What is stealth wealth? Stealth wealth is the desire to conceal your net worth from others. While some millionaires like to flaunt their riches, others do their best to hide it.
Why would someone want to hide their wealth? That’s an interesting question. Ask a wealthy individual why they practice stealth wealth, and they’ll most likely talk about preserving their assets.
They may also rattle off a list of rich people’s problems. Here are a few:
- Wealthy individuals face more lawsuits.
- Contractors and businesses charge higher prices.
- They can’t distinguish real friends from fake ones.
Have you heard these reasons? They all focus on the need for wealthy individuals to protect their money. The premise is that you’ll be a bigger target if people know how much you’re worth.
Are These Assumptions Accurate?
As a millionaire myself, I don’t believe this list is entirely accurate. Here’s why:
- The average person isn’t getting sued for tremendous amounts of money. If they do, umbrella insurance can mitigate most lawsuit fears.
- Contractors and businesses may charge higher prices, but you can easily shop around for better deals.
- Ordinary people don’t cling to the coattails of wealthy individuals. Fake friends may be a problem for celebrities, but this isn’t likely to happen to the millionaires that live next door to you.
Money is a Detractor, Not a Magnet
Contrary to popular belief, money is not a magnet for friends, relatives, or acquaintances. In real life, it often acts as a repellant. It’s easy to feel jealous, angry, disgruntled, or just plain annoyed by those who have a lot more money than you do.
People tend to tense up around financial conversations and public displays of wealth. They don’t clutch on to the people talking about their fortunes. Instead, they run from them.
That doesn’t mean stealth wealth isn’t important. It just means the standard list of reasons might not be applicable.
In my opinion, the real reason for stealth wealth isn’t to protect your assets. It’s to protect the feelings and perceptions of those around you.
The Benefits of Stealth Wealth
When I first graduated from college, I worked for a successful financial institution with substantial perks and benefits.
In the beginning, friends and relatives would ask questions about my job. How was the company stock performing? How many days of vacation did I receive? When did I expect to receive my next big bonus?
After a few years, I began working from home several days a week and took the opportunity to work from our beach house. Close relatives started making snarky comments, and jealousy began to rear its ugly head.
Success is tricky. We can cheer for those aiming to succeed and still feel jealous when they reach the pinnacles of success. We can applaud those who attain more, then quickly feel like they already have more than enough. Comparison is the thief of joy and misery loves company. It was easier for people to feel angered by our success than feel happy for us.
Do you know what happens when you become successful? Some people begin to compare their success to your own, which can lead to complicated feelings and severe jealousy.
By practicing stealth wealth, I shield myself from those negative emotions, but I also protect my friends and relatives from feeling them. Why create emotional turmoil where it doesn’t need to exist? There are many benefits to being secretly rich, but preventing jealousy, anger, and sadness may be the most important.
Leaving the Door Open for Honest Conversations
I’ve written before about the negative aspects of being rich. It’s easy to judge others based on how much they have and earn. In many circles, rich is a dirty word.
In the United States, the gap between rich and poor is continually growing. I recognized this early on in my career.
As my earning power grew, I became more aware of my wealth’s privileges. In the beginning, I lost friendships over my newfound wealth and created unnecessary family tensions too.
Practicing stealth wealth allows me to fit in just about anywhere I go. When I sit on the beach, no one knows I own or buy real estate on the coast. Most beachgoers assume I rent a home just like they do.
As a former small business owner, I can talk easily with a neighbor who owns her own plumbing company. Answering the door in jeans and a t-shirt, I can also chat easily with a plumber who comes to fix a leak in my home.
Stealth Wealth is More Difficult Than You Might Imagine
My family members don’t know about my blog. They don’t know I’m worth millions of dollars either. I’ve been writing here for over 15 years, and I’ve never told them about the money my husband and I saved. Most of my friends don’t know either.
To practice stealth wealth, you can’t let anyone know how much you earn or how much you’ve stashed away. Unlike some millionaires, I’m not the kind of person who likes to flaunt my money.
In general, I prefer to blend into the background rather than come into the spotlight. For me, modesty and financial success fit hand-in-hand.
Stealth Wealth Signs
Some people say it’s easy to hide your wealth with a stealth wealth lifestyle. To look like the quintessential millionaire next door, you shouldn’t wear expensive clothes, drive luxury cars, or choose the biggest house on the block, but material possessions aren’t the only signs of success.
What other status symbols exist? How about expensive vacations, trips, and experiences?
To practice stealth wealth, you must hide your material possessions and refrain from talking about expensive adventures and experiences. It’s easy to spot stealth wealth when you talk about traveling around the globe. Social media images of trendy hot spots are just as flashy as fancy cars and big houses, and expensive activities, projects, and events can accidentally blow your stealth wealth cover.
