Anonymous
04/13/2018 18:02
Subject: Re:If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:I am so jealous OP. Congratulations!
Thanks, it is a bit unnerving, and a strange feeling. Like it's too good to be true. I guess that's why we just want to save it.
This happened to me when I inherited suddenly. It is a very weird feeling. My advice to you is to do nothing for six months. Make a wish list consider your options and then once the shock has worn off, start to change some things. The money won’t be hurt by sitting in a savings account for a few months. Also, make a plan to keep your friends. Money can do strange things to people - be careful who you tell right now and how much you show. Consider NOT moving to a neighborhood with other people like you (or at least not right now). The best things about money are the freedom and safety it buys you and it’s too easy to get into a consumer trap - particularly in those neighborhoods. It may be strange to imagine from your perspective, as it was from mine, but there are a lot of families who can find a way to spend all that every year. Decide if you want to be one of them
Anonymous
04/13/2018 17:49
Subject: Re:If your HHI went from $350k to $900k +
Anonymous wrote:Bitter green-eyed monster poster here...but this is the kind of post that makes me kick myself for going on DCUM at all.
Yup....
Questioning my career choices..
Anonymous
04/13/2018 16:37
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:If this happened to you, tell us how
DH’s promotion at work.
Mind sharing what he does for a living??
Involves Commercial real estate
I would highly recommend socking every dollar more than you making today into some savings. I have a friend who was in commercial real estate and when the market collapsed in 2008 commercial real estate dried up in less than a month. He went from high income to nothing. Since he was earlier in his career, it was some really rough times.
Op, assuming your husband works for a company, why don't you use your earnings to buy your own small rental property?
Anonymous
04/13/2018 15:39
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:If this happened to you, tell us how
DH’s promotion at work.
Mind sharing what he does for a living??
Involves Commercial real estate
We own commercial real estate. What kind of job in it makes this income stable? If he’s an agent, it isn’t stable. If he’s and owner it isn’t stable, either. All you need is one large expense related to the building. Was it a sale that generated this income? If so and he doesn’t dump it into another one quickly, he will have a lot of taxes due. Point is: how much can you rely on this income?
OP here- I don’t want to go into specifics but it’s the type of job that is commission based, and the $ has been going up each year, $350K may actually have been a light estimate that doesn’t include my income. We definitely don’t spend the money like it is a salary that will always be there. I asked my initial question because I do feel that we have saved so much money in the past few years (7 figures) I was curious what others have done or would do with that kind of money and ongoing potential incomes. Having this much hasn’t changed my thinking, I still bargain shop, really don’t buy much,etc. People I know and in the same industry definitely have way more expensive and fancy lifestyles than we currently do! I think our neighbors would have no idea which is fine with us. I think maybe I should upgrade some aspects of our life (decorate our house, etc.) but I hate to spend money and feel guilty when I do.
You are smart not to be spending that money like water. I have heard too many times about people who come into money and spend it lavishly only to find themselves begging relatives for money years later. A lot of times, the wealthiest people do not appear wealthy-- there is a reason for that!
Anonymous
04/13/2018 15:34
Subject: Re:If your HHI went from $350k to $900k +
Anonymous wrote:OP here, happened with DH’s promotion at work.
What does your DH do?
Anonymous
04/13/2018 15:31
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:If this happened to you, tell us how
DH’s promotion at work.
Mind sharing what he does for a living??
Involves Commercial real estate
I would highly recommend socking every dollar more than you making today into some savings. I have a friend who was in commercial real estate and when the market collapsed in 2008 commercial real estate dried up in less than a month. He went from high income to nothing. Since he was earlier in his career, it was some really rough times.
Anonymous
04/13/2018 15:23
Subject: Re:If your HHI went from $350k to $900k +
This happened to us to us about five years ago. DH was an equity partner working his ass off carrying a small firm circling the drain and guaranteed a ~$200K draw that he didn’t always get. Switched to another firm where he gets a cut of the business he manages without being on the hook for what the rest of the firm is doing that he’s not responsible for. HHI variable but has been between $600K and $1.1M.
