If you’ve accumulated a decent amount of wealth in life, you’ve probably run across the idea of “stealth wealth”.
It’s exactly what it sounds like.
This is a concept that advocates being covert about your wealth. I wouldn’t necessarily say that it promotes falsehood, but actively avoiding being too direct or open about your financial state is certainly encouraged.
The reasoning for this is quite simple.
People around you won’t understand you, or your money will change how they view you. This could create unforeseen problems. And so it’s better to avoid these potential headaches by purposely being secretive about your money.
Money is a big part of life. It ends up influencing our opportunities, outcomes, experiences, and societal standing. As such, how much money you have (or don’t have) will have a lot to say about your identity and how people view you.
As someone who accumulated a good deal of wealth at a young age and retired in my early 30s, which I lay out in 5 Steps To Retire In 5 Years, I’m familiar with all of this.
I can see why those with a certain financial position would choose stealth wealth. It’s easier than the alternative.
However, I’ve never chosen the easy way out. And I never liked the idea of stealth.
I’ll tell you why…
I Want Real Relationships
Honesty is the best policy.
I would much rather know exactly who is with me and who is not.
The real me. Not a pretend me.
I want real relationships.
Playing games and hiding behind a wall so that I can placate other people’s delicate feelings about whatever inferiority complex or envy they might develop as a result of their comparisons to me, is not a very good way to go about building and maintaining healthy and true relationships.
If I have to pretend to be something I’m not in order to be in good standing with others, these relationships aren’t worth having. They’re not based on reality. They’re not real.
If someone likes me for something I’m not, they don’t really like me at all. They like someone else. And it’s not real.
I’ve Lost Relationships Over This
I’m not just talking the talk. I walk the walk on this one.
I lost a good chunk of my family over my refusal to be stealthy about who I really am.
This goes back to the summer of 2014. My two younger sisters, upon fully realizing my financial position in life, started to act differently toward me.
They built up unrealistic expectations about me. Inexplicably, they thought it was fair that I start helping them in a financial capacity, all while simultaneously taking digs at my success and outwardly expressing resentment.
They were young, able adults. But the unwise choices they made in life led them to being in a poor financial position.
This was a perfect opportunity for me to teach them, or so I thought.
I once was in their same exact spot. I, too, made terrible financial choices in my youth and found myself deeply in debt and living in my parents’ basement in my late 20s. They were obviously completely aware of this, as they were present for it.
And so I saw myself as a potential mentor.
However, they didn’t see it that way at all. They saw me as a bank.
Now, I could have gone all stealth wealth on them. Could have flew in like a Stealth B-52 with my money and camouflaged the entire thing. It would have been way easier. And I might even still have my sisters in my life today.
But would that be better? Would I be happier knowing that the only way these people would still be in my life is because they didn’t know who I really was? Is a relationship built on a lie better than no relationship at all?
No. Nope. Negative.
I’m glad this happened. I was truthful about who I really was. And they showed me who they really are. We laid our cards on the table.
As adults, we then had to make choices about whether or not we accept each other based on the reality of the situation.
I decided that I would go on to be happier and more successful without people like this in my life. Here we are five years later. And I’m definitely happier and more successful than I was five years ago.
Put simply, I prefer authentic relationships over fake relationships. Even if that means less relationships.
Stealth Health
Money ends up accounting for a great deal of our identity. Particularly in the West, which is one of the reasons I don’t enjoy living in America anymore.
People put you in a box. They immediately judge you based on the size of your paycheck, the brand of car you drive, the area of the city you live in, etc. It’s human nature.
But money isn’t the only aspect of our identity.
People judge us based on our weight, the clothes we wear, our hairstyle, the attractiveness of our partner, our vocabulary, our sexuality, etc.
If stealth wealth is put forth as a possible solution to keeping relationships, it stands to reason that one should just be stealthy about everything else.
Why not hide who you really are across your entire life?
For example, I spend a great deal of time and energy staying fit. I live the kind of lifestyle that promotes physical fitness just as much as it promotes financial fitness. I’m just as interested in and proud of my physical self as I am my financial self. Indeed, I see the two as inextricably linked.
Should I hide my body, too? What about “stealth health”? Should I actively try to avoid making other people upset or envious about my physical success?
I don’t think so!
In my view, that’s a defeatist attitude that caves in to a crab mentality. It’s like pretending you’re still in the bucket with the rest of the crabs so that they continue to like you.
I’m not a crab. If others reveal themselves to be crabs, I simply move on and find non-shellfish lifeforms with which to form adult relationships. Life is too short to pretend. We have to grow up.
Don’t Be Boastful
All this said, I’m not advocating boastfulness.
There’s nothing admirable about throwing success of any kind in others’ faces.
Just as much as I believe not actively hiding who I really am, I believe in not actively forcing my views or success on anyone.
If someone approaches me at the gym, compliments me on my workout, and asks me for tips, I’m all too happy to share a few pointers.
But I’m not going to dress in a big sweater to cover up who I really am, nor will I go in there and start flexing in front of everyone.
