In an effort to get this site up and running, I provided a quick and dirty personal story of how our family got to be in the 1% of income earners in America. I wanted to take this time to delve deeper into my story, provide some background into my childhood. I may not be what you envision…sitting in my corner office, wearing a top hat, and smoking $100 bills, so I hope through this story, you will be able to get a better understanding and appreciation for this 1 percenter.
Childhood
I grew up a lower middle class household in Philadelphia. My mother worked for the US Post Office and my father was a lab technician at a hospital. My mother stayed at home with my siblings and I until we were all in grade school. As a kid, I knew money didn’t come easy, but we always had everything we ever wanted and needed. We were well fed, well clothed, had toys, and a care-free childhood. However, we never, ever ate out at a restaurant, or bought name brand anything. We occasionally shopped at Aldi (for those that don’t have an Aldi, this is a grocery store that only sells generics i.e. No Skippy Peanut Butter, just “Peanut Butter”).
Adolescence
I started my first job at age 13 cutting lawns for family members. My father would help me lug my lawnmower in his car and would wait for me as I cut lawns for $5-$20 at the time (early 90′s). At age 14 I begin delivering Dominos Pizza flyers door to door for minimum wage. I remember sweating in the summer heat after 1 hour and wondering if it was worth the $4.25. At age 15 and 16, I worked at a telemarketing company conducting surveys on the phone. The was extremely painful as I had to log every call so I literally was counting down the hours at work minute by minute.
Prior to attending college, I took a break in the summer so that I could enjoy it with my friends. I also took a break after my first year at college so that I could take some extra courses at the local community college. At age 19 is when I began to work consistently until present day. Over the course of the next 5 years (from age 19-24), and until I graduated, I worked at local pharmacies and hospital pharmacies to get experience in jobs close to my college major. Unfortunately, this was during the dot.com boom, so naturally I shoveled everything into the market and lost most of what I worked for. This was a wake up call for me to not chase get rich schemes, and that the a slow and steady “Buffett” approach was more reasonable and Biblical.
The Real World
After graduation, I did a 1 year residency program (making 1/3 of what a pharmacist typically makes) so that I could break into the pharmaceutical industry. During this time, I worked part-time on the weekends as a pharmacist. I watched most of my friends working full-time at pharmacies, making a lot of money, and buying fancy cars. I continued to drive my 1994 Acura with over 120,000 miles at the time. After the residency (~2003), I moved into a sales rep position making about 2/3 of what a typical pharmacist makes, but I had a company car (Ford Taurus) and moved out of my home. I continued to see my friends from college making really good money, getting married, and buying homes, but I had a plan. I knew I had the talent and passion to build a career in corporate America. After 2 years of sales, I finally moved to a role specific to my major at another company. At this point, I am now on par with a typical pharmacist, but my salary grew in leaps and bounds afterwards. After joining my current company in 2005, my total compensation grew year-over-year by 12.5% in 2006, 10% in 2007, 30% in 2008, 25% in 2009, 2% in 2010, 10% in 2011, and 18% in 2012. This includes a relocation package that I received, stock options, bonuses, 401k matching, pension, etc. I now earn probably over 2x what a typical pharmacist makes.
Parting Words
I don’t say this to brag, but to tell the naysayers out there that things didn’t come easily for me. I worked hard and sacrificed a lot to get to where I am today, and it pains me to watch us be vilified in the media. Some people don’t aspire to being the 1%, and that is fine with me, but when they begin to voice policy changes that affect me, then I have a problem. We live a comfortable lifestyle now, but it wasn’t always easy. I feel blessed and thank God for all that he has provided. Although we are highly leveraged and are in the market for a relatively expensive automobile, we are not buying diamonds and eating caviar. We vacation at the Jersey shore. We live in a nice home, but not extravagant. I drive a car with over 100k miles on it. But we are also now in a position to give back as much as I can to Him (through the church) and to help others in need.
I hope this makes my blog a little more personal and give people an understanding of why I feel a certain way about certain issues.
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Those are some nice raises. Don’t let anyone tell you that you didn’t earn your success! Clearly you did. Makes me question my choice of profession..
Great story! It sounds like you were very focused from the beginning. Always good to point out there are different “flavors” of the 1%…
Did the summer pharma gigs net you enough to pay for your college?