We -
Paid off a ton of debt we had accumulated while not always getting that draw
Were finally able to refinance our house, cutting the payment almost in half
Paid off student loans
Replaced two cars that were 11 and 12 years old
Stayed put but have renovated the kitchen and redone windows and siding
Bought a vacation house and two investment properties. Have done a lot of work on all of them and they’re rented out
Socked away a lot of money for retirement and 529s and we overpay monthly mortgage payments by about 20% extra every month going to principal
We -
Paid off a ton of debt we had accumulated while not always getting that draw
Were finally able to refinance our house, cutting the payment almost in half
Paid off student loans
Replaced two cars that were 11 and 12 years old
Stayed put but have renovated the kitchen and redone windows and siding
Bought a vacation house and two investment properties. Have done a lot of work on all of them and they’re rented out
Socked away a lot of money for retirement and 529s and we overpay monthly mortgage payments by about 20% extra every month going to principal
Anonymous
04/13/2018 09:20
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:If this happened to you, tell us how
DH’s promotion at work.
Mind sharing what he does for a living??
Involves Commercial real estate
We own commercial real estate. What kind of job in it makes this income stable? If he’s an agent, it isn’t stable. If he’s and owner it isn’t stable, either. All you need is one large expense related to the building. Was it a sale that generated this income? If so and he doesn’t dump it into another one quickly, he will have a lot of taxes due. Point is: how much can you rely on this income?
OP here- I don’t want to go into specifics but it’s the type of job that is commission based, and the $ has been going up each year, $350K may actually have been a light estimate that doesn’t include my income. We definitely don’t spend the money like it is a salary that will always be there. I asked my initial question because I do feel that we have saved so much money in the past few years (7 figures) I was curious what others have done or would do with that kind of money and ongoing potential incomes. Having this much hasn’t changed my thinking, I still bargain shop, really don’t buy much,etc. People I know and in the same industry definitely have way more expensive and fancy lifestyles than we currently do! I think our neighbors would have no idea which is fine with us. I think maybe I should upgrade some aspects of our life (decorate our house, etc.) but I hate to spend money and feel guilty when I do.
If it is commission based, I'd definitely save it for a while. Set some good achievable goals for yourself and then live accordingly. For example, we set goals of 5, 10, and 15M. Before 5M, we lived as normal, no changes. After that we moved to a bigger house, weekly cleaning, hired landscaping, trips, vacations, and etc. When we hit 10M we picked up the pace a little more. Once we hit 15M I think we are going to dial back the income (work less) and keep our lifestyle the same as it is now. Even as we dial back the work income, however, we think our investment income will make up for the slack - so the key really is to try and build wealth as quickly as you can, because it helps you realize whatever lifestyle you are after, sooner.
I understand your feeling of guilt, but it will ease off once you have reached your goals and milestones. Keep that guilt around, it's what keeps your spending in check, use it as a tool.
Anonymous
04/13/2018 09:11
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:We went from $250 to $1.5M (move from govt to private practice in law) over the course of three years. Where we best spent our money:
1) Fully funded a major house renovation--no loans.
2) Take an intl vacation per year. Nice hotels/Airbnbs, etc., hired tour guides, nice meals, convenience tickets (skip the line).
3) Take several domestic vacations per year (to visit family, trip to NYC, beach vacation, etc.)
4) Hire housekeepers for weekly visit vs every other week
5) Nicer presents for family, bigger donations to charity, etc.
The law firm has forced retirement savings, we've maxed out 529s, and the non-lawyer spouse (me) kept working. (My career doesn't pay much, but has great benefits and flexibility and some "prestige" while doing good in the world.) We didn't move out of our neighborhood (Upper NW), but our house is more comfortable. Kids are in private school.
Someone went from, what, about 160K in govt to $1.5 million in private practice in three years (or a bit less, subtracting your small salary) and started taking that many vacations? Niche practice area? Instant partnership? I’m calling bs on this one, chief.
