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I worked and earned income from 1963 to 2022. I always saved a portion of my earnings. Some was “parked” in real estate, some in the stock market, some in bonds and some in a traditional savings account.
Every dollar I saved represented many hours of true labor. Some was as a business owner, some as an engineer, some was “sweat equity” in my homes and RVs, and some labor was expended by maintaining a commercial property.
I didn’t spend all of my income from “work”. I “parked” a portion of the proceeds from that work via investments so I could draw upon them in retirement. I concluded this would be “shadow working” while I was retired. Today, every dollar I pull from my retirement accounts represents wages for my past effort and work success. During my actual working life at least 10% of my hours were “banked” for the future. In essence the echoes of my many years of labor are reverberating today, in the present. My savings are working for me today, but every dollar represents a small amount of physical or mental labor I expended in the past.
This perspective influenced how I invested. Each investment was as if I were asking myself “What company is worthy of my efforts”? Which companies would be better stewards and are aligned with my values? This was a personal approach to investing and I’m sure I left “profits” on the table; there were many companies I deemed to be unworthy, or which had unsavory businesses or business practices.
As a business owner I made a decision each year about how much “profit” to leave in the company. I could invest it in my firm, or share with others via dividends, bonuses or profit sharing. I decided how much to invest in my business. Or, I could have bought a bigger boat, etc. There were a few lean years when I left the earnings in the company and my administrative assistant made more than I did. That too was an investment. An investment in the people and in the business.
Taken to an extreme, this could be unhealthy. When the Dot-Com bust occurred I thought for a brief time of the hours I has spent working to accumulate the savings for those “investments”. However, it reinforced a need for better scrutiny and methods on my part.
My retirement has absolutely nothing to do with my success as an investor. It has everything to do with my decisions as a worker, what I did with the fruits of my labor and my cautious, minimalistic approach to possessions; I could have spent a lot more than I did. Better cars, bigger boat, more toys, etc. So today, as I sit on the deck at the pond alongside two of my RVs, I’m not here because of any success in the stock market. Same is true for when we are in our home in Arizona. This is all literally a consequence of years of conscious, thoughtful decisions I and my spouse made for decades (me for 59 working years) and our many choices and years of “living small” while enjoying life and banking a portion of our labors.
So, today, the stock market and my bank are working for me. I can see my shadow in every dividend or gain that I receive. Some may disagree with my perspective, but overall, I think I have had an empowering way to approach life, work, saving and spending. Sufficiently empowering to get me where I am, today.
Norman, fascinating article and observation.
For some reason, perhaps it’s just me looking at language the wrong way, as usual, but I don’t think buying or selling stocks is “investing.” I think it’s trading because in most stock transactions, someone has to sell so that another can buy. One exception, of course, is an IPO.
I also think of it as legalized gambling — no different than playing Roulette. Pick a number and spin the wheel. However, which number to pick is where study and analysis come in. Or, in my case, paying someone else who, hopefully, knows more than I do.
I used to invest in small companies and other ventures when I was younger. I stopped simply because I’m too old to wait for a return. And I’m not smart enough to pick the next big winner for my heirs.
My last gamble was Bitcoin. I bought the initial limit when Morgan Stanley first offered it. Presently, it’s my biggest single holding and will be the last asset I sell when all others are gone. Basically, it’s for my heirs.
I’m quickly reaching the point of no debts or other liabilities. The last property goes on sale next month. I’m hoping that gives me a good feeling.
Another Forum article explores the concept of “Downslope”. I think I’m on it.
That’s a great description: “I see my shadow…” Congrats, Norman, on successfully navigating your savings life through all 59 years to retirement.
I too took the long view and see that shadow now that I am retired. Indeed, I am inordinately proud of fully funding my retirement with a 403b, despite years of low to middle income. That means more to me than any investment success. Being responsible for one’s self, and being grateful for the opportunity to do so, are the most satisfying.
Thanks for an excellent description of how to create real wealth. It is a lifelong marathon, not a sprint.
Thanks Norman, great piece. Working for 59 years is a fantastic effort and a testament to your stamina.
I hope your long term diligence serves you well for your retirement.
I like that perspective, Norman. I had a late start saving for retirement. But once I began, I took the long view and projected my future earnings and expenses. I figured I’d have expenses for more years than earnings from my own labors. So I laid aside a portion of what I made each year to feed and clothe me in the future. Nearly everyone reading this understands that concept. I’m thankful that I do–many folks don’t
I agree and understand https://humbledollar.com/forum/what-has-been-my-relationship-with-money-that-story-starts-around-age-8-every-kid-needed-caps-and-beans/