You know what, I’m sorry, I didn’t cross-reference your personal story, which mentions student loans! So I assume there was a gap b/w your income and tuition & expenses. I just hear such good things re: pharma as a major, and I’ve wondered about the feasibility of a pay-as-you-go plan in that major.
It paid a little, and I worked at the computer lab at school for some extra money. But I ended up taking student loans for most of college.
point of clarification: did you go to graduate school to get a Pharm. D, or was you undergraduate major something to do with chem/pharm?
After high school, I went to a 6 year PharmD program. So I don’t have an undergraduate degree. It was a straight program.
I had no idea that was even an option. Very interesting. Its also great that you knew where you wanted to go when you were in high school. So many people, myself included, either change direction while in college or have no idea what they want to do when they “grow-up” when when they are applying for college.
I don’t think I really knew either, but my parents exposed me to careers in healthcare and I was always good and liked Math and Science.
Great story. Thanks for sharing the reality of working hard and making those thrifty decisions that obviously pay off. Well done.
Wow very interesting story, and what great raises!
Thanks for sharing your story! I have to admit, the name of your blog throws me off every time, but you write logically and tell a good story. I can learn a lot from you. Thanks for the motivation!
Probably the most inspiring and motiviating comment I’ve received thus far. Thanks for visiting!
Thanks for sharing your story!
I remember growing up with my mom clipping coupons as well, though my dad started making a lot more money as I got older, which is the only reason they paid for my college education. My Bachelor’s degree (I opted to not get a Master’s) is in a technical field and I now make an incredible income for being in my twenties. Sure, my parents paid my way through college, but I am the one who earned the Honours degree, A average, and passed the interview to get the great job I now have. In some ways though, I do feel lucky that the field I chose when I was quite young turned out to be incredibly lucrative when I graduated from college.
You have been blessed. Keep up the momentum and don’t apologize for it! You worked hard!
That’s the advice I’ve been giving out lately to people entering college – STEM (including pharmacy). Most pharmacy programs I’ve seen tack on an extra year, but you can make 6 figures with the right combination of grades, luck, and a charming personality straight out of school.
On this impressive run: 12.5% in 2006, 10% in 2007, 30% in 2008, 25% in 2009, 2% in 2010, 10% in 2011, and 18% in 2012… respect the raises! Is that salary alone or deferred compensation/stock/options/bonuses? It’s interesting you already know the increase in 2012… I won’t know for over a month still.
The salary increases was total compensation (stock, options, bonsus, deferred comp, relo, 401k match, pension, etc)
Great backstory. Shows that having a plan, being focused, and really working to build a career can pay big dividends. Those annual salary increases are outstanding – one must be a strong performer, deliver value, and be quite driven. Sharing your tips on career success would be a real benefit for readers who want to learn from someone who’s done it. For a lot of folks, their career is like the engine that powers their finances.
I don’t think you can win this.
It’s a human tendency to see yourself, and your friends as better than other people. So it’s always ok for you to earn more, it’s never ok for someone you don’t know to earn more than you. Because you know how much you worked to get there. So even if you convince 99% that you personally worked hard, there’s nother 2.5 million 1% that is still believed to be unfairly earning a lot of money.
I once did a test at a forum where people constantly were very negative about anyone earning more than say 40k per year. As an experiment I wrote a post there saying I’d been offered a promotion, with a huge payincrease, leading to a 150k annual wage. While I said I knew I wasn’t qualified, nor capable to do the job. The post got over 100 unique replies. And not a single person said not to take the job, or that it would be unfair, or to do so for a lower wage. I was ‘one of them’ and as such deserving. Yet if anyone else would come in, saying they worked hard and earned 100k they’d be put down as capitalist pigs.
So good on you for trying, but I doubt it’ll work.
@Sonja, I hear you, but I’m an optimist. I may be the lone voice, but I feel that I should do my part…
I think nobody questions that you worked hard and deserve the money. Earning your fair share of money does not make you a capitalist pig. What makes you a capitalist pig is when you shirk paying your fair share of taxes. I and my wife are in a similar stage as iam1percent. I am a software engineer in the bay area and have a physician wife. Which puts us in the 1 percent on income category. But I do believe in progressive and fair taxation and have nothing against Obama’s call for it. Unfortunately anything fair is branded as socialist in this country. Whatever it be from a practical point of view, the end goals of socialism are altruistic and fair. Nobody can question that. Nobody would like to live in a society where the nobleman have all the money and the rest are just beggars. We do want a reasonable wealth distribution and fair and progressive taxation is one of the tools. And the government has a moral responsibility to enforce it.
