It’s been a number of months since we returned from Hawaii, and surprisingly, my FOMO concerning the AI tech growth has light. Positive, I nonetheless don’t have a job paying me gobs of cash as AI CapEx surges increased, however that’s OK. As a substitute, I’ve allotted sufficient cash to AI investments to the place I not really feel the necessity to chase the trade from the within.
You see, my actual worry isn’t lacking out on one other AI unicorn. It’s elevating youngsters 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 reducing 11,000 jobs and Lufthansa reducing 4,000 jobs attributable to AI aren’t outliers, they’re harbingers. Anybody paying consideration can extrapolate how dire issues could possibly be 15–18 years from now, when my kids are coming into the workforce.
As an investor, it’s key to forecast the long run. As a guardian, it’s key to forecast potential distress on your kids. In each instances, in the event you forecast even midway correctly, you’ll possible 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 Complete Job Openings in white. Discover the inflection level: investor optimism as AI guarantees profitability attributable to elevated productiveness, whereas job openings proceed to crater.
As an investor, my hope is the S&P 500 retains climbing—historical past suggests it’s going to over the long term. As a guardian, my worry is that Complete Job Openings will proceed to break down to 2009 ranges or worse. I clearly bear in mind the 2008-2009 World 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 state of affairs 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 12 months, I don’t suppose most Individuals notice what’s coming. Positive, I could 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 just 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 easy methods 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 can be eradicated attributable to AI, or when your kids will graduate highschool or faculty and enter the job market.
Estimate future residing bills. Take right this moment’s fundamental residing bills and mission them ahead utilizing an affordable inflation charge (2%–4%).
Select your cushion. Resolve 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 right this moment’s {dollars}. Use a reduction charge 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 12 months 2040, 15 years from now, he’ll be 23 and a brand new faculty graduate from a daily college.
An earnings that might cowl his fundamental wants is $40,000 a 12 months in right this moment’s {dollars}—equal to $62,319 at a 3% annual inflation charge in 2040.
I estimate it might take him 2–4 years of job looking to appreciate that his goals of clicking buttons to optimize adverts for large tech corporations are out of attain. At that time, he’ll in all probability need to take a trades job to make ends meet. (Electricians, plumbers, and normal contractors needs to be in large 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 12 months 2040 to offer him that cushion.
Right here’s how a lot I’d want to speculate right this moment to achieve $125,000–$250,000 in 15 years, relying on the low cost charge:
| 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 |
Based mostly on a sensible worst-case state of affairs—him taking 4 years to appreciate his hopes and goals gained’t materialize—at a 2% low cost charge I’d want about $185,754 invested right this moment. 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’s vital all mother and father 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 you might 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 principally in Treasury bonds yielding 4%–5% sprinkled with some shares.
I hear you. However the level isn’t simply the mathematics. It’s the psychology.
Will you diligently make investments on your or your kids’s future particularly to hedge in opposition to AI? Perhaps, 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 truly save and make investments for the long run. You now have a transparent why behind your delayed gratification. And when you might have a why, nearly something is feasible.
Whenever 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 Accountability Drive Me to Make investments
In 2025, pushed by worry of a dire future and a powerful sense of accountability to guard my youngsters, I launched into a brand new quest. I made a decision to speculate the Minimal AI Funding Threshold so I might cut 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, and nonetheless is, a promotion the place in the event 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 might develop to anyplace from $256,000 to $2.87 million, based mostly on a 2%–20% annual return.
Which means one baby will both have all his or her bills lined for 4 years of job-hunting or maybe be set for all times. They will pursue careers they need moderately than careers they want.
Alternatively, I might doubtlessly 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 just too excessive for the earnings. Perhaps the world realizes human oversight is extra important than ever—Jevons’ Paradox at work.
In that state of affairs, I’d be much more thrilled if each my kids discovered livable-wage jobs they loved. As a result of as mother and father, it’s our accountability to boost kids 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 youngsters from AI, there’s no manner I might have invested $190,000 in danger property just like the S&P 500 in simply two months. Many of the cash got here from risk-free Treasury bonds after I bought my previous home earlier in 2025. Prior 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 might have such an extended runway to speculate, it turns into simpler to abdomen danger property.
Asset Allocation Issues Too
Lastly, when deciding your Minimal AI Funding Threshold, evaluate that concentrate on quantity to your general asset allocation. The comparability will be to your whole investable capital or whole internet price.
Personally, I’ve a goal of investing as much as 20% of my investable property in different investments corresponding 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 that every one have AI investments.
Positive, the Yale and Harvard endowments have ~40% of their property in personal fairness or alternate options. However you don’t have the scale, affect, or fringe of a multi-billion-dollar endowment. For the common DIY investor, allocating as much as 20% in alternate options is lots.
The older (and hopefully wealthier) you get, the extra vital correct asset allocation turns into to experience 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 perpetually.
No Extra AI FOMO
I’m not bummed I don’t have a job at a sizzling AI startup rising triple-digits a 12 months. 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 youngsters, I’m extra at peace.
It feels nice to put money into hungry founders and workers working 60+ hours every week for fortune and glory, whereas I play pickleball through the day and write on Monetary Samurai. I’m grateful to be investing in AI close to the start of the revolution. Our younger kids aren’t as fortunate, which is why it’s as much as us to speculate for them.
So, for all you AI workers on the market, hold grinding and benefit from the experience. You possibly can make monumental fortunes over the subsequent ten years, and I’ll be grateful in the event you do!
Readers, how are hedging in opposition to AI destroying the livelihoods of your kids? 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 youngsters 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 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 enhance productiveness. Since personal corporations are staying personal 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 too can 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 buy a bit of those corporations main the AI revolution.
That mentioned, don’t neglect: there are no ensures when investing in danger property. Quick-growing corporations will be extraordinarily risky when downturns hit. For instance, Meta misplaced greater than half its worth through the 2022 bear market earlier than recovering. All the time keep diversified, regulate your asset allocation, and ensure your portfolio matches your danger tolerance.
