[vmception]

well this is mostly semantics: the quote does not contradict, most of the wealth was self-made. as in the profits accumulated during their lifetime, it doesn't say anything about how the first one million or any amount was made.

your consternation requires you to have a fixed and shared definition of self made that is just not described at all here.

it does leave a glaring hole about then which wealth was not self-made. alimony? child support? having a million now but having inherited ten million?

of course its not people that spent years in debt, worked on salary, dealt with illness in their family, and made millions. that's very rare and life will never be catering to that, so, yes, a life with more options from earning this way is BS and it does keep people motivated enough to continue trying anyway, but that's not what this article was talking about.

[FactolSarin]

I mean, it takes money to make money. It's a lot easier to get a hundred million dollars when you start out with 1 million to put in the stock market.

[mikepurvis]

It's also survivor bias— having a million bucks gives you the cushion to take those riskier bets, and the people for whom that works out are the ones we read about. There are certainly others who gambled away mom and dad's money into nothing.

[woko]

One cannot transform 1 million into 100 millions without having 1 million in the first case (unless some debt leverage is used, but that is besides the point here). Right.

However, I fail to see how that removes any value (or makes the task look easy) regarding Mc Donald's perspective. For that one guy who transformed 1 million into 100 millions, how many actually lost most of their initial million (in stock trading)? I am like most of us here: I imagine that if I had a million somehow, then I could easily become a billionaire thanks to my wonderful intelligence and wits, because I am better than every other millionaire out there, right? That is all wishful thinking though, and I dread confronting reality to my ego.

In reality, if I had a million, I guess I would invest it into the most risk-free assets rather than bet it all in stock trading.

[peterwoerner]

If you had a million you could also get a loan with interest less than "risk free" assets. E.g. The stock market makes 7-10% but you can get a loan for 1-3%. So 1.5x your returns then become 12-16%.

Perhaps you can invest in lower risk dividend stocks which will pay out your interest + a little and 3x. If we assume those stocks only make 4% but also pay out 3% then you are looking at 16% returns. Moreover when those dividends get raised you are doing even better.

Leverage can go a long way if used well.

[Retric]

The article points out 2,000x returns where possible if he started at 18 using the equivalent of index fund investing. So, he could have underperformed the market and turned 1 million into 2 billion let alone 100m. The critical issue was not spending his inheritance rather than needing to have amazing returns over that timeframe.

[malandrew]

> It's a lot easier to get a hundred million dollars when you start out with 1 million to put in the stock market.

This statement could only ever be uttered by someone that has not tried to do this.

100x increase in any endeavor is extremely exceptional. It's as hard to do as turning $10,000 into $1,000,000.

The only thing having a larger starting amount helps with is that it opens up types of opportunities you did not have before that require greater starting capital and are outside the stock market. Those additional opportunities are as hard to capitalize on as the smaller opportunities that only require $10,000, especially since you need not only money but a lot of people with expertise that you can trust.

But within the stock market, a 100x return is something very few people in the market ever achieve.

The only place where having money clears some significant initial hurdles is probably getting to the first $10,000, maybe the first $100,000. This is a hurdle many have cleared in their lifetime and they still haven't succeeded in turning it into $1 million to $10 million, respectively.

[throwawayfire]

> It's as hard to do as turning $10,000 into $1,000,000.

It's hard, but provably not as hard. If you don't need the money, you can afford to take more and better risk with it.

More risk is enough to get this article (not even necessarily better risk) - if 100 people take a pure 100:1 bet, then 1 can get an article like this.

[As mentioned in the sibling comment, if you have enough time, then hard becomes easy]

[malandrew]

You said it was provably not as hard and didn't try to prove the point you're making. I agree you can take more risk, but there's no guarantee that you're taking better risk and nothing about what you claimed proves that.

It's almost certainly more challenging to take better risks as the investment requires gets larger. All sorts of new challenges crop up that didn't exist with smaller investments. It's the reason why companies have a harder and harder time sustaining the same growth rate as they get larger.

Within the stock market alone, you get access to the same exact risks as the people with the $10k YOLO accounts. If you look at WSB, you'll see a lot more posts about people posting losses on their YOLO accounts than posting massive wins. There are a lot of sharks swimming in the capital markets with deep expertise.

[throwawayfire]

> There are a lot of sharks swimming in the capital markets with deep expertise.

I would argue that you have proven my point - if I have a bunch of money, I can pay for expertise/management that is going to net me a higher return.

[malandrew]

> if I have a bunch of money, I can pay for expertise/management that is going to net me a higher return

Not starting with $1 million. At $10 million you have to be the shark. You need to be closer to $100 million to be able to afford the sharks the don't have their own principal to work with. Even then, you still need to know how to hire the sharks.

Source: I used to work in this market.

[agency]

Bullshit. This guy had decades and decades of compounding returns. The article itself admits:

> Had he just parked $1,000 in a basket of equities when he turned 18, it would have been worth $2,048,400 at his death.

[vmception]

that's also my point.

oh, I don't find that controversial in case my lack of stated opinion prompted someone to fill in their own.

[lucasmullens]

I feel like "self made" doesn't have a useful definition anymore, since people disagree fundamentally on what it means. Arnold Schwarzenegger for instance argues there's no such thing as "self made".

[ruined]

stocks literally represent the right to control capital and be paid by others who do work using that capital. it's the most explicit form of "not my labor" in the entire economy and i'm not sure why you expect op to explain that

[vmception]

I said this in another comment, but I think that you think I find this controversial, and I don't. and I keep forgetting that this is the default assumption these days on wealth related topics.

My thoughts are limited to exactly what I said and I am content with this reality that the profits accumulated during their lifetime are counted as self-made, it doesn't say anything about how the first one million or any amount was made, and that wage earners are excluded from playing from math alone.

[omgwtfbbq]

>well this is mostly semantics: the quote does not contradict, most of the wealth was self-made.

Just for reference, and we don't know how much he really inherited, if he inherited $10M and put all of it into a SP500 index fund that earned 8% returns per year he would have $100M after only 30 years. This is with 0 additional capital invested, 0 effort, 0 skill in picking stock, doing nothing but tracking with the market so perhaps his "self made" status isn't really that impressive. The Author guesses he did better than average to make his fortune but that doesn't seem necessary at all.

[JustSomeNobody]

> alimony? child support?

Alimony implies marriage. In marriage all the money earned belongs to both parties. If there's only a single earner and the other is a nurturer, so what? It's still both party's money. Alimony is there to help the nurturer transition back to an earner.

Child support is, well, you made them, support them. Simple.

[vmception]

What point did you think you were making?

Money paid in alimony has nothing to do with money earned in marriage. The divorce division of marital property covers that. Alimony supports the lifestyle. Would you consider a recipient self made or not.

Would you consider a recipient of child support self made or not.

[JustSomeNobody]

The point I am making? One cannot say someone is not self-made simply because they're getting alimony or child support without acknowledging the contributions during marriage.