Likewise, I don’t go out of my way to flash my money. I reside in a minimalist apartment, don’t own a car, and live a very modest lifestyle.
However, I won’t ever shy away from discussing who I really am, how hard I worked to get here, how proud I am of what I’ve accomplished, and how best to achieve a certain degree of financial success and freedom in life.
Conclusion
I don’t believe in stealth wealth any more than I believe in stealth health or stealth anything else in life.
If you have to be stealthy and hide who you really are, you’re not spending time with the right people. If they’re going to be envious of you and try to bring you down because of your success relative to them, I think the best approach to that is getting in that Stealth B-52 and flying out of there. There’s no reason to be around people like that.
Honesty is the best relationship test. Showing your true colors allows others to show their true colors. Then you can both be adults and make go-forward decisions about that relationship. People seem too afraid of being authentic, in fear of confrontation or headaches. Nobody wants to man up and be real. It’s a shame.
I feel great about my life and the relationships in it because they’re based on mutual respect and understanding. They’re based on reality. I’ve never hidden myself. Thus, I know they love me for who I really am. I’d much rather have these few, authentic relationships than more, fake relationships.
What do you think? Do you believe in “stealth wealth”? Believe in hiding who you really are in any other aspect of your life? Or do you prefer honesty?
Thanks for reading.
P.S. If you’re interested in achieving financial independence and retiring early, check out some amazing resources I personally used on my way to becoming financially free at 33!
Interesting. I think I agree with you in terms of personal relationships BUT I like the idea of looking normal/poor in day to day life.
My wife and I often find ourselves being told that ‘this is the members lounge’, or ‘this is the line for business class’, or ‘can I help you’ because we don’t look in the slightest bit well-off. I see no reason to flaunt the appearance of wealth, and in fact enjoy doing the opposite. I drive a small, banged up, cheap banger of a car and I wouldn’t swap it for something expensive even for free 🙂
We live in a humble flat that no one is going to bother robbing. We are unlikely to be targetted by muggers.
So for me, stealth wealth is more about not looking/seeming wealthy (due to frugality/preference) than lying to friends/family 🙂
Ben,
Yeah, I agree with you. Like I noted, I don’t think it’s admirable to be boastful.
I live a modest life. Much more modest than the vast majority of Americans. And certainly very modest relative to my means. But I live this way because I prefer to live this way, not because I’m trying to hide anything. It’s just being authentic. And there’s none of this “holier-than-thou” motivation that I think can be found in the PF community, where anyone living frugally is somehow taking the moral high ground over big spenders. I just do me.
It’s really all about authenticity, in my view. That’s what I’m advocating.
I’ve come across a lot of content over the years where the “stealth wealth” thing is designed to be covert around most people in your life, instead of just naturally being yourself. And I think that’s a terrible idea. I’ve been open and upfront with everyone I’ve ever met about everything. This allows me to get a better feel for who’s on the same page and who isn’t. I’d much rather have a few close people in my life than numerous relationships that are based on being fake.
If money is this thing that imprisons you and forces you to live cheaply and pretend all the time, that’s a real bummer.
Thanks for adding that!
Best regards.
I have always been stealthy about my finance even around my own children. I am an open-minded person and feel like you have a compelling argument. It certainly is easier from a relationship standpoint to not disclose our financial situation to others. One question I would have however is the question of security without stealth. How do you handle the subject of security? If my kids went around telling people what we have or how we earn and how much couldn’t that information get into the wrong hands down the road? Would we feel like we constantly need to be on heightened alert? The fact is there are bad guys out there and they are opportunists. I have always wondered how your situation has been regarding security with the information you put out there regarding your portfolio.
Rick,
Totally agree with you on the easier thing. I actually noted in the article that stealth wealth would be the “easier” way to go. At least in terms of avoiding potential complications down the road. Is it the best way to go, though? I don’t personally think so. Unless you prefer relationships that aren’t based on truth.
It’s the same thing in dating. Everyone is pretending and playing games, yet everyone is simultaneously out there complaining about how everyone is pretending and playing games. It’s like nobody wants to just be genuine. People complain about others not being honest, yet they’re the first to not be upfront themselves. Maybe it’s just part of the human condition, but I think it’s a poor way to go about life.
I don’t worry about security at all, although that was something that went through my mind before I relocated abroad (because I’m so public with this stuff). For example, Mexico and the Philippines were ruled out almost automatically because of kidnappings. Thailand, on the other hand, is safer than the US pretty much across the board. That said, people tend to look at risk and odds all wrong. The odds of something befalling you because of wealth are almost certainly insignificant relative to everyday odds of something befalling you (like, say, a car accident).
Cheers!
Some things I agree with others Im guarded about. I had very bad life experience with my first wife and then with my fiance. Greed is a terrible thing and some people believe they ” deserve ” what is yours. The legal system here in the US is all in on the transfer of wealth concept i have been remarried now for over 8 years and due to being burned twice already its difficult to be open about all my finances. My wife knows were I stand however there are times when she says things that are reminiscent of the past.
