It’s been a number of months since we returned from Hawaii, and surprisingly, my FOMO concerning the AI tech growth has light. Certain, I nonetheless don’t have a job paying me gobs of cash as AI CapEx surges larger, however that’s OK. As a substitute, I’ve allotted sufficient cash to AI investments to the place I now not really feel the necessity to chase the trade from the within.
You see, my actual concern isn’t lacking out on one other AI unicorn. It’s elevating children in a crueler and harsher world—one the place, partly due to their identities, they get rejected from each top-50 college they apply to. Then, by the point they graduate from a so-so college, entry-level jobs have largely been automated away by AI.
This isn’t some far-off dystopia. CEOs of each main firm are brazenly exploring or adopting AI. They’re implementing hiring freezes, slashing jobs, and lowering headcount by the 1000’s. Accenture chopping 11,000 jobs and Lufthansa chopping 4,000 jobs as a result of AI aren’t outliers, they’re harbingers. Anybody paying consideration can extrapolate how dire issues might be 15–18 years from now, when my kids are getting into the workforce.
As an investor, it’s key to forecast the long run. As a father or mother, it’s key to forecast potential distress on your kids. In each circumstances, in the event you forecast even midway correctly, you’ll seemingly find yourself wealthier, calmer, and higher ready.
Jobs Are Actually Going Away Due To AI
Check out the S&P 500’s current efficiency in pink in comparison with Whole Job Openings in white. Discover the inflection level: investor optimism as AI guarantees profitability as a result of elevated productiveness, whereas job openings proceed to crater.
As an investor, my hope is the S&P 500 retains climbing—historical past suggests it’ll over the long term. As a father or mother, my concern is that Whole Job Openings will proceed to break down to 2009 ranges or worse. I clearly bear in mind the 2008-2009 International Monetary Disaster—that’s after I launched Monetary Samurai after the seventh spherical of layoffs at Credit score Suisse. Worry was my motivator then too.
On the tempo we’re going, by 2032 we might simply see a situation the place the S&P 500 is at a file excessive, however job openings match the lows of the final disaster.
And but, after privately consulting with dozens of readers this yr, I don’t assume most Individuals notice what’s coming. Certain, I’ll sound fatalistic, however a big a part of my wealth has come from recognizing and investing in long-term tendencies. And the AI bulldozer is actual.
Discover Your Minimal AI Funding Consolation Level
Simply as there’s a “Minimal Funding Threshold” the place work turns into optionally available and you’ll cease stressing about workplace politics, there’s additionally a “Minimal AI Funding Threshold” the place you possibly can cease worrying fairly a lot about AI wrecking your profession or your kids’s livelihoods.
This Minimal AI Funding Threshold is conceptually much like your Coast FIRE quantity. However in contrast to Coast FIRE, which is too harmful for most individuals to rely on, the Minimal AI Funding Threshold is an energetic hedge, not a passive hope.
Right here’s the way to calculate yours:
Plug into an AI instrument. Use a compound curiosity calculator or your favourite AI LLM to crunch the numbers for you.
Forecast the timeline. Estimate when your job might be eradicated as a result of AI, or when your kids will graduate highschool or school and enter the job market.
Estimate future dwelling bills. Take immediately’s fundamental dwelling bills and undertaking them ahead utilizing an affordable inflation price (2%–4%).
Select your cushion. Determine what number of years of fundamental dwelling bills you’ll need saved in AI investments—choose anyplace from 1 to 10 years.
Low cost to immediately’s {dollars}. Use a reduction price of two%–8% (decrease if conservative) to calculate how a lot you’d want to speculate now.
Instance Utilizing Our 8-Yr-old Son
Let’s take my 8-year-old son. Within the yr 2040, 15 years from now, he’ll be 23 and a brand new school graduate from an everyday college.
An earnings that might cowl his fundamental wants is $40,000 a yr in immediately’s {dollars}—equal to $62,319 at a 3% annual inflation price in 2040.
