Get a job at AmaGooBookSoft. Execute competently, getting the standard bonus and equity packages. Continue for 10 years. Congrats, you're a millionaire. [This was even easier for folks who joined Google / Facebook between the times when they were clearly unstoppable juggernauts and when they IPOed.]
Start a boutique consultancy with a buddy. Hire up until you get to ~8 employees. Continue for 10 years. Congrats, you're a millionaire.
Everyone knows the management consulting / investment banking career path, right? Congrats, you're a millionaire.
Go to med school. Specialize in whatever the high-demand fields are, like e.g. anesthesiology. Execute competently for 10 years. Congrats, you're a millionaire.
Yes. Within the first four years, a million dollars will have flowed through your bank account. By 10 years, somebody with a rudimentary ability to save money and a disinclination to purchase sailboats or lease BMWs should have a million dollar net worth after taxes.
It's a really good time to in history to know how to program computers.
You don't need a $250k salary to save $1mio in 10 years.
My rudimentary calculation shows you need to save ~50k in the first year, get 4% raises, keep expenses constant, and get a 5% return. Bonuses, options, etc are on top of that. Also, you could get step-raises in the middle for bigger promotions. And, you could marry someone doing the same thing and get there faster.
Or one can choose to believe actual data (see: published Visa related salary info, various government surveys, etc.), which indicates the average salary for these companies is somewhere around $150k (give or take). Sure, throw in bonuses and equity grants and some employees might top $200k regularly. Some very high performers are also going to regularly break $250k. I doubt anybody would debate that.
Let's assume the "big" guys (Google, Facebook, etc.) regularly pay average total compensation around $250k, so that patio11's remark is correct. So what? As many employees as they employ, they represent a small fraction of the number of people who are very well qualified programmers and engineers. Their salaries are by no means common. The market is good, but it's not that good.
You might have to live in the heart of the housing bubble to get that salary. A colleague who was very gifted at JavaScript was offered a job at Google but he was coming out behind after the increased living expenses.
So here is a simple idea. If you're going to work 80h/week anyway and you're a talented coder: source one contract job billing hourly in London and another in SF. Working out of EST you work 5AM-9PM on a 10-6 in both places -- Billing $80/hr with a good corporate setup and working 4000 hours/year you can get 320,000/year, if you have EU citizenship (potentially from one of the return countries) and US citizenship you can probably setup a decent double irish and keep about 280,000+ of that in offshore money. If you want the money in the US and are clever about it you can keep over 250,000 of that money. I suggest London and SF because the 8h timezone difference and high cost of living in both cities. But to give you an idea this is basically $2.5M after-tax locked in the time it takes to make a 10 year exit. That's 1/4 of the first example and way more than 25% of start-ups fail. Admittedly $2.5M isn't the kind of resources that lets you go after solving the biggest problems in the world, but it's pretty solid by developer standards. 1.8X is a good return for a venture capital fund and they have more favourable stock than employees or founders, so you have to think the average start-up return for founders, even enormously talented ones is far worse than that.
While I agree with the idea that working like crazy is likely to net more than a failed startup, a couple of comments:
> If you're going to work 80h/week anyway and you're a talented coder: source one contract job billing hourly in London and another in SF. Working out of EST you work 5AM-9PM on a 10-6 in both places -- Billing $80/hr with a good corporate setup and working 4000 hours/year you can get 320,000/year
I seriously doubt most people can produce 40 billable, quality architecture/programming hours a week, let alone 80 -- especially over a long period of time. Anyway 80/hour is way low for quality work as a consultant; 100 usd/hour should be a minimum. Target a more manageable 2300 hours a year (6 day work week or 5 long days) and invoice 230 000/year.
> if you have EU citizenship (potentially from one of the return countries) and US citizenship you can probably setup a decent double irish and keep about 280,000+ of that in offshore money.
Yeah, stealing (or tax evasion) is an easy way to get rich. If you want to break the law, you might want to look into smuggling or credit card fraud/skimming as well...
For a second issue, there is a certain perception that start-up founders can produce far more than 40 hours/week of quality architecture and programming. Founding a company involves believing in that at some level. I agree it's not in the category of most people, but neither is start-up founder. If you have a serious belief in your ability to do so, try working like crazy on 3 month contracts and see if you actually can. Over 3 months you're unlikely to burn out completely, and you can adjust your expectations of the kind of hours you're capable of accordingly.
Perhaps. But working 4000 hours a year, and producing 4000 billable hours a year, aren't the same thing. There's lots of "fluff" that goes into running a business. Sure, if you can show me someone that are able to produce quality code for 4000 hours a year, that'd be great. But sounds like the EA death marches to me. On the other hand those games, bugs and all, do rack in a tidy profit. So maybe I'm wrong, and you can throw shit at people for a year, and still have them come back for more shitty code the next year?
There is a very big difference between actually breaking the law and exploiting the fact that the law is poorly written, and doesn't properly account for a a variety of issues starting to be used by a sizeable portion of all US corporations.
Sure, if you're amoral but don't commit any crimes, you'll go free. If you're amoral, commit a crime and don't get caught, you'll also go free. There's a difference in the eyes of the law, but I don't think abusing the lack of efficient legislation gets you off the hook for doing wrong, though.
Extending this kind of reasoning leads to condoning such great corporate pioneers as Union Carbide and Dow Chemical (although I don't want to equate embezzling public money (via tax evasion) and killing and crippling people).
It does strike me as extremely short sighted when corporations that benefit immensely from government schooling, research etc go to such great lengths to dismantle the institutions that facilitate their access to skilled labour (among other things).
All that said, if you sneak away a million US or so, go for it. It makes no difference what any one individual does as such; I just wanted to demonstrate that I, at least, take issue with the idea that avoiding taxes should be considered on equal footing with launching a ground breaking technology company. I think the two are quite opposite, even if one might evolve into the other.
And I'm not saying that's what you said, the advice just seemed rather glaring in this context.
You may take issue with it, but it's a fact that a large number of very profitable companies have avoided hundreds of billions of dollars in taxes over recent years. Trying to shame an individual who wants to save a few hundred thousand for retirement is not only stupid, but inefficient.
Contrary to popular belief, not all tax evasion is created equal. A few hundred thousand by an individual is literally a rounding error to tax revenue. Take your tax crusade to Apple, Google, Amazon, Microsoft and the rest of the billion dollar club who are stealing your precious taxes by the hundreds of billions.
> A few hundred thousand by an individual is literally a rounding error to tax revenue.
Which is why I said: "All that said, if you sneak away a million US or so, go for it. It makes no difference what any one individual does as such(...)".
> (...) it's a fact that a large number of very profitable companies have avoided hundreds of billions of dollars in taxes over recent years. (...) Take your tax crusade to Apple, Google, Amazon, Microsoft and the rest of the billion dollar club who are stealing your precious taxes by the hundreds of billions.
Doing one does not preclude the other. If a company destroys wetlands by dumping chemical waste, that does not make it ok for an individual to destroy a small grove by doing the same.
What I probably failed to get across is that my main point is that I don't think it is OK to dodge taxes; I'm fully aware that pretty much anything any one individual does becomes a rounding error compared to what a big corporation does. But corporations are made up of people, and those people are guided by among other things prevailing sentiment. So the young whipper-snapper that starts out by dodging some taxes today, might think little of dodging billions in the capacity as CFO in thirty years.
Get a reasonably paying technical job at large firm and switch jobs every two or three years. Invest most of your disposable income: some in real estate, some in a broad equity fund, and some in a handful of technology stocks in fields you know something about.
For the majority of people who go this route instead of starting their own company, they will be better off economically in ten years time.
