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Our instructor was about 70 at the time ...
Old 01-02-2016, 08:14 AM   #1
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Our instructor was about 70 at the time ...

I can't remember the exact name of the Community College course but, the content was entrepreneurship/personal finance. Our instructor was about 70 at the time, with 7 kids (or was it 9) he had to learn how to make ends meet. In my mind, a natural for teaching the course. I can't tell you what the content of the class book was- I'm sure I read and outlined the content but what I do remember were the 'stories'.

He talked about how he never bought a new car but, preferred to buy two or three year old cars. The depreciation he said, for those first 2 years was tremendous. He told us about how his son in college managed on a food budget of a dollar a day (yeah this was over forty years ago folks). There was no way our instructor could hope to fund seven college educations; What he could do was teach thrift to his kids- apparently with some success. He lectured on how many newly launched small businesses fail because they were undercapitalized at the start and cannot last long enough to become a going concern. From then on I looked at every business opportunity with a critical eye.

There was no learning about finance at home. My divorced mom couldn't teach about money because she never had any. Ours was a Frank's and beans existence - we didn't feel deprived because we knew no other way of living. In retrospect my Dad who enjoyed some success was wasteful and terrible with money. It only got worse as he got older - what does a land locked 80 year old man need with a cabin cruiser with a blown engine? It was that and worse.

For me the lessons of financial discipline didn't fully kick in immediately. The catalyst were an MBA and more so meeting a gal who knew how to save. Her discipline became mine, debt was retired and I learned to LBYM. Coincidentally it was an 60 year old newly graduated Columbia PHd that taught the finance courses where I learned my trade. The classes were small and he was old school- He would walk around and check to see that you did the case study assignments. I spent hours doing the work in pencil on yellow legal pads and they filled my desk. Once he was convinced I was committed he barely looked.

Along the way I read Financial Peace University, countless editions of money magazine, smart money and the Wall Street journal. I saw so many of my colleagues lose their positions to layoffs - I became determined for us be financially independent and once I was the axe never fell.

Over the years my priorities are focused around the simple things I wasn't assured of in my youth: a warm coat and house, a reliable car, a steak now and then and funds to handle life's little curve balls. I'll admit that the wife and I are often puzzled about the financial decisions of others.

Care to share how you learned about money
Ray


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Old 01-02-2016, 08:41 AM   #2
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Interesting topic, Ray.

My dad was the classic "millionaire next door" type. I grew up in an upper middle class neighborhood (and live in the same house, now since we bought the house off of my dad). Dad did not try to keep up with the Jones' though... I thought we were poor since we had used cars, I wore hand me down clothes, and mom had a strict budget to feed us all. Later, I learned that dad was saving for retirement and our college - rather than spending/acquiring debt like many of the neighbors. I remember having a conversation with him when I was in my late teens... he informed me that he had enough money to live till 90 - after that he was going to be a burden on us kids. He was laughing (because his family did not have longevity, unfortunately...)

Having been born during the depression (like many of our parents), he'd absorbed the stretch a dollar mentality from his mother...

As far as your teacher being 70 years old... My step mom keeps failing at retirement. She's a nursing instructor - retired the first time at 67, moved a different university and then retired again 2 years ago at age 85. She is sucked back in again - advising PhD and Masters candidates part time. Fortunately, she's sharp as ever, even if she uses a walker and doesn't drive anymore.
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Old 01-02-2016, 08:56 AM   #3
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My dull life story, from 2013.....initial post plus subsequent comments......(one accident compounded by another):

The Effect Of Serendipity On Retirement
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Our instructor was about 70 at the time ...
Old 01-02-2016, 08:59 AM   #4
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Our instructor was about 70 at the time ...

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Interesting topic, Ray.

My dad was the classic "millionaire next door" type. I grew up in an upper middle class neighborhood (and live in the same house, now since we bought the house off of my dad). Dad did not try to keep up with the Jones' though... I thought we were poor since we had used cars, I wore hand me down clothes, and mom had a strict budget to feed us all. Later, I learned that dad was saving for retirement and our college - rather than spending/acquiring debt like many of the neighbors. I remember having a conversation with him when I was in my late teens... he informed me that he had enough money to live till 90 - after that he was going to be a burden on us kids. He was laughing (because his family did not have longevity, unfortunately...)

Having been born during the depression (like many of our parents), he'd absorbed the stretch a dollar mentality from his mother...

.

My parents were those debt-acquiring next door neighbors, newly arrived from the oilfields of TX and elsewhere, livin' large in California. Kinda like the Clampetts without the bank account.

