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Comment by saurik | Hacker News Reader

I do not expect to make any major expensive lifestyle changes as a result of having more money (and to the extent to which I have already been being paid better recently due to working on Orchid, I have only barely done so and usually only quite temporarily), which I realize disappoints some people who had wanted me to post a concrete picture of something expensive I purchase to help motivate others to reach for bug bounties ;P.

(FWIW, I maybe should at some point buy a car--as I currently waste money on renting one; pre-pandemic I was using a combination of ZipCar and Lyft, but both services suck now--but I can't imagine myself buying a pointlessly extravagant car; and, sadly, now is a bad time to buy a car anyway... which I think is related to the ZipCar issue: I imagine they might have sold their fleet? Maybe ZipCar will return in force when prices rebalance.)

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Please read this thread to see the pitfalls that might potentially lie ahead: https://www.reddit.com/r/AskReddit/comments/24vo34/comment/c...

It's about winning the lottery but still applicable to some extent, and shows how people's lives go horribly wrong.

Not sure it's actually applicable. That Reddit comment is about poor people winning lots of money by chance, not smart people earning lots of money by working. The risks are very different, not to say that the scale between 2 million and 170 million is way bigger than you seem to think.

Poor people aren’t stupid

If you're poor and gambling, then you're making a stupid financial decision. So the odds of you being financially stupid seem likely to be high.

For most people, gambling isn't a financial decision, it's an entertainment decision. The value of thinking about winning (regardless of how unlikely it is) is worth the $1 cost of a lottery ticket, so labelling gambling a "stupid financial decision" is like labelling owning a TV while poor a "stupid financial decision"... but poor people deserve entertainment as much as rich people.

Gambling is not a human right, no one deserves to be able to waste resources they have no matter how much they may or may not enjoy it.

What? So startups should not be allowed? 90% of them fail after all. The odds of a startup being successful is literally gambling.

I feel like the difference is that companies are generally intended to be a concerted effort of one or more individuals, as opposed to an actual roll of the dice.

Like without getting into nits, you can actually directly effect the direction and value of a company, but you can't affect the roll of dice or the output of a random number generators.

Risk in and of itself doesn't imply the entire thing is gambling; that said, investing by itself would be way closer to gambling in that context, imo

Are you being sarcastic? I said it is not a human right - no one should guarantee anyone the ability to start a business as it isn't societies responsibility to pay the cost of some individuals risk tolerance.

I'm saying the opposite of what you seem to be implying. I'm saying anyone can gamble or start a business, but it's no ones responsibility to make sure they have the option to do so.

Who are you arguing against? I don't think anyone is implying that gambling itself is a fundamental human right.

Time to trot out my favourite paraphrase of Babbbage: I am not able rightly to apprehend the kind of confusion of ideas that could provoke such a statement.

Suppose another ape and I are out enjoying the State of Nature, and we both should have a round troy ounce of silver in our pockets, with heads and tails as an agreed convention. Suppose I were to say to the other ape, "on whose face does Fortune shine her rays?" and we were to flip both rounds, such that whomever showed heads had the better of it: were it both of us, we would exchange, but one head and one tails, well, one ape will leave the gamble richer and the other skint.

Tell me toolz, how should you prevent this encounter without committing a human rights violation? Show your work, please.

Why would I prevent this encounter? Did two adults consent to behavior they both felt benefited them? Who are you or I to suggest our ideals are better than theirs?

All I've said is that you, nor I, should be responsible for making this behavior possible - you seem to have misinterpreted my intent completely if you think the absence of a right is the same as a mandate against someones ability to participate freely as they wish with other consenting adults.

You’re confusing rights and entitlements.

The people who buy a lot of tickets are overrepresented among the winners, to the exact proportion of the size of the ticket pile.

I'd argue that for most gambling, it's not a decision, but an addiction or false hope financial decision. Those that treat it as a entertainment don't really gamble that much money.

Not sure if that's true by number of gamblers, but my gut says it's mostly true weighed by the amount of money gambled away. I say mostly, because we don't count rich kids / oligarchs wasting money for fun, who might dominate the value chart.

This applies to people who are gamblers.

Most people who are the poorest are usually the ones who know exactly where their dollars are going. They can tell you exactly how much a carton of eggs and milk are.

No. People buy lottery tickets for a lot of reasons. It is a fun bit of escapism and entertainment that costs just a few dollars.

You're making the assumption that everyone plays the lottery because they think it is a smart financial decision.

I don't assume nor do I have to assume anything about someones intent to know that gambling is stupid. Entertainment can be had in so many forms today that even the poorest of the poor in developed countries can have choice paralysis from having so many options. Gambling is a stupid waste of resources, if you enjoy doing stupid things I have no moral/ethical qualms with your choices, but it's still stupid.

I don't really like gambling outside of playing poker with my friends but your comment is reeking with a bias for what you define as "Entertainment".

Gambling is not a waste of resources. It is a transfer of resources from one entity to another. It's a zero-sum game.

