How an Outhouse and Schizophrenia Led to Financial Independence

By Steve

Part 1 (of 2 parts)

I grew up on a northern Wisconsin dairy farm with Italian-American immigrant parents and grandparents. One major experience with frugal living was my family’s outhouse. It wasn’t until I was eight-years-old that my parents built an indoor bathroom complete with a tub! In 1950’s America, an indoor bathroom was a luxury. When the Baby Boomer generation began to buy homes about two decades later, the one-bathroom house was replaced by two, three and sometimes four bathrooms.

My older brother suffered from paranoid schizophrenic. Joe lived with my mother until he was 60 years-old. Twenty-three years ago when my aging mother moved to my sister’s house, he packed his stuff and drove off never to be seen again.

I realize that an outhouse and a serious mental disorder are widely different and a bit of a stretch, but they are both major influences on my journey to financial literacy. In this blog post, I discuss how these growing up experiences led to an unintended and positive consequence—financial independence.

Growing up on a farm has advantages. The hard work of throwing hay bales in 100-degree summer heat and shoveling manure in ten below zero winter cold, and living within our means were my first experiences. As it turned out seeing and experiencing firsthand growing up without material excesses evolved into an incredible advantage over my Boomer generation’s borrow and spend excesses. My parents spent only on what they needed for the farming business and bare necessities. My family didn’t have much, and it turned out to be a valuable lesson.

The easiest way for your children to learn about money is for you to not have any. –Katharine Whitehorn, British Journalist

My father died when I was 13. My mother saved enough money from her assembly-line job at Minnesota Mining and Manufacturing Company (3M) to pay for my first year of college. The one-thousand-dollar annual cost included tuition, room, and board for one academic year. One grand was heavy-duty money in 1966, but she had it for me. Her saving habit evolved into a significant influence for the rest of my life. Her college funding influence had such an impact on me that I helped a couple of my younger relatives. I didn’t know at the time, but the seemingly insignificant act of saving paid back a thousand-fold. It’s unfortunate that one of the most significant and common sense habits ended up abandoned in our busy adult lives.

What Happened to Good Old Fashion Saving?

Sadly, the savings habit has steadily declined in the last 40 years and has now almost vanished from American culture, and the reasons are many and complex. I never fell for my generation’s addiction to borrow and spend*. My parents went through the Great Depression of the 1930s and WWII. My parents’ generation saved. It might be because of my parent’s influence, but most importantly, I never earned much money to significantly save for retirement until I was in my 40s. My savings habit survived despite some temptations of my generation’s excessive spending habits.

Don’t misunderstand me. I got a lot out of my generation’s contributions to society and to me. We are the most educated and celebrated American generation in history. I was the first in my family to attend college by my mother’s and my generation’s encouragement. It was the “thing” to do. While I have achieved an educational equal to my generation, there is one significant difference. Boomers did not appear to assimilate from their parents that saving is a good idea.

“Boomers are not financially savvy,” said Tom Brokow in his television series, “The Boomers.”

Thankfully, I am at the older end of the Baby Boomer generation and picked up on that savings habit too and took my education and my savings habit to the next level—financial independence.

My First $500 “Saved”

Just like my mother’s habit, I saved $500 buying savings bonds with my first real job as a Marine. After my military stint, I settled in California to live with my older sister in Los Angeles. I continued to save working at various jobs.  I went to two junior colleges on the GI Bill while I was a bolster filler in a furniture sofa factory and a dental technician. I drove a 1966 Volkswagen “beetle” in my 20s and 30s. Clearly, not having money and living within my means were solid experiences. I discovered that keeping fit and eating healthily was inexpensive when compared to the unhealthy dairy products. It’s not expensive to jog in the neighborhood or dine on vegetables and fruit. So, I kept up my frugal living habits. I saved enough to move out of my sister’s house, into the single life with roommates and apartments in Los Angeles.

It was during this time that I had worked at odd jobs as courtroom record filer, Los Angeles Times deliverer and custodian for a small office building. Yet, I was able to save with my $2.00 an hour wage on most of these jobs with the drama of bosses yelling, getting up at 3:00 AM to deliver newspapers. On those early morning commutes to my newspaper job, I listened to the same prerecorded music on my car radio. Soon, I had it with wealthy Pacific Palisade’s residents’ complaints about where precisely to place (not throw) the LA Times in their driveway or doorway! My “hippy” VW plastered with flower-children decals attracted the police, who had nothing else to do but pull me over for some lame violation. After I quit my last job as a false teeth maker, I left with another boss yelling as I walked out the door and went back to college. My goodness, I thought, are there any happy people on this planet?