I estimate it might take him 2–4 years of job looking out to comprehend that his desires of clicking buttons to optimize advertisements for large tech corporations are out of attain. At that time, he’ll most likely need to take a trades job to make ends meet. (Electricians, plumbers, and normal contractors needs to be in enormous demand given all of the datacenters being constructed.)
So, I must have about $125,000–$250,000 ($62,319 X 2 – 4 years) put aside for him by the yr 2040 to present him that cushion.
Right here’s how a lot I’d want to speculate immediately to achieve $125,000–$250,000 in 15 years, relying on the low cost price:
| Low cost Price | Wanted for $125,000 | Wanted for $250,000 |
|---|---|---|
| 2% | $92,877 | $185,754 |
| 3% | $80,233 | $160,465 |
| 4% | $69,408 | $138,816 |
| 5% | $60,127 | $120,254 |
| 6% | $52,158 | $104,316 |
| 7% | $45,306 | $90,612 |
| 8% | $39,405 | $78,810 |
Based mostly on a sensible worst-case situation—him taking 4 years to comprehend his hopes and desires received’t materialize—at a 2% low cost price I’d want about $185,754 invested immediately. That method, by the point he’s 23, I’ll have secretly put aside $250,000 in AI investments alone to assist him survive.
It’s important all dad and mom NOT inform their kids precisely how a lot they’re saving and investing for them. You don’t need them to change into delicate and develop an entitlement mentality.
AI Investing as a Psychological Hedge
A few of it’s possible you’ll be scratching your heads: why put money into AI in any respect if I’m solely assuming 2%–8% annual returns? With such modest expectations, I might simply make investments largely in Treasury bonds yielding 4%–5% sprinkled with some shares.
I hear you. However the level isn’t simply the maths. It’s the psychology.
Will you diligently make investments on your or your kids’s future particularly to hedge in opposition to AI? Possibly, possibly not. Additional, I’m attempting to be conservative in my assumptions.
By particularly investing within the very corporations which will make your life and your kids’s lives tougher, it turns into simpler to really save and make investments for the long run. You now have a transparent why behind your delayed gratification. And when you could have a why, nearly something is feasible.
While you begin viewing AI as an unstoppable beast that might run you and your kids over, you get extra motivated to put money into AI corporations.
Worry and Duty Drive Me to Make investments
In 2025, pushed by concern of a dire future and a robust sense of accountability to guard my children, I launched into a brand new quest. I made a decision to speculate the Minimal AI Funding Threshold so I might scale back my fear and even begin rooting for the very know-how that might hurt my kids.
Step one was opening a new Fundrise Enterprise account earmarked for my kids with $26,000 in early August. (There was a promotion the place in the event you invested over $25,000, you bought $500 without cost invested of their Flagship actual property fund.)
Then, as my Treasury payments matured, I stored funneling between $15,500–$50,000 at a time into Fundrise Enterprise to hit my Minimal Funding Threshold. Each switch I made into my account made me really feel higher.
Hedged Towards No matter Occurs
Solely time will inform whether or not investing $190,000 in 2025 in names like OpenAI, Anthropic, Databricks, Anduril, Canva, Ramp, and dbt Labs will pan out. In the event that they do, I’ll be thrilled—the $190,000 might develop to anyplace from $256,000 to $2.87 million, based mostly on a 2%–20% annual return.
Meaning one little one will both have all his or her bills coated for 4 years of job-hunting or maybe be set for all times.
Alternatively, I might probably lose 80% of my cash and find yourself with simply $38,000 after 15 years as a result of AI turned out to be an overhyped dud. Possibly CapEx spend is just too excessive for the earnings. Possibly the world realizes human oversight is extra important than ever—Jevons’ Paradox at work.
In that situation, I’d be much more thrilled if each my kids discovered livable-wage jobs they loved. As a result of as dad and mom, it’s our accountability to boost kids to be self-sufficient adults. Needing to nonetheless relying in your dad and mom after 25 slowly chips away at your sense of price.
