Here's the next entry in "The Best Financial Tips from FMF Readers" series. Today's post is from Financial Fruition who says:
The best tip I ever received wasn't a tip given to me directly. Upon the passing of my Grandfather I was informed about the size of his estate. Considering the life he lived (94 years), I reverse calculated that amount to figure out a rough estimate of what his net worth was at its peak. By doing this I figured he was a multi-millionaire at some time in the late 1980's. This was an amazing feat to me, as my grandfather emigrated to the U.S. from Russia as a child in the 1920s with nothing but the clothes on his back.
So what "tips" did I glean from my grandfather's sizable net worth?
1) He never spent any of the extra income he received, whether it was a bonus or a big gain on an investment. He always put that money to work for him. And that it did!
2) Keep track of your investments. He was always a student of investing. He wrote his own investment policy statement and stuck with it throughout his life. When he passed we found a binder with graphing paper in it. On these pages were the inflows and outflows of every investment he ever made. Included in this piece were stock, bond and other ideas, as well as his self written Investment Policy Statement, including dated amendments. This binder was especially helpful for the Executors to find assets that no one knew about.
3) Last but not least, my grandfather never bought a car new. Somehow he always knew a "friend" at the car dealer that was giving him a deal on an "executive" car, or a car that was just about over a year old.
Thanks for the lessons Gramps!
Great advice all the way around. I hope I can leave such a legacy for my family.