Saturday, August 4, 2007

In Silicon Valley, Millionaires Who Don’t Feel Rich

New York Times: By GARY RIVLIN


MENLO PARK, Calif. — By almost any definition — except his own and perhaps those of his neighbors here in Silicon Valley — Hal Steger has made it.

Mr. Steger, 51, a self-described geek, has banked more than $2 million. The $1.3 million house he and his wife own on a bluff overlooking the Pacific Ocean is paid off. The couple’s net worth of roughly $3.5 million places them in the top 2 percent of families in the United States.

Yet each day Mr. Steger continues to toil in what a colleague calls “the Silicon Valley salt mines,” working as a marketing executive for a technology start-up company, still striving for his big strike. ...

“I know people looking in from the outside will ask why someone like me keeps working so hard,” Mr. Steger says. “But a few million doesn’t go as far as it used to. Maybe in the ’70s, a few million bucks meant ‘Lifestyles of the Rich and Famous,’ or Richie Rich living in a big house with a butler. But not anymore.” ...

Their lives are rich with opportunity; they generally enjoy their jobs. They are amply cushioned against the anxieties and jolts that worry a vast majority of people living paycheck to paycheck.

But many such accomplished and ambitious members of the digital elite still do not think of themselves as particularly fortunate, in part because they are surrounded by people with more wealth — often a lot more.

When chief executives are routinely paid tens of millions of dollars a year and a hedge fund manager can collect $1 billion annually, those with a few million dollars often see their accumulated wealth as puny, a reflection of their modest status in the new Gilded Age, when hundreds of thousands of people have accumulated much vaster fortunes. ...

Many of these millionaires have options, of course, beyond working hard to earn another $5 million to $10 million. A few even choose to jump off the golden treadmill.

That is what Mark Gage, 51, an engineer, and his wife, Meredith, did when they left the Bay Area in 2005 with $3 million or so in assets. They bought a house in Bend, Ore. — “a bigger, much nicer home with dramatic views” — and now Mr. Gage works only when the perfect consulting job presents itself....

“You look around,” Mr. Barbagallo said, “and the pressures to spend more are everywhere.” Children want the latest fashions their peers are wearing and the most popular high-ticket toys. Furniture does not seem up to snuff once you move into a multimillion-dollar home. Spouses talk, and now that resort in Mexico the family enjoyed so much last winter is not good enough when looking ahead to next year. Summer camp, a full-time housekeeper, vintage wines, country clubs: the cost of living bloats.

To Mr. Milletti, it all looks like a marathon with no finish line.

“Here, the top 1 percent chases the top one-tenth of 1 percent, and the top one-tenth of 1 percent chases the top one-one-hundredth of 1 percent,” he said.

“You try not to get caught up in it,” he added, “but it’s hard not to.”


Talk about the two Americas!

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