Financial Wisdom From A Nonagenarian

On January 17, 2013 in Interview by notrustfund

Screen Shot 2013-01-17 at 8.11.49 PMMy amazing grandmother will turn 94 years young this year.  As she is the person who first got me interested in saving money for a rainy day and investing in the stock market, I have been meaning to do this interview for awhile now.  Since she does not hear well, but is an avid emailer, a written interview proved to be the perfect format.  While I am not sure she fully understood what I meant when I told her this would be published on my blog, she buys things on ebay and manages her portfolio and plays bridge online, so it is quite possible she knew exactly what I meant. 

 

1. Tell us a little about yourself including any relevant financial info.

I was a child of the Depression.  Ten years old when the market crashed.  We lived with my grandparents which was very common at that time, to have three generations living under one roof.  My grandfather was a retired banker and quite well off but lost a great deal of money.  The little set backs now are not like the big and long depression of the 30s and 40s.  I wore cast-off clothes my mother remodeled.  One Christmas my only present was my sled repainted—-I was not too happy about that.  Everyone was poor so all my classmates also worn cast off clothes-no big deal.  More than anything I wanted a bicycle and had plans to get some money.  In 3rd grade I talked a couple of my class mates into the plan.  We would have a garden.  I would furnish the land (my grandfathers) and they would buy the seed and we would sell the produce on the mkt. square. Nothing grew.  I built a miniature golf course===ten cents to play.  Some one broke one of my fathers clubs—-end of golf course.  So having said all this  it has had a lasting influence  on how I feel about money.

2. What are your biggest financial challenges right now?

Don’t have one.

3. Discuss your financial goals.

My goal is not to run out of money, not much chance of that.

4. What is the best piece of financial advice you have ever received?

Until I was in my 50s  I never had any money to invest or was I interested in the market.  A pity.  I think one should start to invest as soon as they have money.  In 1970 we were suddenly jobless.  The only money coming in was a $172.00 monthly pension.  Everything was for sale, including  our house.  It did not sell.  I found a job but not much pay.  After two years of struggling we moved to Turkey to live in a very primitive village.  Your grandfather worked for the government to help build and start a paper mill.  The money was good for the time.  When we came home we had $20,000. to invest and live on.  Not much now but then quite a bit.  I decided to go into the market much against my husbands wishes.  I went to a broker and he sold us a fund with an 8 1/5  percent load.  Bad advice.  Next broker was even worse.  I studied and worked out my own system of investing based on price earning ratios, insiders buying, and many other things.  I started making money and still am.  So I can not say that I took anyone’s advice.  Not my husbands not the broker or anyone and was scared to death at what I was doing.

5. What is the best piece of financial advice you could give?

What you spend money on is so personal that I can not give advice.  What makes you  happy.  I go across town to save ten cents on a pound on bananas—–I darn my socks—-I paint my house.  I have even been know to buy day old bread.  I save the pennies and spend the dollars.  I have done expensive remodeling of my house and think nothing of plunking down money for this.  I take some wonderful, quite expensive trips almost every year and as I write this am leaving next month for a cruise.  Money is to be enjoyed.

6. When you were my age (mid 30s) were there any rules of thumb about how much to spend on things?  Such as how much you should spend on an engagement ring or how much to spend on a house?  And how much of a down payment did you have to put on a house?

It  use to be  2 times salary (for a house). It is hard to judge over a period of 50 or more years.  Engagement ring—–what is that?  Never had one.  Lucky to have a wedding ring.  Your grandfather had education debts to pay off and the army pay was not too great.  As a example as a private I was earning $21.00 a month and your grandfather was earning $110.   Education for your children is expensive(now).  I don’t remember that we paid hardly anything.  Both kids worked all summer and I think almost paid for their education. When buying things don’t overlook second hand.  Some beautiful furniture for sale very cheap.

7. Were there any rules of thumb as to how much of your salary you should put into savings?

We put almost nothing in savings which was perhaps a mistake.  How much you save depends on how much you earn.  Different for each family.

8.  What words of wisdom do you have for me or people my age?  Financial or otherwise.

Enjoy every minute of every day.  You can not compare money earned now and money earned years ago—but you also can not buy a new car for $2000. today.  I am so thankful I went into the market against everyone’s advice.  Had I not I would have spent the last 30 years on welfare.  Investing has changed a great deal in the last 40 years.  I made my money on stocks.  Now I think the funds have taken over the market and no matter how good a stock is if the funds don’t pick up  on it won’t go any place.  I am not making much money now because I have about half stock funds and bond funds.  They balance out.

My main concern about the market now is the great debt the government has and they continue to waste huge amount of money and no one seems to care.  Could the market crash again? I am not sure.  The biggest mistake I have made in the last few years was in 2006 when I felt the mkt was greatly over sold, which it was and there was a melt down.  At that time I transferred quite a large amount to foreign stocks thinking they would hold up.   They did not.  All went down and have not been able to recover.  I have just sold off the last of them at quite a loss.  I am fascinated with the market and pay close attention.  It’s a giant  bridge game.

