Richness in Christian preaching often contrasts earthly wealth with spiritual wealth, emphasizing true riches found in faith and contentment rather than material possessions (1 Timothy 6:17-19). Illustrations frequently use images of money, luxury, and possessions to highlight the fleeting nature of earthly riches and the eternal value of godly contentment and generosity.
Sheik Mohammed Al-Fassi earns $5 million a day, total worth around $6 billion. Possessions and homes described. Owns $20 million yacht. A likeness of his face appears on the bottom of his Olympic-size swimming pool. Feed bill for dogs is over $50,000 a month. First divorce from Dena cost him $100 million.
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Patti Chiles awarded $500,000 in emotional damage in divorce case against husband Jerry, 44, an oil millionaire in Houston. She walked in while he was having sex with secretary. He brought prostitutes to the home. She called it emotional terrorism. She made tape recordings of his prostitutes. He claims she set him up. Total award was $1.4 million. Was first time a husband or wife had won civil damages for pain endured during a marriage.
#183
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In 1894, when Congress was considering a tax of 2 percent on incomes of more than $4,000 (1 percent of the population), a wealthy New Yorker threatened to leave the country. A Nebraska congressman, William Jennings Bryan (The Great Commoner), said:
“Of all the mean [miserly] men I have ever known, I have never known one so mean [miserly] that I would be willing to say of him that his patriotism was less than two percent deep … If ‘some of our best people’ prefer to leave the country rather than pay … we can better afford to lose them and their fortunes than risk the contaminating influence of their presence.”
Charles E. Hurwitz, 49, a corporate raider who rules a financial empire worth an estimated $8.5 billion, says, "There's a little story about the Golden Rule. Those who have the gold, rule."
From the standpoint of material wealth, Americans have difficulty realizing how rich we are. Going through a little mental exercise suggested by Robert Heilbroner can help us to count our blessings, however. Imagine doing the following, and you will see how daily life is for as many as a billion people in the world:
1. Take out all the furniture in your home except for one table and a couple
of chairs. Use blanket and pads for beds.
2. Take away all of your clothing except for your oldest dress or suit, shirt
or blouse. Leave only one pair of shoes.
3. Empty the pantry and the refrigerator except for a small bag of flour,
some sugar and salt, a few potatoes, some onions, and a dish of dried
beans.
4. Dismantle the bathroom, shut off the running water, and remove all the
electrical wiring in your house.
5. Take away the house itself and move the family into the toolshed.
6. Place your "house" in a shanty town.
7. Cancel all subscriptions to newspapers, magazines, and book clubs. This
is no great loss because now none of you can read anyway.
8. Leave only one radio for the whole shantytown.
9. Move the nearest hospital or clinic ten miles away and put a midwife in
charge instead of a doctor.
10. Throw away your bankbooks, stock certificates, pension plans, and
insurance policies. Leave the family a cash hoard of ten dollars.
11. Give the head of the family a few acres to cultivate on which he can raise
a few hundred dollars of cash crops, of which one third will go to the
landlord and one tenth to the money lenders.
12. Lop off twenty-five or more years in life expectancy.
By comparison how rich we are! And with our wealth comes responsibility to use it wisely, not to be wasteful, and to help others. Think on these things.
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According to Rev. Brett Blair, this list comes from economist Robert Heilbroner
#1412
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James Boice once heard a statement given by the great vaudeville actress Sophie Tucker. She was being asked by reporters about her early struggles before she became a success, and whether or not she had been happy in her years of poverty. She answered, "Listen, I’ve been rich, and I've been poor. And believe me, honey, rich is better!"
Sermon in James series. Danger of being rich. James 5:1-6
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CAN A CHRISTIAN DRIVE A B.M.W.?
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I. A radical critique.
II. James' rebuke of the rich.
A. He is addressing the rich pagans outside the church. 5:1
B. No rich people in heaven?
C. Wealth has a way of demanding our allegiance. Matt 6:24
III. Here come de judge.
A. We are in the "last days." 5:3
B. Treasure is secure in heaven, or rusted on earth.
IV. What the rich did wrong.
A. They have ripped off workers. 5:4
B. They have lived for pleasure.
V. Difficult truths.
A. Everyone will answer to God.
B. The way we live shows what we really believe.
C. The longer we live a certain way, the harder our hearts become.
D. Put hope in God, not money. 1 Timothy 6:17
#2730
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From Henry David Thoreau's book WALDEN, written in 1845:
"A man is rich in proportion to the number of things he can do without. Beware of all enterprises that require new clothes."
Should A Christian Buy A Lexus?
Yes and No answers by different Christians.
Yes, we can own a Lexus. “Utilitarianism” sees the moral good as making the best possible use of our resources and so many Christians think the rich should give away all their money to the poor. In reality the Bible says two things to the rich: riches are a blessing, but it is a blessing that is supposed to connect us to God. When the connection breaks down we are in sin. The connection is spiritual (humility, compassion) and physical (justice for the poor). The Bible contains many righteous wealthy people, who were even affirmed by Jesus. Jesus and the prophets condemned those rich who ignored the poor and lived in spiritual alienation. Another factor is that wealth is relative – a Lexus is a luxury to most Americans, but even a beat-up old car is a luxury to most of the world. John Schneider
No, we shouldn’t own a Lexus. A rich lifestyle more reflects American consumerism than biblical righteousness. Christians are not to be rich in things. We should reduce consumption, not increase it. How much can we keep? It is difficult to determine exactly. What we keep may be more important to God than what we give. Possessions are OK if they proclaim the gospel of Jesus. Jo Kadlecek & David Williams
Letter to Editor (#90, page 12) by Jim Moses of Lexington, Kentucky:
The problem is not really the Lexus but what constitutes stewardship. It is also an issue of the fit between our accountability to God and our accountability to others. Williams and Kadlecek over-simplify the poverty issue. It’s true that God does not need us to achieve the power of riches to bring about His will, but God challenges and strengthens our trust in Him by distributing as He wills. Jesus’ disciples were more the middle class of their society than the poor. Peter, Andrew, James, and John had a fishing business that was big enough for Zebedee to hire others to work in. Matthew was a tax collector. John retained sufficient possessions that he had a house to provide room for Mary after the crucifixion.
The early Church had sufficient resources to care for widows. Some voluntarily sold their possessions and gave all to the church but, if I interpret Peter’s rebuke to Ananias properly, that was not required. In fact, there was only one man (recorded) whom Jesus told to give all to the poor. That “rich young ruler” was clearly violating the first and great commandment.
The real bottom line is, where do Emily and Robert go from here? I have a dear friend who says God has never permitted her to buy a new car but has always provided a reliable used car. She never condemns those who buy new cars, but her testimony had me reevaluating our fourth new vehicle (in 26 years). The clearest witness of the Good News is the love we have for one another. This love must transcend the Cavalier and the Lexus.
Jim Moses, Lexington, Kentucky
I'll never forget Easter 1946. I was 14, my little sister Ocy 12, and my older sister Darlene 16. We lived at home with our mother, and the four of us knew what it was to do without many things.
My dad had died five years before, leaving Mom with seven school kids to raise and no money. By 1946 my older sisters were married, and my brothers had left home.
A month before Easter, the pastor of our church announced that a special Easter offering would be taken to help a poor family. He asked everyone to save and give sacrificially.
When we got home, we talked about what we could do. We decided to buy 50 pounds of potatoes and live on them for a month. This would allow us to save $20 of our grocery money for the offering.
Then we thought that if we kept our electric lights turned out as much as possible and didn't listen to the radio, we'd save money on that month's electric bill. Darlene got as many house- and yard-cleaning jobs as possible, and both of us baby-sat for everyone we could. For 15 cents, we could buy enough cotton loops to make three pot holders to sell for $1. We made $20 on pot holders.
That month was one of the best of our lives. Every day we counted the money to see how much we had saved. At night we'd sit in the dark and talk about how the poor family was going to enjoy having the money the church would give them. We had about 80 people in church, so we figured that whatever amount of money we had to give, the offering would surely be 20 times that much. After all, every Sunday the pastor had reminded everyone to save for the sacrificial offering.
The day before Easter, Ocy and I walked to the grocery store and got the manager to give us three crisp $20 bills and one $10 bill for all our change. We ran all the way home to show Mom and Darlene. We had never had so much money before.
That night we were so excited we could hardly sleep. We didn't care that we wouldn't have new clothes for Easter; we had $70 for the sacrificial offering. We could hardly wait to get to church!
On Sunday morning, rain was pouring down. We didn't own an umbrella, and the church was over a mile from our home, but it didn't seem to matter how wet we got. Darlene had cardboard in her shoes to fill the holes. The cardboard came apart, and her feet got wet. But we sat in church proudly. I heard some teenagers talking about the Smith girls having on their old dresses. I looked at them in their new clothes, and I felt so rich.
When the sacrificial offering was taken, we were sitting in the second row from the front. Mom put in the $10 bill, and each of us girls put in a $20. As we walked home after church, we sang all the way. At lunch Mom had a surprise for us. She had bought a dozen eggs, and we had boiled Easter eggs with our fried potatoes!
Late that afternoon the minister drove up in his car. Mom went to the door, talked with him for a moment, and then came back with an envelope in her hand. We asked what it was, but she didn't say a word. She opened the envelope, and out fell a bunch of money. There were three crisp $20 bills, one $10, and seventeen $1 bills.
Mom put the money back in the envelope. We didn't talk, we just sat and stared at the floor. We'd gone from feeling like millionaires to feeling like poor white trash.
We kids had had such a happy life that we felt sorry for anyone who didn't have parents like ours and a house full of brothers and sisters and other kids visiting constantly. We thought it was fun to share silverware and see whether we got the fork or the spoon that night. We had two knives, which we passed around to whoever needed them.
I knew we didn't have a lot of things that other people had, but I'd never thought we were poor. That Easter Day I found out we were. The minister had brought us the money for the poor family, so we must be poor.
I didn't like being poor. I looked at my dress and worn-out shoes and felt so ashamed that I didn't want to go back to church. Everyone there probably already knew we were poor! I thought about school. I was in the ninth grade and at the top of my class of over 100 students. I wondered if the kids at school knew we were poor. I decided I could quit school since I had finished the eighth grade. That was all the law required at that time.
We sat in silence for a long time. Then it got dark, and we went to bed. All that week, we girls went to school and came home, and no one talked much. Finally on Saturday, Mom asked us what we wanted to do with the money. What did poor people do with money? We didn't know. We'd never known we were poor.
We didn't want to go to church on Sunday, but Mom said we had to. Although it was a sunny day, we didn't talk on the way. Mom started to sing, but no one joined in, and she only sang one verse.
At church we had a missionary speaker. He talked about how churches in Africa made buildings out of sun-dried bricks, but they needed money to buy roofs. He said $100 would put a roof on a church. The minister said, "Can't we all sacrifice to help these poor people?"
We looked at each other and smiled for the first time in a week. Mom reached into her purse and pulled out the envelope. She passed it to Darlene, Darlene gave it to me, and I handed it to Ocy, Ocy put it in the offering.
When the offering was counted, the minister announced that it was a little over $100. The missionary was excited. He hadn't expected such a large offering from our small church. He said, "You must have some rich people in this church."
Suddenly it struck us! We had given $87 of that "little over $100." We were the rich family in the church! Hadn't the missionary said so?
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EDDIE OGAN lives in Washington with her husband, Phil. They have one son by birth and 11 children by adoption. This article was taken from a letter she wrote to encourage some missionaries.
___________________________________________________________________________
[version in sermon, changed to third person]
Eddie Smith will never forget Easter 1946. She was 14, her little sister Ocy 12, and her older sister Darlene 16. They lived at home with their mother, and the four of them knew what it was to do without many things. Her dad had died five years before, leaving Mom with seven school kids to raise and no money. By 1946 her older sisters were married, and her brothers had left home.
A month before Easter, the pastor of their church announced that a special Easter offering would be taken to help a poor family. He asked everyone to save and give sacrificially.
