You can’t hide your money all the time

I’m a fan of stealth wealth, but…

There are many benefits to stealth wealth, which is the practice of not showing off how much money you have.

Fewer people will ask you for money if they don’t know you have money. 🙂 It’s also easier to determine who your real friends are. You’re also less likely to get ripped off since people who appear to be rich are more often financially targeted. And your life in general will be simpler. Because at the end of the day being rich doesn’t have to be expensive. But looking rich sure does.

That’s why many millionaires drive 10 year old cars or trucks instead of the latest models. Or they live in modestly sized homes instead of mansions. They wear everyday hoodies and jeans instead of designer clothes.

The idea of stealth wealth is to live the life you want by spending it on things and experiences that matter the most to you, and not flaunt your wealth for other people to see.

Although this sounds simple in theory, it’s unfortunately not so cut and dry.

There are a lot of things you can buy with money to improve quality of life that’s also very conspicuous. For example flying business class instead of economy. The plane ticket price difference is many folds. And even though it seems like an unnecessary luxury option, so is flying in general if you think about it. It’s hard to put a price on personal comfort.

Driving a nice car and living in a big house have their benefits as well on a personal level. Generally speaking more expensive cars are more comfortable to drive. And a bigger house gives you more room, which is important if you want to raise a family. I own a 2 bedroom apartment, and a detached house. There’s a reason why I choose to live in the house and rent out the apartment instead of the other way around. And it’s not a financial reason, obviously. 😀

The problem with increasing your standard of living is that you can’t hide your wealth from the world. People can clearly see you’re flying business class, or driving a Mercedes GLE, or sending your kids to private school, or living in a big house.

Does that mean in order to practice stealth wealth you have to lower your living standards to that of the average person earning the average income? If you did that you would certainly have more financial security and a higher savings rate. But is that the life you want for yourself? 😕 If you have the means to improve your life with material experiences, perhaps you’re close to FI already, would you spend the money?

Buying fancy things doesn’t have to be about keeping up with the Joneses, or comparing your social class with your neighbours.
Maybe it’s simply about wanting a better life for yourself.

Financial freedom allows you to live a life of purpose, spend money based on your values, keep a clear mind, and keep your days simple so you can enjoy what’s important to you. But what if you already have everything you need financially. You have all your basics needs met like housing, food, fun hobbies, goals, entertainment, companionship, and health. And you don’t have to work anymore, which is most people over 65 years old, or younger if you’re part of the FIRE community. What happens now if you save extra money above your FI number?

If the idea of stealth wealth in the first place is to not base your spending habits on how others judge you, is being reluctant to improve your living standards just a form of self deception? Are you afraid your friends might see you differently if you start wearing expensive cashmere?

Another thought is if you know you’ll reach your FI number within the next 10 years or so. Would you be willing to spend more now and delay your financial goal for 1 or 2 years? If you plan to retire at 45 and probably live until you’re 90. Does it really matter if you extend your FI date out by a year or two, if it means you can drive with heated seats and steering wheel right now? 🚗

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Random Useless Fact:

Orangutans and chimpanzees are some of the smartest primates.