I also notice that when I drive my older car and dress regular I dont even get noticed, when we take our Lincoln SUV out on the town seems lile every bum comes up aaking for money 🙁
I also get many remarks like ” Dont you work ? ” or ” What do you do live off your wife ? ”
There are pluses and minuses to being financially well off. I have gotten to the point were I find it best to just ignore those who are indifferent to my standing. We have lost friends along the way but then were they really friends ? Like you most of my family dont talk to me any more my middle son is the only one hear from or visits. He never asks or talks about money and we are just farther and son.
Im 58 now and have been financially secure for decades the best advice and old guy can give is … Yes live your life however be guarded. Fortunes and even lives have been lost due to tje greed of others.
Bob,
Hey, sorry to hear about the financial losses from marriages. Not nice at all.
However, I think you can be fully open with finances with a partner, yet simultaneously protect yourself. It’s called a prenup. Very simple to set one up that is practically bulletproof, yet so few people take advantage of it. I’d never, ever in a million years get married without one. Not even debatable. In fact, prenups are great because there’s full disclosure up front. So you’re set up with honesty AND protection right off the bat. A great way to start a life together.
I look at Warren Buffett for a lot of things in life, as he’s my personal hero. He was fully upfront with his kids and wife about everything, but he also set them up with realistic expectations. Wasn’t always easy – and I know, for a time, his daughter was not at all happy about his decision to not help her with a kitchen remodel some time ago. But he has great (and authentic) relationships with his kids now because they went through all of that. Wasn’t the “easy” way, but few things in life worth having are easy.
Again, I’m not saying to scream at the top of your lungs about your money and success. I don’t think there’s anything admirable about boasting. Likewise, however, I don’t think there’s anything admirable about being inauthentic or hiding. I prefer to be courageous and have authentic relationships as a result of that courage. 🙂
Best wishes.
Stealth wealth isn’t about lying to anybody or trying to deceive people. Rather it is about living the way you want and when people see/judge you, they draw their own conclusions that might lead them to underestimate your financial net worth. If so, that’s OK.
Who’s to say what size house a wealthy person should live in? Who’s to say what type of car a wealthy person should drive? Who’s to say how a wealthy person should dress? And what is wealthy?
If I have a house, card and general lifestyle I am happy with when my net worth is $500,000 do I need to ‘upgrade’ everything when my net worth is $1,000,000? $2,000,000 $5,000,000. If I don’t then am I doing something wrong? This would clearly put me in stealth wealth mode. I don’t see anything wrong with that at all. In fact living below one’s means is the cornerstone of a good financial plan.
I don’t think stealth wealth has anything to do with deceit rather a mis-match between how society judges people and people’s individual values. Stealth wealth is saying I am not going to keep up with the Jones’s.
sfmitch,
I think you’re either misreading what I just wrote, or you’re not familiar with stealth wealth as it’s widely advocated. Stealth wealth is not about “not keeping up with the Joneses”, which is what I’ve been doing and writing about for years now. It’s about pretending to be something you’re not in fear of repercussions.
I’ll quote Ramit Sethi:
“Stealth wealth is: The college student who commiserates with his buddy’s complaints about student loans — while secretly owning a trust fund himself.”
Yeah, let’s pretend we’re poor and offer a shoulder for someone to cry on because we’re too afraid to man up and be who we really are in fear that this supposed “friend” won’t like us anymore. Now I’ll go puke.
You said: “Stealth wealth isn’t about lying to anybody or trying to deceive people.”
Maybe not outright lying. But it is a concept that advocates purposely hiding who you are, even to those who are close to you, which is deception. It’s not about living authentically modestly, which is what I do. You are talking to the guy who lives in a 400-square-foot apartment here. I own no car. I’m all for living modestly, IF IT’S WHAT YOU PREFER TO DO. However, stealth wealth would be more akin to living modestly because you’re afraid that others might judge you or want something from you if you live less modestly. It’s about not being who you truly are, which I think is a terrible idea.
Try to re-read what I wrote and do some more research on stealth wealth, as it sounds like you’re way off base here.
Cheers.
To me, stealth wealth is the opposite of conspicuous consumption – pure and simple.
Stealth wealth means people can’t judge my book by it’s cover.
One can live a stealth wealth life and still be open and honest about their financial situation, with the people they choose to. If other people draw conclusions about my wealth based on what they see, I’m OK with that.
sfmitch,
“Stealth wealth means people can’t judge my book by it’s cover.”
Sure. If your aim is to deceive people, you can avoid having them properly gauge your wealth by living poorer than you otherwise could. If you WANT to live that way, that’s great. If you’re living that way so that you can HIDE who you really are, that’s a terrible way to go about it.
We’ll have to agree to disagree about this, since I don’t think you really understand what I’m saying. I already provided a quote that proved you wrong on the deception part of it.
I live well below my means. And I’m also totally open and honest about who I am. It’s a very Buffett-like approach to life, which is the opposite of the whole “stealth wealth” concept – a concept that I think is total garbage.
Cheers.
Amazing how many people don’t understand this clearly written article. It has nothing to do with living beyond your means, or living within your means, or keeping up with the Jones. I suspect a lot of people commenting didn’t even bother to read it. Sheesh.