How to Spot Stealth Wealth
Even if you try to hide your wealth, your profession may provide clues. It’s easy to Google for the salaries of doctors, lawyers, and engineers. It takes a few short clicks on a web browser to estimate the average pay rate for most careers.
In reality, most jobs have rather large pay ranges. Imagine a software engineer earning between $50,000 and $200,000 per year. No one knows if you are at the top or bottom for your selected profession, but that fact doesn’t matter. Many people will hear your job title and assume you make six figures, not a middle-class salary.
Now I know what you’re thinking. Just because you earn a high salary doesn’t mean you’re wealthy. Student loan debt and poor spending habits can eat away at high wages, but the average person doesn’t consider that when judging your financial success. To them, the job title indicates wealth.
The ability to attain stealth wealth depends partly on what you do for a living. A doctor or engineer will have a more difficult time hiding their wealth than a teacher or social worker.
I am a stay-at-home parent living just outside of an expensive city. Where I live, a 1600 square foot house costs $750,000. The cost of living is so high that most families require two working parents to pay the mortgage.
I can wear t-shirts, jeans, and drive an old stealth wealth car, but the minute I tell someone I stay at home, they assume my husband earns a lot of money.
Hiding Wealth From Your Friends
Exotic trips and pricey excursions also make stealth wealth difficult to pull off. I rarely discuss my beach house with others, but even new friends and neighbors begin to wonder why we travel out of state multiple times a year.
Hiding wealth from your friends isn’t easy when you leave town for a month and come back with a dark, I’ve been in the sun for days, tan.
I often say our beach house is a “family home.” Some new friends may assume it belongs to my parents or in-laws, but subsequent questions usually follow.
“Does your family rent the house?” they’ll ask. “Would they rent it to me?”
At this point, I tell them the truth. “My husband and I bought it years ago,” I say.
Some proponents of stealth wealth condone lying, but I don’t wish to cover up my wealth that way. As I mentioned above, practicing stealth wealth leads to more genuine and honest conversations, and I can’t be genuine if I cover up the truth.
Should I Share My Financial Knowledge?
Proponents of stealth wealth often avoid the topic of money. Many rich people think you should lie about your wealth or pretend you don’t know anything about financial matters.
I’m afraid I have to disagree. It feels selfish to hold back on financial wisdom that could help others become wealthy. I talk openly about money, while leaving out personal facts and figures.
My husband and I recently talked to a friend about buying her first house. We openly shared the thought processes behind fifteen-year mortgages, bi-weekly payments, and using bonuses to pay off balances. Then we discussed the importance of balancing saving goals like investing in the market while paying down her first home.
We didn’t jump in with our ideas. Instead, we let the conversation flow freely into these topics. We discussed all of these matters in general terms. Of course, this may blow our cover, but we don’t intend to keep all of our financial knowledge to ourselves.
I’m not willing to keep these financial details to myself in the name of stealth wealth. We didn’t mention the price of our home or that we are mortgage-free, but we provided a ton of helpful information.
To hold back feels selfish and stingy. Being secretly rich isn’t about hiding the keys to becoming wealthy; it’s about finding ways to share them.
Stealth Wealth Leads to Real Wealth
We also talk to others about the lure of consumerism, including advertisements and lifestyle inflation. It’s easier for some to part with their hard-earned money than save it. The fewer status symbols you feel pressured to purchase, the more money you can stow away.
We don’t discuss our net worth, but we talk a lot about how content we feel. A rich life isn’t just about having a bunch of money in the bank. It’s about being rich in other ways too.
I could keep these keys to success to myself, but I want to share my knowledge with those who are open to receiving it. I want to teach others to save money, build wealth, and become financially independent.
Embrace Stealth Wealth
Some people may feel the need to hide behind stealth wealth, but most of us aren’t intentionally hiding anything at all. We aren’t purposefully avoiding the purchase of fancy stuff. We just don’t feel the need to buy much of it.
My husband and I prefer cooking at home to eating in fancy restaurants. We choose backyard barbecues over hosting meals on fine china. We avoid lifestyle inflation and aim to be true to ourselves. We can blend in with our neighbors by living simply with less.
That is until we head out of town. If we’re gone for a while, at least a few friends and neighbors will notice and ask where we’ve been. The average family can’t afford to spend a month away from home.
We could hide the truth or openly enjoy our money and tell people we were away on vacation.
Since my household is just starting on the path to FI, we don’t yet have much experience of dealing with stealth wealth.
Yet we do have the parallel of being tactful with our lifestyle.
We’re not hiding anything, we just choose our boundaries and choose to not volunteer information as appropriate.
