100 Years Young--Life Lessons from my Father
My dad was born on August 9, 1920. He turned 100 years old yesterday, and in the age of Covid, the celebration took place via Zoom. What a long way we have come during his lifetime! When a family friend asked what I was doing these days during the call, I mentioned that I was writing an article on what he taught me about money in honor of his birthday. My Dad’s response was “that’ll be a short article!” Dad may have memory issues, but he hasn’t lost his sense of humor.
Like many of his generation, the Great Depression likely shaped Dad’s attitudes around money. My dad grew up in West Philadelphia, the son of immigrants. His father worked in the family clothing manufacturing business, and his mother’s family had a smoked fish business. The “money lessons” I absorbed from him were more about his values than the nuts and bolts of money.
Lessons One and Two
Education was something Dad valued highly. Education was not something to skimp on. He encouraged us, regardless of our gender, to be anything we wanted to be. Along with this was a “pay it forward” expectation. He was the youngest child, and the only one to finish college, thanks to the support of a generous uncle. He got a degree in Chemical Engineering from the University of Pennsylvania (class of ’42). In turn, I know my dad helped a nephew with college tuition, and this tradition has continued with my generation giving to the next, both directly and indirectly.
As a teenager, I got into a fender bender the very first night I had my license and with a car full of friends. I came home in tears, expecting a good “talking to,” but instead, Dad comforted me with these words: “never cry over anything that can be replaced with money.” Granted, that is easier to say (and believe) when you have money, but it certainly reflected how he valued well-being over wealth. (It also taught me about the value of insurance!)
Lesson Four (this one is about money)
When I got my first job after college and was looking for a place to live, Dad shared the rule of thumb to make sure my rent was 25% or less of my monthly salary. While much about our financial lives has changed over time, this rule of thumb persists. Of course, that percentage is necessarily higher if you live in a major metropolitan area (or sadly, if you make minimum wage.)
My husband reminded me that Dad never wanted to run out of cash. Before we ever left the house, even as adults visiting with our own family, he wanted to make sure we had enough cash “just in case.” I must give a nod to my mom here for a different cash lesson—she ran the household budget from a fixed monthly amount, and her checkbook balanced to the penny every month! She made a weekly trip to the bank drive-thru, usually with her dog in her lap, and got her cash for the week. Debit cards didn’t exist back then, and neither did credit cards as we know them today. When I have been on a tight budget, I have fallen back on this method of budgeting by taking a fixed amount of cash for the week, and using it to pay for everything. When it was gone, no more spending!
Dad lost his job of 25 years as the result of a takeover, just after my husband and I got engaged. At 62 he was a few years short of his planned retirement, and many dollars short of what he planned on retiring with in terms of a pension. He took his pension as a lump sum and invested it. He didn't realize it at the time, but the gift of time (compounding) worked in his favor. Obviously concerned about money. he offered to write us a check if we eloped, instead of having a wedding. We ended up having a wedding, but nothing too lavish. Had we been older when this happened, I think we would have taken the deal!
My dad tried to start a business, but it didn’t pan out, and he eventually took an administrative job with the State of New Jersey for a little income and benefits. My parents eventually sold the house I had grown up in and moved from suburban New Jersey into Brooklyn Heights to be nearer to their growing grandchildren (and my siblings.) I know it scared him to take out a mortgage at that age, but it was a wise investment, and it was soon paid off. The co-op they bought appreciated a great deal, which has become more important now.
While my father would have felt more secure had he been able to amass more money before retiring, he had been conservative enough his entire life with savings and smart enough with his investing (he had a good advisor) that he was able to swing the move to New York. My parents also got a good deal of traveling in while they were able. The amount he retired with, supplemented by Social Security and a small state pension, sustained my parents for close to 40 years after the early and unplanned retirement. This includes covering in-home assistance, which increased to 24x7 when my Mom needed more help before she passed away two years ago, and continues today.
Lesson number six is that "stuff happens" and you need to adapt. If you live below your means and save and invest all along, you can survive, even thrive. You just might need to tweak your expectations. That is the hard part.
Dad always wanted to have enough to leave his children with “something.” We kept telling him that was not necessary, but this motivation may explain why it is only in the past couple of months that his (liquid) assets have dwindled to the point where the family had to work out financing his care going forward. He supported his family for over 70 years, and we are so grateful for the full and “rich” lives we enjoy thanks to him. That is the legacy he leaves us. We are happy to take it from here, Dad.