When they got home, they talked about what they could do. They decided to buy 50 pounds of potatoes and live on them for a month. This would allow them to save $20 of their grocery money for the offering.
Then they thought that if they kept their electric lights turned out as much as possible and didn't listen to the radio, they'd save money on that month's electric bill. Darlene got as many house- and yard-cleaning jobs as possible, and she and Eddie baby-sat for everyone they could. For 15 cents, they could buy enough cotton loops to make three pot holders to sell for $1. They made $20 on pot holders.
That month was one of the best of their lives. Every day they counted the money to see how much they had saved. At night they'd sit in the dark and talk about how the poor family was going to enjoy having the money the church would give them. Their church had around 80 people, so they figured that whatever amount of money they had to give, the offering would surely be 20 times that much. After all, every Sunday the pastor had reminded everyone to save for the sacrificial offering.
The day before Easter, Ocy and Eddie walked to the grocery store and got the manager to give them three crisp $20 bills and one $10 bill for all their change. They ran all the way home to show Mom and Darlene. They had never had so much money before.
That night they were so excited they could hardly sleep. They didn't care that they wouldn't have new clothes for Easter; they had $70 for the sacrificial offering. They could hardly wait to get to church!
On Sunday morning, rain was pouring down. They didn't own an umbrella, and the church was over a mile from their home, but it didn't seem to matter how wet they got. Darlene had cardboard in her shoes to fill the holes. The cardboard came apart, and her feet got wet. But they sat in church proudly. Eddie heard some teenagers talking about the Smith girls having on their old dresses. Eddie looked at them in their new clothes, and Eddie felt so rich.
When the sacrificial offering was taken, they were sitting in the second row from the front. Mom put in the $10 bill, and each of the girls put in a $20. As they walked home after church, they sang all the way. At lunch Mom had a surprise for them. She had bought a dozen eggs, and they had boiled Easter eggs with their fried potatoes!
Late that afternoon the minister drove up in his car. Mom went to the door, talked with him for a moment, and then came back with an envelope in her hand. They asked what it was, but she didn't say a word. She opened the envelope, and out fell a bunch of money. There were three crisp $20 bills, one $10, and seventeen $1 bills.
Mom put the money back in the envelope. They didn't talk, they just sat and stared at the floor. They'd gone from feeling like millionaires to feeling like poor white trash.
The Smith kids had had such a happy life that they felt sorry for anyone who didn't have parents like theirs. They thought it was fun to share silverware and see whether they got the fork or the spoon that night. They had two knives, which they passed around to whoever needed them.
Eddie knew they didn't have a lot of things that other people had, but she'd never thought they were poor. That Easter Day Eddie found out they were. The minister had brought them the money for the poor family, so they must be poor.
They sat in silence for a long time. Then it got dark, and they went to bed. All that week, they girls went to school and came home, and no one Talked much. Finally on Saturday, Mom asked them what they wanted to do with the money. What did poor people do with money? They didn't know. They'd never known they were poor.
Eddie didn't like being poor. She looked at her dress and worn-out shoes and felt so ashamed that she didn't want to go back to church. Everyone there probably already knew they were poor! She thought about school. Eddie was in the ninth grade and at the top of her class of over 100 students. She wondered if the kids at school knew they were poor. Eddie decided she could quit school since she had finished the eighth grade. That was all the law required at that time.
They didn't want to go to church on Sunday, but Mom said they had to. Although it was a sunny day, they didn't talk on the way. Mom started to sing, but no one joined in, and she only sang one verse.
At church they had a missionary speaker. He talked about how churches in Africa made buildings out of sun-dried bricks, but they needed money to buy roofs. He said $100 would put a roof on a church. The minister said, "Can't they all sacrifice to help these poor people?"
They looked at each other and smiled for the first time in a week. Mom reached into her purse and pulled out the envelope. She passed it to Darlene, Darlene gave it to me, and Eddie handed it to Ocy, Ocy put it in the offering.
When the offering was counted, the minister announced that it was a little over $100. The missionary was excited. He hadn't expected such a large offering from their small church. He said, "You must have some rich people in this church."
Suddenly it struck them! They had given $87 of that "little over $100." They were the rich family in the church! Hadn't the missionary said so?
A Cincinnati radio station wanted to kill some time one evening. The DJ asked listeners to call in and give their idea of what it meant to be RICH. Here are some of the responses: “You know you're rich if:
(1) You frequently get locked out of your house because of a faulty security system;
(2) You attend a symphony because you actually like that kind of music;
(3) You collect art and you're not afraid to admit you don't know anything about it;
(4) When it's cold you can go where it's warm;
(5) When it's warm you can go where it's cold;
(6) Your plumbing never backs up;
(7) You develop a serious interest in sailing;
(8) You never have to call a tow truck;
(9) Your Porsche is in the shop days out of each month but you don't mind because there's always the BMW or the Lincoln.”
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Some time ago a magazine article gave a dazzling account of a scuba diver who had recently discovered the treasures of a sunken Spanish galleon in just twenty feet of water off the balmy coast of Costa Rica. Eleven million dollars worth of gold was waiting to be claimed. Day after day the scuba diver secretly brought up perfectly preserved gold pieces of-eight. The lure of that scene probably will cause about 75% of you to spin off into some monetary fantasy while I am trying to preach. Let me add to that story and say that even though we think such an occurrence would answer all of our problems for life, that riches often brings poverty instead. Just 10 years after this man discovered the Spanish galleon, he was brought to misery, disillusionment, broken relationships, and bitterness. Riches did not prove to be the answer.
We often put our affection on stuff that has a price tag. I read recently a story about an old, rich man with a cranky, miserable attitude who visited a Rabbi. The Rabbi was a simple man whose heart was right and he lived a simple life. They weren’t together very long before the Rabbi got a wonderful idea on how to illustrate to the man what was wrong. He took him by the hand and he led him over to his window and he said, “Now look out the window and tell me what you see.”
The man stood there and said, “Well I see some men and some women and I see a few children.”
The Rabbi took him by the hand and led him across the room to a mirror and said, “Now look there and tell me what you see.”
The man frowned and said, “Well, obviously, I see myself.”
“Interesting”, the Rabbi replied. “In the window there is glass, in the mirror there is glass. But the glass of the mirror is covered with a little bit of silver. And no sooner is the silver added than you cease to see others, and only yourself.”
Maybe our troubles started when just a little bit of silver was added and we stopped looking through and starting looking at.
"That man is richest whose pleasures are the cheapest."
-- Henry David Thoreau, Quotes From The Masters (QFTM) 7/10/02
I bring you here, my friends, a story from the LIFE section of Wednesday’s USA Today. It’s the most amazing story of excess and being spoiled rotten, to the point that it made me say, “You know, it’s no wonder the rich have a bad name.” This LIFE section cover story tells the tale of a guy named David Kirsch who has set up a business wherein he will go out to breakfast, lunch, brunch and dinner with a rich client...and supervise them.
Kirsch charges between $150 to $250 an hour to tell these clowns what not to eat so they don’t gain weight. He will go with them and shout, “No! You cannot have the bread! No! You cannot have that item on the menu, and you cannot have that item.” USA Today actually has a picture of this taking place! I held the picture up for Rush 24/7 subscribers to see, and it’s clear as a bell.
The guy is telling his client in this picture, a woman named Lulu Johnson, apparently some kind of actress, what not to eat. Apparently Lulu cannot go out to eat without this guy sitting next to her telling her not to eat the bread. Here’s a quote, “He insists that not only do they avoid bread, they avoid the foie gras.” Now, why does this have to be a story about “the rich” in America? Why can’t it be what it really is about - idiot people, like actors and actresses that are so self-indulgent and helpless that not only can they not speak without a script, they can’t eat without a consultant.
Former Tyco International chief executive L. Dennis Kozlowski, who allegedly used company funds to buy a $15,000 umbrella stand and a $17,100 traveling toilette box. Tyco revealed it paid for a $6,000 shower curtain, a $2,200 wastebasket and many other expensive items for Kozlowski's New York City apartment. Tyco accused Kozlowski of recklessly tapping company funds, including more than $1 million for his wife's birthday party in Sardinia last year. The event's planners called for gladiators and an ice sculpture of Michelangelo's David with vodka streaming from the statue into crystal glasses, according to Tyco's filing. Other unauthorized expenses Kozlowski allegedly incurred include a $6,300 sewing basket, a $445 pin cushion, a $1,650 notebook and $5,960 for sheets. Tyco is in the process of seizing most, if not all of Kozlowski's assets, including a $17 million Fifth Avenue apartment, a $7 million Park Avenue apartment he turned over to his ex-wife, a $5 million Nantucket home and a $30 million compound in Boca Raton, Florida.
At his arraignment, the judge released Kozlowski on a $100 million personal recognizance bond that was to be secured by $10 million in personal assets. Because his assets are frozen he could not make bail. He and another company officer were ordered to come up with the necessary funds or face time at Riker's Island, one of the nation's toughest jails.
In 2000, Kozlowski had Tyco authorize nearly $96 million in unapproved bonuses for 51 employees to offset relocation loans for employees moving to Florida. "Forgiveness was offered to some people who never moved ... and people who did not even have a Tyco mortgage," Tyco said. Kozlowski and Swartz allegedly received about $50 million as part of the program, which was purportedly paid out from the proceeds of Tyco's successful initial public offering of TyCom, its undersea fiber-optic cable network, documents show. Only a few weeks after the Florida loans were improperly forgiven, Kozlowski introduced another unauthorized bonus program that cost Tyco more than $55 million, Tyco alleges. Sixteen executives, including Kozlowski and Swartz, participated, Tyco said.
[Kozlowski gets 8 to 25 years in a New York prison and is due for parole in 2014.]
MATERIAL POSSESSIONS
(NOT WORTH MUCH IN HEAVEN)
Knowing he would die soon, a rich man had all his assets converted into gold bars, put them in a big bag on his bed, draped his body over the bag of gold, and breathed his last. When he woke up, he was at the gate of heaven.
Saint Peter met him at the gate and with a concerned look on his face said, "Well, I see you actually managed to get here with something from earth! But unfortunately, you can’t bring that in."
"Oh please, sir," said the man. "I must have it. It means everything to me."
"Sorry, my friend," said Saint Peter. "If you want to keep that bag, then I’m afraid you’ll have to go to, you know, the other place. You don’t want to go there, believe me."
"Well, I won’t part with this bag."
"Have it your way," returned Peter. "But before you go, would you mind if I looked in the bag to see what it is that you’re willing to trade eternal life for?"
"Sure," said the man. "You’ll see. I could never part with this."
Saint Peter looked in the bag and with a puzzled look on his face said to the man, "You’re willing to go to hell for ... pavement?"
What’s coming between you and God? Your money? Your possessions? Your status? Your friends? Your fun? You may be sure that none of it can compare with what God has prepared for you (1 Corinthians 2:9). "What good will it be for a man if he gains the whole world, yet forfeits his soul?" (Matthew 16:26).
Still More Hot Illustration For Youth Talks
Wayne Rice, Zondervan, p. 23.
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Another version, submitted by Integrity@1stconnect.com on 5/21/01:
A man shows up at the pearly gates carrying a large chest. St. Peter stops him and says, "I'm sorry, this is Heaven. You're not allowed to bring anything with you."
The man clutches the chest tightly and says, "Oh, I have to take this with me. It's my dearest possession."
"Well, show me what's in it," says St. Peter.
The man smiles and opens the chest. Inside is bar upon bar of shiny gold. St. Peter seems confused. "Out of all of the things you could possibly bring with you to Heaven," he asks, "why would you want to bring pavement?"
*
As Henry Ward Beecher said, "No man can tell whether he is rich or poor by turning to his ledger. It is the heart that makes a man rich. He is rich or poor according to what he is, not according to what he has."
Skyscraper apartment buildings line the coast of the wealthy section of Rio de Janeiro, each a testament to the privileged living within its security gates.
This is where Felix Alves once lived.
He was rich, successful and popular. After obtaining an engineering degree, he soon basked in earning six figures a year working for an American diet-supplement company.
