Blogs walk a fine line between information and soul baring. I agreed to do a guest blog to contribute to Mrs. Mad Money Monster’s endeavors with this website, but did not look forward to the self reflection that comes along with it. So without delay, let’s get into the reasons I have chosen the path to financial independence with Mrs. Mad Money Monster…
You Learn What You Live
I had a mother who was thrifty. She was a single mother during the crucial, formative years with my brother and I. It was just the three of us from roughly 1973-1978. Two boys during the oil crisis of the mid-70s, working three jobs, with a mortgage, a Volkswagen Beetle with no front brakes (we used the emergency brake) and liver for dinner. This paints the picture of a woman doing all she could all on her own to raise her children. Once my step father came into the picture things stabilized, somewhat. We got a new house, new school, and a new lease on life.
Home And Garden
Me in middle school with an Academy Award!
While my mother saved money, Mrs. Mad Money Monster pointed out that she didn’t really build wealth. My mother and step father paid off a thirty year mortgage in half the time. We drove beater cars that cost no more than 500 dollars and the only new vehicle we had while I lived at home was a 1979 Ford truck, bought at half price because of a newspaper ad print error. My mother could be shrewd when she saw an opportunity.
Eventually, my mother returned to school and got her nursing license. By the time I was in eighth grade in 1980-81, money complaints eased up. However, the majority of our groceries were still the white generic labels with bold black print: “COOKIES, BREAD, CRACKERS, PASTA...”
Fast food was a once a month treat. My mom would call from work, take an order from one of the fast food chains up town. She would come home with front seat covered in bags and styrofoam containers. Now THAT was livin’!
Our lawn mower was bought at a yard sale. Our lawn service was me. When it came time to give our 1965 Cadillac a new paint job, it was a family affair that put The Brady Bunch to shame. Me, my brother, and a bunch of my neighborhood friends descended on that auto dinosaur with sanding blocks. We stripped that sucker down for the cost of a few pizzas and sand paper. My step father bought the paint and painted the car himself in his father’s barn.
Our big beach vacation to Seaside Heights, NJ
We had one true family vacation. My mother was fired from her main job at an auto parts warehouse for trying to form a union. She and her “Gang of Six” took their employer to court and after a year legal battle, got a small settlement. It was hardly a windfall. Instead of spending it on a car or some kind of extravagance, my parents put the money into our house. They were able to add a family room in the basement and carve out a washroom and some storage.
The remainder of the money allowed us to go out to an Italian restaurant one evening to celebrate her Norma Rae-esque victory. “You can get anything on the menu”, she told my brother and I. I celebrated with a fried clam strip basket. That gives you an idea how high end the restaurant was.
Her total settlement was around eight thousand dollars in 1979. In addition to finishing our basement and some fried clam strips, we were also able to afford a new truck, money towards my mother’s return to nursing school, and our lavish vacation to Seaside Heights, NJ. Pretty wild, huh? We stayed at some economy motel near the beach. We ate on the boardwalk and I had my first dish of blueberry pancakes!
All of that on eight grand in the late 70s, early 80s. Not too shabby, Mom!
Low Expenses And Eliminating Debt
Keep in mind, while we were living our extremely frugal lifestyle, she was also making multiple extra mortgage payments every month. We lived with a dog and several cats over the years. We did not have cell phones, and only had basic cable – which was a big deal in 1979 – and much less expensive than the astronomical prices charged today!
My mother kept a zero balance on her single credit card. She carried the firm belief of “you don’t have it, you don’t buy it.” My brother and I were given the Atari 2600 one year for Christmas. But, there were no games to go along with it. My parents never once bought a single game cartridge for us, as my mother made it clear she thought they were a waste of money.
Now before I tackle that hypocrisy, while she saved money everywhere she could, she never invested. They had CDs, and when she became a nurse she had a 401k type of retirement, but they owned no stocks and they did not actively build wealth through investing.
While my mother railed against video game cartridges, she was a three pack a day smoker. Pall Mall, unfiltered. She started smoking at the age of 13 and by the time she was 24 she was up to almost three packs daily. She hit the three pack plateau by her 40th birthday. Mrs. Mad Money Monster did a calculation of how much was spent on smoking in my mother’s lifetime, and what it would have translated to in properly managed wealth today. She can insert that here…
Hi, Everyone! This is Mrs. MMM. It’s true, I did a quick calculation of how much the cigarette money would’ve amounted to today, had it been invested. The total was somewhere just south of $1,000,000! Womp. Womp.
Debt Freedom – Debt – Debt Freedom Again
Not all pictures are digital!
My mother also liked to party. To be clear, she was a social drinker and weekend warrior. She did not drink at all during the week, but when Friday rolled around, the gloves were off and she gave the week a good kick in the ass. Beer was the beverage of choice. Weekends were home or away gatherings of her and my father’s friends, cards, smoking and beer.
