‘It Was Funny to Write the IRS a Check That Was Bigger Than One Year’s Salary’

LS: Okay, Blair White, which is the not your actual name but a name I made up for you. You reached out to talk about your money, which I am so thankful for, and I’m actually going to print part of your email because I liked it so much:

I’m 30 and have a lot of money at my disposal (As in a few million dollars? For some reason the question mark makes me feel less weird writing that). The vast majority is not technically in a trust (it’s all in my name in various accounts), but I sure didn’t earn it! Most of my money is from my dad and available to me, but I do have an official trust fund from my grandparents as well (for which my dad is trustee).

Tell me more about your money.

BW: I always knew that my family was wealthy, ever since the concept of wealth became clear to me. When I was 12 or 13 my dad set me up with an UGMA (which is basically an account in my name that I’d get full access to at 18) and I started buying stocks. At that time I thought I wanted to go into finance, so this was a way for me to learn about it. I bought AOL and the stock shot up and I thought I was a genius!

I also knew I had some sort of trust from my grandparents, but I didn’t know how big it was. When I was 23 or 24 my dad told me I had other money in my name. We were at a restaurant, my mom was in the bathroom, and he told me the dollar number and it was strange.

At that point I knew I had about $500K in trust, and I knew he had invested other money in my name, but I didn’t know it was in the low millions (I don’t remember the actual number at that point).

LS: What was it like to hear that?

BW: It was really hard to wrap my head around it, so for a few years I tried to not really think about it. I thought of the person with money as Virtual Me (that was it I actually called it) and the real me, who had a full time job and was making pretty good money for someone right out of college. I mean it was exciting to think that I was rich, but I didn’t really want to think about it too much, it seemed too crazy.

Basically, there was Blair and Virtual Blair, and the two were different.

LS: So the $500K you knew about was part of Virtual BLair — did you have access to any of the money?

BW: Yes, I had full access to the roughly $2M. It was in various accounts in my name, without any of the limitations of a traditional trust.

LS: It sounds like when you found out about it though, you weren’t wanting for anything — you already had a good job, and no school loans?

BW: Yes. I’m very fortunate that my parents paid for school, and I had a good job. I also am not a super big spender, so I only used it to pay taxes at first. Even though I had a salaried job at around $50K/year, I had to pay the government $60K in addition to what they withheld. I am all for being taxed a lot (I think my taxes should probably go up), but it was funny to write checks that were bigger than a year’s salary.

A few years later I bought a one bedroom apartment, though.

LS: So when your dad told you about the money — did he say how he had intended for it to be used, or how your grandparents had intended it to be used? Did he give you limitations?

BW: My grandparents wanted that money to be spent on education and/or housing. That was made clear. But my dad never said what I should or shouldn’t buy. I think he’s always trusted me with money. I don’t know what I did to earn his trust, but it’s nice to have. And by trust I mean his feeling, not trust fund.

LS: I’m interested in 12-year-old you wanting to go into finance!

BW: Ha! I think I just wanted to be like my dad, because he’s in finance. So it was more me wanting to be like him than anything else. I was just then finding out about the power of wealth, and that interested me. I grew up in a town that was only just becoming the wildly affluent place it is today. I remember having a new middle school friend over for a play date. I thought it went well, but the next day everyone called me Rich Bitch and basically ignored me for a couple of weeks.

So I was trying to figure out what wealth meant, how my house (which is really nice but nothing that shocking) could turn people against me. I don’t mean this as a poor me story, but it was the first time I was really like, huh. Money is weird.

After that I made some pretentious statements about how I didn’t care about money or material things, because they didn’t matter. But then my mom gently pointed out that only rich people can afford to not care about money, which made a lot of sense even then.

So basically, I was super confused.

LS: Your mom is really insightful.

BW: Yes! She’s much more emotional about money because she didn’t really have any growing up, but she has some good insights.

LS: What did you end up studying and doing for work?