On an individual level, gambling is roughly breaking even in the long run (say, 95% retention of the resources).

> Gambling is not a waste of resources.

Yes, it is.

> It is a transfer of resources from one entity to another. It's a zero-sum game.

All real gambling consumes as well as transfers resources, and is, therefore, negative sum.

> Yes it is.

No it's not.

Are we "debating" like in first grade or what is this?

What do you mean consumes?

By your definition it seems literally everything is a "waste of resources"

> By your definition it seems literally everything is a "waste of resources"

Most activities use resources.

Many produce value and are not a waste of resources.

Gambling isn't even always stupid. There are professional gamblers who have made more money than I will ever make, and maybe more than you will, too.

My only beef with lottery players is that they always take forever in the convenience store line.

Before I read this I was thinking this exactly!

Haha yes. I have only played the lottery, maybe, 10 times in my life. But it is fun sometimes, and in my state the money goes mostly to good causes anyway.

If I'm about to be evicted or declare bankruptcy, does having $1 really change anything? Meanwhile, does having a small chance of staying in my house change anything?

It's easy to say "well, lotteries have a negative expected payoff". And that's true, but it can still have a less negative payoff than a payday loan or having your car repossessed.

This is a good example of why utility curves are not, well, lines.

The utility of $2*X is not exactly twice $X. It can be more or less, and that can differ between different people.

Not the guy you replied too, but I don't think he was implying that poor people are stupid. It's more like people who work for their money and earn it step-by-step are better suited to manage and grow it further. Earning money gradually gives you leeway to slowly adjust your lifestyle to your upgraded monetary status.

I'm not sure this is a sound analogy, but imagine someone picking up cigarettes for the first time and building up tolerance over time as they go from one cig a day to two, three, four and so on. Now, compare that to someone suddenly smoking 10 cigs per day. The latter person is more likely to get wrecked from the side effects.

Edit: I checked your profile and saw that you're the co-founder of Industry Dive, damn. I love your newsletters and websites!...especially Payments and Banking Dive.

The poster you replied to didn't say stupid. He said money coming from work and money coming from gambling are going to have different outcomes.

You mean they aren’t stupid by necessity or that there isn’t a correlation on the population level?

That's a generalisation and it's invalid like all generalisations.

That said, it's more likely that someone whose life ended in poverty is not as smart as someone who can live comfortably. IQ generally correlates with income (you can google a few studies).

There are surely tons of reasons that can push smart people into poverty (bad health, poor environment leading to poor choices) but that shouldn't obscure the general trend.

That said, I think over a certain IQ, other traits of your personality or the environment will have the predominant effect in determining whether you'll end up poor or not.

Similarly, over a certain amount of money, I'm sure there will be more variance. Making 5k more than your peers doesn't mean you're smarter than them - and the fact that you're all able to earn a living and save some money means you're all smart.

That's not what I said either. Again, the Reddit thread is about people with a small amount of money winning a large amount of money. A person like Saurik working for a bug bounty and getting paid for it is not nearly the same scenario.

No, but they usually don’t have great money management skills due to not having said money to manage. It’s not any different than warning first time farmers about all of the ways running a farm can go bad.

Why don’t they get jobs at FAANG then?

I did say that it's applicable to some extent and I'd bet that extent is more than you think!

There are plenty of horror stories that are below $10 million.

> Whittaker wasn't a typical lottery winner either. His net worth at the time of his winnings was in excess of $15 million, owing to his ownership of a successful contracting firm in West Virginia.

That Reddit comment is not about 'poor people', though it's true the scale is a bit different.

> is about poor people winning lots of money by chance, not smart people earning lots of money

Assuming that was unintentional, now might be a good opportunity to reflect on unconscious bias.

I come from a poor family and now my family is no longer poor because of my work. I wouldn't say I'm smarter than the average person, but somehow I'm luckier. But with that said, I don't seem to be even smart enough to realize what unconscious bias you're referring to, care to spread some light for me?

They use "smart" as the opposite of "poor", which implies that they see "poor" as pretty much synonymous with "stupid".

The first example he gives is an already-rich guy though

Wow, that's depressing.

I was in jail with a guy who was a total mess. Nice, but seemed pretty mentally-disabled.

One day a new guy came on the block. "Wow, what is George doing in here?" "You know him?" "Yeah, I know him. He is one of the greatest musicians I ever met. He can play any instrument like a savant. I knew him a few years ago, just after he inherited $4m when his father passed. He ended up getting in drugs and everyone would hang out at his house." "Wow, who was his dealer?" "Who was his dealer?! EVERYONE was his dealer!"

I'd been keeping George in coffee, because he didn't have a single cent on his commissary account (which is rare in jail, even the worst criminals usually have someone out there). Poor George had snorted or injected $4m of drugs and everyone had sold them to him and partied with him until all the money was gone and George's brain was cooked and he went around shaking his fist at the sky until he was arrested. And not one of his hundreds of "friends" would put a cent on his account.