Top 1% of income earners pay 38% of the income tax share, the top 10% of earners pay 70%, and the top 50% pay 98% of the income tax share.
The bottom 47% pay 0%.
How is this not fair already??
i think most people wouldn’t begrudge you for your career success – well done taking good risks that (luckily) paid off for you. for many people, those same risks didn’t pay off and they’re in a much less comfortable position than you.
the more legitimate gripes of the 99%’ers occur in situations where mitt romney pays an effective 14% tax rate and an average joe worker pays an effective 25-40% tax rate (when adding FICA/state/etc). the same super-rich then funnel money into politicians and elections to retain and maximize their tax breaks.
Whoa, with all due respect, you’re comparing apples and oranges. First of all, you included FICA/state taxes for Avg Joe, but didn’t include them in Romney’s. Secondly, Romney has already paid income taxes on the money he invested and is being taxed again on the earnings..double taxation. Wages are taxed once. Lastly, and more importanatly, Romney pays capital gains taxes while Average Joe pays income taxes…two completely different taxes. That’s like comparing sales tax to the gas tax…you can’t compare the two.
Read my post on capital gains (http://www.iam1percent.com/2012/02/09/capital-gains-tax-ignoring-the-correlation/) and why in NO country is capital gains tax as much as income tax.
point of order #1: w/r/t Romney’s capital gains, a big chunk of which is carried interest. Carried interest is not really any different in character than a non-qualified stock option or restricted stock award, but CI gets capital gains treatment while option proceeds / stock awards are counted as ordinary income.
point of order #2: the carried interest isn’t taxed twice, because the initial investment in any portfolio company by a hedge fund is borrowed money, which is not taxed upon receipt.
point of order #3: they aren’t apples and oranges — again, how is a dividend different to the recipient than an interest payment? Why should I be taxed 15-20% on the coupon payment from Exxon, but if I bought their debt, I would pay 35%. Wholly unfair!
Sales taxes and gas taxes are not apples and oranges either, and can be compared.
Tax code needs to be consistent, explicable and logical rather than based on ideology.
I’ll give you carried interest…I think that should be taxed at income tax rates, but not cap gains.
Like I said before, we don’t have a revenue problem…we have a spending problem. This is why I don’t get the OWS movement. They’re pissing in tents on Wall Street when they should be changing policy in DC. You can tax the rich at 100% and it still won’t fill the most recent Obama budget deficit.
Let’s be serious and discuss spending and more importantly discuss the elephant in the room…Medicare and the Ponzi scheme called Social Security.
I don’t really think we have that much of a problem, period. This is just the business cycle, only a little deeper than any recession of my lifetime. We’ll grow out of the deficit in time as we return to full employment — as a country, our financial situation is like yours. Fully solvent, but highly leveraged, and with awesome earning power (and even greater future potential)! If we were insolvent, nobody would be buying US debt. It took 12 years to incur the current national debt, it’ll take a decade or so to grow out of it in the best case.
I suppose I’m one of those squishy moderates who isn’t bothered by SSI / Medicare / the debt, which was going to kill us all in 84 but turned out not to be so bad.
As for entitlements, SSI is still the third rail and for good reason. It’s largely because the program, unlike other government boondoggles, has worked as promised. Your characterization as a Ponzi scheme is popular but wrong. SSI hasn’t missed a payment, which is more than you can say for any private insurer and definitely more than you can say for any Ponzi scheme. Further, who do you know getting rich off of SSI the way Madoff / etc., did? Also, SSI is basically transparent. It’s prohibited by law from contributing to the deficit.
I expect the cap on the payroll tax will be more closely indexed to inflation in the near term, which is the easiest fix to Social Security and generally non-controversial.
As for Medicare, the costs are driven by the enormous increases in costs of drugs and services — given that substantially all of your income is tied to the cost of drugs and providing medical services, begin in pharma sales and doctoring, respectively, anything that bends the health care cost curve is going to hurt you and your wife’s incomes personally as less is spent on drugs and services.
Additionally, where do you cut Medicare? The admin costs are something like 2% of the overall spend, if I recall correctly, so it’s not like it’s some horribly bloated operation…
1) there is no fica on cap gains
2) fair enough, many states tax cap gains, but many do not.