Then the cash at his fingertips began leaving his hands faster than he could close his wallet. New cars. Expensive clothes. Dining in swanky restaurants.
But, as the saying goes, “What goes up, must come down.”
“I lost all my money,” Felix said. “For three months I only ate rice and beans. I had my electricity cut off twice because I didn’t have $10 to pay it.
“In two and a half years I earned $350,000. Over the next two and a half years I became ... $25,000 [in debt].”
Looking back on his financial misfortunes, Felix knows that everything happened for a reason.
“I believe that God used [the debt] to call my attention to Him,” he said.
If it hadn’t been for this bottom-of-the-barrel lifestyle he and his wife Luciana found themselves in, Felix may not have fervently searched for spiritual peace. He certainly would not have begun leading a church-planting ministry among the rich of Rio.
But first he had to turn to God.
Broke, Felix and Luciana were forced to sell their possessions and move into his parents’ house.
The corners and wall space of their living space were adorned with murals of the Virgin Mary, oriental charms and talisman-like statues of different gods and spirits that Felix’s mother felt protected the home.
Felix and Luciana began dabbling in Buddhism, Hinduism and spiritism. “[We] tried every kind of religion and philosophy,” he said. “But still that void was not filled.”
NO EXCUSES
Then a Christian friend encouraged the couple to come to church with her. In a two-year time frame they attended only about four times, Felix said, making excuses for all the other missed Sundays.
But the friend finally reached her quota for accepting excuses. She called one Sunday to tell them about a church they needed to try. She also informed them she was on her way to pick them up. “No” was never an option, Felix recalled with a chuckle.
“We were very well-received,” he said. “I liked the style [of the service]. The preacher was talking about ... what the Bible said about stress.”
Felix had never heard a sermon preached like this before. The pastor spoke plainly, addressing Felix’s needs. This was something new for him.
In the past, Felix never felt part of any type of church service he attended. He didn’t understand most of the “religious” words that were used. Nothing the speaker taught pertained to everyday life. The people in attendance seemed more like lifeless puppets attending out of obligation or just to be seen.
This time, however, “All the things I was looking for in other religions, that day I discovered in Jesus Christ and the Holy Spirit.
“I know the Holy Spirit touched my heart,” he said. “But I didn’t pray because I didn’t know what to do.”
Felix and his wife continued to attend church every Sunday; in less than a year, they became Christians when they realized Jesus was the missing piece from their lives.
Through church, Felix met Southern Baptist missionary Guy Key of Texas, who began helping him outline a plan to be debt-free in two years. Above all, Key stressed the importance of giving back to God through tithing.
“I told him ‘I don’t have one dollar,’” Felix said. “He said to make a plan to pay my debt ... as well as start by giving 1 percent ... and increase it every month by 1 percent till I reached 10 percent.”
Felix and Luciana chose to give more - — while still paying off their $25,000 debt.
“We decided to give 3 percent, then 5, 7, 9 and 10,” he said. “In six months we were out of debt and [tithing 10 percent]. It was a question about faith, not about having money or not.”
PREPARATION FOR MINISTRY
Felix began to feel the Holy Spirit tugging at his heart.
“...I was being called to be a pastor,” he said. “All the things I did, all the experiences I had [were] to prepare me [for ministry].”
Key began inviting Felix to go for runs with him. Through exercise, their friendship grew into what is now more than six years of spiritual discipleship. Felix began to pray about giving his life to plant churches in different parts of Rio de Janeiro.
Felix is a “spiritually sensitive” person, Key said, and relationships are a must for him. It was a sense of relationship that prompted him and his wife to continue visiting the church where they eventually became Christians.
“It wasn’t a temple or a church building. It was a ‘normal’ building. If you invite someone to a place that is friendly to them, it is more welcoming,” Felix said of the noticeable differences at this church.
“That is why I started my first church in a hotel,” he added. The church is now located on the first floor of a small shopping center. Strategically placed -- in the center of the fastest growing part of Rio, called Barra da Tijuca -– the new congregation is targeting the hard to reach middle- and upper-class segments.
Among the challenges: security walls and gates that surround apartment buildings. Unless an acquaintance lives within the walls of an apartment building, Felix cannot step foot on the property.
Money is another challenge. The majority of people living in Barra da Tijuca are very well off. Secure, comfortable, rich and lacking nothing, why would they want to change?
Felix can relate.
But the biggest challenge for him now is simply bearing the pain of knowing what they’re missing.
“Every day my heart breaks again because people are dying here, and they don’t have Jesus Christ,” Felix said. “[We need churches in the] area that speak the language of the people who live here.”
________
Emilee Brandon is a writer for the Southern Baptist International Mission Board.
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[Original illustration at this number was a duplicate of HolwickID #10401]
This is our entire problem… the kingdom is of the Poor!
• The rich is he who has… and in God’s world, he who has possessions (or thinks he has possessions) of his own, is automatically and totally excluded from participating in the things which God bestows.
• The poor is he who has not… and it is to these that God gives. These are the ones into whose empty cups God pours the things of his kingdom.
It’s not just about wealth of monetary possessions.
• A poor student is one who lacks learning.
• A poor musician is one who lacks talent.
• And the rich person is the one who possesses his resources in any field, be it learning, music, sports, money, or anything else.
“How hardly shall the rich… “
• We live in a day so full of emphasis on our resources.
• We live in a day when from childhood people are taught their “worth.”
But we live also in a day in tremendous spiritual poverty.
• Here, in the spiritual realm, we lack — in knowledge, in strength, in revelation, in faith, in love, in grace.
• Just as the Pharisees who thought they saw and were blind, so we think we possess — and we have not.
• Just as the Laodicean Church we measure ourselves by our own parameters and see not our true condition.
• More and more in these days I am conscious of the immensity of the realm of God, and how abysmally little any of us know of this.
• What is our awareness of the reality of that Living Kingdom which fills and maintains all things?
Someone said to me many years ago, “Prayer is measured not by its length but by its intensity.” I’ve never forgotten a young lady in Paraguay, praying for that nation and saying, “Lord let me cry; let me cry as one cries for his only son.” May God give us to find that strong desire which causes all else to bow before it and which brings us to the place where our prayers are heard and answered.
People speak of the importance of having a dream — I don’t think so … a dream usually comes from within; ‘old men shall dream dreams’, and is as good or bad as the life from which it springs, the soil in which it is planted. But a vision is from without,
• beyond our world,
• beyond our experience, • beyond our learning.
It is a revelation imparted from the world of God, beyond the knowledge and teaching of men. If God cannot give us vision, if we are left with only our man-made dreams – we perish.
I wrote at the beginning of this year of Israel led by a prophet – one’s whose eyes had been opened. I believe today more than ever that what we need as the people of God is to have our spiritual eyes opened – to see the things which HE has prepared and the paths which HE sets before us.
“Thy kingdom come”…
• There is no point in praying it unless we know what it is about.
• And there is no way to know what it is about unless it is by revelation.
• And there is no way to find the revelation except by seeking.
Julian of Norwich said something to the effect that
• God causes us to desire a thing,
• And to seek a thing,
• Because He desires us to have that thing.
• He is Light and He desires that we desire and seek Light… until He can flood our souls with that Light.
This is not just Light in the sense inner assurance, but Light to illuminate every area of this dark world around us.
• Light that shines in a dark place.
• Light for each day — and every way.
• Light that will not cease to shine until we come to that Place where there is no darkness.
He desires for us a transformed life. A life where we are no longer full of ourselves and our supposed resources but emptied that He may fill us with Himself.
May He grant us the drawing power of His Light and the fear of darkness that will bring us to the Light of His Presence.
London's THE MIRROR newspaper released a list of the world's 20 inheritance-wealthiest animals, topped by the dog “Gunther IV” (now worth over US$320 million, from the late German countess Karlotta Libenstein), followed by Kalu the chimpanzee (about US$95 million, from the late Australian Olympic swimmer Frank O'Neill) and the dog Toby Rimes (about US$80 million, from the late New Yorker Ella Wendel). The list consists of 10 cats (4 of them American), 5 dogs, a hen, a tortoise, a parrot, Kalu the chimp, and a herd of cattle supported by a British royal trust. (Most on the list are offspring of the original recipient, with trust funds even larger because of investments.)
The Osage Indians of Oklahoma endured a flood of income in the 1920s when their lands turned out to sit on an oil field. Rapacious non-Indians schemed to steal their sudden wealth, in one famous conspiracy even taking Osage wives and then poisoning them for the inheritance. As a tribal leader said of that period, “The Osage were never happy again until they lost all their money.”
Many more examples could make the point that it is often easier to become fabulously rich than to stay that way. Sudden wealth produces myriad problems, from technical questions of investment management to political and social crises. The problems compound when a favored few gain vastly more than others, and the whole group is surrounded by a mass of envious outsiders who have a long history of plundering their assets.
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I was on hold the other day trying to schedule an appointment for a hair cut. As I waited for the receptionist, I half-listened to the obligatory recordings. The announcer asked me to consider scheduling a make-over with my upcoming appointment and to make sure I leave with the products that will keep up my new look. (Apparently, when you have a captive audience of customers “muzak” is hardly strategic.) But I was then caught off guard by a question: “What do the local communities of Chad, Africa, mean to you?” The answer he offered was as immediate as my inability to think of one: “Chad is a leading producer of organic acacia gum, the vital ingredient in a new line of products exclusively produced for and available at our salon.”
In a culture dominated by consumption, the commodification of everything around us is becoming more and more of an unconscious worldview. Thus, when we think of Chad, we can think of our favorite shampoo and its connection with our hair salon. The land where it came from, the conditions of its production, and the community or laborers who produce it are realities disassociated with the commodity. Like soap and luggage, the nation of Chad can become just one of the many commodities within our consumer mindset.
As I put down the phone, I couldn't help but wonder about Amos's description of those who are “at ease in Zion.” How at ease do you have to be to begin to see the world in commodities? At the time of Amos's words, Israel was at one of its most opulent junctures. They had expanded their territory in more than one direction. Their winter palaces were adorned with ivory and their feasts were lacking nothing. They could be heard singing songs to the sound of the harp and seen anointing themselves with the finest of oils. It was in such affluence that the shepherd Amos proclaimed, “Woe to those who are at ease in Zion, and to those who feel secure on the mountain of Samaria” (Amos 6:1).
Amos's omen is far from isolated in Scripture. While Amos compares the drunken women of Israel to the fat cows of Bashan, Micah describes the rich as men full of violence, and Jeremiah cites those with wealth and power as those who grow fat and sleek. In the book of Revelation, the church that God is about to spit out of his mouth is the one who has “acquired wealth and needs nothing” — the one not realizing that they are “wretched, pitiful, poor, blind and naked” (Rev. 3:17).
As G. K. Chesterton once noted, “[I]t is impossible to have any sort of debate over whether or not Jesus believed that rich people were in big trouble — there is too much evidence on the subject and it is overwhelming.” The pervasiveness of this evidence makes for a rough entry into the ongoing debate about the morality of affluence among North American Christians. Like Chesterton, I am at times uncomfortably aware at whom the words of Christ were aimed: I am the rich Christian to whom Jesus speaks bluntly.
I am also among the crowd he takes the time and care to caution. Among his many words about money, Jesus warned, “Watch out! Be on your guard against all kinds of greed; a man's life does not consist in the abundance of his possessions” (Luke 12:15).
How then shall we live in a world of affluence? How are we to fight the all-pervading atmosphere of consumerism and the attitude of commodification around us? There is good reason for unrelenting words against greed that turns communities into commodities and souls into consumers. There is a reason Christ has called the poor in spirit blessed, for those who cling to the Father know it is Him alone they can eternally hold. We were not made to be at ease in Zion; we were made in the image of God.
We serve a God who never sleeps or slumbers in part because those who are hurting never sleep or slumber. It is He who calls us to follow and to deny ourselves, to consider in our hearts the treasures that block our vision of the Cross, as well as our vision of our neighbor. There are none seen as commodities in the eyes of the Creator; there are but children with the eyes of their Father.
