I Think America’s Middle Class Will Disappear. Here’s How I Handle Money

A friend of mine who lives in America once asked me why the people at the very top in Russia, the heads of Gazprom, Rosneft and other state companies, keep wanting more. They clearly have billions. I told him it’s a competition, and I showed him what I meant while we were walking through a harbor.

Here’s a yacht that costs $10 million, and there are plenty of those. Right beside it sits one for $20 million, and the owner of the first one feels like a poor relative. The owner of the $20 million yacht feels the same way next to a $40 million one, and so on up the line. In a port I visited recently, two yachts were docked that cost about $300 million each. The year before, I saw the yacht of Jan Koum, who was born in Ukraine and sold WhatsApp to Facebook; I believe it cost around $250 million. Alisher Usmanov’s yacht reportedly cost $600 million. Whoever has the smaller one feels uncomfortable, because somebody else’s is bigger. That’s why these people always need more, and some of them end up in prison.

I don’t feel that way myself. When people ask how much money I have, I tell them I’m in the ultra-high-net-worth category and leave it at that. When I was very young and newly married, I didn’t have five rubles to bring to a birthday party, and I felt fine. In the Soviet Union I bought my first car only once I had earned enough for five. What I have has always been enough for me.

I used to call what I feel toward successful people white envy, the harmless kind. Viewers corrected me. Envy is envy, they wrote, and for me those people are simply motivation, the way an athlete wants to win. I think they’re right. I don’t want anyone to do worse than me; I want to do better than them. I don’t believe in luck, either. To get lucky you have to work very hard, and people who simply got lucky rarely keep the money. Many lottery winners lose it all after a while, because people show up to talk them into burying their money and waiting for a money tree to grow, like Pinocchio. Those who still have money didn’t get lucky. They earned it.

Did I ever feel rich? Honestly, no. I came to America in 1990 and started at $4 an hour. By 1995 the company my partners and I had built from scratch had $500 million in turnover, and I still didn’t think of myself as rich. I did think of myself as well-off. I know a man with roughly a billion who thinks he’s poor, and another who made $10,000 and decided he was a tycoon. It depends on what’s going on inside you. I live much more modestly than I could, because I don’t need more.

Why I don’t lend money, even to friends

My advice: don’t lend money to anyone, friends included. Friends turn into enemies over it, and so do relatives. I’d also avoid hiring relatives; a husband and wife are a different story. Not long ago an acquaintance who used to be very rich and has lost almost everything asked me on the phone whether I’d lend him $50,000 if he needed it. I said no. He asked about $10,000, then $1,000. I told him I wouldn’t lend him anything. He asked what I’d do if he were dying. I said he has children with money, and they would help him. Other people did lend to him, and when he didn’t pay them back, they fell out.

You can help a relative, but give things, not cash. Buy them something they can’t sell or pawn, in case there are bad habits involved. Financing is a different matter. If your business funds projects, that’s business, not lending.

Hollywood stars like to say they won’t leave their children any money and the kids will have to make it on their own. Look at how many actors are the children, nieces or nephews of famous people in the industry, though. Angelina Jolie’s father is a well-known actor. She may well be talented and have made it herself, but plenty of untalented relatives made it too, because their families kept pushing them. A famous last name doesn’t open doors by itself. A recommendation does.

That’s what an influential person is: someone who can solve with one phone call a problem you’ve been fighting for 20 years. Say you’ve spent ten years trying to get a meeting with Yuri Luzhkov back when he was mayor of Moscow. Then you run into someone who takes out his phone, calls him and asks him as a friend to talk to you, and Luzhkov can’t say no. In business and in life, in any country, connections like that matter a great deal.

Why I think the middle class will disappear

I don’t have any loans myself. When we arrived in 1990, no bank would have given me one, because I had nothing. We rented an apartment for $420, I found an air conditioner at the dump, a hotel was throwing out mattresses, and someone gave us a couch. I bought a used car with my own money. The dealer told me it went for $5,200 at auction; it really went for $3,200, and with everything included I sold it six weeks later for $15,000. I’ve started every business with my own money. By 1995 we were earning so much that I didn’t know where to put it, so I never needed loans after that. When I built shopping centers, I used financing from banks and other institutions, but that’s part of running a business, not borrowing to live.

I understand it’s different for people who live on a salary, and right now it’s very hard for them. Because of what politicians are doing around the world, the middle class is sinking. I expect that before too many years pass, there will mostly be very rich people and poor people.

The poor will feel fine, the way people did in the Soviet Union, where almost everyone was equal. There was a party elite that traveled abroad, but everyone else never saw it. They didn’t eat caviar, crab or lobster, and there was nothing around to irritate them. I think the whole world is heading that way. Only a small group will be very rich, the biggest business owners, top officials and heads of state, and they will eat the lobster and caviar. Everyone else will eat much worse but won’t be irritated, because everyone around them will be just like them. The rich already live behind so much security that nobody sees or hears them.

