I've always been interested in investments and sometimes been interested in economics. I've written two blog postings about these issues in the past:
- Economics Isn't Physics: What Politicians Don't Get About Recovering from a Severe Recession (2009)
- Things I'm on the Fence About (2013)
I've been thinking about writing about investing for a long time. We are reasonably comfortably retired for four reasons:
- At least one of us (usually my husband) has been gainfully employed throughout our marriage
- We always had health insurance when we needed it
- We always worked to pay off debt and have basically had no debt for over six years
- We started investing once we both had good jobs and diversified our investments as soon as we could
And, I also have to admit it - we've also had plain dumb luck. Sometimes life goes way beyond your control. While that's happened to us in some ways, it hasn't happened that much with finances. And when finances got ugly (and they have a few times), we were able to adapt to the situation.
We got married in the late '70s just after my husband Jim graduated from college. Lots of people started getting married when they were older in the '70s. We wanted to be together whether we had money or not. My parents threw us a fairly simple wedding (no limos, limited flowers, nice reception, no matching tuxes or dresses). We borrowed a car to drive our wedding gifts back to Pittsburgh as we didn't have a car of our own. Our honeymoon was two nights in Washington DC, where my brother picked up the car to drive it home. We were both unemployed the first few weeks of our marriage, but, luckily, had wedding gifts to buy groceries and pay rent.
But this was all OK. We were together and we learned a very important lesson over those first two years of marriage - we learned how to live poor. We learned how to be adaptable. It was news to me as I'd grown up very middle class. But it wasn't news to my husband, who'd grown up fairly poor and had been a scholarship student in college. He'd taken the bus about two hours every day from his home across Pittsburgh to get to classes.
Soon after we settled into our first apartment, I got a job as a waitress. Jim got a job as a school teacher meaning he'd continue to be unemployed for another 2 1/2 months. I was hoping to return to college in the fall, but the money just wasn't there so I worked at various jobs (I really hated waitressing) a found a job I generally enjoyed - working as a floating sales clerk in a department store. I landed in the book department which I enjoyed the most. We were extremely cautious that summer as we had no health insurance. The birth control pill pack was $10 a month in those days and that was probably the expense we were the most religious about covering.
Jim's introduction to teaching was walking the picket line his first weeks of "work." Luckily, the strike only lasted for two weeks. That year, we made just a touch over the local poverty level but at least we had health insurance. We were able to get a Sears credit card, which we needed as we moved to a better apartment but one without a refrigerator. MasterCharge turned us down. About the only other thing we bought on credit that year was a set of Encyclopedia Britannicas which Jim got at a discount as he was a teacher.
The main surprise the first year was I needed surgery. The excellent health insurance paid for everything, but I had to take a month off of work. Still, we were able to come up with enough money so I could return to the University of Pittsburgh the next fall. I worked part time at the Burger Chef in the basement of the Cathedral of Learning while going to college full time. MasterCharge gave us a credit card that year so I was able to charge my college textbooks. Jim continued teaching science. He also made some extra money by tutoring some of his students.
And then...Jim did not get tenure at his teaching job. I encouraged him to look for a non-teaching job - he'd been a physics major in college but was a good writer. Relatively quickly, he got a job at a plant in Ohio. But since it was a uranium enrichment plant, he had to get a security clearance, which meant we were without health insurance for a while. While I'd finished my junior year, I was pretty sure we'd be in Ohio by early in the fall, so I didn't try to stay in Pittsburgh to finish my senior year.
We both worked the same full time temp job that year - reading newspapers and recording keyword searches for a legal case. Simultaneously interesting and boring. But we were able to save enough money to buy a car, which we knew we'd need. It wound up taking nearly six months for him to get his security clearance, and then we were on our way to Ohio.
Since he was now making twice as much money as he did as a teacher, we found an excellent apartment - the first floor of a large old house near downtown Chillicothe, Ohio. We suddenly had huge rooms and even separate offices. There was a porch, yard and a detached garage! Our bedroom had a bathroom with a shower! Such luxuries! I got a job for the 1980 census, helping to administer census taker tests which would be full time until September.
We felt rich.
So we decided it was time to start our family. As I'd had ovarian cyst surgery two years before, I figured it could take a while to get pregnant. Surprise - I was pregnant the next month. Yeah, I guess you're near peak fertility when you're 23 and your husband is 25.
Much as we were happy about the baby, we really didn't care much for Chillicothe. We met a few other couples around our age...but...it just felt dull. After we had our daughter, Leslie, in the fall of 1980, we were very busy with her, but...we really didn't like where we were. Just after Leslie's first birthday, Jim started looking for a new job. I don't remember now how he found a job, in those pre-World Wide Web days, up in Boston, but it was exactly where we wanted to be. By February 1982, we were living in a small apartment in Boston and we were city-dwellers again.
I haven't started talking about investments yet because the first few years of our marriage, we had virtually none. I knew a little about stocks and bonds - my grandfather had given each grandchild 6 shares of AT&T stock. We got something like $16 of dividends a quarter. We sold that stock before we left Pittsburgh. I think Jim was on a pension plan for his first few jobs; not sure the term "401k" even existed yet.
But even though we didn't have investments, we understood how to live within our means. I don't think we left Ohio with more than $500 in consumer debt and maybe $2,000 in car debt. Our main "optional" expense were books. We really loved to read and had probably 4,000 books (mostly paperbacks) by the time we moved to Boston.
Things were different in the 1970s and early 1980s - you could get an apartment without bringing in extra roommates if you made little money. More jobs offered decent health insurance. College loan pay-off was easier - college was cheaper and the special college loan interest rate was around 3%. Financially, it is harder for most people today than it was 45 years ago.
More next time!