When my mother’s step father died in 1985, he left her $25,000. She used part of it to get herself a new Chevy Cavalier and another chunk replaced all the upstairs carpeting that was the original stuff since the house was built in 1973. Trust me, that carpeting took a beating over the years from all the parties that went on in the house. By the time I was in college and out of the house, the mortgage was paid in full. The remainder of the $25,000 was used to eliminate it completely.
They were 100% debt free by the time Reagan left office and that had a HUGE impact on me.
The 90s arrived with a paid off house. And, my mother finally decided to fulfill her longtime desire for an in-ground pool. The house was paid off, they were sitting pretty, and this dream pool had a $50,000 price tag. I advised against it. Why? My mom was not an outside gal, my dad would get stuck with the maintenance, and I was out of the house AND didn’t swim. So I sure as hell wasn’t planning on coming by at the start and end of swim season to help open and close the pool. No thanks.
They did it anyway. However, my father was recently promoted at work and the extra income went towards paying the pool debt off early. So, by 2000 they were once again debt free.
No car loans. No mortgage. No major credit card debt. Not too bad.
A Family Business
My dad took over a successful family tire garage. They bought the business from his father for around $200,000. Their goal was to pay it all off in five years. They met that goal! By 2005, their debt was repaid and the tire garage was functioning in the black and thriving.
There is a small side story to this. During that five year period focused on paying off the business, money was tight. During a visit one hot summer day, my mother lamented my father having to mow the lawn by hand. The riding mower needed a new battery and it was $60. While I could have easily given her that for the battery, I replied “Well, how about both of you don’t smoke for a week and there’s your sixty bucks!”
I know, I know…in this over sensitive, politically correct age, I sound like a spoiled ungrateful son. After all my parents did for me, I couldn’t spare sixty lousy bucks to make my dad’s lawn care a tad easier.
I could have. I chose not to. Like she chose not to contribute to a wasteful habit like video games. Had I called her from college and said I couldn’t afford books or a class, the first thing she would have said was, “Well don’t party for a few weeks and use the money you save for books.”
I spent a lifetime in second hand smoke with a mother who was a nurse and knew exactly what that exposure could do. If the battery was important, they could choose to suspend their cigarette purchases to buy one.
Where does all of this go? My mother’s health started to show signs of failing by 2000. Shortness of breath, poor skin tone and weight loss had me thinking cancer. With the amount of smoke that circulated her body, I would be amazed if it wasn’t.
Instead, it was emphysema. She finally decided it was time to travel. They did jaunts to Disney, then out to the Grand Canyon, California, and Alaska. By 2005, my mom could barely walk from her car to the front door. She stopped driving that year for good. She retired in 2002 from nursing under the umbrella of disability. When her doctor showed me PET scans of her lungs and they were as black as construction paper, the end was clear.
I got her approved for a double lung transplant that she refused. Aside from the trauma she would endure with no guarantee she would be any better off, she admitted the real reason she didn’t want new lungs. She would smoke with them, and that wasn’t fair to someone who needed new lungs and wouldn’t deliberately destroy them.
She died in 2007. There was never concern for keeping the house. There was money to keep her comfortable medically. She was able to stay in her own home without the fear of losing it.
She unfortunately died in the nearby hospital and not in her bed as she had hoped.
This is a very abridged thumbnail, sketch of a wonderful mother and person. Her will left everything to my dad, which my brother and I agreed to. But there simply wasn’t a lot there. I did receive her Beatles collection and while that had significant value, it’s only if I liquidate it, which I never will.
Show Me The Money…Or Not
With all of their debt elimination, I felt they should have had more money. Wealth. They should have accumulated wealth. There were no stocks in her name. No investments. The few CDs yielded a little more than nothing.
The amount of money on cigarettes and beer alone could have resulted in significant wealth. I will defer to the lovely Mrs. Mad Money Monster for those figures.
Hi again! It’s me, Mrs. Mad Money Monster. It is true. If Mr. MMM’s parents would’ve taken the money they spent on beer and cigarettes and invested it instead, they would’ve been sitting on 7 figures – assuming an 8% return.
A life misspent takes on a different meaning from a purely financial perspective. Opportunities were there, they simply weren’t taken. Missed opportunities and a failure to invest alongside debt elimination equated to little wealth accumulation. After joining forces with Mrs. Mad Money Monster, I realized I want to tackle both sides of the financial coin. I want to be financially independent.
My next installment will be a look at my financial workings in the mid to late eighties and what led to a self imposed exile.
And there you have it, the very first post by Mr. Mad Money Monster! What’s your story? Why have you chosen to become financially independent?
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