“Working-Class Millionaires”

Gary Rivlin in the NYT has a terrific article entitled “In Silicon Valley, Millionaires Who Don’t Feel Rich.” The article discusses how a few million dollars of net worth doesn’t go as far as they used to, especially in the Silicon Valley where there are tens of thousands of millionaires and perhaps you’re not really rich (at least, compared to your peers) until you hit 9 figure net worth. It says:

Silicon Valley offers an unusual twist on keeping up with the Joneses. The venture capitalist two doors down might own a Cessna Citation X private jet. The father of your 8-year-old’s best friend, who has not worked for two years, drives a bright yellow Ferrari.

This is no joke. At my wife’s former company, which had created hundreds of millionaire-employees, the talk at company parties often involved each person’s personal jet. Those of us who didn’t own private jets were awkwardly unable to participate in the conversation.

A side consequence of this competition, and the inflated housing prices, is that there are comparatively few single income families where we live. In turn, it’s hard to arrange playdates during the middle of the week, and “mommy-and-me” classes frequently are more like “nanny-and-me” classes.

My wife and I expressly discussed these issues before we decided to move back to the Silicon Valley. Not only were we planning to live on a single salary in one of the most expensive housing markets in the world, but it’s an academic salary at that, effectively ensuring that we would never be able to keep pace with our neighbors. This doesn’t bother me in the least–it’s a choice my wife and I made knowingly and for the right reasons–but I’m dreading the day when my kids start asking questions about why their classmates are doing things that we simply can’t afford to do. Then again, like the birds-and-bees discussion (another conversation I dread), it will present a powerful opportunity to teach our kids some essential life lessons.