Another Kind of 1 Percenter

Another Kind of 1 Percenter

I’d like to introduce ANOTHERKINDOF1%ER, an avid reader of this blog and a 1 percenter in terms of net worth. He no longer draws in a 1 percent income, but has accumulated enough wealth to put him in the top 1% in terms of net worth. The opposite is true in my case. I have not accumulated a significant amount of wealth, but our household income puts us in the top 1% of income earners.

He also has a different perspective than me on investing, spending, and taxes, which I think many of my long time readers may appreciate!

He will be contributing to this blog over the forthcoming months.

This is his story.

I’d like to thank IAM1PERCENT for the opportunity to share some thoughts on this site and hope to provide some insights from a very different perspective on personal finance, life, the universe and everything….

What does it mean to be a 1%er in America today?

Is income alone the sole driver of the term or should total net worth be a standard as well? Should net worth be a factor in conjunction with income or should you have a separate test where you qualify under either standard? These questions have been discussed admirably here by your blog host and a number of commenters, and I’d like to add my 2 cents to the discussion.

There are many statistics available both on the top 1% income and top 1% net worth in America, and for these purposes, I’ll stick with the data from here, $6 Million Gets You Into 1% at 40, but Not at 60, and take the standard that for people in their 40s, it takes a net worth of $5.8M to get into the 1%. As my wife and I are now both effectively retired, in our mid-40s raising our 3 kids in central New Jersey, and have a net worth of a little over $7M, we fit in under this less traditional measure of a 1% but have not hit the income standard for a couple of years. This gives me a fairly different perspective on being a 1%er in America today than many, including IAM1PERCENT, but I think personal finance strategies, goals and ideals from this viewpoint can provide a valuable counter. I’m excited to participate in this forum and really look forward to exploring it further.

My Background

I went straight to law school from college and then began a career in corporate law at a large firm. After I decided to leave law firm life for the corporate world, I worked at 2 large corporations in mixed business and legal roles generally related to finance. After 20 years of working, I was fortunate enough to be in a position remarkably similar to the one cited in IAM1PERCENT’s post Retired at 45.

I was leaving a good job that paid extraordinarily well, but had decided to go in a different direction. I had initially thought that would involve some time off before jumping back into a slightly less stressful and demanding full-time work environment.

However, as time passed and I became more involved in the daily lives of my 3 young kids, I began to realize that any role that would put me back into a 1% income category would involve stress, travel, work, demands, anxiety and more stress…..all things that I really hadn’t missed that much. So a few months of ‘taking a pause’ as I used to describe it stretched to a couple of years, and I am comfortable enough that I don’t envision ever jumping full-time into the real high intensity working world again.

Thankfully, I’m at a stage that I can consider an ‘encore’ career on my terms rather than something that is critical to pay the bills.

So what are the numbers?

We spend a lot of money and don’t make as much income as we used to. As a snapshot, our annual spending (excluding income taxes and capital improvements to our house) has ranged from a high of $225k down to $180k over the past 5 years. That is an obscene amount of money to spend each year to live.

Income comes primarily from investments, dividends, interest, real estate and deferred compensation, and comes to about $200k per year (before taxes) going forward. The difference between income and expenses today is generally covered by appreciation in the asset mix so while I’m often negative on cash flow, appreciation in the asset base and the resulting rising net worth keeps me comfortable with it.

How did I get here?

There are really a number of factors that contribute but I’d say the two biggest ones are a fanatical dedication to work and frugality. On dedication, it has always been apparent to me that good work gets rewarded with more work and responsibility.

From this pattern, I concluded early on that you make a really great first impression, which leads to more work and opportunities. Being constantly available and responsive, and going the extra mile while anticipating requests, always keeps you in your boss’ mind when another chance to shine comes up.

For example, I was an early adopter of the Blackberry and found that a short quick response to any request at any time showed that I was always on top of things. This led to opportunities to shine further and stay in a person’s mind as someone reliable and efficient who gets things done.

The second major point of getting here is, for lack of a better way to put it, that I am cheap. My guess is you are snickering already at how a family can spend 5 times the average national income and still be frugal. But in my life, I have never understood how someone pays a late fee, allows a subscription to be renewed without negotiating down some $$ off, doesn’t use a cell phone to check a purchase price online before buying or books a last-minute full price airfare rather than getting it six months in advance.

I remember switching our NYTimes newspaper subscription, you know the paper kind like in the olden days, between my wife and my name every 20 weeks or so for years because it was literally one-quarter the price of a full renewal. My kids joke that Dad was too cheap to get two hotel rooms, even as we are staying in a luxury Caribbean resort (in hurricane season of course because rates are lower then).

More factors in getting here? Getting into a high paying career track as an attorney and busting my butt to create more opportunities, and taking risks at financial rewards once they presented themselves, would have to be the largest components. This led to high income years which where proceeds where primarily invested in real estate income producing properties to a lesser extent, and to a great extent in relatively conservative investments.

