Episode: 2589
Title: HPR2589: Saving Money: a response to Klaatu's Personal Finance Series
Source: https://hub.hackerpublicradio.org/ccdn.php?filename=/eps/hpr2589/hpr2589.mp3
Transcribed: 2025-10-19 06:15:16

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This is HPR Episode 2589 titled, Saving Money, A Response to Clotus Personal Finance Series.
It is hosted by John Culp and is about 14 minutes long and carries a clean flag.
The summary is, A Response to Clotus Verenized Series about Personal Finance.
This episode of HPR is brought to you by archive.org.
Support universal access to all knowledge by heading over to archive.org forward slash donate.
Hey everybody, this is John Culp and Lafayette Louisiana.
You might be asking yourself, who is this?
I've never heard of this guy, John Culp.
It has been a very long time since I recorded an episode.
My apologies for that.
I've been very busy at work and have not been able to keep up the frantic pace at which I used to contribute episodes.
But I was listening to a couple of episodes recently done by Clotus about Personal Finance,
sorry the air conditioner, just cut on as soon as I was starting to record and it's going to
make noise in the recording here.
I wanted to respond a little bit to a couple of things that Clotus said in there about saving.
He's right on point that it's very difficult to save money early on in your career when
you're not making very much money because it can be hard just to meet your financial obligations
every month. But there are some ways and I can share with you a couple of the ways that I use
to save when I was in graduate school. That was when I was earning a little bit of money but
really not very much. One thing that I did that was offered through the University of Texas,
as I was a state of Texas employee while I was a graduate assistant at the University of Texas.
So I had some teaching duties and I also worked for a while at the humanities research center
on campus, just getting paid by the hour and whatnot. But they offered a pretty easy way to buy
United States savings bonds. And bonds are, I'm still not sure whether that was a good idea for
me to do it or not, but my parents used to buy them and I think they thought it was a pretty good
idea. My dad's pretty savvy financially. He's a guy who grew up poor and now is living a very
good retirement because he had a plan. Having a plan is half the battle I think. He grew up in a
family that didn't have enough money to send any of the kids to college and so he had to figure out a
way to make that happen. And the way that he chose was to join the military which paid for his
schooling. So he joined the Air Force. They paid for his way through college at Florida State.
And then he served in the Air Force for 20 years and along the way they paid for him also to get a
PhD in mathematics which prepared him for a second career that he started right. I think he retired
on 20 years to the day after starting in the Air Force because if you serve 20 years in the Air Force
or any of the other branches of the US military you get a lifetime pension after that of $25,000 a year.
And that was part of his plan all along. And so then he had a since he had a PhD in mathematics he
had credentials for a career in academia after that. And so he became a college professor and then
he worked his way up in that from rank and file faculty to department chair to vice president
at a little school in Nashville, Tennessee and was able to retire at a fairly early age I think
around 60 or so. And now he's enjoying a comfortable retirement. But he's always been a big fan
of saving money. I mean he talks about all the ways that he used to scrimp and save back in a day.
And one of them was he learned how to fix his own car because he couldn't afford to pay mechanics
to fix it. But the Air Force base where he was stationed had a really good workshop where you
bring your car in and work on it yourself. They had all the tools, they had jacks and lifts and
things like that and even had some people that might be able to give you pointers on how to do
things. And he learned quite a lot and was able to fix his own car by just buying the parts and
installing them himself. He and my mom also habitually bought houses that were less expensive and
smaller than what the realtors told them they could afford because they didn't want to have too
high of a mortgage payment. They wanted to be able to stock some of the money away for savings
every month, pretty much their whole lives. And so he and this falls into the the category of
what Clotu mentioned also which is you know the basic principle is to spend less money than you earn.
And my parents were always great models for that behavior. So and I know that one of the
instruments they used for savings was US savings bond. And the idea behind those is that there's
a certain face value to the bond say $100. But when you buy the bond you only pay $50 and then
you have to let it mature. And after I don't know 20 or 25 years after you pay $50 for it it will
be worth $100 and you can redeem it for that amount. And I still have those things around here
somewhere they actually might be ready to redeem by now. I've kind of forgotten about them.
And that's part of the strategy of saving also is just put the money away and don't think about it
anymore. The more effective saving strategy that I came up with was during the time when I was
trying to figure out how I was going to pay for a new guitar. My dad had purchased a guitar for
me that got me through college. It was a nice guitar but a very nice 1969 Ramirez got a great deal
on it for I think $2,000 and my dad financed that because it was essential to my studies in college
and he had the means that decided to support me. And I'm very grateful to him for that.
Around 1993 I think it was I got on the waiting list for a guitar builder in I think at the time he
was in Washington state. He moved out to Hawaii for a while and then I think he moved back to
Washington. But his name is Robert Ruck. If you look up Robert Ruck classical guitars on eBay you'll see
his guitars there. They're very very nice guitars and he builds them in batches of maybe I think he
builds maybe 25 guitars a year and they're not the kinds of things you can just go to the store and buy.