________
Copyright © 2005 Ravi Zacharias International Ministries (RZIM). Reprinted with permission. "A Slice of Infinity" is a radio ministry of Ravi Zacharias International Ministries.
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Elvis Presley tops the annual Forbes list of celebrities who are the top moneymakers after they have died.
Singer Elvis Presley, who died in 1977, made an estimated $45 million in the past year.
Cartoonist Charles Schulz (2000) is next on the list with $35 million.
Musician John Lennon (1980), raked in $22 million.
Artist Andy Warhol's (1987) take was $16 million.
"Cat in the Hat" author Dr. Seuss (1991) made $10 million.
Actor Marion Brando (2004) with $9 million.
Actress Marilyn Monroe (1962) with $8 million.
________
Source: Peninsula Daily News, October 28, 2005, http://peninsuladailynews.com
With a fortune estimated at $17 billion, Larry Ellison is so rich he spends $55,000 a day on what his accountant calls “lifestyle” expenses. It's a lifestyle few of us can even imagine, reports CBS News correspondent John Blackstone.
It's no secret Ellison, the founder of software company Oracle, spends exuberantly: $100 million went into his unsuccessful attempt to win the America's Cup sailing race.
“I'm addicted to winning. The more you win, the more you want to win,” Ellison told 60 Minutes in a 2004 interview.
He's rumored to have spent $200 million building a Japanese-style estate above Silicon Valley. Now, documents filed in a since settled lawsuit charging insider trading are giving an inside look at the billionaire's budget. A handwritten note from Ellison's accountant sets out expenditures: $194 million on a new yacht, $25 million on a villa in Japan and $20 million a year on “lifestyle.”
Worried about your credit card bill? Ellison spent $75 million in interest payments on bank loans.
Carrie Kirby of the San Francisco Chronicle first turned up the documents that reveal Ellison spends big, and borrows big. Her investigation found that in 2000 he was $1.2 billion in debt, having borrowed hundreds of millions from three different banks simultaneously.
“Wouldn't you loan money to him?” she asks Blackstone. “He's good for it, right?”
Ellison declined to comment for this story but the documents show one way he may not be much different than the rest of us. He has somebody nagging him about spending too much. An e-mail from Ellison's accountant reads: “I'm worried, Larry...New purchases should be kept to a minimum.”
It seems, however, that Ellison paid little mind to the advice given by his accountant. He later went on a beachfront buying spree in Malibu — spending $200 million on a string of luxury properties.
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Bertha Adams died on Easter Sunday in Palm Beach Florida in 1976. She was 71 years old. The coroner’s report said that she died of malnutrition. She had been known to beg for food, and only weighed 50 pounds when she died.
Authorities found her home to be “a pigpen . . . a big mess!” It appeared that Bertha died penniless.
Then two keys were found, that led to two safety deposit boxes. The first one had over 700 shares of AT&T stock and $200,000 cash. The second one had only cash, $600,000.
Her great wealth did her no good. James sees such hoarding as obscene because it corrupts and corrodes life.
==============
Another version by Charles Swindoll:
"Tightwads"
Mrs. Bertha Adams, 71 years old, died alone in West Palm Beach, Florida, on Easter Sunday. The coroner’s report read: “Cause of death . . . malnutrition.” She had wasted away to fifty pounds.
When the state authorities made their preliminary investigation of Mrs. Adams’ home, they found a veritable “pigpen . . . the biggest mess you can imagine.” One seasoned inspector declared he’d never seen a dwelling in greater disarray. The woman had begged food from neighbors’ back doors and gotten what clothing she had from the Salvation Army. From all outward appearances she was a penniless recluse, a pitiful and forgotten widow. But such was not the case.
Amid the jumble of her unclean, disheveled belongings, the officials found two keys to safe-deposit boxes at two different local banks. In the first box were over 700 AT&T stock certificates, plus hundreds of other valuable certificates, bonds, and solid financial securities, not to mention a stack of cash amounting to nearly $200,000. The second box contained $600,000. Adding the net worth of both boxes, they found well over a million dollars.
Charles Osgood, reporting the story on CBS radio, announced that the estate would probably go to a distant niece and nephew, neither of whom dreamed their aunt had a thin dime to her name.
Can you imagine picking up the phone and hearing that you’d just inherited half a million? Why, I wouldn’t know whether to shout “Glory,” dance the jig, wind my watch, whistle “Dixie,” or sing “The Doxology.”
You can count on this, friend: those two relatives are awfully glad Aunt Bertha still had their names lying around.
But don’t you also wonder about this woman? Why, oh, why would anybody salt away all that bread in two tiny boxes, month after month, year after year, and refuse to spend even enough for food to stay alive?
Fact is, Bertha Adams wasn’t saving her money; she was worshiping it . . . hoarding it . . . gaining a twisted satisfaction out of watching the stacks grow higher as she shuffled along the streets wearing the garb of a beggar.
I confess an almost total loss of understanding as I try to imagine pleasure being drawn from simply stacking up one’s treasure for the sheer and selfish delight of watching the stack grow higher. Now don’t misread me. I’m a firm believer in saving, investing, intelligent spending, and wise money management. But I have trouble finding one word of scriptural support for being a tightwad!
And it isn’t hard to spot them. They all start with one main question: How much does it cost? And one main answer: We can’t afford it. And one main criticism: We’re spending too much money. I have yet to meet a Christian tightwad who knew BY EXPERIENCE the first principle of enthusiastic faith. Never have I seen one who could dream broad dreams or see vast visions of what God can do IN SPITE OF man’s limitations.
Give me a handful of “greathearts” . . . generous, openhanded, visionary, spiritually minded givers . . . magnanimous giants with God who get excited about abandoning themselves to Him. Now I remind you, they may not need a teller for their fortune when it’s over and done with, but who cares? The name of the game is not CAUTION — it’s still VISION, isn’t it? Seems like I read somewhere that those without it perish.
And speaking of that, when they buried Bertha Adams, she didn’t take a penny with her.
________
Taken from Charles R. Swindoll, “Tightwads,” in THE FINISHING TOUCH: BECOMING GOD’S MASTERPIECE (Dallas: Word, 1994), 448-49. Copyright © 1994 by Charles R. Swindoll, Inc. All rights reserved.
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[Original illustration at this number was a duplicate of HolwickID #20908]
Gambling is big business. Very big. Mogul Sheldon Adelson owns the Las Vegas Sands Casino and earned $9 billion in 2006, with his stock up 125% since its public offering in December 2004. Adelson has made almost $1 million an hour since the 2004 Forbes 400 list was published.
Tom Monaghan grew up very poor. His father died when he was five years old and his mother, who worked as a domestic servant, put him and his brother in a foster home. When Monaghan got out on his own he worked diligently and founded the Domino’s Pizza empire, which he sold in 1998 for one billion dollars.
Monaghan is a very devout, and very conservative, Roman Catholic. One day, he was arrested by a passage from the work of C. S. Lewis. Lewis proposed that, in the scheme of Christian morality, pride -– the sin of self-regard -- was “the great sin.” Lewis wrote that pride was “the essential vice, the utmost evil.... It was through Pride that the devil became the devil; Pride leads to every other vice: it is the complete anti-God state of mind.” A rich man’s striving for greater wealth, Lewis contended, was not greed but pride.
“That hit me right between the eyes,” Monaghan said. “C. S. Lewis told me that it was pure pride. You wanted to impress other people -- impress them with a spectacular play, or you wanted to impress them with all your worldly goods and accomplishments.”
As he lay in bed that night, Monaghan said, he swore a “millionaire’s vow of poverty.” The next day, he began to dispossess himself of the earthly treasures he’d accumulated, beginning with his dream house, which was under construction in Ann Arbor. The house had cost seven million dollars already; it sits unfinished in a field of weeds. Monaghan sold almost all of his art collection, some of it at a staggering loss. He had put thirty-five million dollars into building an island resort; he sold it for three million dollars. He gave up the helicopter, the Gulfstream business jet, and the Bugatti. In 1992, he sold the Tigers baseball team to his pizza rival, Mike Ilitch, of Little Caesars.
“I had to get rich to see that being rich isn’t important,” he told writer Peter Boyer. “I was brought up poor, and I was embarrassed by my threadbare clothes and shoes. I had to get that out of my system.... It was a relief. I was getting too sidetracked by the quest for that stuff. I mean, it was a game. It was fun. You know, which new Gulfstream do you like? How much is it gonna cost? What do I have to do to get one?”
After he made his decision, Monaghan announced that he would devote the rest of his life, and his resources -– after providing for his family -– to the Church. “I want to die broke,” he declared.
The New York Times reports that some millionaires in Silicon Valley just can’t make ends meet, and are gripped by a sense of economic insecurity. Most Americans would surely find this perplexing, but a million dollars only goes so far.
As the paper explains:
By almost any definition -- except his own and perhaps those of his neighbors here in Silicon Valley -- Hal Steger has made it.
Mr. Steger, 51, a self-described geek, has banked more than $2 million. The $1.3 million house he and his wife own on a bluff overlooking the Pacific Ocean is paid off. The couple’s net worth of roughly $3.5 million places them in the top 2 percent of families in the United States.
Yet each day Mr. Steger continues to toil in what a colleague calls “the Silicon Valley salt mines,” working as a marketing executive for a technology start-up company, still striving for his big strike. Most mornings, he can be found at his desk by 7. He typically works 12 hours a day and logs an extra 10 hours over the weekend.
“I know people looking in from the outside will ask why someone like me keeps working so hard,” Mr. Steger says. “But a few million doesn’t go as far as it used to. Maybe in the ‘70s, a few million bucks meant ‘Lifestyles of the Rich and Famous,’ or Richie Rich living in a big house with a butler. But not anymore.”
Reporter Gary Rivlin described “working-class millionaires” who are members of the “digital elite.” They do not think of themselves as wealthy, even as they are fully aware of their financial standing in comparison to most Americans. It’s that other comparison that bothers them. As Rivlin explains, “But many such accomplished and ambitious members of the digital elite still do not think of themselves as particularly fortunate, in part because they are surrounded by people with more wealth -- often a lot more.”
There can be no doubt about that. There are now millionaires in almost every community, and the wealthiest now count their fortunes in the billions, not millions, of dollars.
Those given to comparisons of personal wealth can always find someone with a larger fortune. This is especially true where the wealthy congregate together in communities like those in California’s Silicon Valley. When the comparison game starts, it never ends. Rivlin cited one man worth approximately $10 million who saw that sum as relatively paltry: “You’re nobody here at $10 million.”
The enticements and pressures of a consumer society also play a part. One man told Rivlin that “the pressures to spend more are everywhere.” As Rivlin explained, “Children want the latest fashions their peers are wearing and the most popular high-ticket toys. Furniture does not seem up to snuff once you move into a multimillion-dollar home. Spouses talk, and now that resort in Mexico the family enjoyed so much last winter is not good enough when looking ahead to next year. Summer camp, a full-time housekeeper, vintage wines, country clubs: the cost of living bloats.”
Another Silicon Valley millionaire admitted the reality: “Here, the top 1 percent chases the top one-tenth of 1 percent, and the top one-tenth of 1 percent chases the top one-one-hundredth of 1 percent.... You try not to get caught up in it, but it’s hard not to.”
That must be an honest admission, and one does not have to be a millionaire to get caught up in the comparison game. If honest, most of us would probably admit to the temptation to follow John D. Rockefeller’s adage that all we need is “a little bit more.”
This report certainly brings these words of Jesus to mind:
Do not lay up for yourselves treasures on earth, where moth and
rust destroy and where thieves break in and steal, but lay up for
yourselves treasures in heaven, where neither moth nor rust
destroys and where thieves do not break in and steal. For where
your treasure is, there your heart will be also. [Matt. 6:19-21]
[sermon version at the bottom]
Every three years the Federal Reserve Board conducts a national survey that tracks the financial health of American households. Most people are surprised to realize how little money it takes to win a gold star from the Fed. If you and yours are bringing in $40,000 a year, you’re doing better than half the households in America. Or, as a Washington think tank recently pointed out: If you’re a teacher married to a policeman, your combined household income puts you in the top 25 percent of all households in the nation.