3) there is no double taxation on the original investment, only the gains are taxed.
4) cap gains income is like regular income in all practical senses. this is great example of a typical 1%’er whining about preserving their tax breaks.
Like I said in a prior post, historically over the past 50 years, everytime the cap gains tax was increase, the revenue collected from the tax decreased. The opposite was true when cap gains was decrease, the revenue collected from the tax increased.
Is your goal in increase tax revenue to the government or to make things “fair”? Like I said, you will never find a country that taxes cap gains at the income tax level..for this precise reason.
Great story, and I totally agree (and have wrote about it to).
I think it’s a shame that those that sacrifice their youth working their tail off are vilified. Especially when they make jobs for others!
I don’t see any occupiers at the houses of our sports heroes protesting. Yet those guys get big bucks and spend it all on themselves (mostly). Why not protest them too, they are rich and just play games…
What really kills me is hearing the president, jon stewart and the like (colbert), and other rich politicians complain about the 1% too, when they are more like the .01%… What hypocrites…
Jon, I completely agree with you…its ashame. One of the main drivers in me starting this blog..to be a lone voice for those that worked hard to get to where we are…
1) you read Greek? Impressive given your other pursuits. The facts are that the market considers us a safe haven and the downgrade did not increase our cost of borrowing.
2) a Ponzi scheme doesn’t stay solvent for 100 years. We’re not “at the beginning” of SS by a long shot. SSI is no more a pyramid scheme than any other insurance.
3) I think you are confusing projections with facts. That 5-10 year insolvency projection has been talked about for 30 years re: Medicare.
There will be no meaningful entitlement reform in the short or medium term. I think the country will survive.
Good one bro. Its another rugs to riches story. Keep it up. What do you think contributed towards your near abnormal salary hike every year?
Thanks for visiting! As stated in the post, this increases were in total compensation. Part of it was a base salary increase, and a bonus increase…some were in a relolocation package phased in over 3 years which included cost of living allowances and mortgage subsidies, and most recently, I vested in company stock (not options). Those were the big drivers.
I am by no means an economist but I tend to agree that our country has a bigger spending issue than it does a revenue issue. What I don’t understand is how we can continue to cut 2% from the employee’s portion of social security each year and expect the insolvent to become solvent.
I started working (ie paying into the system) 28 years ago and, if given the choice right now, would give up any and all benefits I am due at retirement age just to be able to invest the 15+% of my check each month the way I see fit.
Just my two cents; which actually cost the government 2.6 cents to make.
I agree with you 100%. I haven’t been contributing as long as you have, but would gladly forego future contributions if I can invest the money the way I want. It should be an opt-in program.
Regarding pennies, its too bad it is illegal to melt down your pennies to sell on the open market….
Good stuff. It’s amazing what a little hard work can do!
This is my new favorite site. I think the PF world needs a different perspective as well. Most of the bloggers (myself included) write about saving money and planning ahead, no one really talks about what would happen when you get ahead.
I’ll be stopping by often as I have a lot to learn! Also, I love seeing anyone with a science background do well.
Marissa, thanks for the kind words! I just checked out your site…fantastic content! I’ll be watching you closely to see how your doing…the 30k challenge sounds interesting as well.
Some other facts:
“Some analysts state that the availability of more expensive, state-of-the-art medical technologies and drugs fuels health care spending for development costs and because they generate demand for more intense, costly services even if they are not necessarily cost-effective.”
“FACT: 416 brand-name drugs had extraordinary price increases” — GAO, Dec. 2009
I am not sure how you can claim not to be a stereotypical 1%-er and promote prescription drugs and/or other pharma technology (a leading cause of the explosion in health care costs) with a straight face. Christianity is about honesty. People in sales or promotion are not about honesty. They have a fiduciary duty to sell their product.
I hope you’re not a Christian, because you were not honest in your comments. You pulled (out of context) some verbiage from the Kaiser report on healthcare costs, but conveniently left out the sentence prior to the one you posted. That sentence goes “For several years, spending on prescription drugs and new medical technologies has been cited as a primary contributor to the increase in overall health spending; however, in recent years, the rate of spending on prescription drugs has decelerated”
Additionally, in the report and I stated before, prescription drugs account for 10% of healthcare costs. So if you want to be real about healthcare spending…look at the other 90%. By the way, I’m not in sales..I’m in drug development.
