| ▲ | GMoromisato 3 hours ago |
| I've more or less followed this advice, and it's worked out for me. For the most part, I used my salary to pay for expenses and stock compensation to build up wealth. The tricky part is that a lot of this advice is situation-dependent. Should you switch to a riskier company that offers a higher compensation? Sometimes yes, sometimes no. Should you work late to accomplish goals hoping to get a promotion? It depends. So how are we supposed to know what to do? The answer, in my opinion, is people. You have to trust people who are trustworthy and avoid people who are not. As an employee, your success depends on the people who hired you--they are the ones who can promote you or cheat you. The best leaders are the ones who realize that helping you advance is going to help them advance. Help your boss accomplish their corporate goals and they will promote you--not as a reward, but as a bet that you will help them on the next goal. Bad leaders are either too selfish (fail to promote you) or too incompetent (unable to rise, even with your help). You need to learn to avoid them. Therefore, my advice is this: Look at the leaders in your company--people who could plausibly hire you. Which ones are the best bets? Which ones have both the talent and the integrity to succeed? If you're lucky there's more than one and you can work to get on their team. If you're unlucky, there are none and you need to find a different company. |
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| ▲ | spwa4 2 hours ago | parent | next [-] |
| Problem with this is that this can get you to 1-5 million in net worth (declining fast, someone joining a FANG now certainly won't make it as a single contributor to 5 million, unless they're truly exceptional) (of course 5 million effectively pays you a relatively high level FANG salary just from 4% safe investments ...) Maybe you can get to 50 million with a reasonable management career. But let's say you're on this path and you have 3 million or so, at 35/40 years ... then what? Management at all costs? No reasonable job at a FANG will get you to even just double what you have at that point. |
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| ▲ | GMoromisato 2 hours ago | parent | next [-] | | If you have $5 million USD wealth you're in the top 5% of the US (and top 0.5% of the world). If you cannot have a happy life on that, well... But I get it--if your goal is to accumulate more wealth (no judgement--that's a legit goal) then it gets harder. When I was at Microsoft, partner-level engineers were making $1 million per year; now it's probably $2 million. Staff-engineer at FAANG is probably similar, I bet, to say nothing of the AI labs. I bet you could reach $25 million after 10 years with the right investment strategy. And $25 million throws off at least $1.25 million per year if you invest right. Beyond that, you probably do need a startup or some other significant ownership stake. | | |
| ▲ | jebarker an hour ago | parent | next [-] | | I know these are just spit-balled numbers but getting to $25M in 10 years even with $2M annual comp would require pretty risky investment I think. Assuming you spent $300K per year and paid US taxes you’d have about $900K left over. 7% average returns would mean you’d have about $13M saved after 10 years. Getting more than 7% on the whole portfolio is going to require significant risk. | | |
| ▲ | GMoromisato an hour ago | parent [-] | | Fair enough--I didn't do the math. Looks like you'd hit $25M after 15 years or so. And I grant that 7% is aggressive. Still, if you reach staff-level at 40 years old, you could have $25M at 55. That's pretty amazing. But that requires lots of luck. Most people never make it to staff-level. I never did. | | |
| ▲ | jebarker an hour ago | parent [-] | | It is incredible. Sustaining 15 years at staff level will cost you a lot in other ways though! | | |
| ▲ | GMoromisato an hour ago | parent | next [-] | | Yup! Depends on the company and the person, of course. Another thing: People at FAANGs usually ride the stock up and get way more than 7% per year. I'm embarrassed to say that I sold a lot of MSFT stock at $30 in 2011. Today (~15 years later) it is trading at $530. | |
| ▲ | spwa4 an hour ago | parent | prev [-] | | Sustaining 15 years at staff level is near-impossible and will extract a heavy toll for the vast majority of people. Plus at 55? Not saying you'll be dinged purely for your age but it's not like it has no influence ... |
