CWR Building Wealth – Who Is That Lady?
By Dwight Harshaw, BBA, Personal Finance Counselor
I would like to tell you about an elder who has taught me money-wisdom. She is not someone who is well known or famous. She has never lived in opulence or earned huge sums of money but because of her frugality, she has always had more than enough to take care of her needs. She has helped others when they were in a tight spot financially, even when they had more assets than she had. Here are some lessons that I have learned from her.
Education is important.
She was the eighth of ten children who were born in the early years of the twentieth century and grew up in a rural agricultural community. At that time education for African Americans was not highly regarded and even less so if a learning disability such as dyslexia was present. Going to school was a seasonal affair that took a backseat to farm work. Needless to say, she received very little formal education. She feels that if she had more educational opportunities she would have had greater earning potential.
The lesson; education is the key to better job opportunities. According to the Bureau of Labor Statistics, lower wages and unemployment hit the least educated harder than any other group.
Take control of your life.
Sometime during the 1960’s she found herself looking for a new place to rent. She stopped at a home with a rental unit in the rear that was in a neighborhood that was perfect for her. It was close to downtown, close to her church, and near a bus stop but there was a problem, she was black and the owner informed her that, “we don’t rent to colored people.” The rejection was not given in a mean-spirited way but it was humiliating and disappointing. She shrugged it off and vowed to never rent again. She used her savings to purchase a modest bungalow in a lower middle class neighborhood which she still owns today.
The lesson; there is nothing like having your own. Use your money to empower yourself. Because she had money saved, she was able to change her situation from renter to owner.
Save your money and limit your expenses.
She has always been thrifty and adverse to debt. She never had a job that paid much more than minimum wage but she kept a lot of what she earned. She saved her loose change in receptacles and the dollar bills went to the bank or to the safe. There was no eating out and instead of shopping at department stores, she used her sewing skills to make clothing. When she retired she became an avid gardener, growing all kinds of vegetables, further cutting her living expenses. She often talked about how little money was needed for her to live on.
These are very important lessons; avoid debt, maximize every dollar you earn, make saving and investing a ritual. The sooner you start, the more time your money has to grow.
She was always employed as a domestic, working in Arkansas, Kansas, and California, but that was not her only source of income. She was also entrepreneurial. She had a reputation for making some of the best baked goods around. People would order rolls, donuts, fried pies and other items which she sold from her home. Also, people who were not so good with managing their money-between pay periods-trusted her to hold their money and give it to them as they needed it. If they ran out of money they could borrow what they needed from her. The interest on the loans was 10% with the interest paid up front. Virtually all of her loans were paid back. The few loans that went bad were usually made to relatives.
The lesson; most people don’t get rich working for wages. If you want to earn more, you have to find something else you can do like being a landlord or a small business operator to increase your earnings. You can also invest in stocks, mutual funds or other financial products that can help your money to grow. Of course today we live in a more complicated world, so do your homework, seek advice from knowledgeable people you can trust, and be cautious.
We can learn a lot from her example and the examples of many elders like her. They are a tremendous resource.
Who is that lady I’ve been telling you about? She is my grandmother. I honor her this month as one of the unsung heroines we all know. She has inspired me and many others to be money-wise. Her prescription for creating wealth is, get an education, work hard and save.