It’s been a number of months since we returned from Hawaii, and surprisingly, my FOMO in regards to the AI tech increase has light. Certain, I nonetheless don’t have a job paying me gobs of cash as AI CapEx surges greater, however that’s OK. As an alternative, I’ve allotted sufficient cash to AI investments to the place I not really feel the necessity to chase the business from the within.
You see, my actual worry isn’t lacking out on one other AI unicorn. It’s elevating children in a crueler and harsher world—one the place, partly because of 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 overtly exploring or adopting AI. They’re implementing hiring freezes, slashing jobs, and decreasing headcount by the 1000’s. Accenture slicing 11,000 jobs and Lufthansa slicing 4,000 jobs resulting from AI aren’t outliers, they’re harbingers. Anybody paying consideration can extrapolate how dire issues might be 15–18 years from now, when my youngsters are getting into the workforce.
As an investor, it’s key to forecast the long run. As a dad or mum, it’s key to forecast potential misery to your youngsters. In each circumstances, in case you forecast even midway correctly, you’ll seemingly find yourself wealthier, calmer, and higher ready.
Jobs Are Vanishing Due To AI
Check out the S&P 500’s latest efficiency in crimson in comparison with Whole Job Openings in white. Discover the inflection level: investor optimism as AI guarantees profitability resulting from elevated productiveness, whereas job openings proceed to crater.
As an investor, my hope is the S&P 500 retains climbing—historical past suggests it should over the long term. As a dad or mum, my worry is that Whole Job Openings will proceed to break down to 2009 ranges or worse. I clearly keep in mind the 2008-2009 Global Financial Crisis—that’s once 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 may simply see a situation the place the S&P 500 is at a report 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 suppose most Individuals notice what’s coming. Certain, I could sound fatalistic, however a big a part of my wealth has come from recognizing and investing in long-term trends. And the AI bulldozer is actual.
Discover Your Minimal AI Funding Consolation Level
Simply as there’s a “Minimum Investment Threshold” the place work turns into non-obligatory and you may cease stressing about workplace politics, there’s additionally a “Minimal AI Funding Threshold” the place you may cease worrying fairly a lot about AI wrecking your profession or your youngsters’s livelihoods.
This Minimal AI Funding Threshold is conceptually just like your Coast FIRE number. However in contrast to Coast FIRE, which is too dangerous for most people to rely on, the Minimal AI Funding Threshold is an lively hedge, not a passive hope.
Right here’s easy methods to calculate yours:
Plug into an AI device. Use a compound curiosity calculator or your favourite AI LLM to crunch the numbers for you.
Forecast the timeline. Estimate when your job will likely be eradicated resulting from AI, or when your youngsters will graduate highschool or faculty and enter the job market.
Estimate future residing bills. Take as we speak’s fundamental residing bills and mission them ahead utilizing an affordable inflation price (2%–4%).
Select your cushion. Determine what number of years of fundamental residing bills you’ll need saved in AI investments—choose anyplace from 1 to 10 years.
Low cost to as we speak’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 faculty graduate from an everyday college.
An earnings that might cowl his fundamental wants is $40,000 a yr in as we speak’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 goals of clicking buttons to optimize advertisements for large tech corporations are out of attain. At that time, he’ll most likely should take a trades job to make ends meet. (Electricians, plumbers, and basic contractors needs to be in big 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 offer him that cushion.
Right here’s how a lot I’d want to speculate as we speak to achieve $125,000–$250,000 in 15 years, relying on the low cost price:
| Low cost Charge | 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 |
Primarily based on a sensible worst-case situation—him taking 4 years to comprehend his hopes and goals gained’t materialize—at a 2% low cost price I’d want about $185,754 invested as we speak. That manner, by the point he’s 23, I’ll have secretly put aside $250,000 in AI investments alone to assist him survive.
It is important all mother and father NOT inform their youngsters precisely how a lot they’re saving and investing for them. You don’t need them to develop into mushy and develop an entitlement mentality.
