Uncle’s Story Part 2: Digging out of Poverty

by Sandy L on August 9, 2011

Today, I’ll be sharing the second part of my uncle’s story.  If you missed, Part 1 you can read it here.  Once my uncle was scooped up by the red cross and resettled in the US, he started to rebuild his life with his new bride Sophie.   The two of them worked about 10 years before their first child was born and then my aunt stayed home.

I’m sure a lot of people wonder how someone can come to the states with only the shirt on their back and eventually build up a great fortune. Well, I’ll tell you how my uncle did it.   First and foremost, he had a perspective that few get to have this day and age.  Like my mom, he grew up in a one room farmhouse with 9 siblings, no running water or electricity.  Their primary transportation was the one family horse.   Moving to America where he instantly had all these things was a gargantuan lifestyle upgrade.

Back in the 40’s and 50’s not many people ate out, so that wasn’t even something that was common back then, so there would be no spending there.    For housing, he rented a crappy apartment in a crappy part of town until he saved enough money to be able to buy a rental property with cash.  They both worked as much overtime as possible.  He worked at a factory that made military weapons.  I’m sure it felt good to work somewhere that helped lead him to his freedom.  My uncle’s first property was a 6 unit apartment building purchased for $16,000.    It was cozily nestled between a funeral home and the highway.  It was not a prime location. It was not in a good neighborhood or good school district. It was not in good condition.  My mom lived there for a while too and she was convinced the house was haunted and the dead people from next door were coming to visit her at night.

Although he knew nothing about plumbing (how could he, he had none), he taught himself how to be a handyman.  He did all the repairs at his house by taking apart broken things, seeing how they were put together and doing trial and error until he figured out how something went together.    He never ever outsourced anything.  If he couldn’t figure out how to fix it, he didn’t do it.   After about 10 years of collecting rent from these properties and working, he was able to move to a nicer part of town, and bought another 3 family neighborhood in the old Jewish section of town.  By then, the Jewish people were moving into big single family homes and he was able to snatch up a nicer 3-decker.  This one had hardwood floors, built ins, tile bathrooms, the works.  It needed work too, but it was 100x nicer than his last place.  He also claimed to buy a bunch of their furniture too, because again, the deco furniture was being upgraded to more modern styles and he was able to furnish his home with quality used furniture that still is in use at my cousin’s home today.

By this time, he was getting rent from 7 apartments and it was a good thing too because now it was the 60’s, the war was long over and he  got laid off.  He was always bitter about losing his job, but this is the point that he became a handyman and started working for himself.  His time was occupied with fixing and managing his own rental properties and he also started roofing and siding houses.  This was the toughest kind of construction work that yielded the most amount of money, so that’s what he did.  I think he called some roofers and eventually ended up finding a Lithuanian man who he learned the trade from.  Roofing is one of those professions where you are always looking for help because most people just can’t hack the physical toll it takes on your body.  Once my uncle learned the trade from him, he went out on his own but they still helped each other on different jobs.   My uncle was roofing until well past retirement age.

My uncle amassed a small fortune.  Here are the classic things he had going for him.

He had multiple sources of income

In addition to social security, a pension from his days at the bomb factory, and a reparations check from the war, he also had substantial rental income.   His rental income alone was enough to replace a very good paying salary.  If you think about how much money 5 three bedroom and 3 two bedroom apartments can fetch in a city these  days, you’ll get an idea of the type of income he was generating monthly.   He did all of this without investing a penny in the stock market or borrowing a single cent from anybody.

He spent less than he earned

Unfortunately, after he settled his family in his newer rental, I don’t think they saw another new piece of furniture enter that house for the next 40 years. His broken couch leg was replaced with a brick and he had this Archy Bunker-type chair that everyone hated and wanted him to toss.  It was still pretty comfortable so I could see why he wanted to keep it but he did border on miserly.  He really hated spending money and was always afraid of falling back on hard times. He very much had that depression era mentality.   The one thing he splurged on was his pickup truck. He would buy a new truck about every 15 years.

Although this is a good thing to do when you’re digging out of poverty, for a lot of immigrants it’s often hard to make that transition and let a little lifestyle inflation creep in.   His idea of lifestyle inflation was to quit roofing so that he’d have more time to fish and forage.  He never took vacations, he never bought good cuts of meat or upgraded worn out things in his home.   He spent his free time during retirement fishing, berry picking, mushroom picking, collecting firewood and tending his garden.  His hobbies were all about reducing his grocery and heating bills.  He and my mom enjoy those hobbies immensely but they are practical in nature too.

I’m sure he was often glad that he sponsored my mom to come over to the US, because the two of them spent a lot of time together, especially the last 10 years of his life.  I had moved out of town by then and my aunt had a stroke and couldn’t do as much anymore. He would take my mom grocery shopping and stop over every couple of days to see her.  Babci does not skimp on food, so she would always feed him the stuff that he was too cheap to buy for himself.  It really was a win/win situation.  They were very close.