Is a mortgage a good idea for a middle-class family? It was when rates in America and Europe were 2% or 3%. In Russia rates are around 20% or more now. If inflation were so fast that stores couldn’t change their price tags in time, as in Russia in the ’90s, borrowing at that rate might make sense. When prices are fairly stable, buying property at 20% and hoping it goes up is madness, in my view. The West learned its own lesson in 2008, when subprime mortgages, handed out to people nobody checked, brought down the whole world.

In America a mortgage costs around 6% or 7% today, while a few years ago it was 2.5% or 3%. Plenty of people in Florida would like to sell, because insurance of every kind has become very expensive there, from home and car to health. But they bought 10 or 15 years ago with a 30-year mortgage at 2.5%, and if they buy somewhere else, they’ll pay 6.5%. So they stay put, and not only in Florida.

If you work for yourself, don’t buy anything until you have, say, half the price in spare money. Invest in the business, save and rent, and buy later, when you have money to spare. If you’re on a salary and can invest on the side, in the stock market for example, I’d invest rather than buy, because mortgages are too expensive today and investing pays more. You can buy what you need afterward.

Earn more, or spend less?

The simple answer is earn more. But two families with the same income can live very differently: one lives well, the other is in debt. So you also have to know how to spend. When I came to America, I could have rented a better apartment and bought a $6,000 car instead of a $700 one. I saved even on McDonald’s, so the money could go into the business. If you’re just starting a business, the answer is clear: save. Once the business is running and growing, you have to put more into it to earn more. And if you simply hand your money to someone else, you’ll be one more Pinocchio. Even the biggest Wall Street banks can lose your money; I’ve been through it.

Do I buy things on sale? I’m not like the ’90s new Russians in the old joke, who were proud of paying more for the same tie. My family knows where we get the best mix of price and quality. In Chicago we buy groceries mostly at three chains: Whole Foods, Trader Joe’s and Mariano’s. Trader Joe’s belongs to the same family that owns Aldi, but it’s a step up, and most of what it sells isn’t American but is good quality. When something is on sale, of course we buy it. At Mariano’s I once bought ten peaches, apricots, a big melon and more for $20 in total. Strawberries that usually cost $6 were a third of the price, and a melon that’s usually $8 was $2.

In a restaurant I always look at the prices, though I won’t deny myself the most expensive dish if I want it. Near my place in New York there’s a café called Sant Ambroeus, on 61st Street between Madison and Park, and there’s another on Madison at 77th Street, next to the Mark Hotel. Well-known actors and musicians from the neighborhood come in. An espresso there costs $5.50 plus tax, and if you sit at a table, add a 20% or 30% tip, so it comes to $8 or $9. A pastry is $12 plus tax, about $15. I do buy them, because the atmosphere is good and it isn’t much money. But in my head I feel I’m being overcharged.

A billionaire with $11 billion once said he would never go back to a certain restaurant because it was too expensive. He couldn’t spend his money in ten million years, but I suspect he wasn’t always rich, so he still counts. I understand him. About five years ago my wife and I flew to Milan. Round-trip business-class tickets from New York cost about $5,000 a person, and I can afford that. I’m not bragging; I know many people can’t. Just off Via Montenapoleone there’s a café where an espresso costs €1.20 and a pastry €3. I sit there feeling that I’m the one getting the bargain, and the $10,000 for two tickets doesn’t bother me at all. I enjoy it.

Turbot for two costs €60 or €70 in Spain. At La Marée in Moscow the same fish was $350, and people ordered it without looking, because nobody went there who couldn’t afford it. If I lived in Spain, I’d feel cheated in Moscow. So yes, we look at prices in stores. I don’t call that saving. I call it common sense.

I’ve never kept a log of my spending, and neither has my wife, who does most of the shopping. Before I started my channel, a young man from New York interviewed me in Chicago and asked in the car whether I knew what things cost. Of course, I said. He asked how much sour cream costs, and I realized that’s my wife’s department. I think it depends on how you’re organized. Some people understand money instinctively, and others will write everything down and still have none. Don’t try to save on everything all the time. Spend on what you value, like a good massage if you think it’s good for your health.

Spouses should think about money roughly the same way, at least when spending affects the family budget. If there’s so much money that it doesn’t, let each of them do what they like. A friend of mine in New York had a wife who kept buying Hermès Birkin bags. Those bags now cost five times what they did, and she started trading them and making good money. So was she a shopaholic or a businesswoman?

Saving matters most when you want to start a business. Some people can never hold on to money, so they always want to start with someone else’s. I never wanted that; I started seven businesses from scratch with my own money. When someone brings me an idea, I ask how much they’ll put in. If they say they have nothing, the conversation is over, because nobody is going to practice on my money. Partners have to think alike.

And success isn’t only money. It’s family, a roof over your head, health and safety. I’ll admit that while I was building my businesses, I gave my family and my daughter very little time. I don’t think you can push a business to a certain level and still be with your family as much as you’d like. Once the business runs like a machine, with other people in it, then yes, spend that time with your family.

