Observations on life

More than one way to gain 🤑

I retired in January 2010 after working nearly fifty-years. Since January 2010 my income has not increased, it has decreased in real terms and in spending power because of inflation. In that respect I am like most retirees. Never living beyond (or at) our means my wife and I haven’t noticed the drop in income significantly. 

All the talk of inequality got me thinking about how the wealthy get wealthier each year. More often than not their wealth grows from their investments in real estate and stocks and bonds, including reinvestment of interest and dividends. 

Those options are available to almost everyone on one scale or another at one time or another.  

I recently looked at my investments accumulated over a lifetime and found that while my income had decreased since January 2010, my net worth had grown by 45%. How could that happen? I don’t save any longer, I don’t work. The answer is simple and again available to mostly everyone who makes prudent choices during their lives. 

My wealth has grown in several ways. The value of my home has increased slightly, the stock market has risen and hence the value of my mutual funds and couple of stocks has risen. I have reinvested all interest and dividends and they too have grown in value. 

It hasn’t been a steady climb for sure. There were down years and a few scary moments causing second thoughts about my strategy, but the result is clear. The amount of money involved is not relevant, the process is and that process is available to anyone. 

You and I may never be billionaires or multimillionaires, we may never start a new business or an entire industry or change the world or be an exceptionally savy investor, but we have (in my case had) the opportunity and that has not changed. 

But there is one drawback; seizing every opportunities takes hard work, awareness, motivation, patience, determination, drive and more. I fear that those among us who buy into the fair share, system is rigged and anti-billionaire rhetoric may be lacking in those areas. Think about what that rhetoric says. Heavily tax those few who reach the very top; give the money to the government to redistribute as a few bureaucrats and politicians determine best; often in programs that provide disincentives to demonstrate the qualities I listed above. 

But there is more. To keep all these programs running requires higher taxes on everyone. That means less and less money to spend as you determine, less to allow you to seize opportunities. Less reason to seize those opportunities. As a result, you have placed much of your life and what you can achieve in the hands of politicians. 

Fearing, maligning  and envying the billionaires seems misdirected and definitely not productive. 


Categories: Observations on life

12 replies »

  1. Same here in the U.K. Value of portfolio HAS increased because of careful investment over 45 years. Dividends have increased slightly too. But the big deficits come from bank savings accounts who were giving 6% interest pre 2008 with most now giving less than 1%. The real kick in the teeth a few weeks back came from the sh1t Richard Branson (who is funding a Tony Blair group to overturn our Brexit vote) who cut his Virgin Money savings rate to 0.1% You couldn’t make this up!


      • During the referendum there was a lot of cognitive dissonance occurring with voters no longer split on tribal lines such as Lab v Con, so despite what the MSM say about we Brexiteers there was much thought put into voting. Sad to say though we are accused of NOT thinking or if NOT knowing what we were voting for. Both views are an utter insult certainly to my personal intelligence, education and care for my country. Patriotism has become racism in the eyes of many


      • Why should I be? One month ago UK was shown to be the fastest growing economy in the G7. Employment has risen. The rest of the world is queuing up for trade deals. Oops, was that not on the BBC?


      • How would you like USA in a union with Canada and a few South American countries that began with trade deals, then a single currency, then your fishing waters shared, then unified laws, then human rights doctrines, then imposed immigration quotas. Utopia or dystopian nightmare? Welcome to the EU. Brexit began the dismantling and Le Pen will complete it.


      • Perhaps, but history shows us that a Europe with a score of countries each vying for power does not go well. I would think the more interdependent Europe is the better long-term possibility of avoiding another war in the future.


      • Interdependence does not mean de-pendence. Most Brits now know about the Kalergi Plan which aims to destroy European culture which is NOT a multicultural superstate with its own military. This is the real threat, UK military under the control of Brussels which Juncker is now espousing


  2. I also believe the rhetoric about redistribution of wealth has set the stage for most of this violence we see going on today. I want what he has and I deserve it. you don’t. Work for it. I know folks who have more than one job and get tired but they understand if they want something, they have to earn it. That was how I was brought up and you too Dick. Yes, my property has increased in value, I need my dividends and pay taxes on them, When it was tax free, I reinvested them too.
    Prices have gone up in almost everything. Our Cola was 6.00 and Medicare went up 6.00 so nothing more in SS. I retired Dec. 2010. Every so many years; you do need to get a newer car, house repairs can be costly, sickness can eat into the budget with care and drugs. BUT we worked all our lives. We didn’t ask for a free ride. The attitudes I’ve been hearing do not agree with that philosophy. It’s gimme gimme I deserve what you have but I don’t want to work for it.
    Killings, stabbings, robberies, gangs. This redistribution I believe has caused this to really foster.


  3. Income not increased – form SS website here are the COLA – I grant you some years are zero percent increase, others clearly non-zero.
    January 2010 — 0.0%
    January 2011 — 0.0%
    January 2012 — 3.6%
    January 2013 — 1.7%
    January 2014 — 1.5%
    January 2015 — 1.7%
    January 2016 — 0.0%
    January 2017 — 0.3%
    Otherwise, an interesting article. I could forgive one ‘income not increased’ , but two is when I have to comment.


    • You have a point, sort of. Yes there were some COLAs, but the reality is my and many other folks net SS check has gone down over the same period because of Part B and D premium increases. In any. Are, I was just trying to make a general point about what happens to income in retirement.


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