Below you’ll find the average income picture sliced into income levels. Think of this chart as a parking ramp. If your household income is $170,000, you’re among the nation’s top 10 percent wage earners and get to park on the top floor. Anything in six figures means you’re in the top 20 percent and get to park on the floor right below.
ANNUAL INCOME PARKING RAMP
Income level Median income
(percentile) (rounded)
Level VI (90 to 100) $170,000
Level V (80 to 89.9) $99,000
Level IV (60 to 79.9) $65,000
Level III (40 to 59.9) $40,000
Level II (20 to 39.9) $24,000
Level I (less than 20) $10,000 [1]
So does making $170,000 a year make a person rich? Last year a plurality of respondents (29 percent) in a survey by The New York Times said that “rich” was making between $100,000 and $200,000 a year. Unfortunately, the survey didn’t break out how many people in that salary range considered themselves rich. If the people I talk to are any indication, very few do.
Of course, income is only one part of the equation defining where you stand. Net worth is more telling. Net worth, as every financially precocious schoolchild knows, is the sum of one’s assets -- home equity, investments, savings accounts, retirement funds, cars, furnishings and such things as jewelry, furs, wine collection, old baseball cards -- minus all outstanding liabilities such as mortgage balance, revolving and credit card debt, college loans and so on. Across all households, the national median net worth is $86,000. Half of your fellow citizens have more than that, half less. As you see, there’s a massive disparity between the haves and have-nots.
NET WORTH PARKING RAMP
Net worth (percentile) Median net worth
(rounded)
Level VI (90 to 100) $833,600
Level V (80 to 89.9) $263,100
Level IV (60 to 79.9) $141,500
Level III (40 to 59.9) $62,500
Level II (20 to 39.9) $37,200
Level I (less than 20) $7,900 [2]
We live in a country that once celebrated itself as egalitarian, yet 1 percent of the population -- nearly 3 million people -- currently has as much money as the 100 million people at the bottom of the ramp.
Yet when I ask those at the top of the ramp how they feel about the future, whether their fortunate place on the ramp gives them a measure of confidence about it, they shake their heads.
YOU AND YOUR BROKER
If you’re not parked near the top of the ramp, you’re of little or no interest to financial services firms and financial advisers. There’s no money to be made at these levels. Last year, a handful of Wall Street firms told their brokers they would no longer receive commissions on accounts holding less than $50,000. But for the Wall Street firms, there’s gold on the floors above. The greater the household assets, the more fees and transaction costs can be extracted from an account.
WEALTH POLL
The investment industry divides people on the top floors of the garage into three broad segments of wealth, each of which is nicely profitable.
The biggest and broadest affluent segment consists of people with investable assets of between $200,000 and $1 million to $2 million. This group is sometimes referred to as mass affluent, and it would be fair to think of it as the meat and potatoes of the financial services business. If you’re at the lower end of that range -- if you have, say, $300,000 in your accounts -- you’re definitely of prime interest to the brokers and customer reps at Merrill Lynch, Smith Barney, Vanguard and the rest. But they need to be careful lest you cost them money. They may call you on the phone, but they prefer that you use their website.
The next segment up from mass affluent is where the action gets white hot. This parking level belongs to those designated as high net worth individuals (or HNWIs). There are no universal criteria here. Generally, HNWIs have invested assets of at least $1 million, although some companies also target younger households with healthy six-figure incomes, knowing that their net worth is likely to reach target levels in the near future. Right now there are well over 7 million high net worth households in the United States, with a forecasted growth rate of 16 percent a year and projected assets of $32 trillion.
If their marketing efforts are any indication, Wall Street firms see HNWIs as the happiest people in the world, no matter that so many of them are, rightly or wrongly, distressed over their long-term prospects. Distress is not what’s pictured in the ads. The ads are filled with images of zippy seniors who flash large white teeth and incredibly healthy gums. They dance. They jog. They bike. They fish. They golf. They snuggle. According to the ads, life is a theme park expressly designed for the middle-aged. Graying boomers waltz across their living rooms, raise glasses to one another on the decks of ocean liners and exchange smiles secure in the knowledge that a surefire blue-steel erection is just a pill away. These ads remind us that we are living in the Golden Age of Aging. Not only are we younger and healthier than middle-aged people used to be, many of us would probably have been blind, disabled or dead by now had we had the bad luck to have been born just a tiny bit sooner.
VALET PARKING
If you’ve made it onto the top levels of the ramp -- say you have at least $5 million in investments -- you are deemed to be an ultra high net worth individual (or UHNWI). This is a very nice position to hold in life, all the sweeter thanks to recent federal tax cuts. People earning $10 million a year hand over a smaller percentage of their income to the government than those earning a tenth of that and -- to a great degree -- escape the “gotcha” snare of the alternative minimum tax, according to The New York Times.
The treatment extended to a UHNWI approaches that accorded to royalty. As a UHNWI, you aren’t offered a cardboard cup of day-old sludge from a Mr. Coffee machine. Now you qualify for a china cup of freshly brewed java from a gleaming French press. They’d better get another grinder or two. The Boston Consulting Group reports that 3,000 new households a year lay claim to $20 million or more in invested assets. Should you be among them, put your feet up and just whistle for service.
If getting yourself to a firm’s teak-paneled office is too much of a schlep, the investment advisers will high-tail it to you. They’ll be more than delighted to take you to dinner at the best place in town and toast your success with the finest vintages on the menu. They go to this expense because they obviously respect your business prowess and find you personally charming. Mostly, though, they admire you for your assets. They will ply you with leather binders filled with laser-printed pie charts, bar graphs and three-dimensional wave diagrams. Over dessert, they will produce PowerPoint slides that show how your nest egg will incubate and eventually burgeon into a soaring phoenix that will carry your Number higher and higher, all thanks to their nurturing and personal attention.
There is yet one more place to park, higher up and more exclusive still. This spot is for people for whom even discreet, private banking is déclassé. On this level of the ramp you forgo the wealth managers at even the toniest trust companies and rely instead on your own “family office,” complete with its own in-house investment manager and staff.
Typically, families with family offices have $100 million, $500 million, $1 billion, enough to blow off even the Lehmans, the Goldmans and the Northern Trusts of the world. At present, there are approximately 5,000 family offices around the country. Family offices are not for strivers -- at least not yet. But family offices may be going the way of fractional jets, shared yachts and high-end vacation-home clubs. People with only 20 million Numbers have begun to band together to create, in effect, multifamily offices to oversee their investments and estate planning.
Back down on the street, though, it’s another world. Most people have to circle the block, just looking for a way to get into the darn garage.
________
1. Before-Tax Family Income, 2001 Federal Reserve Board Survey
2. Family Net Worth, 2001 Federal Reserve Board Survey
From THE NUMBER by Lee Eisenberg. Copyright © 2006 by Lee Eisenberg.
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Sermon version:
If you and your spouse are bringing in $40,000 a year (each of you would be earning $10 an hour), you’re doing better than half the households in America. Or, as a Washington think tank recently pointed out: If you’re a teacher married to a policeman, your combined household income puts you in the top 25 percent of all households in the nation. If your household income is $170,000, you’re among the nation’s top 10 percent.
Income is only one way to look at it. How much have you saved away? This includes the equity in your house, your investments, your bank accounts, your retirement accounts. (Minus your credit card debt, of course.)
Across all households, the national median net worth is $86,000. Half of your fellow citizens have more than that, half have less. The top 10% have a total net worth of more than $833,000. Right now there are well over 7 million households in the United States with a net worth of $1 million or more. Together, they have assets worth $32 trillion - that’s a “t”.
The super-rich have $20 million or more in assets. Every year, 3,000 new households join this select club. If you are a proud member of it, our Building Finance Committee would like to have tea with you this week....
Like many carbon-based lifeforms, you perhaps think that bankers are driven only by naked greed. But that is just because you don’t understand them: They actually have a deep psychological need for that money.
In a new article at the U.K. site eFinancialCareers, several bankers explain that they have legitimate reasons for needing more than one million British pounds (about $1.6 million) per year in pay -- more money than most non-banking types could ever figure out how to spend. In a nutshell, it’s all about psychology. Abraham Maslow clearly should have added “crap-tons of money” when building his hierarchy of needs.
“It’s really not that unusual to find Wall Street bankers who are close to declaring themselves bankrupt,” Gary Goldstein, co-founder of U.S. search firm Whitney Partners, tells eFC’s Sarah Butcher. “Some people are really struggling.”
The entire story -- the latest in a series of jaw-dropping articles from Butcher, who is becoming the City of London’s version of Bloomberg’s Max Abelson, reporting bankers saying dumb things -- is required reading for anyone trying to understand the soul of the banker.
The struggles of millionaire bankers (in Butcher’s piece most of them are men) are an important factor for heartless regulators and shareholders to keep in mind as they consider putting limits on banker pay in the wake of a financial crisis that was fueled by bankers chasing higher pay. “One million” of anything -- pounds, dollars or Bitcoins, sounds like a lot to us rabble, but let bankers explain to you how it’s pretty much the same as nothing, really.
For one thing, taxes will quickly whittle a seven-figure income right down to the mid-six figures, perilously close to being within sight of the middle class. Then, an ex-Goldman banker points out, with the mere $600,000 in take-home pay remaining, bankers still need to “pay the mortgages on, and maintain houses, in the Hamptons and Manhattan, to put three children through private schools costing $40k a year each, and to pay living costs.”
Bankers might want to shed some of these costs by, say, sentencing their kids to rub elbows with the filthy Poors in public schools or owning just one house. But they are under constant social pressure to spend and spend some more, according to another ex-Goldmanite -- who is now a psychotherapist, naturally.
And this is before the wives get their cut. According to the bankers and ex-bankers in this article, there are only two marital choices available to bankers: The frumpy, educated girl they’ve been saddled with since college, or a physically attractive layabout who sucks their soul and bank account dry. Which only makes sense, because what other kinds of women are there, amiright, fellas? Science.
An even stronger urge than the need to keep up with the Rotschilds or satisfy the missus is rooted in the bankers’ childhoods. Every time they push a client to buy a subprime CDO, these bankers are merely trying to bring a smile to the cold, disapproving eyes of the parents looking over their shoulders. According to the squid/therapist quoted in the article, only “intense therapy” can help.
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http://news.efinancialcareers.com/us-en/140070/when-a-million-isnt-enough-why-top-bankers-are-struggling-to-get-by/
When a million isn’t enough: why top bankers are struggling to get by
by Sarah Butcher
5/1/13
In theory, a seven figure annual pay packet should be more than enough to live on. In the UK, only the top 1% of income taxpayers earn anything more than £150k according to figures from the Office of National Statistics. In the US, the top 1% of people earn more than $370k according to the Internal Revenue Service. And yet, some bankers in the top bracket are having money troubles.
“It’s really not that unusual to find Wall Street bankers who are close to declaring themselves bankrupt,” said Gary Goldstein, co-founder of U.S. search firm Whitney Partners. “Some people are really struggling.”
Claims that bankers are having problems making ends meet won’t do much to ingratiate them to the public. At last week’s Barclays Annual General Meeting, Joan Woolard, a pensioner from the north of England berated Barclays for overpaying its bankers. Anyone who wanted more than £1m ($1.5m) a year was simply a “greedy b*stard,” said Woolard.
For some people working in financial services, however, £1m is simply what’s needed to cover the cost of living.
“You get a lot of people who have a very expensive lifestyle,” said Louise Cooper, a former Goldman Sachs salesperson and financial analyst at Cooper City. “They will always have a nanny, private schools for the children and they will have a very big expensive house. All of this has to be paid for out of taxable income,” she points out. “With a top tax rate of 45%, this means that you need to be earning nearly double what you’re spending.”
Tax is an issue in the U.S. too. “After tax, your million dollars will be around $600k,” said Goldstein. “Out of that, you get people trying to pay the mortgages on, and maintain houses, in the Hamptons and Manhattan, to put three children through private schools costing $40k a year each, and to pay living costs.”