Is it harder to start a business today?

Am I afraid of losing everything? I used to be, when I invested a lot. In Minsk I was a very well-off man, and in America I started as a loader in a produce store, so later I never wanted to take risks that could put me back there. Today my money is spread across different baskets, different investments and assets. If all of it collapses, it will collapse for everybody. Back in the ’90s I risked my life more than my money, and more than once. You always have to be a little afraid. The ones who went after a mammoth with their bare hands are long gone.

When I start something, I always assume it might not work and think about what happens then, and then I do everything to make it work. I lost $2.5 million on a startup in American healthcare. The business was working and no longer losing money, but I couldn’t find the right couple of people for the team, and I couldn’t keep going. I knew losing $2.5 million wouldn’t change my life, and I came away with more life experience.

Is it easier for entrepreneurs today than in the ’90s? Every era has its own problems. People sometimes tell me I didn’t make my main money in America. It doesn’t matter where you made it; what matters is that you made it honestly, and I can account for my first million, made from scratch. Co-ops started in the Soviet Union in 1987, and I sensed that the country was heading for collapse. There was nothing in the stores and close to 300 million people, so the starting point was very low. I was in the right place at the right time with the right people, and I found the right kinds of business.

It was dangerous. There were organized crime groups in every town, and many people were killed. I recently watched Guy Ritchie’s The Gentlemen, and it reminded me of my business back then, though we had none of those killings, or at least none that I knew of.

Today in the West nobody risks their life to run a business, but finding a business is much harder. I think companies like Amazon, Apple and Google will soon take everything, and everyone else will get the crumbs from their table. A few weeks ago I talked to a neighbor in Chicago, 30 years old, who has a trucking company with about 100 to 120 trucks. He’s been in America around ten years, and his friends still find businesses: construction, cars and so on.

I believe entrepreneurs are born. I could never work for someone else. In college I was a poor student and nearly got expelled because I wasn’t interested. Then I went into business, and it turned out I remembered everything, because I cared. An entrepreneur will start something no matter what: a nail salon, a repair shop, painting or building houses. Businessmen are different. They finish business school and get hired to run companies, because an entrepreneur takes a company to a certain level and then often lacks the organizational skills. Tell an entrepreneur an idea, and he says let’s do it. Tell someone who isn’t one, and he’ll give you a hundred reasons why it won’t work.

Business courses, in my opinion, are nonsense. Mentoring is something else, though I never had a mentor myself. My close friend Yura came to Chicago from Kyiv in 1991, a year after me, with some money, and opened a company that brought programmers to America. For two or three years he had three programmers. Yura is a very decent man and a good manager, but less of a visionary. Yura had an older friend, Sasha, an experienced businessman who used to drop by the office to chat. One day Sasha asked to buy a share. Yura said the company was worth nothing, and Sasha said he just wanted a reason to keep coming. He bought half for pennies, kept dropping by and kept saying, call this person, offer that one this deal. Within two or three years they had 30 programmers instead of three, and later they sold the company for a lot of money. Sasha didn’t even realize he was mentoring Yura. That’s what a mentor is.

What I tell people who write to me

People talk a lot about a rich mindset versus a poor one. I’ve never read books on it. I know Robert Kiyosaki wrote Rich Dad Poor Dad, and that’s about it. I learned by trial and error and always believed you have to jump into the fight. What matters, I think, is spending time with people who have achieved more than you, in business or in science. Talk to practitioners, not theorists. I once made a video about the economist Igor Lipsits; he’s a theorist, and I’m a practitioner. Practitioners have made plenty of mistakes and can tell you what not to do.

Some of the messages I get move me. Vadim, who is also from Minsk, is a former wrestler who lives in America and runs a tournament in Minsk. He makes bronze sculptures, and his company is called Never Give Up. He wrote that I’d forgotten my usual sign-off at the end of a video, and he asked to meet for 15 minutes to give me a statuette. We talked for an hour and a half. That heavy bronze statue, with Never Give Up written on it, now stands behind me when I record in New York. Before that, the mother of a 20-year-old I had helped get a job in my building painted my portrait with my motto on it.

Another man, from the Chicago suburbs, wrote to me after I posted a video about an acquaintance who turned on me because of my YouTube channel. He was a dentist before he moved here about eight years ago and didn’t want to spend years retraining. For five years he ran a painting business and saw no future in it. He wrote that one day he prayed for someone to look up to, and a week later he came across my first video. Now, he says, he feels 25 again: a medical consultation project of his is about to launch, and the website for his painting business already gives an online quote based on the size of a room. When I get messages like that, I know I’m doing something useful. Some people write me nasty things, and sometimes it’s hard. But whoever keeps fighting gets there. Whoever sits on the couch saying someone else got lucky ends up with nothing.

You can’t just sit there. You have to keep pushing.

As I always say, keep fighting and don’t give up.

Originally published as a video on my YouTube channel on 18 June 2025. Watch on YouTube