The economy, as you may remember from last month, is still in need of discussion, particularly in light of this special issue on personal finance and investing. For those unfamiliar with the term, “investing” essentially means saving money to buy things in the future that cost a lot less right now. (Both gasoline and milk, for example, are rising almost daily in price, leading one to the obvious solution of stockpiling them in the basement for a couple years—but not too close to the furnace, because the gas could go bad.)
Prudent financial planning has become a necessity since your parents are, at this very moment, blowing your well-unearned inheritance on frivolous things like food, medicine, and payments to Nigerian citizens who, because of their proud tradition of generosity, promise to return the money with interest just as soon as they receive your parents’ bank account number.
With the economy in apparent free-fall, investing wisely can be a challenging proposition. Fortunately, the age-old maxim of starting early still applies, as the following data show:
• If you are in the 25-to-35 age bracket, and set aside 5 percent of pre-tax income in stocks and bonds, your investments will grow—even if current economic conditions prevail—permitting you to retire comfortably by the age of 83.
• If you are in the 36-to-50 age group, you’re behind already. You should move into your neighbor’s garage to save on rent and invest half of your salary in stocks of strong growth industries, such as prison construction. This will permit you to retire at 92, though you’ll still have to work weekends. As a prison guard, perhaps.
• If, like me, you’re in your late 50s, you should seriously consider selling your organs for cash. But remember—and this is important: You can sell a kidney, since you have two, but not a liver, of which you only have one. (Or maybe it’s the other way around.)
IN PLANNING FOR the future, it is important to adhere to these three time-honored principles:
1) Always enter the Publishers Clearing House sweepstakes.
2) Don’t travel without your lucky rabbit’s foot.
3) Make regular contributions to a balanced portfolio of equity investments.
But why, one might ask, would you bother with that third thing, given the enormous potential of the first two? I mean, after decades of playing, what are the mathematical odds that you’ll keep not winning the lottery?
I can only say that sticking to this forward-thinking philosophy has made me somewhat of a legend here at Sojourners. Staff members frequently stop by to seek out my financial counsel. They listen carefully, take meticulous notes, and then leave determined to immediately do the exact opposite. Because they know I have been profoundly wrong in every financial decision I have ever made. Such is the consistency of my record that my own father insists I call him before buying a stock, so he can dump it from his portfolio.
The tech stock crash of 2001? My fault. I bought Cisco Systems and then bragged about it, thus triggering a market correction that wiped out billions in assets.
The falling dollar? I blame myself. I called Europe and told them I was coming to visit.
Declining purchasing power? My bad. I recently told the hot dog vendor outside the Treasury Department downtown that his prices seemed a little high. Next day’s headline: “Fed Raises Rates on Rumors of Inflation!”
Fortunately, the Bible tells us we needn’t worry about the future. Consider the lilies, it says, who neither toil nor spin (probably because they don’t want to pull a hamstring). Not to mention the birds of the air, who “neither sow nor reap nor gather into barns,” although, since they lack opposable thumbs, I wouldn’t expect them to. Actually, it’s been my observation that birds are incapable of anything except eating the seed I put out every morning. But as I sit at the breakfast table and watch them flitting about—and totally not sharing—I wonder if I’m just perpetuating their dependency or, worse, their sense of entitlement. It would be better if I taught them a skill, or perhaps a craft, such as constructing Russian nesting dolls out of macaroni noodles and paste, a practice that, given my financial acumen, is in my own future. (I’m told that they make excellent gifts.)
Regardless, I’ll continue to set aside a portion of my salary for the future, even though we’re paid in Sojo Dollars, as opposed to actual money. Which means I can only spend it on Sojourners back issues and stuff in our supply closet. But that stapler looks nice.
Ed Spivey Jr. is art director of Sojourners.