My Grandpa Joe lived through the Great Depression. It was not an easy time for most Americans, and some of the lessons from the Depression stuck with its survivors for the rest of their lives.
Lessons from the Depression
The Great Depression started with a major stock market crash on Black Tuesday, October 29th, 1929. That day, the Dow Jones Industrial Average fell nearly 13%, and 12% the following day. By November 13th, the market fell from a high of nearly 400 all the day down to 198.60.
The stock market was just one place where the financial chaos could be seen, but unemployment, low incomes, and increased poverty came along as well.
Those who grew up during the Great Depression learned the value of a dollar. When my Grandpa finished his army service at the end of World War II, he literally sold his pants to help pay the bills.
Because of that experience, many from the Greatest Generation learned lessons of frugality, saving, and budgeting the hard way.
One day my Grandpa was visiting my family in Denver and he went with my mom to the local Nordstrom department store. My Grandpa lived in Fayetteville, Arkansas, where he was a marketing professor for many years.
In Northwest Arkansas at the time, there was no Nordstrom. There was a big Dillard’s, but not much more in the higher end shopping spectrum.
My Grandpa was a big fan of Allen Edmonds shoes. For the uninitiated, Allen Edmonds is a very high end, very comfortable dress shoe. My Grandpa spent a lot of time wearing shoes, he thought, so it was a place worth investing to have the very best.
But my Grandpa was also frugal and pragmatic. He wouldn’t spend money on something unless it was really worth it. He would justify every major purchase he made, which is a great lesson for all of us.
This day, however, Grandpa Joe was into his 80s. He looked at the near $400 price tag and told my mom he was not sure if the shoes were worth the cost, he didn’t have all that many years left and spread out over 10-15 years, his cost of ownership was going to be high compared to his previous shoe purchases.
For a man in his financial position, the $400 would not make it or break it for him. He could afford the shoes without worrying, but he wasn’t sure if he wanted to. He just wasn’t sure if that kind of investment was worth it in his old age.
Apply This to Your Life
While most of you are probably in your 20s-30s and don’t remember the Great Depression, we would all be well served to live our lives with some of the lessons in frugality that my grandpa took with him in his life every day until he passed away.
Even if you have millions of dollars in the bank, spend thoughtfully. Make sure you will really get value from each dollar you spend and you will always have a rich life.
Have you ever decided to buy something expense because you knew it would be worth the cost to you? Have you ever skipped a low dollar purchase because it didn’t seem worth it to you? Share your stories in the comments.