Want to Avoid Regret? Stay Out of Debt!

The news tells us that Americans are finallly getting more cautious about getting into debt. Our elders, many of whom lived through the Great Depression, think it’s about time! One of their strongest lessons is to save up the money before you buy something – or your may regret it.

Here’s what some of the elders interviewed for 30 Lessons for Living told me:

What should young people avoid? Credit card debt. They’ve got to have the instant gratification thing. I struggle with my granddaughter about it all the time because she doesn’t have the patience. She’ll get way in debt for something she’s gotta have and I keep saying: “You’re not ready for this, you don’t have a good down payment.” And also, I want her to have a cushion because sometimes it takes a while in between jobs, and she’s just not prepared to do that. She’s just like; “Well I know I’m going to have this job always.” Well, my first husband; in ten years of marriage, he had thirteen different jobs. And we had three small children and it was very nerve-wracking. (Evette, 83)

One of the things that I would tell any young person was save a little money every week for yourself. Make sure those few dollars a week are put away because that compounds and at the end of fifty years you’re going to have a nice nest egg if you pay yourself first. We have granddaughters that are paying off student loans that are just out of sight. They both worked as waitresses and if they had put aside a few dollars a week for themselves, they might not be struggling so much. (Pru, 75)

Unfortunately, I never had the money to save when I was in my twenties. That’s what I say to my kids now. I say that I wish I could have started saving when I was their age, when they’re in their twenties and like that. If you’ve saved money, like I stress that younger people should do, and then you can really relax when you get older and retire and enjoy life and like that. And think about having your house all paid for, and sit back and enjoy your hobbies and do volunteer work when you get older, and enjoy your grandchildren and travel. But if you’ve saved money and like that, you can do that and not have to keep working. (Flora, 71).

Worth taking a look at before you pull out those credit cards!

Financial New Year’s Resolutions From the Wisest Americans

Some of the most common New Year’s resolutions have to do with money: saving more, making more, spending less, andelder advice money so on. America’s elders, however, urge you to take a broader view of money and what it means in your life. The “experts on living” in the Legacy Project have some excellent advice on the topic.

The fantastic financial journalist Morgan Housel at Motley Fool wrote an excellent article (10 Money Lessons from Elderly Americans Who Have Seen It All), based on my book 30 Lessons for Living. Take a look – it will help you think “outside of the box” about money issues over the coming year. I will share the first two lessons here.

1. Young people obsess about making a lot of money. Older people wonder what they were thinking.

When asked about their prescription for happiness at work, what wasn’t mentioned spoke the loudest. And fancy statistics aren’t necessary because the results are so clear.

No one — not a single person out of a thousand — said that to be happy you should try to work as hard as you can to make money to buy the things you want.

No one — not a single person — said it’s important to be at least as wealthy as the people around you, and if you have more than they do it’s real success.

No one — not a single person — said you should choose your work based on your desired future earning power.

2. Money is often at war with time. Balance them appropriately.

The view from the end of the life span is straightforward: time well and enjoyably spent trumps money anytime. They know what it means to make a living, and they are not suggesting that we all become starving artists. But they also know firsthand that most people who decide on a profession because of the material rewards at some point look back and gasp, “What have I done.” In their view, we all need a salary to live on. But the experts concur that it’s vastly preferable to take home less in your paycheck and enjoy what you are doing rather than live for the weekends and your three weeks (if you get that much) vacation a year. If doing what you love requires living with less, for the experts, that’s a no-brainer …

If you are willing to accept a lower income level, you can gain enormous benefits by choosing part-time work as a lifestyle. Imagine if you suddenly had more leisure than work time. Some experts made this decision: living on much less money, renting rather than owning a house, and forgoing expensive consumer goods to pursue a job and a lifestyle they enjoy

Check out Morgan’s article for the other eight tips!

People over Things

There is no one among the elders who does not prefer to be comfortable financially. What is clear from their lessons, however, is that they believe “enough is enough.” Time spent earning enough money is time reasonably well spent. Time earning an excess of money far beyond that required to meet one’s needs, however, is time wasted.