But looking back, I was fortunate to get fired, laid off, getting rehired, getting yelled at and quitting jobs. Surprisingly, the Marine Corps was of little help. My military experience was an essential stepping-stone from living at home to living on my own. But that’s all. Veterans frequently reported that they “grew up” in the military. Not me. Living on my own with utilities and rent responsibilities in the big and lonely Los Angeles is what I needed to grow up and be a responsible adult.

These experiences were sometimes humorous, painful, humbling and eventually empowering. They forced me to hustle around finding jobs and to see a bigger perspective and not take negativity personally. However, I managed to save $2,500 over a five-year period**. My saving habit was automatic and imprinted from my parents modeling. By my middle 20s, I graduated from Los Angeles Community College with an AA degree, and I had set my sights on getting a BA degree. That was a big deal for this “student” who had a spotty academic record. These valuable experiences contributed to my long-term career success and becoming financially independent.

My First Motivation to Succeed–My Psychology (not my brother’s)

I developed a fascination for psychology. Due to partly understand my brother’s sickness and partly for my self-knowledge and personal growth. After living in Los Angeles for a couple of years, I was so lonely I joined a psychological humanistic growth center. For a farm kid, living in the big city was unbelievably strange in the vast humanity of one of the biggest and sophisticated cities in the world. While my move was a substantial life-changing challenge, I had already lived away from home and the farm for over four years. But I was shy and needed more self-confidence. Lucky help was everywhere. Joining this center and being committed to its programs for 6 years was a life-changing event.

In those days, there were human potential growth centers at every street corner. Millions of people learned meditation, yoga, and sought higher consciousness experiences. It was the era of getting the more out of life than the stress-filed and mindless 9 to 5 monotony and martini drinking on weekends. I stayed at this center because it was something I could afford as the underlying message was about peace, love, and happiness without material things by living a more meaningful life. I also found out that smart and educated people had the same problems I did! After a few years of attending weekly group meetings, my mind and my life began to shift. It’s nothing earth-shattering. I started loving big city life and began connecting with people. I dated and enjoyed my time with the opposite sex and then….(See Part 2).

*For full discloser, I currently live in a beautiful spacious 2600 square foot home with 2.5 baths which is too big for one person. I also drive an expensive car that my late hubby and I bought four years ago, wear fine clothes, attend black-tie fundraisers and dine at fancy restaurants. But I continued to pay cash for my current retirement home, solar panels, major home remodeling and two brand-new 100% electric cars. The back story is that I never bought a new car during my working years. I did without and saved a little all through my working life to get to this economic place in my life. Chronic car payments would have prevented Dan and me from saving and investing because as educators we were never high earners. However, high earners do not escape this either and have one disadvantage when compared to us regular earners. High earners have the temptation to spend, especially if they are married to a high maintenance, spendthrift spouse. Of course, they can afford to have high car payments, which brings us back to my point. The borrow and spend habit will bring about stress and anxiety because you will worry about your “stuff” and both the “stuff” and your spouse must be maintained. It doesn’t matter how much you earn.

**I was not happy when I had to cash-in the $500 worth of bonds to pay for an engine overall in my VW. The bank could not hold them as collateral for a loan.

 

Steve’s Bio

Stephen A. Schullo, Ph.D. (UCLA ’96) taught in the Los Angeles Unified School District (LAUSD) for 24 years and UCLA Extension teaching educational technology to student teachers. Steve wrote investment articles for the United Teacher-Los Angeles (UTLA) newspaper for 13 years. Thrice featured retirement plan advocate in the Los Angeles Times and U.S. News and World Report. He co-founded an investor self-help group 403bAware for teacher colleagues and wrote 7,500 posts in three investment forums since 1997. Frequently quoted by the media, testified at California State legislative hearings and honored with the “Unsung Hero” award by UTLA for his retirement planning advocacy.

For the last twelve years, he serves on LAUSD’s Investment Advisory Committee as a “Member-at-Large” and former co-chair. The committee contains collective bargaining reps from the unions and monitors the district’s tax-deferred retirement plans, 457b/403b, of 55,000 former and current LAUSD employees, worth $2.5 billion in total assets.