November 28, 2022

Business Update Blog

When To Play The Status Game Again: Money, Fame, And Impact

Since 2012, I have tried really hard to stop playing the status game. After all, leaving my job in banking meant losing status.

After my career was over, I turned down multiple TV show appearances, podcast interviews, and speaking gigs. To be able to just do my own thing felt incredibly freeing. I wrote on Financial Samurai because I just wanted to write, not to gain fame. This is one of the reason why I don’t have an Instagram account or post many pictures.

Sure, due to my lack of status and publicity, few people credit me with kickstarting the modern-day FIRE movement in 2009. Nor have I ever won any awards. But that’s OK. As a minority, being ignored is something I’m used to. I’ve got my archive of posts and thats’s what matters.

Although it was jolting at first to be a nobody after 13 years of being a somebody, things got easier. Without status, I felt lighter. Without the desire for status, I could also do things for the pleasure of it, not for the accolades.

The joy of being a nobody became a way of life and I continued carefree until about 2019. Then something happened that made me realize I had better get some status back for the well-being of my family.

You Get Good At Having No Status

Just the other day while watching a tennis tournament, I had a 15-minute-long conversation with a fellow spectator at my private club. He was there as a guest, pitching coaches to sign up for his tennis app company.

During our “conversation,” I learned his name, his USTA rating, his record, how his doubles partner beat Cam Norrie 6-1, 6-1 in college, where he went to high school, where he played in college, his title, and the company he worked for.

He just went on and on about his accomplishments. My friend, who was sitting next to me, said, “Wow! You should be a true crimes detective! You were able to extract his life’s story without him asking you a single thing!”

“That’s the power of being a nobody!” I responded to my friend.

If the tennis app company guy had known I was a member of the club, seen my VIP sponsor pass (hidden in my pocket), and known I ran Financial Samurai, he might have asked me to introduce him to coaches and the president of the club. Then, he might have asked me to help promote his product online.

But by being a skilled nobody, I was able to control the conversation and maneuver back to focusing on the match when I wanted. This is exactly how I want things to be in the real world.

When The Need For Status Will Return

For seven years after renouncing my status as an investment banker, I thought I would never have to play the status game again. I wasn’t going to look for a new job nor was I going to start a company. Socially, I was already playing meetup softball and tennis at my club for 12 years.

Eventually, I wanted to return to Oahu and become a fruit farmer who would surf every morning and read a great book every afternoon. A simple life is all I wanted.

Then in 2019 everything changed. Shunning status turned from being a selfless act to a selfish act. No longer could I afford to be a nobody because now I had dependents.

See also  The Fear Of Spoiling Adult Children By Giving Them Money Is Overblown

Rejections Galore

Our rude awakening occurred when my son got rejected from six preschools in 2019 and in 2020. We thought we’d get into at least two of the schools. But out of pride, I didn’t ask for recommendations from alumni parents I knew.

For occupation on the application form, I wrote I was a local high school tennis coach. I thought being a fellow teacher would be looked upon positively. The high school I coached for was a school some of these preschoolers would ultimately like to attend.

Further, I didn’t apply for financial aid, which meant I wouldn’t be taking away resources from a needy family.

Getting into preschool in San Francisco is 90% due to parents and 10% due to the children. The admissions committee always looks up what the prospective parents do. Some schools have playdates to determine whether the kids are mature enough at 2.5-3-years-old. But so long as the kid isn’t doing something terrible, the evaluation process isn’t that meaningful.

Admissions committees want parents to be techies, doctors, lawyers, bankers, or entrepreneurs. These are occupations with high status. They want parents with LinkedIn profiles. By admitting families with status, such schools increase their chances for future donations and quality referrals.

When The Need For Status Became Crystal Clear

Getting rejected from six preschools wasn’t the end of the world because we ultimately got into one. But the main reason why we got into our neighborhood preschool was due to luck.

For one year, we kept running into a preschool teacher at our son’s school every week at the California Academy of Sciences. Eventually, we built up a relationship and he referred us to the admissions director, who was his wife!

Today, the preschool has a two-year waiting list.

What crystallized the need for status as a parent was when my friend applied to preschools. I was giving him feedback and tips on the various schools to help him navigate through the cumbersome process.

Instead of getting into three out of six schools, as I had forecasted, he got into all the schools because of my great counseling! Not. Rather, he got in everywhere because he has high status.

If each school has a 5% acceptance rate, getting into all six is practically impossible. Further, a couple of the schools even have lottery systems, which are supposedly used to make admissions 100% unbiased.

But when these lottery winners all tend to be extremely wealthy with high status, it’s clear the lottery system is rigged. The admissions directors will manually move you up the lottery board if they find out you are rich and powerful.

Being Rich Is Only One Part Of Having High Status

The rich continue to play the status game because there are plenty of rich people. There are literally millions of millionaires! Roughly 35% of Financial Samurai readers are millionaires compared to just 8% of Americans.

These preschools can fill their classrooms 10X over with kids of rich parents. Therefore, being rich is no longer good enough for getting your toddler into school. You’ve got to be rich and have a “positive impact” in the world. Sadly, being a high school tennis teacher didn’t cut it.

“Positive impact” is subjective. You could be seen as having a positive impact by being a VP at a sugary drinks company that contributes to the diabetes epidemic. You could also be seen as having a positive impact by being a Director at a company that gets kids hooked on social media.