Very often, the elders pointed to a conflict between the pursuit of money and putting a priority on personal relationships. They stand firmly on the side of investing in relationships:

I have been poor, and I have been rich, but I feel best when I have a coterie of people who like and respect me for what I am, and not what I have. (Clinton, 67)

Surround yourself with people you love. It’s nice to have money and be able to live well, but loved ones are more important than possessions. (Malinda, 72)

Material things are useful, but good relationships with God and the people around you make life worth living. (Neil, 90)

Last but not least, money isn’t everything. Take time to have some fun in life. It’s not all dreary and dog-eat-dog. Stop and smell the roses. (Darren, 73)

Of all the elders who made this point, one in particular stuck with me, from Joshua, 74. He told me that it all comes down to making connections with and caring about others:

Well, who have you helped? What circles do you move in? Some people I’ve known, they never helped anybody. They were never in any circles – they lived their own life totally unto themselves. You know what? Nobody would go to their funerals. It would be as though they never passed by on earth. So if I stick my head in a hole and think of just myself, and I don’t try to do some good and get out and interact and use my braints to help people, then nobody will come to my funeral. And I’ll deserve it!

What You Don’t Have Can Teach You a Lot About Happiness

How can you be happy without a lot of material things? Families are dealing with that problem today.

The experts on the issue are oldest Americans, the last surviving witnesses to the Great Depression. Bonita, 96, tells about a childhood most of us can hardly imagine. Living on very little, Bonita, her family, and her friends found it possible to be very happy.

Here’s her story:

People now think they need so much to be happy. We were happy in my family, and just think of what we didn’t have!

To give you an idea of what we lived without, here are a few practical things that I have had to learn over my life:

• To use electric lights rather than kerosene lamps.

• To use electric stoves and later a microwave oven instead of a wood stove.

• To use an electric washing machine instead off a scrub board, boiler on the stove, and three galvanized wash tubs.

• To use an electric clothes dryer instead of hanging the clothes on the line outside.

• To have a faucet in the kitchen rather than getting water by the pail-full from a spring in the meadow a fourth of a mile away.

• To have an indoor bathroom rather than taking a bath in the wash tub in front of a kitchen wood stove.

• To have toilet paper rather than an old Sears and Roebuck catalog.

• To use an indoor toilet rather than the privy behind the house.

• To live in a home with an electric iron rather than a sad iron heated on the stove.

• To listen to a TV rather than a Victrola.

• To answer the telephone when it rings rather than having to check out the special ring on a party line.

• To use frozen and prepared foods from the store rather than baking bread and eating garden and home canned foods.

• To buy ready-made clothes in a store instead of those made by a dressmaker who came to our house.

There are so many things people take for granted today, that we didn’t have. For example, life without a bathroom is hard to describe. One has to live it to know what it is like. Our bathing in those days was done in a basin of water that we carried to our bedrooms. In the winter, this meant trying to undress as near as possible to the stovepipe which added a bit of heat to the bedroom. During the winter, Mother tried to see to it that we each had a bath of some sort once a week. In the morning we washed a bit in the kitchen.

Our toilet was a small shed about six feet square. They were always built with three holes so daily trips to the privy often meant that it could be a social affair. My other memory of this building is of the swarms of flies in the summer. They buzzed and hummed around beneath you and kept you company whenever nature called you to this place.

The other big job before running water was doing the family washing for ten people. It started on Sunday night when a big copper wash boiler had to be filled with water from the spring up in the meadow. This would bring the water up to the room temperature during the night. Then Mother would heat the water to boiling on the wood stove. All the white clothes were boiled first and then washed. It was supposed to be more sanitary to boil the sheets and underwear. Then the hot clothes were removed with a “clothes stick”- a long bleached pole- and carried by the pail-full to the back wash room where we had three galvanized tubs on a large bench. In one tub, we rubbed the clothes on a wash board with Fels Naptha Soap. We rinsed the clothes in the second tub and then put them thru bluing water which seemed to counteract the yellowish color that the clothes often had.