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| ▲ | joshuamorton 14 minutes ago | parent | prev | next [-] | | > When I was at Microsoft, partner-level engineers were making $1 million per year; now it's probably $2 million. This seems...high. The levels.fyi data for 68/69 shows them maybe crossing 1M, and the highest available data point at a bit under 1.5 mil. Staff engineers at FAANG are not making 1M a year except in cases of significant stock growth. 700-800K is more reasonable. The AI labs pay a significant premium, yes (2-3x!). My math on it was basically "I can work for 10-15 more years and retire meeting my financial goals, or work until my 4 year grant at an AI lab finishes and meet all the same goals, with more interesting work". | |
| ▲ | spwa4 an hour ago | parent | prev [-] | | > Beyond that, you probably do need a startup or some other significant ownership stake. That would be what I'm trying to avoid. |
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| ▲ | singpolyma3 an hour ago | parent | prev | next [-] | | If you're at 5 million you're already well past wealthy and should probably not be stressing about this. | |
| ▲ | hdjrudni 2 hours ago | parent | prev | next [-] | | I think you can make it to 5 million in maybe about 12 years at FAANG. Maybe quicker if you're frugal. More if you raise the ranks quickly. | | |
| ▲ | ryandrake an hour ago | parent | next [-] | | I don't think your math is mathing. To end up with $5,000,000 after 12 years at, let's say, a constant 5% annual interest rate, you will need to invest over $25K per month over that time, or $300K per year of disposable income, after taxes, living expenses and so on. You would have to be very high level even in a FAANG to be able to do that. I know, I know, everyone on HN says entry level FAANG makes $600K/year and drives a brand new Porsche, but it's not reality. | | | |
| ▲ | joshuamorton an hour ago | parent | prev [-] | | I'm not sure that's quite feasible. 2-2.5M in 10 years is about the best I've seen excluding getting reasonably lucky with major stock jumps. You could juice that a bit further with really aggressive savings, but for most people, you're looking at 4-5M in income pre tax over that 10-12 year period (maybe a bit higher), weighted mostly toward the end, so without a ton of time for market gains to help. |
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| ▲ | quickthrowman an hour ago | parent | prev | next [-] | | You don’t need a FAANG salary, that just makes it easier. My net worth is nearing $1M after saving for 8 years, making less than $100,000 a year. If I exclude the ESOP equity I have, it’s still over $500,000 and that’s just maxing out 401K and Roth each year for 8 years with the market return. | |
| ▲ | derwiki 2 hours ago | parent | prev [-] | | 4% of 5m is 200k; not a high level FAANG TC |
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| ▲ | brcmthrowaway 3 hours ago | parent | prev [-] |
| Do you sell your stocks immediately and reinvest in SPY? |
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| ▲ | GMoromisato 2 hours ago | parent [-] | | I put half in a basket of tech stock (QQQ, etc.) the other half in buying a house. I am not an expert, so don't take my investment advice--do your own research. | | |
| ▲ | thmoonbus 2 hours ago | parent [-] | | Disclaimer: I am not qualified to give investment advice, I’m just an average tech worker who spent some amount of time on bogleheads forums. I personally don’t invest more in tech than I need to via broad index funds (and I certainly never keep my RSUs in the company stock, I always sell immediately). Otherwise, if there is a sector-wide downturn, I’d be triple exposed - my paycheck, my tech investments, and my company stock. That seems like a lot of risk to take on. I’m open to other opinions here. | | |
| ▲ | GMoromisato an hour ago | parent [-] | | Which game would you rather play: A. Guaranteed $1,000 each month
B. Every month, flip a coin. Heads gains $5,000, tails you lose $1,000.
Obviously B has greater expected return, but losing $1,000 hurts. What if you can't pay the rent that month?To me, that's SPY vs. QQQ. Tech in general has higher expected return, but more volatility. If you can handle the volatility, then QQQ is better. If not, then not. Ultimately, I'm taking a bet on tech because I believe tech has the greatest chance of improving the economy/world. [I'm also not qualified, so do your own research] | | |
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