This article is by staff writer William Cowie.
Confession time: Despite a financial and business education more comprehensive than most, I never invested. I grew up poor and just couldn't wait for my first "serious" job and those big bucks. It was so bad, I decided to drop out of college in my senior year. "None of this ivory tower crap is going to make me any more money," I told everyone who would listen. Fortunately, both of them were able to talk me off the ledge. One of them was my future wife, bless her little gizzard.
After graduation, my illusions were shattered: There are no high-paying jobs in a recession for someone with just a bachelor's degree. There are hardly any jobs at all. Carol Burnett came up with the formula: Comedy = Tragedy + Time. That explains why I've been able to entertain so many after-dinner guests with the now-humorous details of my early career. Bottom line: It took several years to set up a household on entry-level wages. My big break came when, in the final year of my MBA, I landed a job that tripled my income. (No matter what all the critics say, no single degree makes you as much money as an MBA.)
Finally, we were rolling in it. The top restaurateurs in town knew us by name. You would think that someone with such a solid education (in accounting and finance, no less) would realize the time had come to start investing. You would be wrong. We had accumulated us some Joneses along the way, up with which we had to keep, and we did some serious "keeping" for the next few years.
Of course, we told ourselves we were "investing." (All
do that.) You could call that spectacular wooded plot in the Cape (Town, not Cod) for our next dream custom-built home an investment. We did. You can call anything you spend money on "an investment" -- nice cars (they will be collectible one day, you know), good wines (more valuable when aged), jewelry, and any number of other wanna-haves -- investments, one and all.
Deluding yourself that what you're doing is smart is not hard. Wise readers know where that journey ended: Our debt tripped us up in our forties, and we got wiped out in yet another recession.