You’ve tried new investment strategies and schemes to increase your income. Perhaps it’s time to revisit the strategies that worked so well for so many years.
Decades ago consumers bought what they needed and shopped for price. They didn’t indulge every whim or desire. They concentrated on essentials and necessities.
Previous generations looked at their home as a place to live, a safe refuge, a family place, a stable part of their lives. Their houses were not investments or showplaces, just places of comfort and security. Likewise automobiles were primarily transportation, not instruments of display or status. Their wardrobes were limited and fit easily into their small closets.
Eating out was an event, primarily reserved for special occasions. Exotic trips were almost unheard of as were indulgences like cruises and spas. Gyms were populated by jocks and bodybuilders, tanning salons didn’t exist, and pets were “groomed” by their owners.
If they wanted to make a major purchase like a vehicle, refrigerator, sofa, or college education, they sacrificed, set money aside and saved enough to buy it. “Christmas Savings Accounts,” “College Savings Accounts,” and “layaways” were popular at banks so that families could save a little each month in order to not go in debt during the holiday season, or for other important reasons.
Average people knew little of stocks and almost nothing about derivatives, commodities, foreign exchange, currency speculation, day trading, etc. The typical person invested in U.S. savings bonds and savings accounts. While some bought stocks and bonds they relied on fundamental values and company history.
People worked for the same employer for a lifetime and retired with a defined pension.
You’re probably thinking “what a simple life” or “ things have changed…that won’t work today.” And you would be correct on both counts. There is no going back and not too many would want to! On the other hand there may be some lessons to be learned with those behaviors and values.
Lessons from the past
- Buy and spend responsibly
- Living above your means is only possible over the short term
- Spend less than you earn
- Pay cash when possible
- Curtail the use of credit
- Invest conservatively
- Don’t buy more house than you need
- Saving money is a worthwhile objective
- The future is unpredictable; be self-reliant
- Examine your personal and family financial priorities
- Establish long-term financial goals
- Nobody cares more about your finances than you do
- Prepare for retirement
- Real success is found in friends, home and family