Anyway, to the point. It amazes me the number of FIRE people, especially on Reddit, who constantly ask “what do I tell people who ask what I do for a living?” & the number of people who suggest all these different convoluted answers. Everyone seems afraid to say ‘I saved my money so I could retire as soon as possible” When it’s pointed out that that is a perfectly reasonable honest answer, they all push back with a myriad of excuses why they could never say that. People won’t like them, people will ask to borrow money, people will target them etc etc. It makes no sense to me whatsoever….what the heck is wrong with saying you are retired from your full time job & you pursue any interest you like?
Steve,
Thanks. I’m glad we’re on the same page. I’ve found many of these comments very odd, as if I haven’t been advocating for, writing about, and actively participating in living modestly for almost a decade now. But living modestly has absolutely nothing to do with the stealth wealth concept as it’s been defined by the PF community.
The Reddit stuff you’re citing is exactly what I’m talking about. And it’s exactly the problem with SW. Now, you can go all SW and pretend you’re something you’re not, as the people on Reddit are clearly recommending and doing. I’m saying, as I noted throughout the article, that’s creating fertile ground for inauthentic relationships and potential problems down the road.
As for what the heck is wrong with saying the truth, I think this passage sums it up:
“People seem too afraid of being authentic, in fear of confrontation or headaches. Nobody wants to man up and be real. It’s a shame.”
The truth isn’t a problem. But it’s the more difficult way to go. It’s why cognitive dissonance is so pervasive. A comfortable lie is so much easier to deal with than an uncomfortable truth. But I’d rather be real, and I’d rather others be real. It’s the only way you can actually make an educated decision on a relationship. Basing relationships on lies is so dumb and immature. And you’re probably wasting time and money on people who don’t even like the real you. I find that beyond comprehension, but people are funny.
Best wishes!
I think people are confusing what Jason is defining stealth wealth to be. He is using the term to describe not being open and honest about ones financial situation. He is not defining it as living below ones means. I think it is obvious that he agrees with the idea of living below ones means. However, hiding the fact that you are financially independent is what I believe he is describing as dishonest. He makes a strong argument to be honest and open about your finances. The question is are people ready to ‘deal with’ the potential of losing relationships over the disclosure that this would likely cause. This is why i think the term ‘brave’ applies.
Rick,
Exactly. I thought that was pretty clear in the post, and I’ve obviously been transparent and enthusiastic about my own modest lifestyle for years. Not sure how or why anyone would mix up “live below your means” and “stealth wealth”.
Warren Buffett lives well below his means, but he’s never been the kind of person to go stealth about his wealth. He’s been open about the money with everyone in his life. I feel, and do, exactly the same. Buffett was OK if relationships suffered/declined as a result, and he’s never shied away from that.
Thanks for adding that!
Best regards.
I don’t look at it that way. I’m not trying to hide my wealth.
We lived frugally when we were poor and we continue to do so now that we’re wealthy.
It’s just minimizing lifestyle inflation. I don’t go out of my way to try to deceive other people. It’s their own perception about wealth that trick them.
For close friends and family, I’m pretty transparent. My brothers know we’re doing well. They’re fine financially so it doesn’t create conflicts.
Joe,
Yeah, I wouldn’t say that’s practicing stealth wealth then. You’re living how you like to live, and you’re pretty open with those who are close to you. That’s, down to the decimal, what I do. I noted to not be boastful, which would mean you don’t go around to your neighbors’ front doors and tape a note with your net worth to it.
I quoted Ramit Sethi on stealth wealth in another comment. Ramit’s view on it is pretty widespread. SW is generally a concept that would actually advocate that you NOT be transparent with your close friends and family, in fear of any potential problems that might bring on. Fans of SW would probably look at what happened with my sisters and point to that as a good example of why stealth wealth is such a good idea. I’m saying that genuine relationships built on mutual understanding and trust are better than those built on deceit.
I live more modestly than probably everyone reading this blog. I’m obviously all for living that kind of lifestyle. But only if it’s the way you like to live, not because you feel forced into doing it in fear of what other people will say, think, or do.
Best regards!
Related but not exactly the same topic, I just read a blog post on Financial Samurai regarding being stealthy about your side hustles and/or your FIRE plans. I couldn’t help but agree with him in terms of not blasting it around your job. He told about how he told two coworkers about how he was negotiating a severance package, causing them to blab about it through the entire office and almost jeopardizing his severance.
But reading the comments on that blog nearly gave me a migraine. People railing on FIRE bloggers who actually used their real names and photos and were open about their finances. The commenters did NOT like that. One guy even said that if he ever found out one of his employees had a blog like yours (you weren’t actually mentioned) or any sort of side hustle, he would immediately terminate them. His reasoning? When he was an employee, he used to ditch work in the middle of the day to work on his side hustles.
I’m sure you never intending this article to be a response to that one (or at least the commenters), but reading the two only a day apart really made it feel that way. But again, that’s because I read the two consecutively.