For instance, our family knows that my dearheart wears a collar instead of a wedding ring.
They don’t dig, and we only answer in vague terms that we practise different traditions.
I’ve seen keeping secrets wear on friends’ lives.
There’s something to be said for being able to live in the open. 🙂
I love that you’ve been able to set up boundaries like that with your family. It’s easy for the lines to blur on those differences.
I hadn’t considered the added stress of hiding wealth. I’ve seen secrets destroy friend’s lives, but for some reason, I never thought of stealth wealth that way. But your right. Buying less because it fits your lifestyle is natural and honest. While purposefully hiding your wealth could come with unintended emotional turmoil.
Sometimes you can’t hide having money. I ran the largest company in our part of the state. I was on and in the news frequently so everyone assumes I am rich, and by most people’s standards we are. But I didn’t have any problems with others wanting anything. And we live modestly, we drive used cars, my wife’s is a 2006, still live in our first house we bought 40 years ago. I did retire slightly early and she was a stay at home mom. So we live like stealthers, but everyone knows we’ve got money anyway. But it hasn’t been a problem, we aren’t snooty, flashy people so we rarely rub people the wrong way.
I’m sure stealth wealth works for many people, but that’s a perfect example of where it doesn’t work. We live frugally and are very mindful with our money, but the people who know us know we have money. They don’t know how much, but they know we have a decent amount. I can’t be a stay-at-home parent with a beach house without some money in the bank. Thanks for the comment.
I haven’t read anything, before this post, about stealthy wealth but I find it fascinating. Thank you for sharing.
Perhaps there are a bunch of people around me who are practicing stealthy wealth but from the handful of frank conversations I’ve had with family and close friends, I doubt it.
This topic does remind me a lot of the book, Millionaire Next Door. Maybe I should see if my neighbors are practicing stealthy wealth!
The Millionaire Next Door was the first book that I read discussing the idea. Having a high income doesn’t correlate to having a lot of money, but it’s certainly a more likely scenario than having a low salary and having a bank full of savings. You are right though, most people struggle with money, so there probably aren’t too many lurking out there compared to the general population.
I enjoyed reading this. Thanks for writing this post!
Thank you for your comment.
One of my biggest fears about retiring early is that people would KNOW. There have been a few instances where people seemed a little resentful, but honestly, I make excuses for it. I tell people that my job was stressful and that I needed a break. That retiring from my company allowed me to choose who would be taking care of my clients, and I think I’ll just be a stay at home mom for a while. All of that is absolutely true, I just imply that I will go back to work, which probably won’t happen.
The cost of living where we are is pretty low, and you don’t have to have a high earning job to have a stay at home spouse. Lots of people here do. We drive ordinary cars, and don’t live a flashy lifestyle except for travel. I don’t know that people think very much about it. I once accidentally disclosed that we didn’t have a mortgage to some friends. It was a little awkward.
It’s interesting that you feel the need to defend your choice to retire early. I felt the same way about becoming a stay-at-home mom. I used to explain that I’d been laid off, but I failed to say that I interviewed for a new job and then turned it down so I could stay home with my son. It was simply an easier, more relatable story to tell. It’s all true, I just left out some of the details. I don’t tell people that anymore though. I’ve been home long enough now that I tell the full truth if I’m asked.
I’m sure it’s easier to practice stealth wealth in a low-cost area. Actually I should’ve written about that. In some places it’s certainly easier to hide in plain sight than others!
I retired early. My home is modest, but in a nice area. I take frequent mini vacations. I quietly splurge on some experiences. Most this is just what I’m comfortable with.
I tell one falsehood… I pretend to work, from home. This dispels the idea that I’m sitting on a pile of cash and “unearned” income”.
The reasons for this stealth wealth are: To be less of a target for lawsuits, people wanting loans, and scammers. Yes, I worry about being overcharged too. It makes people respect my schedule ( Friends won’t assume I’m always free, without notice, to do something). It allows me a polite way to decline certain invitations…”sorry, I have a project deadline, I’ll be working all that day”.
I very much want to spare less fortunate friends from feeling bad by flaunting my wealth. Lastly, I want to be treated as an average member of my social circle.
Hi Fred, I appreciate your comment. How do you feel about telling people you work from home when you don’t. Does it bother you? I always feel guilty when I omit details and find myself doing that less often as I age.
I don’t know how I’ll share if we manage to retire early because I keep everything about our finances under wraps mostly. There are a few friends I grew up with who I share with pretty honestly but they’re the exception to the rule. On my side of the family it’s because it’s much easier to say I won’t support my con artist biofather any longer because I need the money for my own family. If we had the money to retire, I would feel pressure to support him again because we “could”. I don’t have any intention of going back down that destructive path and it’s easier to say it’s because we can’t rather than we won’t. It’s a bit absurd considering he bled me dry for nearly 20 years. And yet.