Yes, it happens within a firm. Associates who make partner can quadruple their salary or more in one bump. A hard-earned bump from working many, many, many hours to get there.
NP, we know of someone who did this. DOJ to partnership I think?
Yes, this happens. Government to partnership.
Does it happen with in-house to partnership? Very niche practice.
yes, it can happen from associate in a firm to partner.... often quadrupling or quintupling the salary in one year. Very hard-fought and well-earned with ridiculous amount of hours and work put in.
Anonymous
04/13/2018 09:10
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:We went from $250 to $1.5M (move from govt to private practice in law) over the course of three years. Where we best spent our money:
1) Fully funded a major house renovation--no loans.
2) Take an intl vacation per year. Nice hotels/Airbnbs, etc., hired tour guides, nice meals, convenience tickets (skip the line).
3) Take several domestic vacations per year (to visit family, trip to NYC, beach vacation, etc.)
4) Hire housekeepers for weekly visit vs every other week
5) Nicer presents for family, bigger donations to charity, etc.
The law firm has forced retirement savings, we've maxed out 529s, and the non-lawyer spouse (me) kept working. (My career doesn't pay much, but has great benefits and flexibility and some "prestige" while doing good in the world.) We didn't move out of our neighborhood (Upper NW), but our house is more comfortable. Kids are in private school.
Someone went from, what, about 160K in govt to $1.5 million in private practice in three years (or a bit less, subtracting your small salary) and started taking that many vacations? Niche practice area? Instant partnership? I’m calling bs on this one, chief.
Yes, it happens within a firm. Associates who make partner can quadruple their salary or more in one bump. A hard-earned bump from working many, many, many hours to get there.
NP, we know of someone who did this. DOJ to partnership I think?
Yes, this happens. Government to partnership.
Does it happen with in-house to partnership? Very niche practice.
Anonymous
04/13/2018 02:36
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:There are some great answers here. The same happened to us, and more (big law).
1. Pay off your mortgage. It's a great feeling to be debt free.
2. DON'T buy $5,000 handbags just because you can. (Doesn't sound like you are interested in those things, good!) We've seen lots of people that frittered away their temporary bump in income on stupid things like that.
3. Max out your 529's. You can contribute more upfront and then take a few years off of giving... thereby maximizing the investment value). Also a great feeling.
4. Give more to charity. Feels fantastic, and there are many, many needy ones out there. Also makes you feel less guilty about the insane money you are making if you share it.
5. Invest in convenience for your family. Time is more valuable than money at a certain age.
6. Bump up the style of vacation you take. We got better hotels, hired guides in unfamiliar destinations, and thought of the trips as the "last time I'll be here."
7. Give more elaborate gifts to those you love.
8. LOVE the idea of the family organizer and having a handiman on call. Wish I had done that as our livestyle got more complicated.
9. Get the second home. I also vote for it being under a 2 hour drive so you actually use it and form lasting memories with your kids there.
10. Congratulations to you for even asking this question on this forum. You sound able to handle it wisely! Good luck.
OP here- interesting list, thank you!! I do love giving gifts and spending money on experiences, not stuff. Definitely not $5000 handbags!
Anonymous
04/13/2018 02:31
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:If this happened to you, tell us how
DH’s promotion at work.
Mind sharing what he does for a living??
Involves Commercial real estate
We own commercial real estate. What kind of job in it makes this income stable? If he’s an agent, it isn’t stable. If he’s and owner it isn’t stable, either. All you need is one large expense related to the building. Was it a sale that generated this income? If so and he doesn’t dump it into another one quickly, he will have a lot of taxes due. Point is: how much can you rely on this income?
OP here- I don’t want to go into specifics but it’s the type of job that is commission based, and the $ has been going up each year, $350K may actually have been a light estimate that doesn’t include my income. We definitely don’t spend the money like it is a salary that will always be there. I asked my initial question because I do feel that we have saved so much money in the past few years (7 figures) I was curious what others have done or would do with that kind of money and ongoing potential incomes. Having this much hasn’t changed my thinking, I still bargain shop, really don’t buy much,etc. People I know and in the same industry definitely have way more expensive and fancy lifestyles than we currently do! I think our neighbors would have no idea which is fine with us. I think maybe I should upgrade some aspects of our life (decorate our house, etc.) but I hate to spend money and feel guilty when I do.