I’ve also been fortunate in graduating with very little debt, having a wonderful wife who I adore (and seems to enjoy our being home together) and who during her short working career before she became a full-time mom, had some really successful high income working years.

It has not been a straight and simple course, however, and the recent financial crisis hurt. My philosophy however on the investment side has always been moderately conservative, more along the risk profile of an older individual who would prefer a steady 5% tax-free return over the prospect of 12+% in an aggressive equity mix.

On the real estate side, I’ve been fortunate to avoid deals that seemed too speculative and focused on income producing commercial and multi-tenant residential property investing alongside partners, and we bought and sold our homes at fortunate times to stay away from being burned by the downturn.

Where do I go from here?

Thankfully, I can walk my kids to the bus stop each day, do their homework with them until they drive me to need a cocktail, and live a stress free life until I get bored. It hasn’t happened yet, but I continue to look at real estate deals to keep sharp and potentially put my money to work a little harder. And if I do get bored, I always like the idea of teaching so that could be a possibility someday.

How do you get to be a 1%er?

I hope to explore this in broader detail in the future but here is a healthy start:

  • Know Where Your Money Goes – About 15 years ago, I discovered the joy of financial management software on a PC. I know, what a geek. What could possibly be cool or interesting about it? If I have to explain it to you, then you won’t get it, but I’ll try.At year-end, when I tell my wife we spent $200k last year and she responds that she just can’t understand how we did that, I present a net worth balance sheet and multi page categorized financial statements breaking it out. I enjoy spending 10 minutes a day updating my Quicken program and can tell at any time where we stand. I can evangelize forever on its importance, but will simply summarize by stating it as a simple fact.You can’t seriously take charge of your financial life unless you make a minimum effort to track your spending and assets, and then take the time to analyze what you have done in the past and use that as a yardstick to manage your future.
  • Dedication to Work – Luck is critical in life; I’m a firm believer that I have been fortunate in landing opportunities that had huge successful financial upsides. However what puts a person in this position.Why does one guy get asked to work on a project over another, and then gets a bonus because the project goes well? Because that guy responded to the text at 11:30pm immediately after the boss sent it looking for information. And the response was 90% of the information necessary but was there immediately with a prompt follow-up the next morning.
    So the boss knows there is someone who is always there when needed. You make your own luck sometimes, and being always available and quick to respond goes a long way.
  • Frugality – Take it from a spender, buying things is really fun. I am a tech geek, I need the new device just because it’s new, and newer is obviously better. However, I am cheap as well. So I take my kids to the 3D movie because they like the shiny glasses and blow a fortune on popcorn, but at least manage to snag some cups so they can all share it, and let them refill to their heart’s content. Spend wisely whenever possible, you’d be amazed how it adds up.
  • Starting Early – I know you here it over and over, but compounding is your friend. Putting money aside early in life adds up over time, and getting it working on your behalf is the key to cutting back down the road.

That’s all for now. I hope to continue our conversation and give you some more perspectives on the road to 1%erhood. I don’t think anyone has coined that word yet so I’m calling dibs.


About The Author

Edwin is a marketer, social media influencer and head writer here at I Am 1 Percent. He manages a large network of high quality finance blogs and social media accounts. You can connect with him via email here.


  1. [email protected]&More

    Congrats on making it into the 1%. I don’t think it would be for me though because I am not one of the people who will let work into my personal life. It is a personal decision that I am OK with because I don’t feel the need to make it to the one percent.


      Thanks Lance. I appreciate your perspective and checked out your site – some good solid money saving tips there. In particular, I like your suggestions on using credit cards to your advantage. I’ve always been a big believer in cash back rewards, that simply credit you with 1+% each month on your purchases.

      On life style choices, I’ve come to point of agreement with you, but decided to bust it for a while to get here. Now, I’ve got enough set aside that I can make the choice to put personal life and family ahead of continuing to focus on earning and feel its a great time for it. But I respect any view that says the journey to get here is a personal choice of sacrifices and can’t argue with anyone that would choose that route.

      I do disagree with you respectfully in the sense that work by definition intrudes upon personal life and while a healthy balance makes sense, I would want my kids for example to show a solid dedication to putting a career at least on a balanced level with personal life. I want them to be happy, but to recognize that you need to dedicate yourself to less appealing aspects of life to better enjoy the benefits as well.

  2. Aiming for 1 %

    Wow..this is a very inspirational post for me. Its amazing how you did this in such a short span of time. I believe that all the points you made are very valid and that hard work definitely pays off (not just financially but in other aspects of your life too). Congrats and keep up the good work!


      Thanks Aiming – appreciate the sentiment. Makes me feel better now that I’m basically doing a lot of sitting around smelling the roses at a relatively young age of mid 40s, rather than continuing to push hard to make more $$, to get some validation from others that I’m doing the right thing.

      Still get a nagging sensation of opportunity cost sometimes….that I’m wasting some quality earning potential and/or work related life experience years……

      1. Aiming for 1 %

        Haha..Smelling roses…Is that what you do with your free time?