Why can’t bankers simply ditch the house in the Hamptons and put their children into state run educational establishments? Unfortunately, this seems easier said than done. “When you work in banking, you end up surrounded by people who earn a lot of money,” said Erika Shapiro, a former fixed income saleswoman at Goldman, Citi, Credit Suisse and UBS who became a yoga instructor. “Everyone around you has a big mortgage and is sending their children to private schools.”
“You just get trapped at a certain level of expenditure,” said Tony Greenham, a former investment banker at Barclays and head of finance and business at the New Economics Foundation. “You’re in a peer group which aspires to and achieves a certain standard of house in a certain area, a certain type of holiday home, and certain schooling for your children.”
The social conditioning to spend heavily is insidious and is enforced by bankers’ peers, said Nell Montgomery, an ex-Goldman Sachs sales trader-turned psychotherapist. “People in banking get into a thought process whereby having three children at private schools costing £100k after tax is normal. You hear people saying they’d rather pay for private tutoring than spend £10k on a holiday. It’s a mindset in which things which are not normal come to be perceived as standard,” she said.
Ironically, in light of Woolard’s outpouring at the Barclays AGM, Goldstein said top-earning Barclays bankers are suffering most acutely. “Barclays’ bonuses are so heavily deferred that people there are receiving very little cash,” he said. “They are living on $300k-$400k base salaries, which are halved after tax.” Earlier this year, it emerged that Barclays was deferring 100% of all bonuses for its managing directors.
In some cases, the situation is being aggravated by decisions from the past – both in terms of spousal selection and ill-informed borrowing.
Cooper said some of the most impoverished-but-wealthy bankers are those with trophy wives. “You’ll get these guys who turn up at work with the girlfriends they’ve had since university, and then suddenly – once they start making a lot of money – they’ll ditch the old university educated girlfriend and find a much more glamorous and good looking woman that they’ve found through work,” she said. Predictably, Cooper said such wives are high maintenance, expecting expensive handbags, expensive shoes, houses in the right areas, expensive education for their children, jewels, nannies and help. “There are lots of lovely men in the City who’ve been with their wives since they were paupers,” said Cooper. “But there are also some who get trapped in relationships where the deal is that they have to earn a lot of money.”
Trophy wives are an issue on Wall Street as much as London, but Goldstein said U.S. bankers’ woes are being further compounded by foolish borrowing decisions taken during the boom times. “A lot of people borrowed against their stock,” he said. “It was rising by 20%-30% a year and a lot of people borrowed against it to buy a boat or the house in the Hamptons.” Now that stock is worth far less – or, in the case of Lehman or Bear Stearns, nothing at all.
How to learn to live on less
So what can you do if you’re a banker who’s lost all sense of financial perspective and can’t make ends meet on £1m? Get some perspective, is the widely advocated answer.
“Remember how little you needed to live happily when you were a student,” said Oliver James, a clinical psychologist and author of the book ‘Affluenza’. “People tend to think of their wants as needs,” James added. “But our real needs are actually very basic – you need food, warmth and maybe light, and you need to feel emotionally secure.”
The best antidote to over-spending is to retain a single partner for life, said Cooper: it helps put things in context. Alternatively, try cultivating friendships outside of banking. “I always had a lot of hobbies which brought me into contact with people from different walks of life,” said Shapiro. “I always knew people who earned £25k-30k a year.”
Finally, there’s always therapy. Montgomery said a lot of people in banking formed insecure attachments to their parents as children. This makes them overly-competitive and ostentatious, she said. “When you’re insecure, you can take refuge in a kind of grandiosity in which you say ‘at least I’m earning a lot and going to these kinds of expensive places,” said Montgomery. “You can only get over this kind of thing with intense therapy,” she added.
According to a 2023 survey from Lifeway, more than half of American Protestants say they hear the Prosperity Gospel in their churches. 76% of churchgoers believe God wants them to prosper financially. And almost half think that they have to do something for God in order to receive material blessings from him. With younger Christians, those percentages are even higher.
“In the last five years, far more churchgoers are reflecting prosperity gospel teachings, including the heretical belief that material blessings are earned from God,” said Scott McConnell, executive director of Lifeway Research. “It is possible the financial hits people have taken from inflation and the pandemic have triggered feelings of guilt for not serving God more. But Scripture does not teach that kind of direct connection.”
“Pursuing holiness was never designed by God to be a plan for financial riches,” McConnell said. “The size of one’s finances is not the measure of anyone’s service to God nor relationship with Him.”
As more churchgoers affirm prosperity gospel beliefs, younger churchgoers — those 18-49 — are more likely than older churchgoers — those 50 and older — to affirm their church teaches that if they give more money to the church and charities, God will bless them. “This research does not rule out the possibility that biblical teachings were poorly heard by more young adults, but they definitely have experienced a lack of clear biblical teaching on the reason for generosity,” McConnell said.
African American churchgoers are the most likely to say their church teaches that if they give more money to the church and charities, God will bless them in return. And those who attend worship services one to three times a month are more likely to say the same than those who attend at least four times a month.
Churchgoers without evangelical beliefs are more likely than those with such beliefs to say their church teaches that if they give more money, God will bless them (55% v. 48%). The opposite was true five years ago [2018] when 41% of evangelicals agreed and 35% of non-evangelicals agreed.
I’m attending a new support group for Christians who want to be better stewards of our money. We’ll be reading from Mark Scandrette’s book Free: Spending Your Time and Money on What Matters Most, and discussing issues like generosity, giving, and how to know when you have too much stuff. (It’s a fair bet that most of us do have too much stuff.) Our aim is to be more transparent with each other about this taboo topic.
So I’ve been thinking lately about what the Bible has to say about money. Quite a lot, actually — particularly in the advice-filled Book of Proverbs. What does the Book of Proverbs have to say about money, generosity, and wealth?
1) Get rich slow.
Proverbs takes a dim view of get-rich-quick schemes, in keeping with the book’s general emphases on wise and industrious living. The authors of these proverbs don’t really question the overall idea that having money is a nice comfort; Proverbs is not the place where you’re going to find those “Go, sell all that you have” admonishments of that crazy Jesus guy in the New Testament. It just tells you to accumulate your nest egg slowly, “little by little” (Prov. 13:11, 28:20). Don’t be greedy or hasty.
2) Give to the poor.
While Proverbs doesn’t highlight a particular percentage or amount that we’re supposed to give to the poor, it’s clear from start to finish that we’re expected to be generous. When we oppress the poor, we insult God (Prov. 14:31, 17:5); when we ignore those who are suffering, God is likely to return the favor and not hear our prayers when we’re in trouble ourselves (Prov. 21:13).
3) Don’t be idle. Like, ever.
Proverbs hammers home the point that work is vital to a fulfilling life. If ants can do it, so can you (Prov. 6:6–8)! Ideally, in the Bible’s eyes, you’d be at work on your own land, raising your own food with your family or clan. Failing that, you can at least join a CSA and work diligently at whatever day job you’ve got. Hard work builds character, whereas idleness leads to destruction and watching reruns of Jersey Shore (Prov. 13:4, 12:24, 10:4).
4) Don’t be too rich or too poor.
Proverbs makes a strong case for the strength of the middle class: if you’re too poor, you’ll be prone to sins like theft and envy; if you’re too rich, you’ll cozy up to the things of this world and forget all about God (Prov. 30:8).
5) Get your priorities straight.
Loving God and growing in wisdom are more important than money. Money is a fleeting thing that’s of use for this brief life but no longer (Prov. 23:5, 27:23). The Bible says it’s better to have a little money but be right with God than a lot of money you obtained unjustly (Prov. 16:8).
This is our entire problem… the kingdom is of the Poor!
• The rich is he who has… and in God’s world, he who has possessions (or thinks he has possessions) of his own, is automatically and totally excluded from participating in the things which God bestows.
• The poor is he who has not… and it is to these that God gives. These are the ones into whose empty cups God pours the things of his kingdom.
It’s not just about wealth of monetary possessions.
• A poor student is one who lacks learning.
• A poor musician is one who lacks talent.
• And the rich person is the one who possesses his resources in any field, be it learning, music, sports, money, or anything else.
“How hardly shall the rich… “
• We live in a day so full of emphasis on our resources.
• We live in a day when from childhood people are taught their “worth.”
But we live also in a day in tremendous spiritual poverty.
• Here, in the spiritual realm, we lack — in knowledge, in strength, in revelation, in faith, in love, in grace.
• Just as the Pharisees who thought they saw and were blind, so we think we possess — and we have not.
• Just as the Laodicean Church we measure ourselves by our own parameters and see not our true condition.
• More and more in these days I am conscious of the immensity of the realm of God, and how abysmally little any of us know of this.
• What is our awareness of the reality of that Living Kingdom which fills and maintains all things?
Someone said to me many years ago, “Prayer is measured not by its length but by its intensity.” I’ve never forgotten a young lady in Paraguay, praying for that nation and saying, “Lord let me cry; let me cry as one cries for his only son.” May God give us to find that strong desire which causes all else to bow before it and which brings us to the place where our prayers are heard and answered.
People speak of the importance of having a dream — I don’t think so … a dream usually comes from within; ‘old men shall dream dreams’, and is as good or bad as the life from which it springs, the soil in which it is planted. But a vision is from without,
• beyond our world,
• beyond our experience, • beyond our learning.
It is a revelation imparted from the world of God, beyond the knowledge and teaching of men. If God cannot give us vision, if we are left with only our man-made dreams – we perish.
I wrote at the beginning of this year of Israel led by a prophet – one’s whose eyes had been opened. I believe today more than ever that what we need as the people of God is to have our spiritual eyes opened – to see the things which HE has prepared and the paths which HE sets before us.
“Thy kingdom come”…
• There is no point in praying it unless we know what it is about.
• And there is no way to know what it is about unless it is by revelation.
• And there is no way to find the revelation except by seeking.
Julian of Norwich said something to the effect that
• God causes us to desire a thing,
• And to seek a thing,
• Because He desires us to have that thing.
• He is Light and He desires that we desire and seek Light… until He can flood our souls with that Light.
This is not just Light in the sense inner assurance, but Light to illuminate every area of this dark world around us.
• Light that shines in a dark place.
• Light for each day — and every way.
• Light that will not cease to shine until we come to that Place where there is no darkness.
He desires for us a transformed life. A life where we are no longer full of ourselves and our supposed resources but emptied that He may fill us with Himself.
May He grant us the drawing power of His Light and the fear of darkness that will bring us to the Light of His Presence.
Tom Monaghan grew up very poor. His father died when he was five years old and his mother, who worked as a domestic servant, put him and his brother in a foster home. When Monaghan got out on his own he worked diligently and founded the Domino’s Pizza empire, which he sold in 1998 for one billion dollars.
Monaghan is a very devout, and very conservative, Roman Catholic. One day, he was arrested by a passage from the work of C. S. Lewis. Lewis proposed that, in the scheme of Christian morality, pride -– the sin of self-regard -- was “the great sin.” Lewis wrote that pride was “the essential vice, the utmost evil.... It was through Pride that the devil became the devil; Pride leads to every other vice: it is the complete anti-God state of mind.” A rich man’s striving for greater wealth, Lewis contended, was not greed but pride.
“That hit me right between the eyes,” Monaghan said. “C. S. Lewis told me that it was pure pride. You wanted to impress other people -- impress them with a spectacular play, or you wanted to impress them with all your worldly goods and accomplishments.”
As he lay in bed that night, Monaghan said, he swore a “millionaire’s vow of poverty.” The next day, he began to dispossess himself of the earthly treasures he’d accumulated, beginning with his dream house, which was under construction in Ann Arbor. The house had cost seven million dollars already; it sits unfinished in a field of weeds. Monaghan sold almost all of his art collection, some of it at a staggering loss. He had put thirty-five million dollars into building an island resort; he sold it for three million dollars. He gave up the helicopter, the Gulfstream business jet, and the Bugatti. In 1992, he sold the Tigers baseball team to his pizza rival, Mike Ilitch, of Little Caesars.
