Warren Buffet also made the point that investing in a company (this applies whether its your capital or your time as an employer) that it was the calibre of the people that determined whether the investment was worthwhile, or not.
And that's why interviews, as a potential employee are so important, you want to know who you will be working for/ with, so you should be asking questions that determine what sort of people you are getting involved with.
Maybe you can get to 50 million with a reasonable management career.
But let's say you're on this path and you have 3 million or so, at 35/40 years ... then what? Management at all costs? No reasonable job at a FANG will get you to even just double what you have at that point.
If you cannot have a happy life on that, well...
But I get it--if your goal is to accumulate more wealth (no judgement--that's a legit goal) then it gets harder. When I was at Microsoft, partner-level engineers were making $1 million per year; now it's probably $2 million. Staff-engineer at FAANG is probably similar, I bet, to say nothing of the AI labs. I bet you could reach $25 million after 10 years with the right investment strategy. And $25 million throws off at least $1.25 million per year if you invest right.
Beyond that, you probably do need a startup or some other significant ownership stake.
Obviously this means one has to be earning that much for 15+ years.
Still, if you reach staff-level at 40 years old, you could have $25M at 55. That's pretty amazing. But that requires lots of luck. Most people never make it to staff-level. I never did.
Another thing: People at FAANGs usually ride the stock up and get way more than 7% per year. I'm embarrassed to say that I sold a lot of MSFT stock at $30 in 2011. Today (~15 years later) it is trading at $530.
This seems...high. The levels.fyi data for 68/69 shows them maybe crossing 1M, and the highest available data point at a bit under 1.5 mil. Staff engineers at FAANG are not making 1M a year except in cases of significant stock growth. 700-800K is more reasonable. The AI labs pay a significant premium, yes (2-3x!).
My math on it was basically "I can work for 10-15 more years and retire meeting my financial goals, or work until my 4 year grant at an AI lab finishes and meet all the same goals, with more interesting work".
That would be what I'm trying to avoid.
If you have $3 million at 35 years old then all you have to do is invest it, keep your expenses manageable, and find a comfortable job that pays the bills for the rest of your career.
If you’re setting your sights on either very high net worths like $50 million or very early retirement targets like $5-10 million in your mid 30s, even high-normal IC career paths like working at FAANG aren’t going to get you there without some extreme luck. You either need to be grinding hard at TC maximized overall career paths or getting very lucky with equity at risky early stage startups.
I know, I know, everyone on HN says entry level FAANG makes $600K/year and drives a brand new Porsche, but it's not reality.
It was much much easier ten years ago, too.
That's one of the clearest examples of the difference between income-vs-wealth and the difference between "high cost of living" and "every expense is higher." If your higher salary offsets your higher cost of essentials of SV plus goes beyond that, a Porsche is much more relatively affordable to you than someome making the "inflation adjusted" amount in Ohio. (Or if you're looking to retire earlier, you can put more away for that too.)
In the last few decades the part you're missing in your math is that the trick is NOT to take 5% gains. Instead, keep it in the company. The wealth people have gotten from working BigTech hasn't been higher base comp or even TC, it's been specifically stock in BigTech.
In the last 15 years there have been several significant Big Tech valuation-jumps that have helped people save $$$$ too, but won't necessarily help the next round of folks. Amazon, Google, Meta are both up 10x since 2014. Apple is 20x+. So if you started then with an equity package worth 500k... 2022 was also a great time to start at Meta, and a decent (2x+) one at Amazon. 2020 even was a great time to start at Apple, up 6x since then. And before then, 2002-2014 was also a wildly good time to be at Amazon or Meta or Apple or Google. Better, even, for some of them!
So that's a good 25-years of wild gains. The "regular" employees who benefited from that timing are somewhat-understandably now saying just everyone can do that and have great results. I'm not sure if I'd make that bet myself in 2026 with the changes to things from AI. Though none of them are pure-SAAS that's easy to duplicate, so... maybe still go for it!
I think I'd be way too bored, though. Last time I considered a job offer from one of them, I just decided to throw a bunch into stock in the company instead and took a startup offer. It worked out ok as a hedge, if not AS good as taking the offer would've been.
Some of those doors have gotten much harder to get through. The days of falling into a FAANG job by being willing to relocate to the right city and know enough to practice LeetCode for a few weeks have passed. It’s possible that the days of putting modest money into the S&P 500 and getting 8-9% year after year have also passed, but I don’t predict the future as well as I’d like.
Also different tax rates for investment vs income: 200k taxed at 30% is easily L6 level compensation. And if you're comparing to L6 anywhere outside of US it's easily L7.
Also: these amounts are declining. Except perhaps in AI.
In my experience, those numbers are low for the US. This is about accurate: https://www.levels.fyi/companies/google/salaries/software-en...
See also IBM
I personally don’t invest more in tech than I need to via broad index funds (and I certainly never keep my RSUs in the company stock, I always sell immediately). Otherwise, if there is a sector-wide downturn, I’d be triple exposed - my paycheck, my tech investments, and my company stock. That seems like a lot of risk to take on.
I’m open to other opinions here.
A. Guaranteed $1,000 each month
B. Every month, flip a coin. Heads gains $5,000, tails you lose $1,000.
To me, that's SPY vs. QQQ. Tech in general has higher expected return, but more volatility. If you can handle the volatility, then QQQ is better. If not, then not.
Ultimately, I'm taking a bet on tech because I believe tech has the greatest chance of improving the economy/world.
[I'm also not qualified, so do your own research]