Loving your blog. Just read a bunch of your posts. I am a huge fan of the 1%, which by default makes me a fan of you! Got you in my RSS reader and looking forward to following your blog.
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Matt, thanks for visiting and subscribing! Please let me know if there is anything in particular you’d like to see or if you have any feedback on the site!
Nicely Done! Welcome to the 1% group
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Thanks Tushar! I’m impressed by your story as well (as far as I can tell from your blog)…thanks for visiting!
I love reading stories like this. Just proof that working hard and sacrificing can still get you ahead in America. Let people say what the want to say, well done!
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Verify interesting. As a fellow pharmacist, I do well financially, but I have no desire to be in the top 1%. Actually, I’m trying to find ways to work less and get more time. Instead of pursuing opporunities in sale and management, I’ve turned those chances down in exchange for lower salary and fewer days worked.
My next venture will be a 7 on-7 off night shift position that will pay a little better than my current position and give me more time to travel and relax.
Honestly, I don’t think any additional money over 70k a year creates additional happiness. I know that a fancy car, house , or clothes will do absolutely nothing to make me happier. Maybe these things do make you happy, but to me they are just something else to worry about.
Finally, although I love being a pharmacist, I would not recommend it to someone looking to make some easy money. The pharmacist market is becoming quite saturated and raises are no longer what they once were. The dozens of new pharmacy schools are cranking out new grads so quickly that I know some students who still don’t have jobs following graduation in May. You have a minimum of 6 years of college (with up to 2 years of residency for hospital positions) and if you work in a retail/community pharmacy, you have a high change of being robbed.
Thanks for visiting! Good to hear from a fellow pharmacist. My only motivation to be a 1 percenter is financial security and the ability to retire early. We have a nice home, but we don’t buy fancy clothes or cars. My car has over 100k miles and I have no plans to sell it. If I can retire early, fund my children’s education, and possibly help them get started with life, that is my main motivation.
Thanks for sharing your story – You clearly put in a lot of HARD work to get there. Kudos to you
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Thanks for sharing your story. I originally saw a post of yours on something in Yakezie and saw your site and thought. Oh another rich person flashing their money around. I can relate to your story as it does take a lot of hard work. My wife and I are finally starting to see the fruits of our labor. I would like to have a real estate portfolio, the first rental that we currently live in as well has been great to us. I am very handy and enjoy fixing things on my own in the property. I get that misconception of a person in finance cant possibly know how to fix something. I love how your site lays it out there and your situation and the occupy wall street movement put a bad rap on individuals such as yourself who got sucked in who have truly worked very hard to get where they are at.
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Christopher, thanks for giving me a chance! And you point out the very reason why I started this site. We all didn’t go to wall street or get bailed out…we worked hard and sacrificed. Love your site as well…added it to my rss feed!
Thanks. I subscribed to yours as well. I look forward to some more posts from you.
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If you don’t mind me asking, what is your wife’s career, and how has this contributed to your overall networth throughout the years?
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Wife is a physician…contributes a great deal to net worth though she now works part time.
Actually it took over 200 years to incur the debt, but the debt is now at a higher percentage of GDP than its ever been. And, our credit rating has been downgraded for the first time in history. I think I remember seeing someone write “I don’t think we have that much of a problem” on a blog in Greece. I think they also said they’re not “bothered by entitlements”….I think we all know what happened there.
Sure, SSI hasn’t missed a payment. Most Ponzi schemes don’t miss a payment in the beginning and to early investors. That’s how they get people like you to believe that it is actually sustainable, when their own trustees have come out to say that SSI will be insolvent in 2036. So, yes, it is a Ponzi scheme. If we do nothing, retirees in 2036 will NOT receive benefits that they have contributed. Also, SSI didn’t adjust for inflation the past 2 years, so although they didn’t miss a payment, they are beginning to reduce the benefit.
Drugs and services are healthcare, but drugs are 10% of heatlhcare costs. But what is anyone doing to “bend the cost curve”? Right now, it will be insolvent in 2017…that is a fact…so you cut the benefits to recepients, increase the age to receive benefits, and/or increase payroll taxes. Don’t be fooled by a 2% admin cost. If they actually had administrators watching out for fraud and waste, which is in the billions, the percentage of admin costs would rise. I think the US Postal Service prides itself on being able to send a letter across the country for $0.44 cents, but they’re in the red so its not that impressive. Same goes with Medicare admin costs. THe program is failing. Those are facts.
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