I met and married a LBYM saver, son of savers, and we started fully funding the new savings vehicles called IRAs very early in our marriage. The 401(k)s followed. DH banked his bonuses.

I won't say I got all the lessons right all the time and am still more of a spendarina than DH, but his diligence rubbed off on me such that we have been OK despite the shocks of 2008-9.




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Old 01-02-2016, 09:15 AM   #5
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Both my parent's families were dirt poor and frugal. Paternal grandfather was a struggling farmer/businessman who went bankrupt at least once and then had a successful construction business. Mom's dad died in a car accident when she was 11 leaving a young widow with nothing more than a 6th grade education and 4 hungry mouths to feed. Gram worked menial jobs but was so frugal she still managed to save and gave her children hundreds of thousands in her waning days. My aunt frequently says that she never knew they were poor until she was an adult. DW was also of modest means as her dad died when she was 12 leaving her mom with 7 mouths to feed but they still eked out a solid middle class life.

Dad got an education at the school of hard knocks. He was a go-getter and had a successful sales career and a number of side businesses and rental real estate. While we lived very middle class growing up, I sensed that we were more affluent than most since we had a summer home, newer cars than typical, the business and rental real estate to tend to.

Dad was not a good stock investor. My sense is that he lost a lot in the market trying to catch the next big thing. However, later he invested more in mutual funds. He was however, a good real estate investor... mostly land and residential and commercial rental properties. I do recall him saying later in life that if he had to do it over again that he would have used leverage more in his real estate deals (he tended to pay cash) and that has made me more comfortable with leverage.

I recall growing up wondering if I would do as well financially as my dad since he had done so well. I think I did albeit on a different path... he was more entrepreneurial and I preferred to just save and invest in stocks but we both accumulated our wealth more as intreprenuers (worked in management for larger employers) rather than entrepreneurs.

So my LBYM came from my parents and DW. My investing chops is self-taught reading Money magazine, Smart Money, WSJ and similar periodicals and via my background as an accountant and working in the financial industry.
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Old 01-02-2016, 09:29 AM   #6
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One more note... My dad had some big losers along the way. He got involved in foreign exchange - specifically the Mexican peso... and got hammered when the government devalued it. But his best purchase was the house that I now own... Purchased as a foreclosure in 1966 when it was 2 years old, for $29k. Outstanding loans (first and second) were $33k - but dad was able to assume the payments, no down payment... which allowed him to rent our house in Clairemont till the market turned around a few years later. He sold me the house in 2003 for $600k... not a bad return.
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Old 01-02-2016, 09:59 AM   #7
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Both of my parents were frugal and still are. Waste not want not. They were gleaners and savers. I am not sure how they passed this on so successful to all of my siblings. They didn't really preach it but they definitely lived it. They are the unlikely seeming millionaires next door. They did emphasize to all of us that we should save tax deferred from early on to benefit from compounding and hedge against possible changes in social security. Thanks Mom and Dad for giving me the tools that have brought me to FI and will allow me to retire next year at 55!
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Old 01-02-2016, 11:52 AM   #8
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Quote:
Originally Posted by rayinpenn View Post
I can't remember the exact name of the Community College course but, the content was entrepreneurship/personal finance. Our instructor was about 70 at the time, with 7 kids (or was it 9) he had to learn how to make ends meet. In my mind, a natural for teaching the course. I can't tell you what the content of the class book was- I'm sure I read and outlined the content but what I do remember were the 'stories'.....
While I can fully understand his circumstances, there is certainly irony in that he is still working at 70, while teaching personal finance.

Related to the topic, it seems that many of us either developed our financial education from our parents, or developed on our own. There was no course in personal finance in public school through high school and also none for me in college. I think I developed it more by trial and error, plus desire to educate myself than from anything else. I definitely made some good decisions along the way, whether due to my actual knowledge of the intended results or just luck. Likewise also did some dumb decisions. However in the end I made more correct choices than wrong choices with respect to my personal finances.
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Old 01-02-2016, 12:09 PM   #9
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Being broke taught me to live frugally...
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Old 01-02-2016, 12:11 PM   #10
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Being broke taught me to live frugally...
+1
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Old 01-02-2016, 12:41 PM   #11
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Both of my parents were depression era. Dad quit school at 12 and worked various jobs. He told the story of always selling a newspaper to a local Jewish businessman (I think the guy owned small retail stores). This businessman always told my dad to save part of what he earned every day. That was a hard concept for a 1930's street kid. When dad joined the army at 17, friends and family members thought he was uppity for wanting out of the slums. The college degree through the GI bill was his ticket to the middle class.

