The articles in this magazine reflect my wide-ranging interest in personal finance topics that fascinate me, as well as topics that everyone interested in money should know about.
I’ve always had a restless, wide-ranging curiosity. My mother described me as a ‘Why child,’ because I always responded to new information and experiences with the question ‘Why?’ I think it made her proud. My grandmother saw this personality trait a little differently. ‘Don,’ she used to warn me, always calling me by my middle name, ‘You’ll never be content.’ She saw that, as soon as I learned about something, I moved on quickly to the next thing that caught my attention. ‘You’re going to be hard for a woman to put up with,’ she once said. I still remember the way she shook her head and her resigned, exasperated tone of voice. I was nine or ten at the time.
Over the years, I’ve found that my restlessness has a good side and a bad side. Let’s talk about the bad side first.
When I was young, I never held a job for more than two or three years. I went through the same pattern over and over again. For the first year, I devoted myself to learning all aspects of the job. I spent the second year performing to the top of my abilities. And by the start of the third year, I expected the kudos and a commensurate pay rise for my outstanding work. When these did not come, I changed not just my job, but my career, always looking for the next big challenge.
So by the time I was 30, my resume was ‘diverse and interesting’ – a discouraging phrase I often heard from recruiters and potential employersat least in my ownmind.
The good side of my restless curiosity is that I was always willing to take some risks for the sake of learning something new and interesting. I embraced new challenges because I had the discipline, the tenacity, and just the right amount of neurotic insecurity to work very hard at turning lemons into lemonade, as the old phrase has it. I knew I might fail. But I did not fear failure. I believed that life’s most significant lessons come from both success and failure – and I still believe it today.
So in 1982, when I heard that one old college chum had become a multi-multi-millionaire, while another had become one of the fastest-rising and highest-paid African-American in U.S. corporate business, I began to wonder: ‘How did they do it?’ ‘What do they know about money that I don’t?’ ‘Can I do it, too?’
Thus my restless curiosity came to focus on the subject of money. Little did I know that the ‘Why child’ had found a new arena so engaging, satisfying, and ever-changing that it would occupy me for the next two decades, and beyond.
With lots of questions in my head, I decided to get a job that would help me learn the basics of how money works. I considered banking, but the interviews convinced me that I wouldn’t last even my usual two or three years in a traditional banking job.
Luckily, my former college roommate (with whom I am still friends) offered me a job with his father’s Wall Street training firm. My assignment: to learn about the workings of the financial markets from books and long-time practitioners and then translate the information into training manuals and courses.
This was a perfect job for a perpetual student like me. Working on Wall Street to master the language and lore of finance was as exciting for me as studying Dante in Florence or oceanography on the Great Barrier Reef. Every time I got it right – that is, every time I learned a topic well enough to write about it in a way that was clear and easy to understand – I wanted to learn more.
Did I apply this newfound knowledge to my own finances? Not at first. All I thought about my own money was how to spend it. I used to say, only half jokingly, that I worked hard to pay for ‘my habit’ – not a drug or alcohol problem, but the lure of collecting art, antique furniture, ceramics, and clothes. Only after several years on Wall Street did I refocus on my original purpose: understanding how money works and how to accumulate personal wealth.
My first forays into managing my own money were very cautious. I remembered the story (from an old movie, I think) of a promising young doctor who prescribes himself medicine for some minor problem. His self-medication leads to addiction, which destroys both his life and career. I didn’t want to follow the same path.
In time, however, I began to invest in some of the promising young companies I was hearing about on The Street. Like all investors, I had some winners and some losers. Gradually, the winners began to outnumber the losers. The profits began to accumulate. Having a nest egg for a secure and happy future changed from an impossible vision into a reality. What’s more, I was having fun.
My goal in this issue is to share with you some of the financially empowering insights I’ve experienced over the years. I hope these articles will help you help yourself, as well as help you take fuller advantage of the advice, help, and guidance of financial professionals.
To this end, the articles can be seen as a kind of reference guide to your money. You can read them all at once. Your can read them randomly. Or you can read them on an ‘as needed’ basis, when they apply to your own personal situation.
I wish we could have covered more topics. Inevitably, we ran out of space before we ran out of ideas. But with the help of editor John Blauth, I’ve selected those articles most likely to fit your financial situation, interests, and needs.
While I hope you’ll find the magazine informative and useful, I hope you’ll also find it fun to read. I believe in frugality and prudence, but I don’t think we should cling to every penny or pound we earn. You also have to use some of your money to enjoy yourself. You’ll find articles here about the fun side of money, too.
I like to stress that no one can hope to make ‘perfect’ financial decisions. As in every area of life, perfection is a rare blessing, not the norm. Your goal should be to make informed financial decisions whose consequences you can live with, without regrets, without blame, without cynicism. This is the heart of what financial experts call ‘risk management.’ Understanding risk and your own risk tolerance must always be part of your decision-making process. This magazine will give you some insights into how to make that happen.
‘If you take care of your money, then it will take care of you.’ I love this old saying because it is true. But when I apply this adage to my own life, I amend it just a bit: ‘If I take care of my money, then it will take care of me – and it will let me have some fun along the way.’ I hope these articles help you to do that and more!