I hope this is want you wanted.  Lots of fun doing it.

Thanks so much to my grandmother for sharing.  I love hearing words of wisdom from older generations.  So much has changed over the years in terms of what people view as necessities.    I was most surprised by her answer to number 5 with ‘money is to be enjoyed’ as my grandmother is the most frugal person I know.  I suspect she would not have said the same thing 20 or 30 years ago.  While she did not start investing early, she did invest in the 70′s, which is now almost 40 years ago, so her money has had plenty of time to grow!

Have you ever talked to older people in your family about money?  Do they have any words of wisdom to share?

 

 Photo credit: Studio 306

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16 Responses to Financial Wisdom From A Nonagenarian

  1. Alecia says:

    Such a heartwarming post in so many ways. I really appreciate the “save the pennies and spend the dollars.” We too tend to save the pennies so we can spend the dollars. (Bananas at the gas station are only $.38/pound!) Whether you have your trust fund or not, it’s important to do what makes you happy to maintain quality of life.

    • notrustfund says:

      Thanks so much for this comment. I was very excited about this post but wasn’t sure how much it would resonate with others.

      Nice work on the bananas!

  2. Leigh says:

    I love her story! Unfortunately, all of my grandparents have passed away now and I didn’t hear many finance stories from them. I’ve watched, second-hand, how complicated money can be in a second marriage, even when you’re old enough that your children have their own children.

    It’s strange that your grandmother is saying “Money is to be enjoyed” and you say she’s one of the most frugal people you know because my parents do the same thing! It sure drives me nuts some days. In one sentence, they’ll remind me of the relative whose stock holdings in their employer went down the drain and in another, they’ll tell me to keep all of my RSUs, until I remind them that I see far more than $1,000/year in RSUs.

    I know my grandmother didn’t have an engagement ring either, but there was a beautiful ring on their 25th wedding anniversary that is what you would today call an engagement ring. People made do back then with less, with the woman generally staying at home while the man earned a salary, not always a hugely handsome one. Mortgages were more expensive, there was no such thing as credit. Somehow, I think these “modern” things aren’t all that great.

    My favorite part of your grandmother’s story? “What you spend money on is so personal that I can not give advice. What makes you happy.” I’m actually really enjoying bringing my lunch to work. It is so much more relaxing, ignoring the cost savings! I love it and can’t believe I didn’t try this earlier, but it was much harder to collect supplies from the grocery store back when I didn’t have a car and by that point I was already in the habit of buying lunch.

    • notrustfund says:

      Well it’s great to know that people who are uber frugal are enjoying their money. It’s not always obvious from an outsiders perspective!

      I agree with you on some modern things not being all that great. I also feel like financial education has not kept up with all the modern tools available. It used to be that your banker would tell you what you could or could not afford- not so anymore. Although from my grandmother’s story of the high load fun, it appears there has always been a lack of alignment for certain advisors.

      So glad you are enjoying making your lunch. I love bringing my own lunch to work. Do you anything else to get away from your desk during the day? That’s my #1 complaint about bringing my lunch to work.

      • Leigh says:

        I still maintain my rule of not eating at my desk. There is a table in my floor’s kitchen and I eat there with some of my other coworkers. I have such a great view of the outside and walk two miles each way to/from work that I don’t have as much of a need to go outside in the middle of the day anymore. I do often have meetings in another building though, which forces me to go outside for a bit!

  3. Jackie says:

    What an awesome interview – this is something you’ll be able to look back on for years and show to your kids. Such excellent advice and what a brave woman to strike out on her own against the advice of others! How lucky you are to have her as a role model!

  4. Mara says:

    Such a sensible woman. You are so fortunate to have had her as a role model.

    • notrustfund says:

      It’s very funny to think of my grandmother as sensible. Although she definitely is with her money, which is what comes out in the interview.

  5. Guy says:

    Loved the interview. Of course I have had the benefit of having your grandmother for a mom for a very long time. I thought she always gave the most sensible advice and was the best apple pie crust maker until I met my wife. I have not done as well investing as she has but have always appreciated the advice and info she gave me about the market.

  6. This is so great I would love to be able to talk to my grandmother in this way. I especially love her quote about saving pennies and spending dollars, Totally makes sense

    • notrustfund says:

      Thanks, NOAB. I know, I feel so lucky to have her, and that she emails since it would be hard for us to have this conversation in person due to her hearing loss.

  7. Kate says:

    Love this post! Just read this again and think its so great that you shared this.

  8. Great post. So terrific that you tapped into your grandmother’s extensive wisdom and advice. My dad and mom are in their 80s and have similar stories and they are doing well and staying active. Both still drive, my dad gets on the exercise bike and the computer almost every day and my mom plays mah jong and other card games with her friends. Their secret of success is activity and working their brain. What a joy and treasure to have these nonagenarians and octogenarians.

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