The Money That Changed Everything Part 2 of 2
Financial Windfalls: 15 Stories of the Money That Changed Everything
Post From Topic Magazine
Sara Seager Astrophysicist and planetary scientist at MIT, in Cambridge, Massachusetts
HOW: A winner of the MacArthur “Genius” grant in 2013
SPENT ON: Childcare, household help
I had a major tragedy in my family in 2011, when my first husband died of cancer.
So I’m a single mom, and I’m working 60 hours a week. I’m out of the house quite a lot, plus I travel for work a lot. I spent through all my savings just so I could work.
When I got my MacArthur award in 2013, they asked, “What are you going to spend the money on?” I said, “I’m going to spend it all on household help so I can spend more time with my kids and more time on my job.”
If you have kids, or a person who relies solely on you, not only do you have to take care of them and want to spend time with them, but you have to make their breakfast and their lunch, if they’re really little. And then clean up after them. There’s this endless series of chores. I got tons of responses from people saying, “I can’t believe you said that,” because people won’t admit that. People don’t want to admit the price you pay for working.
In the first two years, I was just spending it. It may be inconceivable to spend that much money, but think about it: I’m going away on trips quite a lot; I’m paying my babysitters, who are very good family friends, to cover 24-7 when I’m gone; or I’m taking the family with me for a conference, and then we might tack on a few days for vacation. It’s a lot of money. That’s where it went, most of it.
Without the MacArthur money, all my time was spent thinking about household problems.
Once I became widowed, I was burning through cash like there was no tomorrow. Because I was having to get up and go to my job and be at work, get my work done, and come home.
You can’t have the job I have as a single mom without a lot of extra support. Maybe you have your parents living with you, or you happen to have extended family who live on your street, but you just cannot do this alone. [The MacArthur grant] didn’t change my life, it allowed me to keep doing what I was doing.
Without the MacArthur money, all my time was spent thinking about household problems, things I had to do. When you’re driving in your car, or you’re walking outside, or taking some time off, what are you thinking about? “I’ve got to get the laundry done.” Or, “I’ve got to get groceries.”
For most of the chemistry problems I work on, there’s no replacement for hard work, but moments of inspiration can come at the oddest times. They’ll come when I’m at the park watching the kids play, and my mind’s wandering and I solve a problem.
The MacArthur didn’t just free me from worrying about money, it allowed me to free up my time to dream, just to think.
—As told to Andy Wright
Jenny Wiegley Employment lawyer in San Jose, California
AMOUNT: Nearly $500,000
HOW: Mother’s estate
SPENT ON: Down payment on a house, funding husband’s business
Financially, I was not really in a good place in 2008. I was in my final year of graduate school. I had student loans for living expenses, but I was in Los Angeles, which is not a cheap place to live.
I was married, but my husband wasn’t making a ton, and we had a fair amount of expenses. Our rent was pretty high; we had car payments; we just always seemed to get ourselves into credit card debt because it always cost more to live than we were bringing in. We definitely had no savings of any kind. We each had a 401(k), but with very little in either of them. I was 28 and he was 29. I had also just had a baby.
My mom was a very, very frugal person her whole life. She was really maniacal about preparing for her retirement, which was ironic because she never got to retire. She got sick when she was 56, I think, and by the time they figured out that she had cancer, it was too late. There was no way she could be cured; it was mostly just treatment.
She was in treatment for just under three years. When she died, her estate was divided between my two brothers and me. But she had given me extra money because I had just enrolled in Cornell Law School, and we were preparing to move when she was diagnosed. I rerouted my life so I could help her and take care of her, and that’s why we were in L.A. I was at every doctor’s appointment; my brothers were off doing their own lives, and they weren’t involved.
My mom wanted to give me, before the estate was divided, a lump sum that would pay off my law-school tuition, which was around $168,000 at the time. She died in February of 2008, and I didn’t start liquidating the retirement accounts until after the fall of 2008, which was when the market crashed. So they all were worth a lot less.
Now we live in a house that’s worth $1.6 million, and I would never have owned a house, period, if I hadn’t gotten that money from my mom.