Interesting: I knew a guy that came into a lot of money. A serious lot. And he found that he had a whole entourage of new friends. Fancy house, gurus, admirers, tons of interesting investment proposals most of which he accepted. And when he died and the accounts were made up it was all gone. Everything. Not a single person around him that did not in some way take advantage of him. I still have a hard time getting around people not being able to deal with their money, especially because in this case it was quite hard earned. Some of the hangers on still haven't recovered from the fact that their 'source of funds' has dried up.

Something similar happened to Tony Hsieh, founder of Zappos (acquired by Amazon for $1.2B), though he still left a considerable fortune after death.

https://news.yahoo.com/zappos-founder-tony-hsieh-didnt-17410...

That's on yet another level. But the parallels are eerie. I wonder how common this is.

A Jack Chick track right here in the middle of a comment thread.

I bet if he was allowed to pick up an instrument and play it would be therapeutic for him. Sad story, hope he bounces back.

I wish he'd get a chance. The system just isn't set up to deal with cases like sad old George. I did see him get released, but then got re-arrested, which isn't uncommon for someone who's mental health issues are being untreated. I bumped into him at court and he told me that he'd been playing guitar and touring with Taylor Swift while he was briefly out, and I went along with it because it really cheered him up to have someone listen to his tale.

Boy do we have the strangest hang ups over people getting lucky. Your link is mostly spinning an untrue story. It’s only a tiny collection of anecdotes, and it’s cherry picking and mostly not true.

This bankruptcy thing is a myth that seems to have been made up and won’t die. I’ve looked into this in the past and the only stats I could find that back it up are based on small winnings, not large winnings, contrary to your redditor’s claims, and the bankruptcy rates were temporary. Get this: the bankruptcy rates went down 2 years after winning between $50k-$150k, and then 3 years after that they returned back to normal. The returning back to normal from a low point was cherry-picked and reported widely as bankruptcy rates going up. Misleading, right? Here’s the Florida study this misinformation was based on: https://eml.berkeley.edu/~cle/laborlunch/hoekstra.pdf

The National Endowment for Financial Education has issued a press release about this bankruptcy misinformation: https://www.nefe.org/news/2018/01/research-statistic-on-fina...

I think this link is way more useful:

https://www.bogleheads.org/wiki/Managing_a_windfall

Funny. This exemplifies the HN community and its distaste for startups. It’s because everyone here performs total population averages. Perhaps it’s likely that most HN members do behave as a total population average.

I am grateful for this insight.

wth you can get sued for making someone else look bad by being better? ha

One relies on solving a problem and providing a service. The other one relies on having the ability to go to a convenience store and fork over the cost of a lottery ticket. Not even in the same reality.

I would tend to look at your use of car services more like spending money you can now afford, to deal with cars only temporarily and reap only the benefits, rather than being stricken with the albatross of ownership.

That said, I do concur that Zipcar sucks now, compared to what it was. I've still never used Lyft or Uber, so can't comment on those. Oh wait hold on, I did try once to gift some Lyft rides to someone via the website and was literally unable to successfully give Lyft money. Still, I would say it makes less sense now to buy a car (even electric) than at any other point in history.

For what it’s worth - I love that you have this perspective. There’s absolutely nothing wrong with just saving the money.

> I can't imagine myself buying a pointlessly extravagant car; and, sadly, now is a bad time to buy a car anyway

Get a fun car that can be a hacking project :)

I was suggested a police car by a friend. They are cheap at auctions, more or less well maintained (tax payer money) and have interesting internals (check sites like https://www.dippy.org/upgrade/dipcop.html) especially for electrical circuits where a police-taxi-module lets you hook up to other functions.

And the laptop mount is a geek dream: your laptop right by you, charging, which doubles as a make-do coffee table at the drive through :)

I want to convert an 80s-style car to powerful electric someday, cyberpunk style. Z31 300ZX probably. If I had a lot of money like that I'd build a big garage and do things like that.

That sounds like such a fun project!

> I was suggested a police car by a friend. They are cheap at auctions, more or less well maintained (tax payer money)

Except that

1) a lot of them are Dodge Chargers which are terribly unreliable

2) they spend incredible amounts of time idling, which isn't good for the engine of a sports car

So what? If it's to have fun and hack, does it matter?

Unless you live in the sticks, you probably aren’t “wasting” your money by using rentals and Lyft.

The problem with a car is for most people it’s their most expensive or second most expensive capital asset, yet has a very low utilization rate (often less than 5%). If interest rates rise their op ex in servicing it (fuel, insurance, loan interest) will exceed that!

A few years ago I sold all my cars. I found I only drove at all a few times a week at most (walk/bike instead). Like you I switched to ridershare/rent and it was fine. My motivation wasn’t really to save money but just eliminate the hassle of having all those cars.

This wiki contains tons of good information about how to best handle the windfall: https://www.bogleheads.org/wiki/Managing_a_windfall

Make sure to read it.

You can buy a very nice car that might even appreciate in value so you get to have your cake and eat it too, I recommend you do research on this.

maybe you can even download one too. I would do even more research into this.

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