Another Point Of View From A Very Wise Person


The other day Meg, she-who-is-wise-beyond-her-years, commented on my post about family and money.

“Hum. That’s funny. My High Wasp family lost all their money (which is a bit more traditional, I have to say, and you know how we feel about traditions). As a result, our lessons about money were the opposite, but of course from the same root.

Root Lessons: Never show off. Honor. Excellence. Hard work, even if you don’t need the money. Integrity.

But our overriding lessons were: Always live off the interest, never touch the principal. Know exactly where all your money is. High Wasps don’t invest aggressively. Diversify. Put a lot away for a rainy day. Never ever brag. Stuff doesn’t matter, family matters (unless it’s family stuff, then you may never sell it unless you need it to eat.)

So. I don’t know. Perhaps good things come from losing money.”

“Always live off the interest, never touch the principal.” This seems to me to be a philosophy with greater implications than preservation of financial security. The concept of interest and principal is fairly profound. Think about it. That for everything there is an initial investment, and then there is the interest? The generated return? This could be true of relationships, true of careers, true of hobbies, true of learning. In one way of living, you make the initial investment and then gather returns. Invest up front, manage carefully subsequently. Mitigate risk. I think there is clearly virtue here. Living thriftily and carefully and honorably.

Unfortunately, some of us are not temperamentally suited. We just can’t do it. Some of us make good investments and then liquidate everything and go to Africa. Some of us make good investments and sneakily dip into principal when the interest doesn’t get us what we want, and are then surprised when suddenly we have nothing. Some of us one day see a huge opportunity looking at us in the face, sell off everything and invest. Some of us then succeed, in relationships, careers, hobbies, studies, beyond our wildest dreams. Some of us then lose everything.

I believe I share those root values Meg mentions, “Never show off. Honor. Excellence. Hard work, even if you don’t need the money. Integrity.” But if I look back at my life I would have to acknowledge that I am prone to taking risks. To sometimes having the proverbial eyes bigger than my proverbial stomach.

All of what I say is true. I still don’t know if it matters.

13 Comments

  • 04/23/09
    7:22 am

    Reply

    The Cape House said...

    These last few posts have resonated so strongly with me. What Meg wrote perfectly sums up the attitudes that I grew up with. My parents actually never mentioned the term “trust fund.” They referred to it as an “education fund” throughout my childhood, but only mentioned it when they absolutely had to. I occasionally overheard my mother discussing with my aunts how to raise children with trust funds and how to tell them. “Trust fund” has developed all sorts of connotations these days, and for most of my childhood (until about 10th grade), I really didn’t realize that I had a trust fund. Trust fund and education fund were two different things in my mind.

    We’ve definitely had the “interest, not principal” lecture over and over, designer clothes are frowned upon most of the time as are other flashy and obviously expensive items, we live to volunteer, and bragging is absolutely strictly forbidden, as hard work, humility, and family privacy are main goals. Definitely take good care of the family heirlooms, but those are the only items worth spending lots of money to maintain.

    I’d love to read a post about disclosure and hear your thoughts on this. I have found that there is absolutely no appropriate time in a conversation to discuss your family’s background. Most friends know that I come from an old New England family, but only 2 know the full extent of what I grew up with (well, I don’t think you could get the full extent without actually living it). I often feel so out of place when friends discuss student loan debts and the like. I sometimes feel absolutely fraudulent around them.

    I likely wouldn’t bring it up because of modesty and family privacy issues, but I’d like to find out how others deal with this.

    Sorry for the novel! I tend to be chatty…

  • 04/23/09
    7:31 am

    Reply

    The Cape House said...

    PS. I liked your description of the “millionaires” conversation with your father. I do not have access to my “education fund” (not 21 yet), and I honestly could not even give you a ballpark sum. I have no idea what will be available to me when the time comes. The adults around here positively refuse to discuss numbers.

  • 04/23/09
    9:23 am

    Reply

    Muffy said...

    Meg is spot on. It seems it is terribly difficult these days with interest rates so low to live off of the dividends but I’ve always believed it was a terrific philosophy. Hard work is so important too. Lovely post.

  • 04/23/09
    9:55 am

    Reply

    Victoria said...

    A mere technicality but I thought Meg was Jewish…?

    Great principles to live by nonetheless!

  • 04/23/09
    9:57 am

    Reply

    Meg said...

    First – I never claim my High Wasp values are healthy values, they just are.

    Second – I am far more like this than you would even suspect, because my non-high-wasp side of the family was hit very hard in the depression, and those lessons have been mainlined into my veins, oldest girl, to oldest child, to oldest child. Oldest absorb that sort of thing. I re-sole shoes. Sometimes I buy a luxury item 75% off and then have guilt for a month. I could never sell everything and go to Africa. But. I am very good at taking big risks, and I’m not terribly attached to lots of money, just to saving what I’ve got.

