Tomorrow is another day
I was perhaps ten years old when my parents—ahem, my father, given that he made most of the budget decisions in the traditional patriarchal setting—decided that the old car would not work with the new sky-high petrol prices. All we were left with is a photo of my sister stylishly posing while sitting on the hood (bonnet, as we said in the old country) when she was about seven years old.
There’s no photo of my brother with the car. None with me either. I suppose my parents thought that we brothers were not good enough to be photographed with the car. 😳🤣
The family joke is that my younger brother refused to walk anywhere in the months after the car was sold. He had been spoiled by the car, in which he always wanted to sit upfront—riding shotgun, as we say here in the US.
Without the car, we walked everywhere. We took the local buses if they were of any use to us, which they rarely were.
My sister was the first one to get a bicycle. And then my brother and I fought over the bike that we were supposed to share, until my sister left for college when we finally had a bike each.
At home, we didn’t have any of the luxuries like the fridge or stereo systems that some of my classmates had. Once I asked my parents about it. They said we didn’t have money for all that.
To help my brother and me understand the importance of money, and savings, my parents gave each of us a piggy-bank, except that we didn’t call it that. It was a wooden cube with a slit in the top for us to drop coins or rupee notes that elders gave us gifts. We kids also dutifully saved the few rupees that came our way.
Well, my parents did have money—they saved it. Their prized savings was in the form of a flat (a condo unit, as we say here) in Madras, which is now Chennai. When India’s urbanization picked up speed, real estate values in major metropolitan areas climbed higher than the rockets that India was launching. My parents were set for their retirement, and luxuries soon followed.
After coming to America, when my immersion into all things Americana began, I was struck by many things, including how little Americans saved for their retirement and the threat of the rainy day.
Now, consider the following chart from The Economist, which I had blogged about in 2008:
Declining savings even as household debt was rapidly increasing. A complete contrast to the life that my parents lived when I was a kid.
It is that “typical” American response to money that was wonderfully captured in a comic strip that I blogged about in 2009:
Only in America. Exceptional America! Most don’t save, or don’t save enough:
Total US personal savings, exclusive of Social Security contributions and 401(k)s, only accounted for 4.1 percent of disposable personal income as of April 2023, according to Forbes Advisor, roughly a third below the 6.2 percent a decade earlier.
Larry Fink, who leads the world’s biggest asset manager, BlackRock, warns about a looming retirement crisis because of demographic changes everywhere in the world. Here in the US, “four in 10 Americans don’t have $400 in emergency savings, let alone proper retirement funds.”
No money even in a rainy day fund. Retirement savings is a dream then.
Come Christmas time, people run around buying gifts. Expensive gifts. Gifts that they really cannot afford. In print and in video, I see parents saying something like, “I want to make sure my kids have everything.” That is not anything anywhere remotely what my parents ever said. We didn’t have anything that they didn’t have. As simple as that. And we kids didn’t care that we didn’t have what some of our friends had.
At my first real job in California, a colleague, Peter, who was a decade older, told me that he was going to offer me a piece of advice whether or not I needed it. He talked about the importance of saving for retirement. He suggested that I channel the pay-raises into savings, into something called “deferred compensation”. A phrase that I had never heard until then.
His mantra was simple: You never miss the money you never saw in the first place. I jumped on this idea; after all, I am my parents’ son!
I became a saver, and am thankful I did. Especially when the rainy day came in the form of a layoff right during my peak earning years that would have led up to retirement in the normal career path. The odds are that the years in retirement could even exceed the years that I lived working, and life would be a nightmare without my retirement savings.
Talk to the young people in your lives about the importance of savings. Email them. Message them. Well, after doing all that, don’t blame me if they stop talking with you 🤣