually costs $200 on up with wine and tip.

7] The average luxury automobile starts in the $80,000 range.

8] Whole Foods bills usually run 20k-30k/year with wine.

9] Luxury handbags usually run $2000, and women’s shoes, $500-1000 which you’ll need to keep in mind if you happen to live with a woman.

10] First Class airfare from Houston to Los Angeles is in the $1200 to $1400 range. Double it if you’re taking your girlfriend.

Meet Badass Sam Bryant, Jr., 70, Bodybuilder.

Sam Bryant, Jr., 70

Brief synopsis: After a failed relationship 20 years ago, Sam Bryant, Jr. started lifting weights to exorcise the emotional pain and never looked back.

http://www.muscleandfitness.com/athletes-celebrities/news/meet-sam-bryant-jr-badass-70-year-old-bodybuilder

Articles like this one are an inspiration to us all…especially those who assume aging denotes decrepitude, irrelevance and existential drear.

You Baby Boomers can also breathe a sigh of relief as Sam is older then you.

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