Sincerely,
ARB–Angry Retail Banker
ARB,
I didn’t come across the article on FS, so this piece had nothing to do with that. Although, I do believe I came across something Sam wrote some time ago about stealth wealth in general, which was basically advocating for everything I’m advocating against. I think he was talking about blatantly lying about who you are and even avoiding smiling so that people don’t sense your wealth by your happiness. Pretty dark stuff, I must say. If money puts you in a place to where you have to frown and be miserable all the time, I’d say that’s worse than actually having little money and a job. Some of the happiest people I’ve ever met are poor and over here in Thailand. And I can kinda see why with the way a lot of Westerners approach money and let it consume and control them in this way.
I think some people, especially sfmitch above, are confusing/conflating “stealth wealth” with “living modestly/below your means”. They might be related in a way, but they’re not the same thing at all. At least, not how SW has been widely advocated. Living below your means is great. I’m all for it and have been doing it for many years. Pretending you’re poor and actively concealing the true nature of your wealth or anything else from those in your life is not great at all. If you want to hide things and build relationships like that, go for it. But they won’t be very good relationships.
I never went out of my way to tell any of my co-workers (back when I still had a job) about anything. However, I didn’t shy away from being real about it all once they saw me on the Today Show. I’m not going to go flash my money in someone’s face. But I won’t try to hide the money or pretend it doesn’t exist if they come asking about it, either. I’m the kind of person to man up and be authentic. If you don’t like me because of that, that’s perfectly fine. In fact, I’d rather you tell me you don’t like the real me so that we can both move on.
Again, I think what I’m advocating is a very Buffett-like approach to life. Live below your means and focus on what matters. But don’t hide who you really are from those in your life. I’ve heard a lot of SW advocates go so far as to hide their money from pretty much everyone, even their significant other. It’s such a Scrooge way to live. And I think that’s setting you up for a fake relationships at best, and disaster at worst.
ETA: On further reflection, I think this conversation is reminiscent of one of the major problems with America. It’s a place that’s so hyperfocused on individualism and being on your own island, there’s no sense of connection or community. It’s more of a collectivism approach over here, at least speaking in societal terms. People are pretty outgoing and open about things, and there’s a real sense of gregariousness. I don’t get why there’s this obsession in the States with money, hiding everything, holing yourself up in your house, and closing everyone and everything off. I guess everyone is afraid the boogeyman is out to get them or something. It’s honestly sad.
Best wishes!
There’s no way to hide those guns brother!
Ronald,
I’m pretty creative when I need to be. 😂
Cheers.
Your personal story about hiding your finances is all too common. I, too, experienced the same thing when dealing with friends and family members who are strugglng financially. People who are poor or don’t have a lot of money will always resent other people who are well off.
Instead of studying and learning from those who are more successful, people prefer to take the easy road and say negative things about successful people.
Hiding your finances prevents those problems 100%. If you think it’s bad in America then it’s 10x worth once you travel to 3rd world countries. The average person doesn’t even have a bank account let alone a dividend growth portfolio. Revealing your success will only attract haters or worse thieves.
But being transparent online will attract potential students and people who want to learn from you. The world is full of different types of people and with the good comes the bad.
Funny thing is publicly sharing your finances forces you to dig down and improve them. There’s definitely a social proof and fear of embarassment that forces people to do wonderful things when everyone is watching. It’s probably why we pay professional athletes the big bucks.
Your portfolio surely inspired me and I want to thank you for your transparency!
investortrip,
Right. I agree. It’s easier to say negative things and harbor resentment than it is to look in the mirror and realize that poor personal choices need to be rectified. It’s also easier to ask for a handout than it is to work for what you want. And it’s easier to buy something now than it is to delay gratification.
All that said, I want to know whether or not someone close to me is the kind of person to take that “easy road”. And I think honesty is a great litmus test for that. It’s certainly worked well for me, as the people that I have in my life are fully aware of who I am, what I do, and what I’ve got. My best friend has been inspired to start his own portfolio and really kick his finances into high gear. This would have never happened for him had I not been upfront, nor would we have a genuine relationship based on honesty and trust.
I wouldn’t say that people in “3rd world countries” are as you portray them. Pretty unfair to stereotype. And the “third world” term is outdated/inaccurate, especially in the way people use it. The common/correct terminology would actually be “developing country”. I live in Thailand, and I’ve met quite a few Thais over here who are pretty savvy and interested in learning about a wide variety of things. They’re very curious and smart. I also feel far safer over here than I ever did in the States. It’s simply a less violent place to live, statistically speaking. It’s not perfect, and there are definitely some countries out there where I’d be more cautious about who I talk to (like, say, Mexico), but I don’t think people in the US are inherently any better or worse in this regard. It’s a situation where you have to use common sense and be careful with whom you associate, but honesty is actually a great tool for rooting out those who would probably aim to do you harm.
Cheers!
I’m practicing stealth wealth at work until I am financially free. People at my work would envy and try to destroy my chances of success (get you fired or hinder a promotion) if they knew about my wealth. It is pretty sick how people act. After achieving financial freedom I will be fully open without a care in the world.