The four older girls all took turns at the wash board in 15 minute shifts. The clothes were put through a hand wringer that had two rubber rollers and squeezed out some of the water. The clothes were then hung outside on a clothes line in the side yard or on the porch in the winter. I can see the long underwear during the winter as it froze stiff almost as soon as it was put on the line. Later in the day we had to bring the clothes back into the house and thaw them out and finished drying them on racks by the wood stove. The clothes really did smell sweet and clean after being out in the fresh air. Mother’s hands were always cold and sore as she went out on those cold winter days to hang out the clothes. Often she would heat the wooden clothes pins in the oven so that they would warm her hands for a few minutes.

Ironing was started on Tuesday and often took all week to do. Flat irons called “sad irons” were heated on the stove and then wiped on a cloth containing paraffin. I think this was to wipe off any smoke from the stove and to make the irons slide easier. We had both irons with handles fastened to the iron and detachable handles which we preferred. As the iron cooled off it had to go back on the stove and we’d try to find a hotter one to use. In those days we always ironed the sheets and pillowcases, and usually had two tablecloths along with everyone’s personal clothes. It was a really big job.

This house was lighted with kerosene lamps. They were smoky and smelly. On Saturday we had to collect all of them and wash the chimneys, rinse them and dry them. The wicks had to be trimmed. The base of the lamp was filled with kerosene and then the lamps were each returned to the rooms where they belonged. The light that they produced was not very good.

The lamp was usually placed in the middle of our large dining room table and at night we all sat around it to do our homework. The older members of the family checked on the younger ones to see that pages of addition were completed and correct or that we had memorized our spelling words for the next day. We practiced our reading assignments by reading to some older member of the family from our reading books. Our teachers wanted each of us to memorize a short poem each week and we were expected to recite it in front of the class during a Friday afternoon assembly. “October’s Bright Blue Weather” and “Robert Reese” were two of my favorites.

With no television or record players, we had to make our own fun and entertainment. When we were through working on our school work for the next day, we often played games. We had checkers, dominoes, caroms, and card games like flinch, authors, concentration, and spit. Sometimes we played hide the thimble or spin the platter. We loved to play dress-up in the old clothes that were sent to us from relatives in California or the Lessells family in New York. We had names like Mrs. Colburn and Mrs. Osborn and would talk to each other at great length about our children, our husbands, and our lives while dressed in long black skirts, fancy lace blouses, and pretty old evening dresses form our relatives who were a bit better off than our family financially.

Do You Need More Stuff? Some Christmas Elder Wisdom

First, let me say that I love the holiday season. But, as Christmas approaches and we are inundated with advertisements and messages to spend wildly, it’s worth taking a break for elder wisdom. In the Legacy Project, over and over the elders told us that people and experiences matter more than things. In hundreds of interviews, they unanimously caution that time spent getting a lot more stuff than you really need is time wasted. The holidays seem like the right time to listen to our elders and think twice about how much we buy.

Steve, 78, tells how he learned to put material rewards in perspective, focusing instead on the accumulation of love for family and friends. As I’m planning my Christmas shopping, I try to keep his lesson in my head!

We were among the very lucky ones. Both my wife and I were born into middle class merchant families, with caring parents in small communities where you knew and were known by your neighbors. My wife lost her father when she was only 13. She, her mother and sister moved to another, beautiful small community where life was comfortable though not luxurous and values for the young were set by the example of parent and community. My childhood with loving parents and an older brother was uncomplicated and also filled with good values set by example. Owning and accumulating was not an important part of life for either of our families.

This upbringing undoubtedly established most of our values and attitudes for the adult years. Honesty, integrity and compassion for ones fellow human beings remained the anchor for all decisions. As we matured, reared and educated four children and attempted to pass along those values to them, we learned that listening is far more important than lectures, and though it sometimes seemed we were not heard, the example of our lives spoke loudly to our youngsters.

Now, at 71 and 78, as we progress through our senior years, living comfortably — not luxurously — we are increasingly aware that accumulating STUFF is of little importance. The accumulation of love for each other, of our children and of life-long friends and extending that love to those less fortunate than we have been is the centerpiece of our lives, of humanity and civilization.

