The Financial Lesson From My 62-Year-Old Penniless Dad
He’s been officially unemployed for decades.
Your life can fall apart in an instant. Today, you have a job and a happy family life. Tomorrow, you get divorced and find yourself looking for a new home.
My father’s lack of financial stability reminds me of how fragile “happiness” is.
It takes one crisis to disrupt your life
My dad was an entrepreneur who renovated homes for private clients. That wasn’t 100% legal because he wasn’t operating as a formal business. He started out by helping friends. His reputation quickly spread like wildfire. People began standing in line to hire him before he knew it.
My dad would create a financial plan for renovations and agree on a remuneration verbally. It worked for him, although you could find him disappointed when he received less money than agreed.
There was one time in the not-so-distant past when this line of work was highly profitable — during the real-estate boom in the 2000s. My dad was thriving.
However, the 2008 crisis turned into a disaster not only for Lehman Brothers. Entrepreneurs in real estate, including my father, took a hit too. The crisis didn’t wipe him out. He had no legal entity, no debt, and owed no taxes (admittedly, for an illegal reason).
But his clients lost money. There were no more apartments and houses to renovate. My dad lost his only source of income. One bad thing leads to another. Father didn’t want another job and managed to get by for a couple of years.
But a man needs a job for fulfillment. I’d see my father once a month. His talk was turning more negative, he was smoking more, and the dark circles under his eyes were growing.
He finally decided to get a job but nobody wanted to take on a 50-year-old with no job history even if he was a jack of all trades. My dad’s friends occasionally hired him to do some woodwork in a workshop. That was all.
My father has never had an official job in his adult life. When your reputation isn’t enough, you use your job history to back you up. Sadly, my dad didn’t have a job history.
Stability comes from your job
I didn’t mention he re-married and got two kids when things were looking good.
Money is an issue in families. My dad probably needed a 10-year emergency fund. His wife became a breadwinner working full-time and hustling. Not enough for a family of four.
Life got hard and culminated in a divorce. Lack of financial planning gets you in trouble. This isn’t the lesson, though.
The lesson is that you should have an official job.
It can make you less money if you pay less taxes but it removes stress out of your life. Very few things beat a regular source of income.
I have a completely different take on my 9 to 5 job. I’m not quitting it, although I hustle. It provides stability that keeps me afloat even if I do something dumb with my money like losing it on stocks (which happened in the past).
I can’t say my father wasted money. He lost some when he tried to set up a construction company that failed. He assumed back then that he could always call a friend and find a new client. That was before 2008.
You can’t postpone your retirement. You should start building your fund early and let returns compound. The good thing is you won’t have a choice if you get a 9 to 5 job.
The personal department will set up a plan for you. Retirement will spring up in a conversation with your colleagues. You can’t avoid planning your golden years.
My dad could’ve had a state-sponsored or individual pension plan. Sadly, he missed the window to secure a legal job. At 62, he’s still clearing snow around the building he watches over. Still without a contract.
So don’t quit your 9 to 5 until you have a reliable and predictable income source. Your day job pays your bills and keeps you on track to retirement.
Above all, it gives your life stability, something my dad lost in the blink of an eye.
This story was inspired by my friend Sarina Chiu whose father is a millionaire.
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