Mom was one of seven kids. All of the children were encouraged to go to college, including the girls. Mom taught home economics at the local university. One of the classes she taught was Consumer Economics. She covered budgeting, banking, insurance, taxes and investments. When I was in high school I took a consumer economics class. " Easy A" since the course materials were a lot of what was at home in mom's office.

Both parents really instilled the importance of LBYM even though we could have always afforded the fancy cars, vacations, etc.
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Let's start at the beginning....
Old 01-02-2016, 01:09 PM   #12
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Let's start at the beginning....

I was born an an early age, naked and flat broke..........
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Old 01-02-2016, 01:12 PM   #13
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I was born an an early age, naked and flat broke..........
...and after the circumcision I was unable to walk for a year.
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Old 01-02-2016, 01:12 PM   #14
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The 4 Yorkshiremen are beginning to stir ..
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Old 01-02-2016, 01:27 PM   #15
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Wow, I can relate to many of the stories in this thread. Parents and grand parents were poor, had low paying jobs, some worked until their early 70's, not a lot of education, no (zero) investment skills, etc. All of this had an opposite effect on me, which seems so typical for me on this board as I'm often an outlier.

I started working long and hard at an early age. Developed (semi-planned) special skills that helped me land a good job that paid very well and allowed me to retire relatively early without practicing LBYM. I invested (self taught) in the traditional equities market most of my working career but changed my AA radically (80+%) to fixed income once I felt I "had enough" to retire like I wanted. See other recent threads about "how much is enough".
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Old 01-02-2016, 02:15 PM   #16
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My parents were very secretive about finances, and our family of 6 lived very frugally. I truly had the impression we were were a lower income family. It wasn't until my father admitted that we all lived on my mother's schoolteacher's salary while he saved and invested his entire salary (civil/structural engineer) that I realized we lived WAY below our means.

Since finances were never discussed, I didn't have a clue about investments until I began earning self-employment income. He then suggested I open a SEP-IRA account. What the heck was that, I wondered. He said that compared to the onerous paperwork that is required of the Keough account he had, a SEP-IRA had very little paperwork, and if he had the chance to do it over he would have chosen a SEP-IRA.

So at age 35, I opened a SEP-IRA and started teaching myself about investing for retirement.
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Old 01-02-2016, 05:27 PM   #17
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I hesitate to say we were "poor" because we did have the basics. A house, heat in the winter, indoor plumbing, and (late in high school) A/C in the summer. I never wondered where the next meal was coming from.

That said, there wasn't much more. Dad was an electrician for the power company, in Jr. high Mom got a secretary job at National Institutes of Health. Dad also had a drinking problem so a lot of money went to that, but we didn't suffer the physical abuse that so many other children of alcoholics did. Both parents came of age in the Depression so that behavior was about hardwired in to both. Both sets of grandparents were the same way.

Vacations were going to see grandparents in PA or Mom's parents in Buffalo, NY except one year they rented one of several very rustic cabin in Allegheny State Park in NY with a bunch of aunts & uncles. Bunks and a light bulb hanging from a wire kind of rustic. Toilets were 50 yards or so up the trail.

So a lot of that frugal behavior was picked up by me and my two sisters, mostly because we didn't know there was any other way. For a period of time Dad ran up a large cc bill at Montgomery Wards and it took years to pay it off, big celebration when that happened so that made me very cautious with credit, I didn't want to fall into that trap.

They never talked much about money though, just what we overheard. Investments? With what money? They didn't have any "extra" money to invest.

So other than having the basic behavior taught by example the rest we had to learn on our own. A saving grace for me was that I picked an employer with a well funded DB COLA'd pension, fairly common back then but of course scarce now.
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Old 01-02-2016, 05:32 PM   #18
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Being broke taught me to live frugally...
which in turn taught me to like beer.
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Our instructor was about 70 at the time ...
Old 01-02-2016, 07:29 PM   #19
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Our instructor was about 70 at the time ...

First lessons on finance came from my parents. Basic LBYM stuff in a middle class family.
Then finance courses for business degree. Typical balance sheet, income statement, business plan, accounting, etc.
Then being a part owner in a business, I learned from the older senior partners, lawyers, accountants, consultants.
So I learned finance from a business perspective - now I need to brush up on personal finance issues such as managing a retirement portfolio and taxes.



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Old 01-02-2016, 09:36 PM   #20
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which in turn taught me to like cheap beer.

Fixed... 😬
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