Who’s Got Your Financial Back
Surprises: Learning How to Take the Unexpected in Stride
Before I dive into the nitty-gritty of financial planning, which is presumably the main reason you picked up this book, I want to begin by sharing some of my personal history with you. I’ve found that looking back is useful. I don’t mean that I lament what could have been, but rather that mining my family’s past – at times a frustrating experience – helps provide a roadmap to a better future for myself, and is something I encourage my clients to do too. By explaining where I came from, I hope you will gain valuable insight into why I am so passionate about my career and helping people like you.
Like many people, I wasn’t able to fully appreciate my parents until I was an adult. As children we have a tendency to view our parents as looming, idyllic figures. It wasn’t until I became a parent myself that I realized just how hard my parents worked, and how they could have worked smarter to be better prepared when hard times knocked at our door.
A Not-So Simple Bronx Tale
I was born in the Bronx, about a block away from Yankee Stadium. When I was a kid, I could always tell when the New York Yankees were playing. From my window I could see the Yankees flags flying proudly around Yankee Stadium. When summer ended, taking baseball with it, football reigned supreme, and the New York Giants replaced the Yankees on game day. The crowds packed into the stadium were so loud that the roar would seep through my windows. It quickly became the soundtrack to my childhood. Watching baseball games on TV now doesn’t even come close, but every time I hear a crowd swell with cheers for a home run, it takes me back to those summer afternoons. It really was a phenomenal area in which to grow up.
The stadium had several fields in the surrounding neighborhood where both semi-professional and little league teams played when the Yankees weren’t playing. I played there with my friends, too. On the days I wasn’t playing with my friends, my dad and I would go down and watch these games together. He would always wear his white tank top and his moccasins with socks – it was quite a look. After watching an inning or two, he’d pull two dollars from his pocket and say, “Go get us a hot dog.” There would be a truck parked outside and I’d get two hot dogs with sauerkraut and mustard, and two Sun Dews to wash it all down. I’ll always cherish those weekends. They weren’t much, but they were some of the only one-on-one moments I had with him – he was constantly working, and I rarely saw him during the weekdays.
A Father’s Struggle
My father was a distributor specializing in miniature lighting. If you’ve ever seen the inside of an airplane cockpit, all of those dials and lights attached to the dashboard are what he sold. He even started his own business in 1959 on Harrison Street in the Tribeca neighborhood of New York City. It was called Reback Electronics Company. He rented a space in the building that housed the Commodities Exchange, which was essentially one large room. As a kid, I would go down there and have no idea why all these men in white shirts and ties were in this building, where my father of modest means was toiling away in his business.
My father never went to college, and only went to high school for one year. I still don’t know exactly how he got into that business. Prior to that, he worked at Lafayette Radio and didn’t like his lifestyle, so he quit and started Reback Electronics. Unfortunately, health was never my father’s strong suit. He suffered a minor stroke a few years before I was born, and then, when I was five years old, had a major heart attack. I was never able to play ball and wrestle with him like other children did with their fathers, which is why most of our weekends were spent watching sports rather than playing them. I always felt like I was missing out on something great, like there was a secret bond between father and son that I wasn’t allowed in on.
My father’s heart attack kept him in the hospital for 7 weeks. The treatment today is certainly far superior than what it was back then, but, given that extensive length of time, my mother had to go to work in his business to keep the doors open. The only other employee they had was an elderly man (who I always thought was 90 years old, but now I realize he couldn’t have been nearly that old) whose main job was to run deliveries and drop things off at the post office, but also to count the inventory for the shipments. My father always got angry with him because he was convinced he wasn’t counting correctly. My mother barely knew what she was doing, but they weren’t about to leave the operations to Methuselah. She worked her hardest to keep it running for as long as she could. When my father finally got released from the hospital and went back to work, he became the seller and the advisor, while my mother took the reins of the back office.
Since both of my parents were at the office for long hours, I became a latchkey kid. The relatives on my mother’s side lived too far for me to stay with them after school, and even as a young boy I could sense that there was a disparity in our wealth. We weren’t poor, but we were far from wealthy. Most kids were able to go home for lunch every day because they lived within walking distance and their mothers were home to feed them. My mother worked, so she would pack me a lunch, and I’d have to eat it in the lunchroom. I so badly wanted to be one of those children who were able to spend their lunchtime with their mother, in a warm, comfortable home. I was embarrassed, I did not want to be one of the vast minority of kids who ate my lunch in the school lunchroom, commanded by the intimidating lunch lady, so I started throwing away my lunch. I was hungry, but I hungered for something more than food – respect and a better life for my family.