He Didn’t Have a Sense of Entitlement

If I think about when people fail to dig out of poverty these days, I think the two biggest barriers to wealth are laziness and a sense of entitlement.   People don’t want starter homes.   If I showed you my uncle’s starter apartment buildings, I bet 95% of the people I’d poll would say “I could never live in a place like that…It’s too loud, it’s not safe, its blah blah blah.”  Even Babci wouldn’t go back there because it’s haunted.

Many people think their dreams aren’t possible because they are too lofty so they give up.  The problem is that someone’s dream is no longer home ownership, it’s home ownership in a nice suburb, with a minimum of 4 bedrooms, hardwood floors, granite countertops and a 2 car garage.    In most parts of the country, home ownership isn’t out of reach because housing is too expensive. It’s out of reach because they refuse to live in the neighborhoods they can afford right now.

Being a landlord is a hassle and a lot of work.  Anyone who will tell you it’s easy has just gotten lucky.   It does require hard work but it also yields tons of income.  I don’t know why more people don’t buy duplex’s and start there.  In most cases, you can have your mortgage paid for by your rental income and save your own income towards that next house.

Lastly, He had a Can Do Attitude

If I think about the last thing that made my uncle successful, it was that he believed he was capable of learning anything.   Even though he grew up without electricity and plumbing that didn’t stop him from learning how to do electrical and plumbing work for his own homes.  He learned how to maintain his car and fix brake pads…he learned every skill he needed for survival.

Do you think he ever stopped and said “I can’t learn how to change the oil in my car…now if you asked me how to shoe a horse, I can help you, but this car stuff, well, that’s out of my league.”  Of course not.  Every one of us should believe in ourselves and our capacity to learn. From personal experience, I’m convinced that nothing is hard if you put the time in figure it out.   Sure you’ll be slow and make mistakes along the way, but with enough practice you’ll be a pro in no time.

The next segment will be about my uncle’s family…who he brought over from Poland, his children, and the last and saddest days of his life.

 

{ 22 comments… read them below or add one }

Kellen August 9, 2011 at 10:39 AM

Your point about what people expect to be able to live in is very true. I share a house in a “bad” (but not very bad) part of town, and we pay only $325 in rent each. In a city. With a big yard for our dogs.

My roommate found the house when she was looking for a place to share with friends, but had to find me and my other roommate through craigslist because none of her friends were willing to live in that neighborhood. When you’re just out of college and your parents aren’t paying for housing anymore, just because you lived in safe suburbs all your life, doesn’t mean you can afford to do so on your own dime.

We were watching house hunters on HGTV the other day. This young couple, husband in the military, wife not working because they have 2 little kids, had to find a place to live in San Diego. Their budget was $300k, which is enough to get you something decent, but definitely requiring work. The wife sees the type of house they can afford, which pretty much all have a trouble spots. But they find one where no work needs to be done for it to be perfectly livable – and what does the wife complain about? No granite counter tops. Ridiculous. Granite counter tops don’t hold your chopping board up and better than, and aren’t any easier to clean than good old formica. But somewhere along the way she thought she “had” to have that for a house to be “livable.”

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Sandy L August 11, 2011 at 6:58 PM

Kellen – I know. I have to say that house hunters is one of my guilty pleasures. I have friend in San Fran (like the most expensive city in the US). He has 5 roommates and pays peanuts for housing. It can be done no matter where you live.

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Linda August 9, 2011 at 12:09 PM

Keep the story coming!

I like learning new practical skills, too. Most of my hobbies revolve around such things: gardening for food, cooking (including canning, pickling, freezing and dehydrating food), and knitting. I really need to learn how to sew, too, but my current hobbies keep me pretty busy.

I do accept some limits to my skills/time, though. I hire people to do some of the things I know I just can’t fit into my life right now like applying 7 cubic feet of mulch and fixing water damage on a plaster wall. Could I do those things myself? Sure. But it would take me a lot more time than an experienced person and time is always in limited supply for me.

Kellen’s comments about the granite countertops makes me chuckle. When I remodeled my 1950’s kitchen a couple years ago the contractor assumed I wanted granite countertops. No way!

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Sandy L August 11, 2011 at 7:01 PM

Linda – I’m finally to the point where I’m going to try to outsource more. Finding competent and reliable people is the hard part for me.

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Little House August 9, 2011 at 2:20 PM

I love this story. It’s really the story of America, isn’t it?

What’s most interesting (and what’s really holding some of us back), is the idea of entitlement. I think that for those of us born here after the ’60’s, there’s this sense that we shouldn’t have to go back to the days of living in a neighborhood that seems “beneath” us. I know that for me, I can’t purchase a house where I currently live because…It’s out of reach because they refuse to live in the neighborhoods they can afford right now. This is so me right now. I just won’t move into an unsafe neighborhood. I’d rather rent than invest in a home I can actually afford! Perhaps I’m spoiled.