D and M,
I don’t think there’s anything wrong with what you’re doing, nor would I call that stealth wealth. Stealth wealth isn’t about outspokenness. In fact, I noted in the article that there’s nothing admirable about being boastful. And being outspoken about your financial position could be construed as such. You’re simply minding your own business, which is great.
You’d only be crossing into stealth wealth territory if, say, you became close friends with a particular co-worker, but then did all you could to purposefully conceal who you really were with this person. Stealth wealth isn’t this innocent “just live below your means” thing that some people are taking it as. If it were, I’d be fully supportive of the concept. Stealth wealth is instead about duplicity, which I don’t agree with. It’s about purposefully deceiving people, even those close to you, so that you can avoid potential issues that the truth may bring about. I’m saying the potential issues that lying may bring about are worse than any potential issues that truth may bring about.
My co-workers never knew a thing about what I was doing, until I was on TV. Once the cat was out of the bag, though, I never shied away from being real. I guess I’m just not afraid to man up and be who I really am. Nothing bad ever became of it. In fact, my closest co-worker, the other advisor in my department, was pretty supportive and thought it was rad. He wished me well when I left.
Best regards.
Good read. Enjoyed the comments too
Carl,
Glad you enjoyed it! 🙂
Cheers.
Brilliant article Jason.
I recently started a blog since I had broken my silence about my investments to a few people. Most did not know of my retirement plan. Almost no one knew I had fully paid off my home. This includes relatives.
But once I broke my silence to a few co-workers and started receiving requests of help starting down this path, I decided to start my own blog. I also sent them a link to this website since it is highly motivational and very informative. Your old website got me on the right path and once I got the hang of investing in companies that are raising their dividends, I saw that much of our portfolios were the same and even had the same purchases around the same time.
Doing this is definitely not about being boastful. This is merely sharing the process of becoming free. Free of the man!
Thank you for writing this.
cheers,
John
John,
Thanks for adding that!
Yeah, I think there’s a pretty big gap between being boastful and purposefully deceiving people. And it seems like some people are very much confusing this. I mean, they’re practically opposite from one another.
Those who aren’t close to me would have no idea about my wealth. It’s not like I talk about dividend income with my barista or neighbor or something. On the other hand, people who are in my life are fully apprised of EXACTLY who I am. That includes finances. It also includes everything else. Best I can tell, they’re fully open and honest with me, too. I wouldn’t want it any other way. Why have fake relationships?!
People are funny. They’ll complain about how others aren’t forthright, yet they’ll be the first to be dishonest themselves. It’s like everyone is trying to outflank one another and hide who they really are.
In my view, this would be a lot like being gay. You don’t need to tell everyone you’re gay. In fact, you shouldn’t. Most won’t care. I’m all for minding your own business and going about your life. But if you’re going out of your way to purposefully deceive by pretending you’re straight around your family and best friends, you’re making a huge mistake. They’re going to love someone you’re not. And that’s a recipe for disaster. Of course, a lot of people in that community have historically hidden themselves, and they’re just now seeing that for the mistake it’s historically been. (I’m simplifying this analogy for the sake of making a point.)
Likewise, I’d never pretend I’m poor or struggling or whatever around those who are close to me. Stealth wealth advocates would recommend that. I’m saying that’s a total garbage way to approach your life. If you’re pretending to be something you’re not around those who supposedly care about you, you’re giving them someone to care for who isn’t real.
I’m advocating for authenticity. That’s all, really. If people in your life don’t like the authentic you, you need to find new people.
Best wishes.
Hey Jason, long-time reader, first time commenter. I have always admired your transparency regarding your Freedom Fund and dividend income however, I was wondering if you ever plan to reveal your total net-worth? I think this would help people understand your exact financial position. The main aspect that is missing from what you currently reveal is probably the money you received from selling DividendMantra. This was probably a significant amount given the huge traffic the wentire was generating. Of course it is totally your choice if you wish to keep this information private but I just thought I would point it out given the topic’s discussion of being open about finances. I have huge respect for everything you have done so please don’t take this the wrong way.
Tim,
If you’ve been reading for a while, you’ll know that I’ve been vocal for years about not making a big deal about net worth. I don’t think it’s worth paying much attention to. I think the focus should always be on passive income against expenses. I don’t go down to the net worth store and buy things with my net worth. It’s cash flow that matters and pays the bills. And it’s cash flow that should be steadily rising against expenses. Net worth fluctuates all of the time, and focusing on this trips people up and adds emotional weight that I think is totally unnecessary and potentially harmful.
All that said, the bulk of my personal net worth is in the FIRE Fund. So I’m already pretty transparent with it. I could have a much higher net worth (and a lot more passive income) if I didn’t quit my job at 32 or if I didn’t have philanthropic goals, but I simply value time much more than money. And in terms of time, my net worth is very, very high.
Cheers.
Jason,
I agree with your article. I am not stealth about my investing, but I am not boastful or loud either. At one point I was talking about it a lot and learned people either don’t want to understand or they don’t care – or something like that. Even if its in their best interest to invest and save. So I now only talk about it with select people who are somewhat like minded in person, or if someone else broaches the topic. You are right, also its good to be upfront about stuff – even if people don’t understand or take it seriously.