    True: Spending is probably a spiritual act of bravery for me.
    True: I am in general pretty brave. This is probably not High WASP related.

  • 04/23/09
    11:53 am

    Reply

    LPC said...

    It’s so interesting. I am trying to be honest and full-disclosure around my thoughts. But it’s more difficult than I expected to get everything right. I write using myself as example of a segment of our culture. I may get the culture wrong. I may get the link between my self and the culture wrong. And I may get even my self wrong. I wouldn’t be surprised. But I’m going to proceed on the premise that it’s worth a try. I appreciate all your comments immeasurably and as long as you don’t mind I will continue to use them as a way to sharpen my thinking.

    I would however say that bravery is unequivocally good. And I’m clear that it’s in no way the property of High anything.

  • 04/23/09
    2:54 pm

    Reply

    Meg said...

    I don’t mind at all. And I think you are being very brave.

  • 04/23/09
    9:12 pm

    Reply

    The Sporting Trad said...

    I think that this is all subjective in the year 2000 of 9! “Old money” is dying off quickly and i can’t help but think that many of our great great grandfathers would be extremely impressed with the ways we have come up with of acquiring things we don’t need. (As a young black man, I KNOW mine would) I received my first inheritance check when i was 18, and used it for a once in a lifetime educational experience, however, i know others who used the same money for a brand new yuppie chariot. My old gal of Welsh descent remembers a time of owning thoroughbreds and picnics on the green, but she still lives for the pursuit of her own FOR her own, and I feel fortunate enough to be included in that category. Others still will never have need of want for anything, but will never reach their full potential, thus ending their families reign of intellectual prowess. This also in and of itself is a tragedy oft seen in today’s WASP. Men with money, but devoid of mind. The lack of integrity seen by our nations wealthiest is disgusting and only points to that fact which I mentioned earlier, that in 2009, does anyone really care?

  • 04/24/09
    6:33 am

    Reply

    LPC said...

    “Men with money, but devoid of mind.” In my family the High part of High WASP does require education. And the effort at thoughtfulness. The belief that constant learning matters. As you point out, the wave of money that propelled my family is for the most part dying off. So what will happen with the next wave, as new money eventually becomes old money? Some will probably go down the road of excess without obvious redemption except contribution to capitalism. Some, in my personal lexicon of hope, will take up what I and others have defined as High WASP values. They will stress education for their children, they will try to do a good job at everything they attempt, they won’t show off. But in the end values are personal. I have a wide tolerance for other peoples’ choices, waiting until actual harm is caused to judge. I’m not even saying my habit of tolerance is good, mind you, it just is what it is.

  • 04/24/09
    12:16 pm

    Reply

    class factotum said...

    “I re-sole shoes.”

    I wasn’t as shocked to learn that a friend of mine, who had grown up with money, didn’t know that shoes could be re-soled. I laughed at him and told him he was a rich kid used to throwing things away. He was now an adult paying his own expenses and was thrilled to learn that his nice shoes were not beyond redemption.

    I was, however, astonished that another friend, who had grown up as I had (father was career military), did not know that shoes could/should be polished. She mentioned casually that she had to buy new boots because hers were scuffed. I said it must be pretty bad if she couldn’t polish the scuffs out and she had no idea what I was talking about. Apparently, one her childhood chores was not polishing her dad’s shoes to a spitshine!

  • 04/24/09
    1:04 pm

    Reply

    LPC said...

    Yeah I resole shoes too. My Ferragamo slingbacks are something like 15 years old. I don’t know if it still counts if the shoes I resole are Italian.

  • 04/24/09
    5:23 pm

    Reply

    thepreppyprincess said...

    If this isn’t intriguing *and* entertaining Miss LPC, full of thoughts to ponder, looks back…. and forward. Once again you are just so spot-on, at least from our experience, which we guesstimate to be somewhere in the middle of the range.

    And we remember shoes being resoled with the admonition that no matter if one’s country club dues were paid or not, we were never to be ashamed of frugal and responsible practices.

    Thank you for such a thoughtful post, it’s outstanding.
    tp

  • 04/25/09
    5:09 am

    Reply

    class factotum said...

    Of course it counts if they’re Italian! That’s even more reason to take care of them.

    I do get a little frustrated with husband and his false economies sometimes. He is in the habit of buying things that are inexpensive rather than things that are a good value. Italian shoes? Good value.

    Buy nice or buy twice is what I say.

    PS I spent a very painful day trying to wear the Ferregamos my friend Julie had given me. They had come into the Junior League Thrift Shop while she was on duty and she snatched them up. Alas, they did not fit her. I tried the 8.5 narrows and hobbled all day in an attempt to make my feet smaller.

Post a Comment

I thoroughly enjoy your comments. If you find this form is broken, my apologies. Please email me and I will rage against the machine.

required
required but will not be displayed
optional