But I got on his waiting list and when I got on the waiting list he estimated that it would be
eight years before my name came up and my guitar would be ready. And so I thought well now is the
time I need to start figuring out how I'm going to pay for this thing because the price was going to
be in the neighborhood of $5,000 and I didn't have any money. So I started looking into investments
but like Klausu said when you don't have much money to start out with it can be difficult to gain
entry into the investment world but somebody gave me the advice to buy a copy of either money
magazine or something like that and just look through it for mutual funds and so I found
an advertisement for Trans-America funds just based in San Francisco I believe
and almost all of the mutual fund advertisements in the magazine required something like $2,500
of initial buy-in if you wanted to just buy in some mutual funds but a couple of them said well
if you don't want if you don't have that much money there's still a way to start investing and I
think the the campaign slogan for Trans-America was and I quote be an investor so they they were
aiming this particular ad at people who wanted to invest but just didn't have much money
and the way they would let you into the mutual fund market was if you committed to have a monthly
deduction from your banking account of at least $50 and so I started doing that I didn't have any
money to open the account at all I just pledged $50 a month that would be automatically withdrawn from
my banking account and invested into this mutual fund and so I started doing that and pretty much
forgot about it I think I drew some out when I needed to buy the the rock when my name came up
actually the first time my name came up I elected to defer for another year
because I still didn't have the money and then when my name came up again I actually decided
to sell my Ramirez which I was able to sell for $4,000 so I got twice the amount that my dad paid
for it and I still needed to come up with about I don't know $600 or something so I think I
cashed out part of my mutual fund which by then had grown a little bit and after that I never
did stop contributing to it I still contribute to it at some point when I actually got a real job
with a salary I bounced my monthly contribution up to $100 and I think that's where it is now it's
possible that I put it up to $200 at some point but I just don't remember I mean at this point
I'm making enough in my job as a professor and director of the school of music where I can do
other kinds of investments as well but that mutual fund we actually just drew quite a large
sum of money out of that to pay for renovations on a new house that we bought and it illustrates
the point that if you just get in the habit of saving this money even if it's not that much $50
a month or $100 a month and just let it go and forget about it years later you'll find out man
there's a lot of money there I think before I took out this latest bid there was something like
$24,000 in that account and that all built up by contributing $50 a month over a number of years
and any of the dividends that were earned on that were just reinvested and so it just builds up
and builds up the main principle with investing is if you can take a long long-term approach to it
that's your best bet now in my current position I have something similar to what Klaatu talked
about which is the 401k in nonprofit organizations there's a similar instrument called the 503c
I think it's 503 or maybe 503b 403b I forget what it's called anyway I use an outfit called TIA
CREF and they are known for catering to educators higher education and stuff like that but it's
it's a similar kind of retirement account and you can actually we actually have a mutual fund
through them as well but they've got different retirement kinds of accounts you can do and what
we do my wife and I both is we have the maximum amount allowed deducted from our salaries before taxes
and put into this retirement account it's called a tax deferred annuity the idea is that you can
suck money away without paying taxes on it and then when you start drawing that money out at retirement
that's when you pay the taxes on it and so this is what they call this when you sign up for it is a
voluntary salary reduction and so my take home pay each month is much less than it would be if I
didn't say for retirement but also when it comes tax time I don't have to pay taxes on that amount
of my salary that was put into the retirement account I will be paying taxes on that when I'm in my
retirement years and that was that was difficult to get started as well at first we couldn't do it
because I wasn't making enough money and I was the only salary but then when my wife also got a
job and we started making more and then the best thing was when we got our kids out of the private
schools where we were paying tuition every month and into the gifted program in the public schools
not only were they getting a better education but also we did not have to pay anymore tuition and so
all that money that we used to pay in tuition we started investing on our retirement accounts
so it can take a while to get there in your career but getting into the habit of saving
is possible even when you're not making much money and that's something I would definitely
encourage people to try to do I guess that's all the advice I would have anyway also just
getting the habit of not spending as much on stuff if you don't have to I mean even with the
decent salary I make I still do about I don't know 70% of my clothing shopping at Goodwill because
I can get a shirt there for four and a half dollars and let somebody else pay the original price
of 40 or 50 dollars for it you know well I mean why should I pay that when I can buy it used
for just a few dollars and so my wife and I both even though we could probably technically afford
to buy all of our clothing new we don't usually just because we're in the habit ever since
graduate school that was how we did it and we're just still in that habit so and then you might
call it being a cheap skate but we call it not spending money that we don't have to all right well
I'm glad to be back on HPR and I hope it won't be too much longer before I do another episode I've
got a couple more things I want to talk about including I'll be a little teaser here I bought a
1948 console radio that's powered by tubes and it's really really cool so I want to talk about that
and then let you hear it and stuff but that will be a separate episode I know Ken Fallon would be
very upset with me if I jammed that different topic into this episode okay great being back I
will talk to you guys again hopefully very soon okay bye
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