“I had to get rich to see that being rich isn’t important,” he told writer Peter Boyer. “I was brought up poor, and I was embarrassed by my threadbare clothes and shoes. I had to get that out of my system.... It was a relief. I was getting too sidetracked by the quest for that stuff. I mean, it was a game. It was fun. You know, which new Gulfstream do you like? How much is it gonna cost? What do I have to do to get one?”
After he made his decision, Monaghan announced that he would devote the rest of his life, and his resources -– after providing for his family -– to the Church. “I want to die broke,” he declared.
Former Tyco International chief executive L. Dennis Kozlowski, who allegedly used company funds to buy a $15,000 umbrella stand and a $17,100 traveling toilette box. Tyco revealed it paid for a $6,000 shower curtain, a $2,200 wastebasket and many other expensive items for Kozlowski's New York City apartment. Tyco accused Kozlowski of recklessly tapping company funds, including more than $1 million for his wife's birthday party in Sardinia last year. The event's planners called for gladiators and an ice sculpture of Michelangelo's David with vodka streaming from the statue into crystal glasses, according to Tyco's filing. Other unauthorized expenses Kozlowski allegedly incurred include a $6,300 sewing basket, a $445 pin cushion, a $1,650 notebook and $5,960 for sheets. Tyco is in the process of seizing most, if not all of Kozlowski's assets, including a $17 million Fifth Avenue apartment, a $7 million Park Avenue apartment he turned over to his ex-wife, a $5 million Nantucket home and a $30 million compound in Boca Raton, Florida.
At his arraignment, the judge released Kozlowski on a $100 million personal recognizance bond that was to be secured by $10 million in personal assets. Because his assets are frozen he could not make bail. He and another company officer were ordered to come up with the necessary funds or face time at Riker's Island, one of the nation's toughest jails.
In 2000, Kozlowski had Tyco authorize nearly $96 million in unapproved bonuses for 51 employees to offset relocation loans for employees moving to Florida. "Forgiveness was offered to some people who never moved ... and people who did not even have a Tyco mortgage," Tyco said. Kozlowski and Swartz allegedly received about $50 million as part of the program, which was purportedly paid out from the proceeds of Tyco's successful initial public offering of TyCom, its undersea fiber-optic cable network, documents show. Only a few weeks after the Florida loans were improperly forgiven, Kozlowski introduced another unauthorized bonus program that cost Tyco more than $55 million, Tyco alleges. Sixteen executives, including Kozlowski and Swartz, participated, Tyco said.
[Kozlowski gets 8 to 25 years in a New York prison and is due for parole in 2014.]
The New York Times reports that some millionaires in Silicon Valley just can’t make ends meet, and are gripped by a sense of economic insecurity. Most Americans would surely find this perplexing, but a million dollars only goes so far.
As the paper explains:
By almost any definition -- except his own and perhaps those of his neighbors here in Silicon Valley -- Hal Steger has made it.
Mr. Steger, 51, a self-described geek, has banked more than $2 million. The $1.3 million house he and his wife own on a bluff overlooking the Pacific Ocean is paid off. The couple’s net worth of roughly $3.5 million places them in the top 2 percent of families in the United States.
Yet each day Mr. Steger continues to toil in what a colleague calls “the Silicon Valley salt mines,” working as a marketing executive for a technology start-up company, still striving for his big strike. Most mornings, he can be found at his desk by 7. He typically works 12 hours a day and logs an extra 10 hours over the weekend.
“I know people looking in from the outside will ask why someone like me keeps working so hard,” Mr. Steger says. “But a few million doesn’t go as far as it used to. Maybe in the ‘70s, a few million bucks meant ‘Lifestyles of the Rich and Famous,’ or Richie Rich living in a big house with a butler. But not anymore.”
Reporter Gary Rivlin described “working-class millionaires” who are members of the “digital elite.” They do not think of themselves as wealthy, even as they are fully aware of their financial standing in comparison to most Americans. It’s that other comparison that bothers them. As Rivlin explains, “But many such accomplished and ambitious members of the digital elite still do not think of themselves as particularly fortunate, in part because they are surrounded by people with more wealth -- often a lot more.”
There can be no doubt about that. There are now millionaires in almost every community, and the wealthiest now count their fortunes in the billions, not millions, of dollars.
Those given to comparisons of personal wealth can always find someone with a larger fortune. This is especially true where the wealthy congregate together in communities like those in California’s Silicon Valley. When the comparison game starts, it never ends. Rivlin cited one man worth approximately $10 million who saw that sum as relatively paltry: “You’re nobody here at $10 million.”
The enticements and pressures of a consumer society also play a part. One man told Rivlin that “the pressures to spend more are everywhere.” As Rivlin explained, “Children want the latest fashions their peers are wearing and the most popular high-ticket toys. Furniture does not seem up to snuff once you move into a multimillion-dollar home. Spouses talk, and now that resort in Mexico the family enjoyed so much last winter is not good enough when looking ahead to next year. Summer camp, a full-time housekeeper, vintage wines, country clubs: the cost of living bloats.”
Another Silicon Valley millionaire admitted the reality: “Here, the top 1 percent chases the top one-tenth of 1 percent, and the top one-tenth of 1 percent chases the top one-one-hundredth of 1 percent.... You try not to get caught up in it, but it’s hard not to.”
That must be an honest admission, and one does not have to be a millionaire to get caught up in the comparison game. If honest, most of us would probably admit to the temptation to follow John D. Rockefeller’s adage that all we need is “a little bit more.”
This report certainly brings these words of Jesus to mind:
Do not lay up for yourselves treasures on earth, where moth and
rust destroy and where thieves break in and steal, but lay up for
yourselves treasures in heaven, where neither moth nor rust
destroys and where thieves do not break in and steal. For where
your treasure is, there your heart will be also. [Matt. 6:19-21]
[sermon version at the bottom]
Every three years the Federal Reserve Board conducts a national survey that tracks the financial health of American households. Most people are surprised to realize how little money it takes to win a gold star from the Fed. If you and yours are bringing in $40,000 a year, you’re doing better than half the households in America. Or, as a Washington think tank recently pointed out: If you’re a teacher married to a policeman, your combined household income puts you in the top 25 percent of all households in the nation.
Below you’ll find the average income picture sliced into income levels. Think of this chart as a parking ramp. If your household income is $170,000, you’re among the nation’s top 10 percent wage earners and get to park on the top floor. Anything in six figures means you’re in the top 20 percent and get to park on the floor right below.
ANNUAL INCOME PARKING RAMP
Income level Median income
(percentile) (rounded)
Level VI (90 to 100) $170,000
Level V (80 to 89.9) $99,000
Level IV (60 to 79.9) $65,000
Level III (40 to 59.9) $40,000
Level II (20 to 39.9) $24,000
Level I (less than 20) $10,000 [1]
So does making $170,000 a year make a person rich? Last year a plurality of respondents (29 percent) in a survey by The New York Times said that “rich” was making between $100,000 and $200,000 a year. Unfortunately, the survey didn’t break out how many people in that salary range considered themselves rich. If the people I talk to are any indication, very few do.
Of course, income is only one part of the equation defining where you stand. Net worth is more telling. Net worth, as every financially precocious schoolchild knows, is the sum of one’s assets -- home equity, investments, savings accounts, retirement funds, cars, furnishings and such things as jewelry, furs, wine collection, old baseball cards -- minus all outstanding liabilities such as mortgage balance, revolving and credit card debt, college loans and so on. Across all households, the national median net worth is $86,000. Half of your fellow citizens have more than that, half less. As you see, there’s a massive disparity between the haves and have-nots.
NET WORTH PARKING RAMP
Net worth (percentile) Median net worth
(rounded)
Level VI (90 to 100) $833,600
Level V (80 to 89.9) $263,100
Level IV (60 to 79.9) $141,500
Level III (40 to 59.9) $62,500
Level II (20 to 39.9) $37,200
Level I (less than 20) $7,900 [2]
We live in a country that once celebrated itself as egalitarian, yet 1 percent of the population -- nearly 3 million people -- currently has as much money as the 100 million people at the bottom of the ramp.
Yet when I ask those at the top of the ramp how they feel about the future, whether their fortunate place on the ramp gives them a measure of confidence about it, they shake their heads.
YOU AND YOUR BROKER
If you’re not parked near the top of the ramp, you’re of little or no interest to financial services firms and financial advisers. There’s no money to be made at these levels. Last year, a handful of Wall Street firms told their brokers they would no longer receive commissions on accounts holding less than $50,000. But for the Wall Street firms, there’s gold on the floors above. The greater the household assets, the more fees and transaction costs can be extracted from an account.
WEALTH POLL
The investment industry divides people on the top floors of the garage into three broad segments of wealth, each of which is nicely profitable.
The biggest and broadest affluent segment consists of people with investable assets of between $200,000 and $1 million to $2 million. This group is sometimes referred to as mass affluent, and it would be fair to think of it as the meat and potatoes of the financial services business. If you’re at the lower end of that range -- if you have, say, $300,000 in your accounts -- you’re definitely of prime interest to the brokers and customer reps at Merrill Lynch, Smith Barney, Vanguard and the rest. But they need to be careful lest you cost them money. They may call you on the phone, but they prefer that you use their website.
The next segment up from mass affluent is where the action gets white hot. This parking level belongs to those designated as high net worth individuals (or HNWIs). There are no universal criteria here. Generally, HNWIs have invested assets of at least $1 million, although some companies also target younger households with healthy six-figure incomes, knowing that their net worth is likely to reach target levels in the near future. Right now there are well over 7 million high net worth households in the United States, with a forecasted growth rate of 16 percent a year and projected assets of $32 trillion.
If their marketing efforts are any indication, Wall Street firms see HNWIs as the happiest people in the world, no matter that so many of them are, rightly or wrongly, distressed over their long-term prospects. Distress is not what’s pictured in the ads. The ads are filled with images of zippy seniors who flash large white teeth and incredibly healthy gums. They dance. They jog. They bike. They fish. They golf. They snuggle. According to the ads, life is a theme park expressly designed for the middle-aged. Graying boomers waltz across their living rooms, raise glasses to one another on the decks of ocean liners and exchange smiles secure in the knowledge that a surefire blue-steel erection is just a pill away. These ads remind us that we are living in the Golden Age of Aging. Not only are we younger and healthier than middle-aged people used to be, many of us would probably have been blind, disabled or dead by now had we had the bad luck to have been born just a tiny bit sooner.
VALET PARKING
If you’ve made it onto the top levels of the ramp -- say you have at least $5 million in investments -- you are deemed to be an ultra high net worth individual (or UHNWI). This is a very nice position to hold in life, all the sweeter thanks to recent federal tax cuts. People earning $10 million a year hand over a smaller percentage of their income to the government than those earning a tenth of that and -- to a great degree -- escape the “gotcha” snare of the alternative minimum tax, according to The New York Times.
The treatment extended to a UHNWI approaches that accorded to royalty. As a UHNWI, you aren’t offered a cardboard cup of day-old sludge from a Mr. Coffee machine. Now you qualify for a china cup of freshly brewed java from a gleaming French press. They’d better get another grinder or two. The Boston Consulting Group reports that 3,000 new households a year lay claim to $20 million or more in invested assets. Should you be among them, put your feet up and just whistle for service.
If getting yourself to a firm’s teak-paneled office is too much of a schlep, the investment advisers will high-tail it to you. They’ll be more than delighted to take you to dinner at the best place in town and toast your success with the finest vintages on the menu. They go to this expense because they obviously respect your business prowess and find you personally charming. Mostly, though, they admire you for your assets. They will ply you with leather binders filled with laser-printed pie charts, bar graphs and three-dimensional wave diagrams. Over dessert, they will produce PowerPoint slides that show how your nest egg will incubate and eventually burgeon into a soaring phoenix that will carry your Number higher and higher, all thanks to their nurturing and personal attention.