You Need to Do What You Love

Many students are involved in summer internships right now, so it’s worth taking a moment to learn this lesson from our elders: focus on work for its intrinsic value more than for external rewards.

Marty, 71, had a very satisfying work life as an engineer and entrepreneur. But he exhorts younger people to think about success not in terms of money, and gives you some important questions to ask yourself about your career.

Earning money seemed to be how they measured a success when we were young. Some people went to college but most people went to work, they got a job and went to work so everything revolved around: What are you earning?  What are you making? And so the more money you made the more successful you were.

And that became more important than: What should I do with my life? What do you want to develop? What do you want to learn?’  But by learning and experiencing that part of your life, you’re going to be doing something you like doing,  that you want to do, and money follows. Money follows. That’s the way it works.

And if money doesn’t follow, you’re doing something you like anyway. So it was like when I was a kid, down the street we had a shoemaker, a father with his kids and they did the shoes, leather soles and stuff. They were a pretty cool family. They loved working there and they loved making shoes and fixing shoes. So there’s ways to be happy without having to be this big-shot corporate guy.

Jeremiah’s Lesson for Living: Wisdom Gathered by our Summer Interns!

Our summer interns are back! Two great undergraduates spent part of the summer interviewing older Welcome-Interns-Signpeople about their advice for living. Here’s the post from Margo Rieman, a junior attending Tulane University in New Orleans, Louisiana, majoring in Management and Psychology and minoring in French. While conducting her interview, Margo learned the importance of thinking wisely, working hard and saving your money. Here’s her report:

When one is young, it can be difficult to make smart decisions and spend your time wisely because understanding and effectively anticipating the long-term costs and benefits associated with a given choice can be challenging. Many people rely on past experiences and invested costs when making life decisions. However, ignoring other factors – particularly the future – may result in a short-sighted perspective.

Jeremiah, a former World War II veteran and now a 99-year old New Yorker, had some wisdom to offer on this topic. Jeremiah made it clear that there are certain things in life that should be prioritized when making major life decisions, despite your immediate wants and needs. Jeremiah recants his experiences below and emphasizes the importance of thinking wisely, going to college, and saving your money.

I was a veteran in World War II. I could have gone to college on the G.I.’s Bill of Rights but I wanted to live, more or less. If you grew up in the 30’s you didn’t have the same opportunities as you do today because of the lack of money. So once you’re in service, and you accumulate some money, after you get discharged you have this money supposedly – what they call, “on the books” – coming to you, so you want to go out and buy a car, which is a mistake. I should have used it to go to college. I wasn’t a gambler or anything like that so I kind of accumulated quite a bit of money.

That perspective, the war, changed me, you know. Plus I had a high school education, and I wasn’t real smart, in fact I was below level but I could have went to college. I didn’t want to, I wanted to have a good time. Well, now I’m pushing 100. I never saved any of my money, and I’m broke. When you see on the television that you need hundreds of thousands of dollars for retirement, they’re not far off.

Jeremiah concluded:

Work hard, save your money. You’re always going to have stressful experiences, but if you know what you’re doing, you can do it. Be conservative. Be very dedicated to what you’re doing. You gotta have fun but it should be 20 percent of your efforts. The thing is if you do it when you’re young, you’ll be better off when you get older.

Jeremiah’s advice forewarned me of the importance of saving while I’m young and to work hard in all my endeavors. He gave me confidence that I will succeed if I am knowledgeable and experienced in the work I am pursuing.

 

 

Want to Be Independent Later On? Elder Wisdom Says: Save Now!

It’s a pleasure to share a guest blog by our third summer intern, Zoe Eisenberg. Zoe is a sophomore financial independenceat Ithaca College. She is majoring in gerontology and plans to minor in Legal Studies. Zoe was excited to learn from the elders themselves through the Legacy Project’s in-depth interviews. This lesson about the role of financial planning in maintaining independence throughout life came from Richard, age 68.