I know some folks assume we’re rich because we can “afford” a loan in this area. I think that’s a very flawed way to assess wealth but it’s been expressed before. I just shrug and say we make a lot of compromises to make it work, because we do. Again, it’s being vague about the fact that we compromise on a lot of things to afford this AND to afford our aspirations of an early retirement.
Along the way I’ve been able to coach friends in negotiating for higher salaries and promotions, and if asked I’m happy to offer my insights on money management but most people don’t ask and I don’t offer unsolicited advice. I figure the people who would trust me and that I’d feel comfortable helping know to ask me if they want information to act on.
I can completely understand why you don’t want to share the details of your finances with your family. My parents have a general idea of our finances, but they definitely don’t know all the facts.
It’s crazy how people connect wealth to possessions, when most of us have to take out big mortgages or credit cards to pay for that stuff. We had an enormous mortgage on our beach house, but because we owned a beach house everyone assumed we were rich. It’s so easy to confuse income with wealth.
That’s an interesting point you raise about trust and advice. We must be rather trusting, because when topics pop up we are often asked for advice 😉 It sounds like you are taking a smart approach.
I can really relate to your post! You must be rather “trusted” — and so people ask for your advice. We are in our mid-50’s, and I retired in 2019, and my husband plans to retire in 2021. We have been working on our plan for many years, saving and spending wisely, paying down all of our debt. What really blows me away, is when family or friends find out that we are about to retire, and they just can’t fathom it. We don’t share our specific financial details, but I tell them that if they are interested in how we did it, I can point them in the right direction— books to read, blogs to follow. For the most part, people just seem overwhelmed, and they don’t really want to change whatever they are doing with their lifestyle or savings rate or investment style. I am very happy, though, that our children (both in their late 20’s), are completely onboard with frugal living, saving, and investing wisely. Being able to sock money away early is perhaps the most potent thing that one can do if they want to retire comfortably. But it is never too late! I feel lucky that I like numbers and can rationally deal with the finances. For many, finances are a source of emotional distress. Thank you for your wisdom and honesty!
We are rather “trusted.” 😉 What a great idea to point people in a specific direction by suggesting blogs and books to read. That’s a great suggestion. It’s a way to say, “I’ve thought about x, y, or z and here is what I read about it.” I love that approach and it’s something I will consider from now on. I think you are right about people following your advice though. It’s difficult to make changes unless you are 100% onboard with creating new goals for yourself. My husband and I often talk to couples who are in bad financial situations that could be altered with a little work, but despite our best advice they don’t change any of their ways. It’s unfortunate to see them suffering. A few small tweaks would make a world a difference to their financial situation and distress.
Great job teaching your children too. My kids are only 5 and 9, but we are constantly trying to impart the lessons that can help them achieve stealth wealth.
“Close relatives began making snarky comments, and jealousy began to rear its ugly head.”
I’m sorry that you had to go through this. I’ve experienced some of the same behavior from close relatives. It’s really sad when relatives you love have to feel like they must cut you down when you’re really just working your hardest to provide for yourself and immediate family.
Hi Curt,
Jealousy is tough. It’s an emotion that can be difficult to control. I understand the feelings, but I wish we could have talked about it differently together. I started saving on a very small salary and didn’t get to this point overnight. I would like to tell them about my journey and how they could benefit from some of the things I’ve learned, but we can’t have an open conversation to share those details. I try to share stories about successful friends. That seems to work some, but if I told them about my stories I know they would shut them out.
I do feel funny about telling people I work from home when I don’t. Still, I feel this has saved me many headaches. I’m not a rich early retiree, I work from home. It has saved me from a few of the issues your other commenters have mentioned. Otherwise, I only speak the truth.
I think a lot of people would do the same in your shoes. I wonder what my husband will say when he decides to become an early retiree in a few years.
It’s amazing to me that people hide the fact that they’re worth millions. I live in an apartment building and just found out through the grapevine that the woman who lives next to me is massively rich. Her car is old, and her apartment is smaller than mine. I don’t understand living life as if you’re working or middle class when you’re anything but that. If I was rich I’d buy a big house and have a nicer car. I’d buy all the guitars and musical equipment I wanted, and would have a music studio in my home. I’d buy expensive clothes, and have a maid. The reason you folks don’t want us to know you are rich af is because you’re afraid we’ll ask you for money. And I would. I’d ask for a mere $100,000 to make my retirement easier, rather than working my whole life with little to show for it. You correctly assume that people like me resent your stealth. Maybe if you shared the wealth you’d feel better!