I didn’t actually take the lump sum and pay off law school, because the debt had a low interest rate that was set for 30 years. What we really wanted to do, because we had a baby, was buy a house. Because this was after the mortgage crisis, you had to have 20 percent down to buy a house.
I knew that my mom wanted me to own a house. She was very explicit about that, and we had even talked about her buying a place that we would all live in together before she died, which didn’t happen. So I felt like I had a responsibility to spend the money in a way that she would approve of. So we did that, we bought a house, and I never felt bad about that choice.
The house earned a lot of money. It gained a lot of equity while I lived in it, and then we put it into our current house, which has gained a lot of equity. Now we live in a house that’s worth $1.6 million, and I would never have owned a house, period, if I hadn’t gotten that money from my mom, because we never would have had a lump sum to put down, ever.
I tried to be really, really responsible with the rest of the money. I did dedicate probably about $50,000 or $60,000 of it to my husband as he tried to start a company, even though I knew that it was not going to succeed. It was an internet start-up, and they usually don’t. It was just really important to him, and it was like an investment in our relationship more than anything. It also meant that he was home a lot during that time.
My life philosophy is that when I die—if I’ve lived my life right—there won’t be a lot left over. It’s not that I don’t want to leave my kids anything. I intend to help them along the way in whatever way I can while I’m alive, which my mom did also do. But I want to actually use the money we have. You really don’t know how much time you have.
—As told to Andy Wright
THE EARLY INVESTOR:
Bill Wasik Deputy editor of the New York Times Magazine in New York City.
AMOUNT: About $100,000
HOW: Investment returns from 1999 to 2000
SPENT ON: Living expenses, peace of mind
When I got out of college in 1996, I didn't know what I wanted to do with my life. I wound up getting a low-level research job at a firm outside of Boston that made investments in start-up tech companies.
And one of the perks of the job was that you could make investments in companies the firm was investing in—up to $5,000 per firm, per investment—which was hilarious because I had zero money. Whatever I invested in I had to carve out of whatever it was I was making.
So I would siphon off $250 and invest it in this company, or $500 for that company. I was this 21-year-old researcher who was siphoning off rent and beer money to make my own little investments in these companies.
Three years later, I decided I wanted to do something more creative. I had enough money saved to move to New York to do an unpaid internship at a magazine. But then the weirdest thing happened: the year I was doing the unpaid internship happened to be the point at which a bunch of the investments that I had put $200 or $500 in suddenly started to pay off. So for a $300 investment, I would suddenly get $10,000 in stock. There was one time that I made a $500 investment that wound up becoming $50,000 in stock.
I was 25, and I made more money the year I was an unpaid intern than I had been making at the investment firm. The people around me were scrounging and making very little money, and I suddenly had cleared around $100,000 from these investments.
‘I feel like having this money, it was like I was a secret trust-fund kid.’
At the time I came to New York, everybody pretended they had the same amount of money. Even people who you knew or suspected were very wealthy would act like they didn't have wealth, and people who really were living close to the bone would still feel like they wanted to or had to come out and get beers, get a drink, and do things socially to the same extent as everybody else.
Because of the money I made, I was able to live in a very expensive city and do the things that people around me were doing, without the feeling of anxiety that so many people had hidden—or didn't hide—about money in an industry where nobody gets paid very well.
I mostly put the money in the bank. I don't know that I would use the word “save” in that it wasn't in a savings account. I probably was able to pay more in rent than I would have otherwise. I did keep my car, which I had needed in Boston but didn't need in New York, and which was totally a luxury. I wasn't really at a point in my life when I was looking to spend money on anything. Because it was about just being there and working, and I was involved in the stand-up comedy world, and I was trying to write.
It gave me the freedom to do all of that. I feel like the main thing the money did for me was it freed me from the kind of anxiety that can be so tricky for people at that time of their lives, when they’re trying to be creative.
After I did the unpaid internship, I got a job as an editorial assistant at a magazine. And about a year into that, the other magazine that I had done the internship at said that there was an editor there who was going on maternity leave, and if I was willing to quit my job, I could come and be an editor there.
I’d be on the masthead and get to do my own editing, but with no guarantees that when the other editor came back three months later, I would have a full-time job. And I did it. I think I never would have done that if I wasn't sitting on a nice big bank balance. And lo and behold, that did turn into a permanent job. And it put me on a career track working at magazines that I don't think would've happened otherwise.
