MY 1975 GRADUATION from college was a momentous occasion for my parents. We had emigrated from Germany, first to Canada and then to New Jersey. They didn’t have college degrees, but they had worked hard and epitomized the American dream. Proud that they’d been able to pay for my education but also relieved that college costs were over, they were looking forward to the start of my career.
Wait, what about marriage and a house in the suburbs?
WHEN I THINK ABOUT my financial journey, I’m reminded of a line from a famous Grateful Dead song: “What a long, strange trip it’s been.” My journey has indeed been long and, on occasion, somewhat strange.
I was born in 1957, the second of three sons. My parents provided us with a loving home and an excellent education. At college, I studied to become an engineer and spent my career in aerospace engineering. No surprise,
APRIL IS FINANCIAL Literacy Month. If that doesn’t excite you, imagine how your children feel.
Still, consider this an opportunity to begin or reinforce your kids’ financial education. Many of my students told me one of their parents was into “finance,” but when I asked how the parent handled the family money, students would just shrug and say that was all they knew.
Children don’t like a straight-up lesson, especially from a parent. The trick is to make it seem casual and as blended into everyday life—theirs,
THIS IS ABOUT a journey, about what can happen and what you can make happen. It’s about starting at the bottom and, over more than 50 years, achieving financial independence.
My financial views were heavily influenced by my parents, especially my father, but not in the way you might imagine. My father was a car salesman. For many years, he worked seven days a week, from 8 a.m. to 8 p.m. He was let go from his job at age 67.
MY WIFE AND I ARE blessed with 11 grandchildren and two step-grandchildren. They range in age from six to 18. Amazingly, as we get older, they’ve gotten older, too. We’re fortunate that all of our family is no more than an hour and a quarter’s drive away.
How I miss the days when they were delighted to play with Pa. We went to parks, to playgrounds, to see koi in a pond. We made sandcastles,
FOR 10 YEARS, my wife and I have given each of our four children $5,000 to $6,000 per year for them to put in their respective Roth IRAs. So far, we have given each of them about $60,000.
They were amazed a few years ago when their investment gains for that year exceeded our annual contribution. Today, their Roth accounts are now each worth about $125,000, so their cumulative growth—about $65,000—now exceeds our total contributions.
OUR FOUR CHILDREN are adopted.
After we’d been married several years, we were dismayed that my wife hadn’t conceived. Through testing, we found that we were both essentially infertile. As one doctor put it, “It’s good you are married to each other.” We decided not to pursue surrogacy, in vitro fertilization or similar options.
I thought our life was on an even keel until one day my wife asked, “When you get to be 65,
RON LIEBER, in his book The Opposite of Spoiled, describes a 2012 conversation between Chris Rock and Jon Stewart. In an interview on Stewart’s show, they got around to discussing the challenges both faced in raising children who could remain grounded amid wealthy surroundings.
Rock described how his own modest upbringing differed from the comfortable life his children enjoy. “My kids are rich,” he said. “I have nothing in common with them.”
MILLIONS OF RETIRED baby boomers struggle financially, and yet they don’t eat avocado toast, don’t have a daily Starbucks habit and didn’t graduate college with a degree in women’s studies.
What’s my point? In the comments section of HumbleDollar, there are two recurring themes—that young adults spend recklessly and that college is of questionable value. I understand these concerns and even share them to some extent. But I’d favor a more nuanced view.
WHEN YOU’RE STUCK in traffic, have you ever idly wished for another lane to ease the congestion?
Not long ago, I listened to a podcast about the eternal problem of highway congestion in Texas, especially in the Dallas-Houston-San Antonio triangle. The expert said that our fundamental problem is that planners think of traffic as a liquid, so their answer to flow problems is always to “build a bigger pipeline”—meaning more highways.
Traffic, however, behaves less like a liquid and more like a gas.
THIS PAST FATHER’S Day, I was listening to a financial talk show. The host asked listeners to phone in and describe how their father influenced their thinking about money.
Callers related that their fathers told them to save early, to not waste money, to avoid debt and a few other basic ideas like “don’t worry about keeping up with the Joneses.”
I told my wife I couldn’t recall my father ever talking to me about money.
FROM AN EARLY AGE, my son showed an interest in business and investing. As a toddler, he’d watch CNBC with me. When my wife and I discussed legal and accounting issues, he’d have his “listening ears” on. (Yes, our dinner table conversations are pretty exciting.)
By the time he was eight years old, he was giving me investing input. He thought Microsoft overpaid when it bought Minecraft maker Mojang for $2.5 billion in 2018.
WHEN I WAS GROWING up, one family in the neighborhood lived differently from all the others. In their garage was a Rolls-Royce. When each of the sons turned 16, a new BMW showed up in the driveway. Because it was so out of the ordinary, it caught my attention. It caught everyone’s attention.
Looking back, this is what I find interesting: This kind of privileged upbringing looked like a guaranteed recipe for demotivating their children.
I RECENTLY HIT the “pay now” button on what I believe will be the last of 20 years of college tuition bills. That’s right, we have five kids. All went to college. None took out student loans.
Was it worth it—not just paying the tuition bills, but the decision to have children in the first place? It’s a pressing question. A birth dearth is hitting the U.S. and other countries around the world, as many adults opt to go childless.
AS A PARENT, it’s my responsibility to teach my children good financial habits. Core among these are deferring gratification, saving diligently, giving generously and making sensible spending choices. I feel it’s also important to make my children aware of financial pitfalls. Succeeding financially—and in life generally—seems to be as much about avoiding self-destructive habits as it is about cultivating good ones.
My wife and I have been homeschooling our children for the last couple of years.