  3. Mrs. Pop @ Planting Our Pennies

    Thanks for sharing a bit of your story. I’m curious, though – have you ever considered moving to a lower cost area now that you’re primarily living off investments?


    Mrs. Pop – thanks for the question. I have definitely thought about it longingly but family in the area makes it an unrealistic option for me.

    The idea of unlocking the equity in my house and putting it to more useful work, of reducing the massive upkeep and expenses that owning a home entails, plus a warmer climate, all really seem appealing now that work obligations no longer make proximity to NYC critical. But we see family members on both my wife and my side every week and more over holiday breaks/kids school vacations so it just isn’t really an option for me.

  5. Yougetwhatyouplanfor

    I’m not quite at the 1% but working toward it. The most important comment (IMHO) is the one about QUICKEN and then actually using it to track all of your expenditures. After using it for probably 6 or 7 years, I will confidently say it is the most important tool we use to move up the net worth ladder. Seeing where you “waste money” is a real motivator to stop wasting it!


      Completely agree with you on Quicken’s importance. For those new to it, there is a multiple tiered reward to its use. As an initial snapshot of your accounts and balances, I find one centralized resource critical. Then using it to maintain and track for months starts collecting a database. Finally, after using it for a few months, you have a basis of historical data to begin to analyze and use going forward. Once you get into years worth of data, you can really begin to see where you have been and plan.

      On a completely nerdy side, I enjoy the 5-10 minutes I spend on a weekday updating web info into it, then checking some basic stats. This is incredibly useful also in monitoring activity like credit card purchases, checks, etc. particularly for the occasional fee you need to get refunded (Bank of America monthly maintenance fees seem to be a new money source that they have started milking).

  6. Brick By Brick Investing | Marvin

    Glad to hear you made it in the 1% and that all the ways to get there remain true today. A lot of people work hard but spend ALL their money because they feel they “deserve” it. Your example of working hard and saving is inspiring, thank you.


      Appreciate the sentiment. I don’t get spending much more than I have to date. Seems to me I spend a fortune compared to growing up and my kids are spoiled rotten. Not sure how much more I can spend for better opportunity costs (hey that gives me an idea for a new post….)

  7. NoTrustFund

    Thanks so much for sharing your story, I always find it so helpful to hear specifics.

    I’m impressed you were able to walk away from such a high paying job. Even knowing you have solid savings, I imagine it’s hard to give up ‘just one more year’.

    Do you ever feel pressure to spend even more? Do you feel as though you made less expensive choices with respect to housing/cars/vacations compared to your co-workers and neighbors?


      Great comments NoTrustFund.

      It was rough to walk away, it was a really cool job. But it had some factors (job evolving/changing to a different functional role, opportunity to bail with a nice package, and a killer commute of 1.5 hours each way, except for days where I was away which was 2-5 days a month) which made leaving awesome.

      I don’t really feel any pressure to spend more. We live very well and comparable to most in my area – I’d say middle upper class central NJ. I’d say I’ve compromised on many things, likening it to the cheapest I can of the best. We have a minivan, as expensive as you can get with every feature like DVD and Nav, but still its a minivan so only half the price of a family size Lexus. I drive a Prius and love it, but plan on trading it in shortly for a newer one (probably an electric Leaf); so I have a cheap car but waste $$ to trade it in every 3 years. We spend a lot of money, vacation like champs about 2x per year. I know others who spend more and those who spend less, and feel pretty comfortable at our level. Would always be fun to spend more, butI always try and get as much benefit as cheaply as possible. Seems to work out so far.

  8. Wayne @ Young Family Finance

    Welcome! It’s great to hear a different perspective on wealth accumulation.

    It’s interesting. I’ve known many people who complain at extra work when the boss is delegating. I’ve always been the opposite. My philosophy has been to make myself indispensable. I know it’s not always possible, but it’s a great work benefit if you can manage it.


      Wayne – completely agree on indispensable being critical. Jack Welch, before he went a little loopy this year, used to have a really interesting perspective on firing the bottom 10% of his work force each year. That had a dual effect of weeding out less productive workers and motivating the remaining work force. Many would question that philosophy particularly in tough economic times, however a business isn’t meant to be a purely humanitarian exercise.

      When times get tough, and people need to be let go, its the most productive and most indispensable who invariably can’t be cut.

      And by the way, loved your resolutions. If working out 2x per week works for you, great. I go for 3x. I never do more under any circumstances on the simple premise that my mindset is to accomplish the goal of 3x per week. Even if I do it Monday, Tuesday and Wedn., that is it. I then can convince myself that I don’t have to go back to that horrible place for another week and still get 3x next week. If I did 4 once, then failed to do it again, it would bum me out so set a goal, make it manageable and reasonable, achieve it and call it a day and enjoy something else.

  9. RichUncle EL

    Great advice, I never used Quicken because I felt they were kind of spying on me, lol. BUt I do use excel spreadsheets. Let me know if I’m wrong about quicken. Long post but really valuable and interesting info we can all use.


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