Americans love to tell themselves lies about class. And of course, wealthy Americans like to tell the biggest lies about class. And I feel like having this money, it was like I was a secret trust-fund kid. I hadn't grown up with that kind of money, but the fact that I got it in this weird and unexpected way wound up giving me insight into the bubble that people who have a lot of available money live in.
I'd like to say that it made me realize how soulless it is inside that bubble. But in fact, it's super nice inside that bubble. And I only wish that my own version of the bubble had been bigger, such that I feel like I could still be living inside it. But it doesn't quite feel that way.
—As told to Andy Wright
Heather McHugh Poet in Port Angeles, Washington
HOW: Winner of a 2009 MacArthur “Genius” grant
SPENT ON: Caregifted, a nonprofit that paid for long-term caregivers to go on vacation
I was teaching at the University of Washington in Seattle when I received the grant. I had the comfort of a secure teaching position. At first, the MacArthur people couldn't get in touch with me. I'm not a person who is disposed to telephones. I kept getting messages that they wanted me to call them, a state of affairs I thought infuriatingly inefficient.
I believe I was pretty petulant when they finally called: I had made an appointment—and walked half a mile to the pay phone at the breakwater on the island in Maine where I live during the summers—to tell them so. Finally, there I was with the damned receiver shoved in my face, the fishing boats coming and going around me. A voice in the phone asked me to sit down.
By my lights, $500,000 is a lot of money for any one person of my constitution to consider all at once—or to administer. As it happened, they distributed it in five separate payments over five years.
I never had children myself. The kid I was closest to had just married and had his first child, who was microcephalic and would probably need lifetime care. I used part of the money to get them the care they needed to find new work nearer his wife’s parents, where they had moved to organize their own local support system. They wouldn't accept much more.
Their experience as parents prompted me to find out more about all caregivers of the severely disabled. Millions of people worldwide, mostly women, do this kind of care with diminished resources, often with no relief. They are generally out of our sight—partly because they are unable to come and go freely, partly because we, in our discomfort with the sight of them, make life less comfortable for them.
It was a jolt of joy to give away that money—the kick of actually materializing a dream for someone who unquestionably needs it
After the few gestures I made to these young parents, and then after taxes (one doesn't immediately consider the falling branches of the revenue agencies in windfall territory), I used the money to found a nonprofit, Caregifted.
The money went to the costs of administering the nonprofit and to travel, food, excursions, etc. on the getaways we did. We did between eight and eleven getaways a year, for five or six years, only for caregivers of the most severely disabled family members, caregivers who had been at that devotion for ten years or more.
We asked what their dream vacations would be if they could choose, given the locations we had lined up (on islands, mostly). Some simply wanted to sleep late. Some wanted a meal out. Some read a book for the first time in years. Some brought a spouse for a much-needed recharge of strained relationships. All wanted to see new territories, visit the ocean, visit gardens, wineries, fishing, markets, tourist excursions.
People who heard about Caregifted often came to us because of my life in the arts—many were artists who had not been able to reflect or catch their breath since giving birth to a child who had to battle severe challenges. All of them recovered some perspective on their own choices, chances, and changes in life. Some person they'd not been in years began to start a conversation with their futures.
It was a jolt of joy to give away that money—the kick of actually materializing a dream for someone who unquestionably needs it. No fancy home or golden furniture or vacation indulgence of your own can ever give you back the gift this gifting does.
—As told to Andy Wright
Courtney and Tye Caldwell
Cofounders of ShearShare, a mobile platform that connects salon owners with stylists to fill empty chairs by the day in McKinney, Texas
AMOUNT: $1.1 million funding round, which included $100,000 in a Google Demo Day competition
HOW: Venture capital funders
SPENT ON: Renovations and branding, hiring staff
Courtney: We met in Tye’s salon 20 years ago in Plano, Texas. Tye’s been in beauty and barbering for 25 years, and I work in tech marketing. Together we’ve managed a family-owned business salon out in North Dallas for two decades now.
