From 2004 to 2009, the inflation rate was less than 4% each year. Gold was $443 an ounce in March 2005 and $975 an ounce in March 2008. Yes rich people had to put their money somewhere as banks and then corporate America started to collapse during the surprise crisis, they took them out of equities for banks offering subprime mortgages and put them into assets like precious metals and the like.

Also in 1999 MSFT was $57 a share. In 2009 it was $16 a share. It cracked $57 again in 2016. 17 years to go sideways.

Cisco never reached its 2000 peak again. Of course companies like Pets.com just went out of business.

And rich people aren't getting richer through smarter investments, but by wealth accumulation on existing assets that people need.

That's why the first million is the hardest since it's working capital for most working folks. After that, it can stay invested and compound.

Being able to hold on to wealth is an underestimated and undervalued ability.

It's actually pretty easy to lose money. Everybody is happy to help you part with yours.

I really want to believe this, but I have a hard time seeing this applying to the ultra-wealthy nowadays. There are far too many strategies to hold on to your wealth or to get it back.

Aside from lottery winners whose assets start liquid, are there examples of people in the last 5 years with over $100 million in assets that permanently lost most of their wealth without doing something really stupid?

> It's actually pretty easy to lose money.

By what mechanism / who exactly? Or referring explicitly to the ultra wealthy? When I think of the normal wealthy, the 1-20 million camp, can't they just stuff all of their money into index funds for the last 20 years and everyone grows 10%+ a year (most years)? That's what the few multi millionaires I personally know have done -> step 1 put money in e.g. Vanguard, step 2 maintain job and spend based on income, not accumulated wealth, step 3 do nothing as wealth builds itself. Once they get past 2 million, I think they are making 80-200k per year at capital gains rates and maybe don't even need to put more in, just ignore it. I don't personally have that situation though so maybe I'm glossing over details or have it wrong.

Earning $1mil and stuffing 100% of it into the stock market is a risky move.

You lay out basically the situation I found myself in. But I set aside some for a future house down payment (less risk for that chunk), future wedding (less risk for that chunk), and even ignoring that, most advice wouldn't say to stuff the remaining 100% into markets.

So maybe 60% went into markets. With hindsight it oftentimes sounds like a good idea to just drop it all in the market. But life is uncertain and crystal balls are in short supply... you would feel stupid if you made $1mil, put it all in stocks, and life came out of nowhere and took a dump all over you when the markets tanked.

Not saying I'm in a bad position, but its nowhere near "1mil at 10% per year (which is in itself kinda a wild base assumption)".

TLDR: people have a rosy unrealistic view of how this works out.

Most people earn money over time. Putting these savings 100% into the stock market as you earn them is pretty reasonable. It’s only a sudden cash windfall that presents problems. The fix for that is to put money in 1, 2, and 3 year treasuries, and invest that money into equities as the treasuries mature.