There’s something to be said for first generation immigrants versus 10th generation immigrants! We’re becoming lazy because we’ve forgotten that our ancestors struggled!

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Sandy L August 11, 2011 at 7:06 PM

Little House – it’s okay not to want to compromise on safety, but I just hate it when people think they “can’t” do something because their standards of what they want are stratospheric. I know you live in CA so it’s a whole different story there. Being a renter is a good time in CA after so many people are underwater in their homes.

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Mutant Supermodel August 9, 2011 at 4:39 PM

Your uncle and my grandfather had a lot in common. My grandfather also had multiple sources of income which included rental properties he saved up and bought. Definitely no sense of entitlement. Definitely spent less than he earned. I think it’s fascinating how immigrants live the “American dream” more…. classically (right word?) than Americans tend to.

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Sandy L August 11, 2011 at 7:07 PM

Mutant – yes. Immigrants are more entrepreneurial in nature because many developing countries don’t have the giant factories and companies to go work at.

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Money Reasons August 9, 2011 at 9:58 PM

Great story! Your Uncle seemed like a great man! I can imagine how hard it would be to let lifestyle creep (or inflation) settle in, shoot for me it’s hard to spend money and I’ve had a cake walk compared to your uncle!

I like his confidence, especially after surviving the Nazis! Thanks for sharing this incredible story!

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Sandy L August 11, 2011 at 7:08 PM

Money Reasons – Yes, he would have been better off with a little lifestyle creep. He was an incredible man.

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retirebyforty August 10, 2011 at 7:33 PM

The sense of entitlement grows every generation. Immigrants from Italy, Ireland and other European countries had the same attitudes as your uncle. After a few generations, the kids all need iPhone and Wii and 5 bedrooms houses.

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Sandy L August 11, 2011 at 7:09 PM

Rb40 – Entitlement is a huge problem in our culture. .

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Jon - Free Money Wisdom August 10, 2011 at 8:30 PM

Enjoying this story. This sense of entitlement is AMAZING to me. What have we or others truly sacrificed? Nothing. Therefore, we deserve nothing. It is a PRIVILEGE to live here. Looking forward to continue to read the story!

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Sandy L August 11, 2011 at 7:10 PM

Jon – You’re so right about entitlement. I really hope my gratitude for living here is not lost in my son’s generation.

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Jackie August 10, 2011 at 9:02 PM

Your uncle sounds amazing. I bet his parents DID pick him to go because they saw from his attitude that he had the best chance of survival.

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Sandy L August 11, 2011 at 7:10 PM

Jackie – that’s my theory too and I’m sticking with it.

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eemusings August 11, 2011 at 6:48 AM

So inspiring.

After reading The Book Thief and Sophie’s Choice this year (also the Bronze Horseman series), I just can’t bear to hear about real life WW2 stories anymore. It’s horrifying what we humans are capable of.

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Sandy L August 11, 2011 at 7:11 PM

eemusings – I don’t think I could read those books. It hits too close to home.

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Molly On Money August 14, 2011 at 10:49 AM

I was just debating with someone about the idea of entitlement. I was arguing on the side of everyone deserves a living wage weather they are digging a ditch (hardest work ever!) or working at a fast food establishment. My friend was saying he couldn’t afford to run his business with that high of wage and why would he hire a laborer with no college education for that amount of money. His point is that the people these days are very entitled and would rather not work at all than work for a tiny wage.
On another note, roofing is not only hard work it’s the most dangerous occupations in the construction industry.

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Sandy L August 15, 2011 at 4:18 AM

Molly – I’m going to sound like an old fuddie duddy when I say “kids these days.” I can’t tell you how hard it is to even find a reliable baby sitter that wants to work around your schedule not the other way around. I have a great girl now, but in 2 weeks, she’s back to school and then I’m back to square 1 again. Yes, a lot of people would rather not work at all than work for a low salary. I’ve seen it in so many cases I can’t even count them all, but perhaps that’s just because of where I was brought up.

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101 Centavos August 21, 2011 at 7:37 AM

Your uncle had the right thinking on buying furniture. Aside from the house itself, in the aggregate it’s probably the single largest expense for homeowners.
A retirement filled with gardening and fishing sounds ideal to me. Great story, Sandy! On to part 3….

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Invest It Wisely September 10, 2011 at 7:56 PM

What an amazing journey. Your uncle sounds like the classic entrepreneur/capitalist hard worker who built up his life from scratch. Amazing that these people all often seem to come from outside the country, too. I’m glad I’m out of the ghetto apartments, but I was very happy to have one in a poor, but safe area of town when I was a student.

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