What’s most important for status is that you are searchable online. The more positive references about you there are online, the higher status you will achieve. Because it’s one thing to tell the world how great you are. It’s another thing when someone else tells how great you are.

See also  Buyer Finance Applications Key to Growing Gross sales

Parents Need To Care More About Who They Are

No matter what path a parent takes, it’s easy to worry about whether we are doing enough to support our children. Every parent wants to provide the most amount of opportunity possible for their children to find purpose and happiness.

For the longest time, one of my biggest worries was whether I was too lackadaisical about my attitude on status and prestige. I haven’t cared about titles or where one works for a long time. Hearing parents talk about their promotions during playdates makes me chuckle inside.

I also no longer think where you go to college matters. After all, everything can be learned online for free or at a low cost. You can spend $20 bucks and read an incredible book about any subject matter.

In fact, I question why a college education still takes four years to complete and costs so much when the internet has accelerated learning and lowered prices.

My Views On Status Have Changed With More Exposure

But now that I’ve gone to dozens of playdates, I realize I need to change my views on status. As a parent, I’m sucked back into the real world of commuting during rush hour and socializing with other parents who are mostly working. Too bad there is no status for not having to work.  

As kids grow older, they need status more because that’s mainly all they have in school. They want to be perceived as smart, athletic, talented, charismatic, and popular. Kids also want to be proud of what their parents do.

If parents don’t play the status game, they end up lowering their child’s status in school. If their child’s status is too low, he or she might get picked on or bullied by other children. They might also get left out of birthday parties and other social events for not having enough status. How shallow and sad! 

The desire for status is one of the reasons why there is so much anxiety in middle school and high school. If parents can at least not embarrass their kids by not driving them to school in a beater, dressing well, staying fit, and staying out of sight when friends are around, we might make our kids proud of us.

Related: How To Convince People You Are Middle Class When You’re Actually Rich

Ideal Level Of Status To Have

After getting rejected by six out of seven preschools, my wife and I are forced to elevate our status to a “minimum acceptable level” so our family is not shunned by society. On a scale of 0-10, with 0 being no status, we’ve decided to elevate ourselves to a 5 from a 2. 

I believe anywhere between a 4-to-7 out of 10 on the status scale is ideal. If your status gets to an 8-10, you’ll constantly be asked to give money and speak. Then you’ll have to constantly acquiesce or have to tell people no, which never feels good. 

The main goal is to have enough status where you and your family aren’t precluded from any opportunities. 

Minimum Acceptable Level Of Status Regained! 

My wife and I don’t wish to say we are investors for our occupations, otherwise, people would assume we have money. So I found a solution.

I now just tell parents who inquire what I do that I’m an author. And if they dig further, I’ll tell them about Buy This, Not That. And if they dig even further, I’ll say that it is a Wall Street Journal bestseller. For those parents who dig this far, I can see their eyes light up. 

See also  Decisions in Finance Schooling

Status unlocked! 

Though most authors make a low income, which is exactly what I want people to know, parents are hard-pressed to meet published authors in the wild. After all, less than 3% of writers are able to land a book deal with a publisher. Therefore, authors who actually have their books in bookstores are somewhat of a unicorn. 

Further, educators are respected members of society, especially those who live in expensive cities. There’s non-stop media coverage about a housing affordability crisis in San Francisco. As a result, if you are a writer, artist, musician, or teacher, society tends to root for you. 

Don’t Want To Be Respected For Being Rich

You don’t want to be respected for being rich. If you are respected for being rich, you attract people who just want a piece of your money. They are mostly money-worshippers and shoulder-steppers who just want to get ahead.

In fact, there comes a point where society starts to despise you for being too rich. Why are you hoarding a billion dollars when you could shelter all the homeless in your city? Why not be more like Mackenzie Scott, actively and rapidly giving away her billions? There are obvious, urgent problems today that could use support now, not after we are gone. 

Instead of being known as rich, you would rather be respected for making a positive contribution to society. Of course, becoming rich is often a result of making a positive impact. But people forget or have a hard time distinguishing this correlation if you get too rich. 

Patagonia founder, Yvon Chouinard once said, “I was in Forbes magazine listed as a billionaire, which really, really pissed me off,” he said. “I don’t have $1 billion in the bank. I don’t drive Lexuses.”

Mr. Chouinard lived true to his values and donated his family’s entire ~$3 billion stake in Patagonia to charity in September 2022. 

May We One Day Be Free From Caring What Others Think

The ultimate goal is to transcend the need for status because you no longer care what other people think. You’re good just the way you are. Everything you wear, drive, say, and do is true to your values. Of course, this is much easier said than done because all of us want to have at least a little bit of status and respect. 

However, once you have children, you will ultimately have to come back to the center in order to give them opportunities. The only way out of the status game may be to homeschool your children. But even then, there are still after-school activities with other families. 

Eventually, our children will develop strong enough identities to lead independent lives. Their need to tell the world where they went to school, how much they make, or how fabulous their lives are over social media will fade. 

But if my observations are correct, it may take decades to figure out how much status is truly enough. And even then, the status amount required is forever changing, similar to the safe withdrawal rate one needs in retirement. 

Readers, how is your relationship with status? What do you think is the ideal amount of status on a scale of 1-10 and why? Is it possible to stop playing the status game as parents? 

For more nuanced personal finance content, join 50,000+ others and sign up for the free Financial Samurai newsletter. Financial Samurai is one of the largest independently-owned personal finance sites that started in 2009.