As a side note your picture is a B-2 Stealth Bomber, the B-52 was bigger and not stealth. Don’t know if you meant that intentionally. I also know way too much about military and civilian aviation in general…
– Gremlin
Gremlin,
We’re totally on the same page.
I don’t go out of my way to tell anyone anything. Nobody outside of a close circle of people (and obviously readers of my content) would know a thing about my wealth, as I live a very modest life. If I suddenly died, the person cleaning out my 400-square-foot apartment would find less than $100 in cash and two bags’ worth of stuff. They’d probably think I was some poor guy.
At the same time, though, I don’t go out of my way to hide any of my wealth if the topic ever comes up, especially among those close to me. I’m real with people. And I expect them to be real with me. While I guess a lot of people are apparently OK with having these fake relationships that rely on surface connections (“Boy, the weather sure is hot today…”), having anything meaningful requires you to be honest and trusting. Plain and simple.
If I were pretending all of these years to be poor with my best friend, and he suddenly somehow found my blog online, I think he’d disown me. I mean, what kind of best friend is like that?
If you’re so afraid of what’s going to happen if people close to you find out about your wealth, you need to seriously take a look at whether or not these are the kind of people that should be close to you in the first place.
Best regards!
Hi Jason,
I remember a Bill Gates interview saying he was surprise because Warren Buffett lives in a house without any camera or security. Another interview Buffett says he bring with him just few hundred dollars in cash.
So I start to think of stocks really as a safe deposit box. It can rains or snow, stocks never get wet. There is a bank robbery assault, they can’t steal stocks. It’s already a hidden wealth, protected with a moat.
I can see you are always very open and transparent even when you share some painful details of your life, looks like is not just a journey for financial indipendence but also a more spiritual path. Lots of people are in the crab-mentality.
I am in a stealth weath mode-on even in my conversations. I try to empatize with lower income people and I join their comment about politics or economy in discount supermarkets. So i realize it’s all matter of mind and mentality.
Thanks for your articles.
praya,
For sure. Stocks are very safe in these terms. It would be quite difficult for someone to extract money from me. But I think that worrying about such an unlikely event is very wasteful. Your odds of catching a heart attack or dying in some kind of accident are much greater than someone trying to rob you of your stocks. I’d actually worry more about hacking.
I haven’t read of any stealth wealth being advocated in terms of protecting yourself against some kind of robbery or loss. Maybe some people are worried about that. I’m not sure. I haven’t personally run across it. I think SW is more about not dealing with any potential issues with friends and/or family members as a result of them finding out about your wealth.
Thanks for dropping by!
Best regards.
Couldn’t agree more. I think it’s very important to be transparent (prudently, of course) about your finances. It helps those around you keep realistic expectations. It also prevents problems that may arise if you exercise options available to you through financial freedom. For instance, a stealth-wealther might have difficulty explaining a sudden move to Portugal. But honest and open communication about one’s status makes it much easier to avoid suspicion and/or assumption.
For my part, I think being honest with the family has opened doors for them too. I went FI in 2017, and kept my sister apprised through the whole process. She’s since followed suit, and her family will be expatriating next year to live out their dreams of international exploration. They’re following your example even more fully than I am! 🙂
Rome,
Yes. Exactly. Prudently, of course. It’s not about being outspoken. It’s about not shying away from being genuine with those close to you.
That’s super awesome that your transparency led your sister to those opportunities. That’s fantastic! 🙂
I noted in a prior comment that my own transparency led/inspired my best friend to building his own portfolio. He’s now sitting on a pretty significant stash himself, with quite a bit of growing dividend income. He started off by listening and observing, but he switched to enthusiastically participating a few years ago.
Your comment reminds me that I made a mistake in the article by not bringing up my experience with my best friend. This would have been a great counterexample to what happened with my sisters. Being truthful isn’t the easy way out. But now I’m able to see who’s really with me. And I wouldn’t go back and do it any differently. If I went back and hid the truth, my leeching sisters would still be in my life and my best friend would be poorer. I don’t see that outcome as better.
Best wishes!
I agree that “stealth wealth” is deceptive, but I don’t think that it is necessarily wrong…
A lot of negative things can happen when you openly share that you have money, and keeping it more discrete can save you from a lot of problems. That’s not to say that you can’t share and talk about it from time to time, but being openly blatant about it is really not a good idea as it will attract unwanted attention. In my opinion, it is wiser to selectively choose when to share how successful you truly are.
cooler,
Deceptive? Yes. Wrong? Not necessarily. We agree. It really depends on whether or not you want authentic relationships. I made my case in the article. I could go back in time, use stealth wealth, and have my leeching sisters back in my life. But I don’t see that as an improvement.
“…being openly blatant about it is really not a good idea…”
Absolutely. I explicitly stated in the article, and repeated throughout the comments, that I do not condone being boastful. There’s nothing admirable about that. And very little good could come of it. You’re setting yourself up for limited upside and massive downside.
This isn’t about being outspoken. It’s about not shying away from the truth among those you’re close to.