Anonymous
04/12/2018 22:10
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:We went from $250 to $1.5M (move from govt to private practice in law) over the course of three years. Where we best spent our money:
1) Fully funded a major house renovation--no loans.
2) Take an intl vacation per year. Nice hotels/Airbnbs, etc., hired tour guides, nice meals, convenience tickets (skip the line).
3) Take several domestic vacations per year (to visit family, trip to NYC, beach vacation, etc.)
4) Hire housekeepers for weekly visit vs every other week
5) Nicer presents for family, bigger donations to charity, etc.
The law firm has forced retirement savings, we've maxed out 529s, and the non-lawyer spouse (me) kept working. (My career doesn't pay much, but has great benefits and flexibility and some "prestige" while doing good in the world.) We didn't move out of our neighborhood (Upper NW), but our house is more comfortable. Kids are in private school.
Someone went from, what, about 160K in govt to $1.5 million in private practice in three years (or a bit less, subtracting your small salary) and started taking that many vacations? Niche practice area? Instant partnership? I’m calling bs on this one, chief.
NP, we know of someone who did this. DOJ to partnership I think?
You would know the answer, not us.
Anonymous
04/12/2018 22:06
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:Anonymous wrote:We went from $250 to $1.5M (move from govt to private practice in law) over the course of three years. Where we best spent our money:
1) Fully funded a major house renovation--no loans.
2) Take an intl vacation per year. Nice hotels/Airbnbs, etc., hired tour guides, nice meals, convenience tickets (skip the line).
3) Take several domestic vacations per year (to visit family, trip to NYC, beach vacation, etc.)
4) Hire housekeepers for weekly visit vs every other week
5) Nicer presents for family, bigger donations to charity, etc.
The law firm has forced retirement savings, we've maxed out 529s, and the non-lawyer spouse (me) kept working. (My career doesn't pay much, but has great benefits and flexibility and some "prestige" while doing good in the world.) We didn't move out of our neighborhood (Upper NW), but our house is more comfortable. Kids are in private school.
Someone went from, what, about 160K in govt to $1.5 million in private practice in three years (or a bit less, subtracting your small salary) and started taking that many vacations? Niche practice area? Instant partnership? I’m calling bs on this one, chief.
NP, we know of someone who did this. DOJ to partnership I think?
Yes, this happens. Government to partnership.
Does it happen with in-house to partnership? Very niche practice.
Anonymous
04/12/2018 15:47
Subject: If your HHI went from $350k to $900k +
Anonymous wrote:Anonymous wrote:Anonymous wrote:We went from $250 to $1.5M (move from govt to private practice in law) over the course of three years. Where we best spent our money:
1) Fully funded a major house renovation--no loans.
2) Take an intl vacation per year. Nice hotels/Airbnbs, etc., hired tour guides, nice meals, convenience tickets (skip the line).
3) Take several domestic vacations per year (to visit family, trip to NYC, beach vacation, etc.)
4) Hire housekeepers for weekly visit vs every other week
5) Nicer presents for family, bigger donations to charity, etc.
The law firm has forced retirement savings, we've maxed out 529s, and the non-lawyer spouse (me) kept working. (My career doesn't pay much, but has great benefits and flexibility and some "prestige" while doing good in the world.) We didn't move out of our neighborhood (Upper NW), but our house is more comfortable. Kids are in private school.
Someone went from, what, about 160K in govt to $1.5 million in private practice in three years (or a bit less, subtracting your small salary) and started taking that many vacations? Niche practice area? Instant partnership? I’m calling bs on this one, chief.
NP, we know of someone who did this. DOJ to partnership I think?
Yes, this happens. Government to partnership.