John Z. Rigos
Founder, president, and CEO
New York, New York
Can you lose what you never had? It certainly felt that way to me.
It was December 1999. I’d sold my dotcom for $42 million. My two partners and I each walked away with $8 million in stock. I’d grown up poor, the son of Greek immigrants. This was a dream come true.
Then the dream ended. From the day of the sale until the day when I could legally sell my shares, the stock tanked. I ended up with a fraction of my original take. Then Bill Gross at idealab courted me as an entrepreneur-in-residence. Idealab was about to go public. Theoretically, my options could have been worth $40 million. Then the Internet market collapsed; idealab never went public, and my options were worthless.
I lost everything — twice. But worse than losing the wealth was losing my identity. I couldn’t even think about working again. Today, I have a certain sense of calm. Those years were the most amazing period of my life. But they warped my priorities. There was a time when I was so obsessed with my company that my girlfriend left me. It was only after I had lost my fortune that she took me back.
John Z. Rigos (email@example.com) cofounded cductive.com, a music- distribution company that he and his partners sold in 1999.
Owner, Dallas Mavericks
The basic worry that comes with having lots of money is no different from what worries everyone else. Whether you’ve got $100 or $100 million, you don’t want to lose it. After we sold Broadcast.com, I hedged my stock with synthetic indexes, in case the market cratered in the six months before I could hedge my actual Yahoo shares. It cost me $20 million, but I protected what I had. Todd Wagner and I had a credo: “Pigs get fat; hogs get slaughtered.”
My bank account never defined what was important in my life, and that’s true for today. I still like eating roast-beef sandwiches, spending time with my fiancée, and going to the movies. I don’t think about money when I get on a scale; I wonder why I can’t lose weight.
Still, there’s no denying that money has given me freedom. That’s the best part about being rich. Money also gives me the comfort of knowing that my parents can go on trips wherever and whenever they want and that my brothers and their families will never, ever go wanting.
Some people claim that having money creates headaches. Not really. I had headaches when I didn’t have money to pay the rent.
Mark Cuban (firstname.lastname@example.org) and Todd Wagner sold their company, Broadcast.com, to Yahoo for $5.7 billion in July 1999. In January 2000, Cuban bought the Dallas Mavericks.
Thomas J. Stanley
The Millionaire Next Door and The Millionaire Mind
The past few years have shown everyone that fast money goes as quickly as it comes. That doesn’t mean you should be despondent. It’s still possible to become wealthy — especially if you avoid classic mistakes.
The first is to confuse wealth with income. Wealth is what you accumulate in assets, not what you make or spend. People who accumulate great wealth often live frugally. They don’t care about status. They care about being independent. If your goal in becoming rich is to look rich, your chances of success are remote.
Another big mistake is to choose the wrong job. Making lots of money at a job that you hate doesn’t work. People who accumulate wealth love what they do. Why? Because if you don’t, you’ll spend all kinds of money to compensate.
Which leads to one final mistake: to have a job in the first place. The average self-employed person has a net worth five times greater than people with jobs. Most people who love what they do work in businesses that they started.
Thomas J. Stanley’s The Millionaire Next Door (Longstreet Press, 1996), coauthored with William D. Danko, spent 200 weeks on the New York Times best-seller list.
Nickel and Dimed: On (Not) Getting By in America
Key West, Florida
I’m baffled by failed executives who demand huge severance packages to “maintain their lifestyle.” They should try to get by on $7 an hour. I did — and I learned a lot.
The biggest surprise: It’s expensive to be poor. Without a bank account, you have to pay to get your checks cashed. Without extra cash, you can’t buy in bulk to save money. And it’s almost impossible to find a place to live, even if you can make the rent, because you can’t make the security deposit.
Stock options and 401(k)s? I had a coworker at Wal-Mart for whom buying a polo shirt on sale for $7 — a required part of the uniform — was out of the question. I drove in car pools to housecleaning jobs where a tollbooth presented a crisis: Would the boss reimburse us?
What struck me when I returned to my real life was how easy it felt. With money, things just happen. Need to get across town quickly? Take a cab. Don’t feel like cooking? Order takeout. The ease of it is miraculous. Maybe that’s why it’s so easy to ignore people who aren’t part of the miracle.
Barbara Ehrenreich writes for Time, Harper’s, and The Nation and is the author of 12 books. For Nickel and Dimed (Metropolitan Books, 2001), she took a series of minimum-wage jobs to understand daily life among the working poor.
John C. Bogle
Founder and former chairman
The Vanguard Group Inc.
Successful investing is less about doing things right than it is about not doing things wrong. And, hard as it is to believe, it’s a nice, even road — if you avoid the potholes.
One of the biggest potholes is letting emotions get in the way of economics. The tech bubble was one of the great manias of all time. We saw how easy it is to hype a stock — and how hard it is to increase the value of a company.
That doesn’t mean you should stop investing. Sure, there will be more scandals. But the biggest financial risk is not taking any risk at all. Be patient. Be more modest in your expectations. Maybe you got caught up in the bubble and made mistakes. You don’t have to keep making them.
John C. Bogle created the Vanguard Group in 1974 and served as chairman through 1997 and as senior chairman through 1999. His fourth book, Character Counts: The Creation and Building of the Vanguard Group (McGraw-Hill), was published this year.
President and COO
Assante Sports Management Group
Newport Beach, California
Contrary to what most people might believe, I do counsel players about when enough is enough. We talk about career goals, geographic preferences, the winning tradition of a franchise — all of which factor into a final deal.
I don’t expect the average fan to understand why a baseball player deserves millions of dollars a year. The challenge for them is to keep their priorities straight. That’s why Leigh Steinberg and I require the players we represent to give back time and money. More than 100 of our clients have set up scholarship funds. Shawn Green gives $250,000 a year to the Dodgers Dream Foundation, which builds and rehabilitates baseball fields around the Los Angeles area. Ivan Rodriguez of the Texas Rangers and his wife, Maribel, donates $100,000 a year to build fields around the Dallas – Fort Worth area.
Personally, my priorities got rejiggered a few years ago. I went through a near-death experience and was hospitalized for a month. That put money in perspective. This year, I’m taking a month off to spend time with my family. Five years ago, I couldn’t have conceived of that.
Jeffrey Moorad is considered one of the premier player agents in Major League Baseball. His clients include Pat Burrell, Darin Erstad, Luis Gonzalez, Manny Ramirez, C.C. Sabathia, and Mo Vaughn. Along with partner Leigh Steinberg, he has negotiated more than $3 billion worth of contracts.