No reason to go on the attack. But if the battle comes to you, stand your ground and be honest. If you’re afraid of what the truth will mean for your relationships, you should probably question what’s really going on with those relationships. They’re obviously not very authentic.
When I think of this whole idea, I’m reminded of the “Trust, but verify” proverb. I give those closest to me the benefit of the doubt. But what better way to verify than to probe them with the truth?
I verified that my sisters were leeches. Then I let them go. Meanwhile, my best friend was inspired by my example and has gone on to build substantial wealth. Win some, lose some.
Truth isn’t easy. But I’d rather know who’s really with me.
Cheers.
Totally can relate to family and finances. Buried my mother had to pay thousands. Family does not believe in cremation wants elaborate funeral arrangements but no money. Brother passed away no money again. I paid for cremation. informed my family I will not be financially responsible for anyone but myself my family stopped speaking to me. I was able to follow your advice and start my dividend stock portfolio I was getting $ 2.34 every 3 months LoL 😂 now I am starting a small snowball effect and can make at least $175 per month. All most paid off 1 house in California and had a 2 bed 1 bath house built in the back yard of the property for rental income I am currently looking for the right tenant. Unfortunately, I am older then I look so people think they can take advantage of me with California tenant laws but my screening process stops them in their tracks. I would rather have an empty house instead of a lousy renter. You helped me to create a financial road to freedom, because my family did not know about money and couldn’t teach me. I appreciate you so much Jason for your honesty and being transparent it helped tremendously. I am also growing tired of the California mentality and am seriously considering moving to Thailand too 😬 but not for a few more years.
FonFon,
Hey, sorry to hear about the family troubles. Not nice. But it sounds like you made the right call and did what you had to do. You were honest, and now you know who’s with you (and who isn’t). No reason to have leeches in your life. I don’t personally agree with the idea that family gets an unlimited free pass. And I’d rather have fewer, better relationships than more, worse relationships. It’s all about quality, not quantity, when it comes to the people in my life.
Wishing you much luck over there in California. Thailand is here if you ever decide to give it a shot! 🙂
Best regards.
This is very interesting topic.
I, my self have been quite stealth wealthy when it comes to my friends. Most of my friends also invest, not just as much as I do. I don’t reveal my exact numbers to them. But we can still talk about investing.
I can talk openly about finances with my siblings and parents, because we all have the same backround and financial situation because of inheritance.
– FN
FN,
Thanks for adding your thoughts!
Yeah, I think you’re going about it in a pretty sensible way. There’s no one-size-fits-all, or “right”, way to approach it. You’ve obviously identified who to be more open with, and who to maybe have some distance with. Sounds very reasonable to me. 🙂
Cheers.
“Money ends up accounting for a great deal of our identity. Particularly in the West, which is one of the reasons I don’t enjoy living in America anymore.”
Try China – it is even worse than the US there!
Thomas,
I’ve never been to China, but I can imagine. There are a lot of Chinese tourists here in Thailand. I see some similarities between the Chinese and Americans, especially in terms of consumerism.
Cheers!
In my view, I actually don’t see stealth wealth as having to do with actively hiding your wealth. But simply living a simple life and finding pleasure in the things that actual matter most (likely not material things). I think you can be open about being wealthy with everyone around you and still practice the principles of stealth wealth. If my neighbors know I have a few million bucks but I still drive Subaru instead of a Maserati, that’s still stealth wealth. Anyway, my definition doesn’t have to be yours, just wanted to share my thoughts. Sorry to hear about not having your sisters in your life.
FT,
“If my neighbors know I have a few million bucks but I still drive Subaru instead of a Maserati, that’s still stealth wealth.”
Yeah, I’d have to disagree with you on that one. That’s doing your thing and being real, which is awesome. But that’s not stealth wealth. It’s not stealthy if everyone knows about the wealth. And this isn’t “my” definition. I’m simply looking at stealth wealth as the PF community has advocated it. If stealth wealth were just living frugally and focusing on what you value, that’d be great. After all, I live in a 35-square-meter apartment and own less than $2,000 of personal possessions. I don’t do that to be stealthy, though. I do it because that’s how I like to live. And I’ve written hundreds of articles over the years recommending this lifestyle.
However, stealth wealth came about in order to purposefully camouflage what you’re doing. That’s where the word “stealth” comes in. The PF community has presented this concept as a way to pretend to be something you’re not. Living frugally because you enjoy living frugally isn’t pretending. Telling your friend you’re poor when you’re not poor is pretending.
I provided a quote by Ramit Sethi above, which goes into the deception.
And here are three stealth wealth tips from Sam at Financial Samurai:
1. Lie and tell people your stuff is fake.
2. Frown more.
3. Pretend you don’t understand things.
If you have to pretend to be miserable and dumb so that you can stealthily operate around others in a clandestine way, I think that’s an awfully miserly and deceptive way to live one’s life. And you’re naturally going to attract people who want to be around a version of you that isn’t really you.
I’ll continue to live my very modest life. But I won’t go and act like it’s stealth wealth, because it’s not. Nor will I pretend I’m something I’m not around those who are in my life. I’d rather have authentic relationships.
Best regards.