Every Friday as a treat, I got a dollar. This was when I learned how to stretch a dollar to its fullest capacity. During lunch on Fridays, I’d set out for the store down the street that served food too. A hamburger was forty cents, French fries were twenty cents, and the large chocolate egg cream was fifteen cents. The remaining change would go towards a tip – I always left a tip – and a piece of dime candy. Can you imagine getting an entire meal like that for under a dollar today? It boggles the mind!
My Mother, the Chief
My father died when I was 15. I always knew that his death at a relatively early age was inevitable and that someday my mother and I would be left on our own. Throughout my young life I had prayed to God every night not to take my father away, and for a while my prayers were answered. When it finally happened, the reality of his death was still a shock. His death had a profound effect on me, but my mother took it much harder. Her body nearly crumbled from grief, as though by shrinking herself the news of his death might miss her completely. She lost every hair on her head and had to wear a wig, all the while suffering from asthma, broken toes, gallstones, and so many other physical maladies. Not to mention another burden –I was a somewhat difficult teenager. For example, she didn’t want me to go to the Woodstock Festival in 1969, but I wouldn’t let up until she agreed, reminding her that before my father died, they had agreed to let me go. Now as a father, I can understand the extra grief this must have caused her.
She never wore this on her sleeve or let it affect her demeanor, though. All of my friends would go to talk to her about their problems, and she always had a solution for everybody. She was 4’11 and 110 pounds; she came to this country without knowing a word of English, only speaking Hebrew, Yiddish and Russian. But she became the mom that did it all. She helped me with my homework and made dinner every night.
When we were out in public, she was smart, funny and charming, and eventually began volunteering at a hospital. I suppose she needed to keep busy. After my father died, there was no way she was able to keep the business up and running, so she sold it. She only got about 60 grand for it – a fraction of what it was really worth, but she needed to sell and took the first offer. The money wasn’t nearly enough to retire on, but, again, she had no choice. She was no longer in any condition to run a business, and I was still way too young to help her out in any significant way.
Family – Friend, or Foe?
The real kicker here is that I had two uncles who were money savvy. One of them was my mother’s brother, Uncle George. He had enough academic credentials to wallpaper the Sistine Chapel: Trinity College undergraduate, Columbia University MBA, New York University Law School, a Fellow in the Society of Actuaries, and the President of a life insurance company. He actually lent my dad some money to help him start the Reback Electronics Company. Another uncle, my Uncle Nat, was a life insurance salesman for another company. Ironically, with all of this education and life experience, neither of them took the time to explain prudent financial planning or decision-making to my parents. In retrospect, a relatively simple conversation warning them about not having sufficient life insurance could have changed many lives, including mine. They knew full well that my father was in ill health, had a dependent wife with a young child, and was running a one-man business that had no assets except for its simple brick and mortar. One conversation with advice that they had undoubtedly given to countless others somehow never came up – something I still wonder about to this day. If these uncles had offered their two cents, or if my parents had any sort of financial guidance from any resource early on, they could have wound up in a much different situation. If only they had established a solid life insurance plan, it would have changed my life and my mother’s – giving her peace of mind and greater health instead of dying a broken woman from stress and heartache.
Of course, hindsight is – and always will be – 20/20. If we allow ourselves, we can spend our entire lives obsessing over what could have been – it’s too easy to slip into that kind of mindset. I was, and still am, frustrated that my parents wound up in those unfortunate circumstances, but I make a conscious effort to be a forward-thinker. Nonetheless, as I said before, it is crucial to learn from past mistakes. The best use of these insights is to help us make better decisions moving forward. The one good thing that did come out of this whole mess was that I am now able to understand my family’s missteps and take the necessary measures to ensure that my clients’ finances, and my own, will not suffer the same consequences.
What’s Your Story?
Perhaps my story will prompt you to delve into your own financial history and discover where you and your family started out. Even the canonized American “rags to riches” story is often glossed over; there are typically twists and turns in all of our personal histories that have been omitted, glamorized or otherwise altered over the years. I find that it can be especially informative and therapeutic to ask questions of your older relatives. You might be surprised by their family stories and wisdom that have been amassed throughout the years.
Of course the only constant in life is change, and the financial climate today is much different than it was in the past. While accumulating assets, saving for the future and also being able to pay for your current lifestyle is not a novel concept, what is most needed now, I believe, is a better understanding of how to go about using your assets to create the life you want. To do this intelligently, in the face of a number of unique challenges, you need an expert to help guide you through.
If you have an uncle in the business willing and able to help, consider yourself most fortunate. For everyone else, let me tell you a bit more about the forces that shaped my journey and how these experiences allow me to understand what you want and need in a Financial Planner.