AI Investing as a Psychological Hedge
A few of you could be scratching your heads: why spend money on AI in any respect if I’m solely assuming 2%–8% annual returns? With such modest expectations, I may simply make investments principally 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 to your or your youngsters’s future particularly to hedge towards AI? Perhaps, perhaps not. Additional, I’m attempting to be conservative in my assumptions.
By particularly investing within the very corporations that will make your life and your youngsters’s lives tougher, it turns into simpler to truly save and make investments for the long run. You now have a transparent why behind your delayed gratification. And when you’ve a why, virtually something is feasible.
If you begin viewing AI as an unstoppable beast that might run you and your youngsters over, you get extra motivated to spend money on AI corporations.
Worry and Accountability Drive Me to Make investments
In 2025, pushed by worry of a dire future and a robust sense of responsibility to protect my kids, I launched into a brand new quest. I made a decision to speculate the Minimal AI Funding Threshold so I may scale back my fear and even begin rooting for the very expertise that might hurt my youngsters.
Step one was opening a new Fundrise Venture account earmarked for my youngsters with $26,000 in early August. (There was, and nonetheless is, a promotion the place in case you invested over $25,000, you bought $500 at no 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 may develop to anyplace from $256,000 to $2.87 million, primarily based on a 2%–20% annual return.
Meaning one little one will both have all his or her bills lined for 4 years of job-hunting or maybe be set for all times. They’ll pursue careers they need quite than careers they want.
Alternatively, I may 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. Perhaps CapEx spend is simply too excessive for the income. Perhaps 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 youngsters discovered livable-wage jobs they loved. As a result of as mother and father, it’s our accountability to lift youngsters to be self-sufficient adults. Needing to nonetheless rely in your mother and father after age 25 slowly chips away at your sense of price.
With out the mission of defending my children from AI, there’s no manner I might 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 offered 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 youngsters, I prolonged the funding time-frame from “proper now” to fifteen years sooner or later. And when you’ve 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, evaluate that focus on quantity to your overall asset allocation. The comparability could be to your complete investable capital or complete web price.
Personally, I’ve a goal of investing as much as 20% of my investable belongings in various investments comparable to enterprise capital. Not solely am I in an open-ended venture fund that invests in AI, I’m additionally invested in 4 different closed-end VC funds, and I’m contemplating two extra that every one have AI investments.
Certain, the Yale and Harvard endowments have ~40% of their belongings in non-public fairness or alternate 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 alternate options is a lot.
The older (and hopefully wealthier) you get, the extra vital correct asset allocation turns into to experience out volatility. Overview your objectives, 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 not bummed I don’t have a job at a sizzling AI startup rising triple-digits a yr. It felt like a waste not grinding it out whereas residing 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 spend money on hungry founders and staff working 60+ hours every week for fortune and glory, whereas I play pickleball in the course of the day and write on Monetary Samurai. I’m grateful to be investing in AI close to the start of the revolution. Our younger youngsters 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, keep grinding and benefit from the experience. You could possibly make monumental fortunes over the subsequent ten years, and I’ll be grateful in case you do!
Readers, how are hedging towards AI destroying the livelihoods of your youngsters? Do you suppose 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
If you’d like publicity to personal AI corporations, take into account Fundrise Venture. The platform owns stakes in names like OpenAI, Anthropic, Anduril, and Databricks. AI is poised to reshape the labor market, eradicate thousands and thousands of jobs, and dramatically enhance productiveness. Since non-public corporations are staying non-public for much longer than up to now, it is smart 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, you can even simply purchase QQQ or shares of the Magnificent 7—Apple, Microsoft, Google, Nvidia, Meta, Tesla—plus Oracle, which has develop into a stealth AI play. The fantastic thing about investing is that you simply don’t must reside in Silicon Valley to take part. From anyplace on this planet, you should buy a bit of those corporations main the AI revolution.
That mentioned, don’t overlook: there are no ensures when investing in threat belongings. Quick-growing corporations could be extraordinarily risky when downturns hit. For instance, Meta misplaced greater than half its worth in the course of the 2022 bear market earlier than recovering. At all times keep diversified, keep watch over your asset allocation, and ensure your portfolio matches your threat tolerance.