Here’s Zoe’s post:

Independence is a value held dearly by many, and it is something that we often express without thinking twice. During my interview with Richard, the importance of independence in his life stood out as a recurring theme and valuable lesson.

Richard grew up in an environment that encouraged independence. His father died at a young age, and within his small family he was expected to be responsible for himself. As a young man, he traveled extensively while serving in the army and working in the computer industry. Though Richard was married briefly, he never had children and he pointed to this as one of the reasons he continued to lead such an independent life throughout middle age.

When reflecting on the choices that have allowed him to maintain his independent lifestyle, Richard emphasized the importance of saving financially for one’s future:

That’s why it’s important to think about your future, and think about money, and think about saving. Don’t get into debt, save for your retirement at an early age. I wish I would have known that. I didn’t really start until I was in my 50’s, you should start when you’re in your 20’s.

 

If I had done it at 20, I’d be a millionaire. I did it at 50 so I’m a “thousandaire.” It’s a huge difference. And you don’t know when your life is going to be over – Plan for the longest time. Start saving! And then do things you want to do.

Today, Richard is adapting to new levels of interdependence as he manages health challenges that have limited his mobility. However, his determination to be self-sufficient to the greatest extent possible is fueling his recovery and adaptation to changing circumstances. Valuing independence continues to serve Richard well – and careful financial planning is one way to do it.

Sensible Lessons about Money

Sometimes I find myself thinking: Whatever happened to good sense? When it comes to money, the elders offer advice that is, well, sensible. They came from a generation of savers, re-users, and careful consumers. Here’s 91-year old Betty’s advice for financial well-being:

You need a checking account and a savings account. Take each paycheck to the bank and deposit, don’t cash it. Hold out enough for cash purchases, groceries, etc.  Leave enough in the checking account to pay current bills. Whenever possible, put a little in the savings account. This is your emergency fund for unexpected expenses and a start toward your savings.

Be wary of credit cards. Never use one unless you can pay the bill in full at the end of the month. The interest can be devastating to your finances.

Aim toward home ownership. Rent is a constant drain with nothing to show for it.

For major purchases, save first and pay cash. This goes for cars and it can be done.  As soon as I’ve bought a car, I start saving (in the savings account) for the next. Making payments adds much more to the cost. That money can be yours to use.

When you have your finances organized and are keeping out of debt you are ready for the next step. Start your life savings. It is all right to start small but you can’t start too soon. Locate a full service brokerage firm and appointment with a financial adviser, who will listen to your needs and advise accordingly. Medium risk stock will likely serve you best. Later you can use the dividends for extra income. If you keep increasing your stock portfolio, it will provide financial security for retirement. Never buy stock from a small outfit that only deals with a limited type of stock or on advice of an individual.

Sensible Elder Lessons about Money

Sometimes I find myself thinking: Whatever happened to good sense? When it comes to money, the elders offer advice that is, well, sensible. They came from a generation of savers, re-users, and careful consumers. Here’s 91-year old Betty’s advice for financial well-being:

You need a checking account and a savings account. Take each paycheck to the bank and deposit, don’t cash it. Hold out enough for cash purchases, groceries, etc.  Leave enough in the checking account to pay current bills. Whenever possible, put a little in the savings account. This is your emergency fund for unexpected expenses and a start toward your savings.

Be wary of credit cards. Never use one unless you can pay the bill in full at the end of the month. The interest can be devastating to your finances.

Aim toward home ownership. Rent is a constant drain with nothing to show for it.

For major purchases, save first and pay cash. This goes for cars and it can be done.  As soon as I’ve bought a car, I start saving (in the savings account) for the next. Making payments adds much more to the cost. That money can be yours to use.

When you have your finances organized and are keeping out of debt you are ready for the next step. Start your life savings. It is all right to start small but you can’t start too soon. Locate a full service brokerage firm and appointment with a financial adviser, who will listen to your needs and advise accordingly. Medium risk stock will likely serve you best. Later you can use the dividends for extra income. If you keep increasing your stock portfolio, it will provide financial security for retirement. Never buy stock from a small outfit that only deals with a limited type of stock or on advice of an individual.