One day, Tye got a phone call from a stylist who had moved an hour away from Dallas and was concerned about losing her clientele. She said: “Hey guys, I know you’re an award-winning salon, but I’m not looking to do this whole long-term-commitment thing. I just need a space to come every other weekend to do my clients so I don’t lose them.”
I laughed at the idea—this was not done in the industry, popping in and out when you want to—but Tye said: “I’m going to give it a try because that suite is empty right now, so there is no use in me letting it collect dust. I’d rather it collect dollars.”
And so we started working as a concierge service, pretty much. After a few years we finally looked up, because I was traveling over five continents in my corporate job in digital marketing for Oracle, and Tye was finishing up his doctorate degree.
And he was like, “Oh, my gosh, this feels like a full-time job, so can you just go find an app that does what we do so the next time somebody calls, we can nudge them in the right direction?” I went online and couldn’t find anything. And that’s when we looked at each other and said, “We have to build it.” ShearShare was born.
Tye: I’m seven of eight kids, so I come from meager beginnings, and one of the things I’ve always believed in is being an entrepreneur and doing things on your own. I grew up in a family of 13 in a three-bedroom, one-bathroom house, so I always learned how to share, or as my mom called it, divide, amongst each other.
Courtney: We began by really bootstrapping ShearShare, not paying ourselves. We lived on rice and beans, and actually went vegan. You can make rice and beans taste really, really good if you add different spices.
Fundraising hasn’t changed much for us personally, but it allows us to think on a higher level versus having to think about what’s happening today. So we’re renovating, going through a brand change, different logos, name, et cetera. Before the capital, we had three to four team members; we now have 11. Hiring the right people really does take off a lot of stress from you.
Tye: Hopefully, one day we can be just like those investors who believed in us, and be investors in our own right.
Courtney: Money is like water to me. I know it’s supposed to come to us when we’re in the flow, and then we’re supposed to use it to give back to make sure that the next generation has it better.
—As told to Haley Cohen Gilliland
THE REALITY SHOW CONTESTANT:
Chip McAllister IT consultant in Laguna Niguel, CA
AMOUNT: $1 million
HOW: Winner, with his wife, Kim, of the CBS reality series The Amazing Race in 2004
SPENT ON: Two iPods, a laptop, church tithe
I wish I could say differently, but I had never been one who respected money enough. I’m a man of faith, and I knew not to love money. It was just always easy to make and easy to spend. If you look at my finances, it’s like a heart monitor. Up and down, and up and down, and up and down.
The Amazing Race was, and still is, our favorite show on television. For a while, my wife, Kim, would say: “We should go on the Amazing Race.” I said, “Kim, leave me alone. You can’t do push-ups or climb stuff. I’m 40 pounds overweight and hate to work out.” Then a bunch of other people told us we should go on.
We just did it to get in a positive place. Right before we went on the show in 2004, we started an information-technology consultancy with a business partner. My wife and I, and the partner, starved to death together for 18 months without making any money.
Then we got this huge account and our company became a $30 million business. But as soon as we started making money, the business partner kicked us out. He used our company money to pay for high-powered attorneys; we couldn’t afford any attorneys. So Kim and I were in bankruptcy and foreclosure.
Losing that business—the loss of money was really bad, but the betrayal by somebody you trusted like family is even worse, you know?
Man, that was the first dang time I ever thought, This must be what it feels like to be rich.
I thought of going on the show as having some long-deserved fun—being with Kim, traveling the world. Because there was not even one iota of me that believed we could win.
At the beginning, we were always right near the bottom. I remember about halfway through the show, the producer, Bertram van Munster, came up and he said, “Chip, Kim, you know, you guys could win this show.” Then we said, “Oh, thank you, Bertram, thank you.” And when he went away we said: “He’s so full of crap … he must want us to run faster or something.”
Then in the last episode, we learned that a crucial flight was delayed, and we were able to book another flight while the other competitors were asleep. Still, we didn’t know we were going to win until our taxi cab pulled up to the finish line. I will never forget that feeling. Just the crying—the convulsive crying.
We had absolutely no plans for the money because we didn’t even think we had a chance to win the damn money. We had no idea.
For almost six months, we knew we had $1 million, and we couldn’t tell anybody because we had to wait for the final show to air to claim it. Eventually, two checks for $500,000 came in our regular mailbox.