With out the mission of defending my children from AI, there’s no method I’d have invested $190,000 in threat belongings just like the S&P 500 in simply two months. A lot of the cash got here from risk-free Treasury bonds after I bought my previous home earlier in 2025. Up to now, I’ve dollar-cost averaged extra slowly, or invested in structured notes with draw back safety when valuations are excessive.
However as soon as I reallocated the cash from me to my kids, I prolonged the funding timeframe from “proper now” to fifteen years sooner or later. And when you could have such an extended runway to speculate, it turns into simpler to abdomen threat belongings.
Asset Allocation Issues Too
Lastly, when deciding your Minimal AI Funding Threshold, examine that focus on quantity to your general asset allocation. The comparability could be to your complete investable capital or complete internet price.
Personally, I’ve a goal of investing as much as 20% of my investable belongings in different investments akin to enterprise capital. Not solely am I in an open-ended enterprise fund that invests in AI, I’m additionally invested in 4 different closed-end VC funds, and I’m contemplating two extra.
Certain, the Yale and Harvard endowments have ~40% of their belongings in non-public fairness or options. However you don’t have the dimensions, affect, or fringe of a multi-billion-dollar endowment. For the typical DIY investor, allocating as much as 20% in options is loads.
The older (and hopefully wealthier) you get, the extra vital correct asset allocation turns into to journey out volatility. Evaluation your targets, run new monetary projections, and keep disciplined. It’s straightforward to get caught up in hype, particularly in a bull market. However nothing good lasts ceaselessly.
No Extra AI FOMO
I’m now not bummed I don’t have a job at a scorching AI startup rising triple-digits a yr. It felt like a waste not grinding it out whereas dwelling in AI central, San Francisco. I am additionally much less bummed that AI is stealing my content material on Monetary Samurai and never offering a correct hyperlink again.
However now that I’ve reached the Minimal AI Funding Threshold for each children, I’m extra at peace.
It feels nice to put money into hungry founders and staff working 60+ hours every week for fortune and glory, whereas I play pickleball throughout the day and write on Monetary Samurai. I’m grateful to be investing in AI close to the start of the revolution. Our kids aren’t as fortunate, which is why it’s as much as us to speculate for them.
So, for all you AI staff on the market, maintain grinding and benefit from the journey. You might make huge fortunes over the subsequent ten years—and I’ll be grateful in the event you do. Now get again to work 8 a.m. to midnight, 7 days every week. Your riches await!
Readers, how are hedging in opposition to AI destroying the livelihoods of your kids? Do you assume most individuals are conscious of the dangers AI poses for his or her job safety? What are another issues we’re doing to assist our kids thrive in an AI world?
Straightforward Methods To Make investments In AI
In order for you publicity to non-public AI corporations, think about Fundrise Enterprise. The platform owns stakes in names like OpenAI, Anthropic, Anduril, and Databricks. AI is poised to reshape the labor market, get rid of hundreds of thousands of jobs, and dramatically increase productiveness. Since non-public corporations are staying non-public for much longer than previously, it is sensible to allocate some capital to them if you wish to seize potential upside earlier than they go public. Fundrise has been a long-time sponsor of Monetary Samurai, and I’m personally an investor of their funds.
For public publicity, it’s also possible to simply purchase QQQ or shares of the Magnificent 7—Apple, Microsoft, Google, Nvidia, Meta, Tesla—plus Oracle, which has change into a stealth AI play. The great thing about investing is that you just don’t must reside in Silicon Valley to take part. From anyplace on the planet, you should purchase a bit of those corporations main the AI revolution.
That mentioned, don’t neglect: there are no ensures when investing in threat belongings. Quick-growing corporations could be extraordinarily unstable when downturns hit. For instance, Meta misplaced greater than half its worth throughout the 2022 bear market earlier than recovering. All the time keep diversified, control your asset allocation, and ensure your portfolio matches your threat tolerance.