There is yet one more place to park, higher up and more exclusive still. This spot is for people for whom even discreet, private banking is déclassé. On this level of the ramp you forgo the wealth managers at even the toniest trust companies and rely instead on your own “family office,” complete with its own in-house investment manager and staff.
Typically, families with family offices have $100 million, $500 million, $1 billion, enough to blow off even the Lehmans, the Goldmans and the Northern Trusts of the world. At present, there are approximately 5,000 family offices around the country. Family offices are not for strivers -- at least not yet. But family offices may be going the way of fractional jets, shared yachts and high-end vacation-home clubs. People with only 20 million Numbers have begun to band together to create, in effect, multifamily offices to oversee their investments and estate planning.
Back down on the street, though, it’s another world. Most people have to circle the block, just looking for a way to get into the darn garage.
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1. Before-Tax Family Income, 2001 Federal Reserve Board Survey
2. Family Net Worth, 2001 Federal Reserve Board Survey
From THE NUMBER by Lee Eisenberg. Copyright © 2006 by Lee Eisenberg.
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Sermon version:
If you and your spouse are bringing in $40,000 a year (each of you would be earning $10 an hour), you’re doing better than half the households in America. Or, as a Washington think tank recently pointed out: If you’re a teacher married to a policeman, your combined household income puts you in the top 25 percent of all households in the nation. If your household income is $170,000, you’re among the nation’s top 10 percent.
Income is only one way to look at it. How much have you saved away? This includes the equity in your house, your investments, your bank accounts, your retirement accounts. (Minus your credit card debt, of course.)
Across all households, the national median net worth is $86,000. Half of your fellow citizens have more than that, half have less. The top 10% have a total net worth of more than $833,000. Right now there are well over 7 million households in the United States with a net worth of $1 million or more. Together, they have assets worth $32 trillion - that’s a “t”.
The super-rich have $20 million or more in assets. Every year, 3,000 new households join this select club. If you are a proud member of it, our Building Finance Committee would like to have tea with you this week....
Like many carbon-based lifeforms, you perhaps think that bankers are driven only by naked greed. But that is just because you don’t understand them: They actually have a deep psychological need for that money.
In a new article at the U.K. site eFinancialCareers, several bankers explain that they have legitimate reasons for needing more than one million British pounds (about $1.6 million) per year in pay -- more money than most non-banking types could ever figure out how to spend. In a nutshell, it’s all about psychology. Abraham Maslow clearly should have added “crap-tons of money” when building his hierarchy of needs.
“It’s really not that unusual to find Wall Street bankers who are close to declaring themselves bankrupt,” Gary Goldstein, co-founder of U.S. search firm Whitney Partners, tells eFC’s Sarah Butcher. “Some people are really struggling.”
The entire story -- the latest in a series of jaw-dropping articles from Butcher, who is becoming the City of London’s version of Bloomberg’s Max Abelson, reporting bankers saying dumb things -- is required reading for anyone trying to understand the soul of the banker.
The struggles of millionaire bankers (in Butcher’s piece most of them are men) are an important factor for heartless regulators and shareholders to keep in mind as they consider putting limits on banker pay in the wake of a financial crisis that was fueled by bankers chasing higher pay. “One million” of anything -- pounds, dollars or Bitcoins, sounds like a lot to us rabble, but let bankers explain to you how it’s pretty much the same as nothing, really.
For one thing, taxes will quickly whittle a seven-figure income right down to the mid-six figures, perilously close to being within sight of the middle class. Then, an ex-Goldman banker points out, with the mere $600,000 in take-home pay remaining, bankers still need to “pay the mortgages on, and maintain houses, in the Hamptons and Manhattan, to put three children through private schools costing $40k a year each, and to pay living costs.”
Bankers might want to shed some of these costs by, say, sentencing their kids to rub elbows with the filthy Poors in public schools or owning just one house. But they are under constant social pressure to spend and spend some more, according to another ex-Goldmanite -- who is now a psychotherapist, naturally.
And this is before the wives get their cut. According to the bankers and ex-bankers in this article, there are only two marital choices available to bankers: The frumpy, educated girl they’ve been saddled with since college, or a physically attractive layabout who sucks their soul and bank account dry. Which only makes sense, because what other kinds of women are there, amiright, fellas? Science.
An even stronger urge than the need to keep up with the Rotschilds or satisfy the missus is rooted in the bankers’ childhoods. Every time they push a client to buy a subprime CDO, these bankers are merely trying to bring a smile to the cold, disapproving eyes of the parents looking over their shoulders. According to the squid/therapist quoted in the article, only “intense therapy” can help.
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http://news.efinancialcareers.com/us-en/140070/when-a-million-isnt-enough-why-top-bankers-are-struggling-to-get-by/
When a million isn’t enough: why top bankers are struggling to get by
by Sarah Butcher
5/1/13
In theory, a seven figure annual pay packet should be more than enough to live on. In the UK, only the top 1% of income taxpayers earn anything more than £150k according to figures from the Office of National Statistics. In the US, the top 1% of people earn more than $370k according to the Internal Revenue Service. And yet, some bankers in the top bracket are having money troubles.
“It’s really not that unusual to find Wall Street bankers who are close to declaring themselves bankrupt,” said Gary Goldstein, co-founder of U.S. search firm Whitney Partners. “Some people are really struggling.”
Claims that bankers are having problems making ends meet won’t do much to ingratiate them to the public. At last week’s Barclays Annual General Meeting, Joan Woolard, a pensioner from the north of England berated Barclays for overpaying its bankers. Anyone who wanted more than £1m ($1.5m) a year was simply a “greedy b*stard,” said Woolard.
For some people working in financial services, however, £1m is simply what’s needed to cover the cost of living.
“You get a lot of people who have a very expensive lifestyle,” said Louise Cooper, a former Goldman Sachs salesperson and financial analyst at Cooper City. “They will always have a nanny, private schools for the children and they will have a very big expensive house. All of this has to be paid for out of taxable income,” she points out. “With a top tax rate of 45%, this means that you need to be earning nearly double what you’re spending.”
Tax is an issue in the U.S. too. “After tax, your million dollars will be around $600k,” said Goldstein. “Out of that, you get people trying to pay the mortgages on, and maintain houses, in the Hamptons and Manhattan, to put three children through private schools costing $40k a year each, and to pay living costs.”
Why can’t bankers simply ditch the house in the Hamptons and put their children into state run educational establishments? Unfortunately, this seems easier said than done. “When you work in banking, you end up surrounded by people who earn a lot of money,” said Erika Shapiro, a former fixed income saleswoman at Goldman, Citi, Credit Suisse and UBS who became a yoga instructor. “Everyone around you has a big mortgage and is sending their children to private schools.”
“You just get trapped at a certain level of expenditure,” said Tony Greenham, a former investment banker at Barclays and head of finance and business at the New Economics Foundation. “You’re in a peer group which aspires to and achieves a certain standard of house in a certain area, a certain type of holiday home, and certain schooling for your children.”
The social conditioning to spend heavily is insidious and is enforced by bankers’ peers, said Nell Montgomery, an ex-Goldman Sachs sales trader-turned psychotherapist. “People in banking get into a thought process whereby having three children at private schools costing £100k after tax is normal. You hear people saying they’d rather pay for private tutoring than spend £10k on a holiday. It’s a mindset in which things which are not normal come to be perceived as standard,” she said.
Ironically, in light of Woolard’s outpouring at the Barclays AGM, Goldstein said top-earning Barclays bankers are suffering most acutely. “Barclays’ bonuses are so heavily deferred that people there are receiving very little cash,” he said. “They are living on $300k-$400k base salaries, which are halved after tax.” Earlier this year, it emerged that Barclays was deferring 100% of all bonuses for its managing directors.
In some cases, the situation is being aggravated by decisions from the past – both in terms of spousal selection and ill-informed borrowing.
Cooper said some of the most impoverished-but-wealthy bankers are those with trophy wives. “You’ll get these guys who turn up at work with the girlfriends they’ve had since university, and then suddenly – once they start making a lot of money – they’ll ditch the old university educated girlfriend and find a much more glamorous and good looking woman that they’ve found through work,” she said. Predictably, Cooper said such wives are high maintenance, expecting expensive handbags, expensive shoes, houses in the right areas, expensive education for their children, jewels, nannies and help. “There are lots of lovely men in the City who’ve been with their wives since they were paupers,” said Cooper. “But there are also some who get trapped in relationships where the deal is that they have to earn a lot of money.”
Trophy wives are an issue on Wall Street as much as London, but Goldstein said U.S. bankers’ woes are being further compounded by foolish borrowing decisions taken during the boom times. “A lot of people borrowed against their stock,” he said. “It was rising by 20%-30% a year and a lot of people borrowed against it to buy a boat or the house in the Hamptons.” Now that stock is worth far less – or, in the case of Lehman or Bear Stearns, nothing at all.
How to learn to live on less
So what can you do if you’re a banker who’s lost all sense of financial perspective and can’t make ends meet on £1m? Get some perspective, is the widely advocated answer.
“Remember how little you needed to live happily when you were a student,” said Oliver James, a clinical psychologist and author of the book ‘Affluenza’. “People tend to think of their wants as needs,” James added. “But our real needs are actually very basic – you need food, warmth and maybe light, and you need to feel emotionally secure.”
The best antidote to over-spending is to retain a single partner for life, said Cooper: it helps put things in context. Alternatively, try cultivating friendships outside of banking. “I always had a lot of hobbies which brought me into contact with people from different walks of life,” said Shapiro. “I always knew people who earned £25k-30k a year.”
Finally, there’s always therapy. Montgomery said a lot of people in banking formed insecure attachments to their parents as children. This makes them overly-competitive and ostentatious, she said. “When you’re insecure, you can take refuge in a kind of grandiosity in which you say ‘at least I’m earning a lot and going to these kinds of expensive places,” said Montgomery. “You can only get over this kind of thing with intense therapy,” she added.
The Osage Indians of Oklahoma endured a flood of income in the 1920s when their lands turned out to sit on an oil field. Rapacious non-Indians schemed to steal their sudden wealth, in one famous conspiracy even taking Osage wives and then poisoning them for the inheritance. As a tribal leader said of that period, “The Osage were never happy again until they lost all their money.”
Many more examples could make the point that it is often easier to become fabulously rich than to stay that way. Sudden wealth produces myriad problems, from technical questions of investment management to political and social crises. The problems compound when a favored few gain vastly more than others, and the whole group is surrounded by a mass of envious outsiders who have a long history of plundering their assets.
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According to a 2023 survey from Lifeway, more than half of American Protestants say they hear the Prosperity Gospel in their churches. 76% of churchgoers believe God wants them to prosper financially. And almost half think that they have to do something for God in order to receive material blessings from him. With younger Christians, those percentages are even higher.
“In the last five years, far more churchgoers are reflecting prosperity gospel teachings, including the heretical belief that material blessings are earned from God,” said Scott McConnell, executive director of Lifeway Research. “It is possible the financial hits people have taken from inflation and the pandemic have triggered feelings of guilt for not serving God more. But Scripture does not teach that kind of direct connection.”
“Pursuing holiness was never designed by God to be a plan for financial riches,” McConnell said. “The size of one’s finances is not the measure of anyone’s service to God nor relationship with Him.”
As more churchgoers affirm prosperity gospel beliefs, younger churchgoers — those 18-49 — are more likely than older churchgoers — those 50 and older — to affirm their church teaches that if they give more money to the church and charities, God will bless them. “This research does not rule out the possibility that biblical teachings were poorly heard by more young adults, but they definitely have experienced a lack of clear biblical teaching on the reason for generosity,” McConnell said.
African American churchgoers are the most likely to say their church teaches that if they give more money to the church and charities, God will bless them in return. And those who attend worship services one to three times a month are more likely to say the same than those who attend at least four times a month.
Churchgoers without evangelical beliefs are more likely than those with such beliefs to say their church teaches that if they give more money, God will bless them (55% v. 48%). The opposite was true five years ago [2018] when 41% of evangelicals agreed and 35% of non-evangelicals agreed.
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