To celebrate, I went to CompUSA and got an iPod, which had just come out. I got my son an iPod. Then I thought, “Shoot, man, I just got $1 million, I can get a laptop.” Man, it was the best day.
I went up to the checkout and the kid ran my debit card and said, “Oh, sir, I’m sorry. There are no finances on this.” The checks hadn’t cleared yet. Then the manager poked his head out and said, “Bobby, that’s okay, just let him go through.” Bobby looked puzzled: “But I…” The manager said, “Bobby, just let it go through. I’ll talk to you later.” The manager obviously had seen the show and knew that the money would be good.
Man, that was the first dang time I ever thought, “This must be what it feels like to be rich.”
—As told to Haley Cohen Gilliland
THE BIG BOOK ADVANCE:
Writer, author of the novel The Golden State (2018) in San Francisco
AMOUNT: Low six figures
HOW: Sold a book in 2017
SPENT IT ON: Retirement, childcare
It was what Publishers Marketplace would characterize as a “good deal.” It was something like five times as much as I allowed myself to hope that I would get for the book. So it was, to me, a tremendous amount of money.
On paper it seemed like this huge number. But you get it in four chunks over what I think in my case will be three years. I sold my book in 2017, so that year I got the first two chunks, and of that 85 percent appeared in my bank account, because your agency just immediately takes 15 percent. I paid 40 percent of that in estimated quarterly taxes. Then I put about a quarter of what remained into a SEP IRA.
That was the best thing, I’d say, about the money that I got. The fact that I could put something toward a retirement. And if I hadn’t done that, I couldn’t have used the money, because I would’ve just paid it in taxes; that 40 percent that I paid would have been higher.
So for three years I have a salary of some kind. It works out to having a job that pays $15 an hour, which is a minimum-wage job in San Francisco, where I live. For 2018, the year my book came out, it looks like I’ll pay 36 percent in taxes, put a smaller amount into that SEP IRA, and with what’s left, it’ll be like I had a job that pays eight bucks an hour. The X factor is that I have two kids.
I had worked full-time and then took a part-time freelance editing job for a website called The Millions, and I said I would give myself a year to try and finish a draft of this book, and if I hadn’t done something with it at the end of the year, I had to get a full-time job again.
I was able to sell the book, so I was like, “Thank God I did it, I did the thing,” but basically we had been paying for childcare for my daughter in that time, and my Millions thing didn’t even totally cover that. My husband has a full-time job that covered rent and expenses; my freelance income mostly covered the daycare, but we had been kind of operating at a loss.
So part of me is like, Wow, I’m an idiot, I got this money on the book, but I spent it on that. But if I didn’t have childcare, there’s no possibility of writing another book
So let’s say I was surprised on the one hand that it was completely life-changing, because I had kept that Millions job for almost three years. I didn’t have to go and get a full-time job. But I’m now in a position where I either need to sell another book pretty quickly—like in the next three months—or I need to get a job.
So in the one sense, it was amazing. But it’s also really driven home that we, my husband and I, can’t live where we live. He has a good job—he works for the city and has great health care, which is another thing that allowed me to try this career path—but a low income for a family of four in San Francisco is now $117,000 a year. Which is just absolutely absurd. For two kids, we currently pay $3,095 a month in childcare, which is more than our rent, and we just can’t continue to do that.
So part of me is like, “Wow, I’m an idiot, I got this money on the book, but I spent it on that.” But if I didn’t have childcare, there’s no possibility of writing another book. Many choices could be different, and having children was not one of the ones that I would take off the table, so that’s what I mean when I say, “OK, clearly we don’t live in the right place for me to have this particular career.” You can’t count on a set amount of money from books.
My hope is that if I sell another book, I will be spending a lot less on childcare, maybe having fewer days of it, and saving a chunk of money that is an emergency fund, so I don’t feel spent down. If I could sell another book, that would be, I hope, something we could use toward a down payment in an area with a reasonable cost of living.
—As told to Andy Wright
For comment section, please scroll down. Thank you.
This website uses marketing and tracking technologies. Opting out of this will opt you out of all cookies, except for those needed to run the website. Note that some products may not work as well without tracking cookies.Opt Out of Cookies