BW: I studied history, and then worked in marketing for about 4 years. Now I’m in the middle of an MFA and I also teach.

LS: What kind of financial situation are your friends in, compared to you? Do you talk about it?

BW: One thing that makes me really uncomfortable is how many of my friends do have trust funds or other money. A lot of them don’t, but several of them do. I think about why that is a lot. Some I met in fancy school, so that makes sense. But others I met through work, and maybe it’s just a coincidence?

But I do have two really close friends in a similar situation, and it’s been super helpful to talk with them about how to approach having so much money. Things like to get a prenup? What sort of car does it make sense to buy? What about hiring house cleaners? etc.

That sound ridiculous, I realize. But it’s true. When you don’t have normal financial limitations decisions become tricky. And I don’t mean difficult, I just mean that even without budgetary constraints, you have to make decisions about what’s a reasonable amount of money to spend for what. It’s not actually a difficult decision, just one that requires a modicum of thought.

LS: Do you still think of your money as two different pots, real and virtual, usable and not usable?

BW: Since I currently receive a stipend of $16K for teaching, I’ve been using more of the money from my parents. I’d say I still live as if I’m making $55K, so I supplement.

LS: So do you give yourself an “allowance,” or just spend and let it flow over?

BW: I should give myself an allowance, or have a budget but I don’t. I just spend and sort of refill my bank account as necessary. I am going to make a budget, soon! My husband is going to help me.

LS: Tell me about your husband. When did you tell him about the money?

BW: He’s always known that my family is wealthy, and I think I told him the dollar number a year or two after my dad told me. We were pretty serious at that point, though. Right after we met he gave me a ride to a private plane! It was before the recession. But still. Ridiculous.

LS: Does his family have money?

BW: No. But he’s been really level headed about this whole thing. Although my family is really liberal, I grew up with this model as man as bread winner. So I’ve had some completely low moments worrying about whether he’d earn enough money. Granted, this was when I was on a career path that was making me miserable, and he was pursuing a creative life. But it was ugly, and I was really ugly and hurtful.

He, however, is brilliant at managing and saving money and living a fun, frugal life. So we’re really good for one another. And we have lots of conversations about our financial approach. It just took me a while to think of our financial interests as one.

LS: Did you have a prenup?

BW: Almost! My parents, well, my dad, wanted me to get one, so I found a lawyer. He had to hire a lawyer, too, and in those initial phone calls it was made clear that the process wasn’t this sensible document, as had been suggested to me, but rather something that would be contentious from the start. So we don’t have one, but we also don’t have joint accounts. One of my rich friends has one, one doesn’t. Honestly, I think there’s more pressure if you’re a woman with money.

LS: Was your dad upset?

BW: No. He was ultimately supportive. I got super, duper upset after those calls with the lawyer, so I think he saw how much it mattered to me. Also, interestingly, at first he said I didn’t need one and then he got a new lawyer, so I think the whole thing came from someone else to begin with.

LS: Do you and your husband split expenses equally?

BW: Yes, for the most part. Sometimes I’ll feel like going out to a nice dinner and I’ll pick up the tab. He’s more conservative with spending money, and worries more.

It’s weird for both of us that I’ve never had to worry about money, that I can’t fully understand what that’s like.

LS: Do you feel like the money you have is enough that you don’t have to worry about retirement? Do you talk about taking time off and traveling, or have you done that?

BW: Since we’re both trying to pursue an artistic life, and are likely to never make money doing so, I now view my money as a sort of arts endowment. My life plan is to try and make the arts thing happen, while teaching or finding other parttime employment, and supplementing with my other money. The goal is to live fairly frugally so I can pursue art.

Basically, I feel as if I won the lottery. In thinking of how to spend a life, I think art is important (which is not to say that my own art is important, but rather culture needs art).

But I don’t worry about retirement. And traveling is important to me, so I will always pay for us to do that.

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