Feeling poor? Try Losing 96 Percent Of Your Wealth.
Feeling poor? Try walking a long New Mexico mile in John McAfee's shoes.
He lost 96 percent of his wealth in the recent bust, and is now selling off his real estate at pennies on the dollar.
McAfee is, of course, the founder of antivirus software company, McAfee. His innovation was to give away the software for free, but charge fees for the upgrades and technical support. The company went public in 1992, and McAfee pocketed an enormous amount of money. Two years later, he sold his remaining shares. At the peak, he was worth about $100 million.
He tells the New York Times, "History told me that you just keep working, and it is easy to make more money."
McAfee then turned his attention to real estate - particularly real estate in the West and Southwest. And, here the story takes an interesting turn.
McAfee originally bought some of his real estate for fun. His 157-acre spread in New Mexico has a massive house, general store, 35-seat movie theatre and a cafe (click for photos). It was also the place he and his friends could fly "open cockpit planes with his friends." At the height of the boom, in 2007, he also spent $25 million to buy a lot and built a 10,000 square foot house in Vail, Colorado. And then there was the oceanfront estate in Molokai, Hawaii.
But as we all know, real estate prices aren't what they used to be. McAfee recently sold the Vail property for $5.7 million. The Hawaii oceanfront estate fetched just $1.5 million. The New Mexico property, along with its cars (including 1923 Model T Center Door, a 1930 Model A Pickup Truck, a 1929 Model A 4-Door Sedan, a 1959 Buick, and a 1960 Chrysler Imperial), collectibles, outbuildings, and landing strips, is now up for absolute auction on August 30, meaning that McAfee will take whatever price is offered.
It's not as if all of his $100 million dollar wealth was in real estate. The New York Times reports that McAfee lost millions in Lehman bonds, and more in the general stock market collapse.
But by his own reckoning, McAfee is now worth just $4 million. He flies coach and probably wonders how in the world someone worth $100 million could lose 96 percent of his wealth in just two short years.
photo courtesy Auction Company of America
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Ilyce R. Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at ThinkGlink.com.
