Updated: May 3, 2013 12:14PM
Originally published: November 25, 2004
A fascinating woman has held my hand on a regular basis for the past two months. In the process I’ve learned a lot about financial planning, survival and optimism.
Also in the process, my nails are growing.
A friend highly recommended Luiza Anghelo as an expert manicurist. What I didn’t know was that she was also an inspiring example of the American dream, and a source of many lessons in money management. Hers is an appropriate story for this Thanksgiving Day.
Luiza came to this country on May 15, 1972, a penniless immigrant fleeing the Communist dictatorship of Nicolae Ceausescu in Romania. She brought with her a husband and two teenage children, and left behind memories of her childhood in a wealthy family.
She borrowed $15,000 from the Tolstoy Foundation to finance her escape from that repressive society -- money that she says ultimately was deposited in a Swiss bank account belonging to the then-dictator. Luiza, who didn’t know a word of English, spent her first years in America repaying the Tolstoy Foundation.
Today Luiza is 72, long-divorced, and always dressed in stunning high fashion. She has a three-bedroom city condo, and a house in the country on 10 acres. She’s a gourmet cook, a great story-teller, a generous gift-giver. At various stages of her life, Luiza has been a medical student, orthopedic surgeon’s nurse, housemaid and cook, department store stock clerk, and accounting department bookkeeper, in that order. And she’s always been a great manicurist on weekends.
Luiza speaks six languages fluently. She’s also a breast cancer survivor (twice), a world traveler (Asia and South America), and grandmother of three. She’s a bargain shopper -- not only Costco and Marshall’s, but handbags and shoes from Brazil, jewelry from Asia, and suits made in Hong Kong.
She rides the bus to work, and it’s only in recent years that she reduced her two-job workweek from seven days.
I learn all this as she wields her file and scissors, and encourages me to stop picking at my cuticles.
Something doesn’t add up as I hear these bits and pieces of Luiza’s life. So I start asking questions, and Luiza laughs when I finally ask if she’s worried about having money in her old age.
“’I’ve never worried about money, and I’ve never been short of money.”
Then she reveals her financial secrets. To sum them up: She worked hard, and she always saved. Or as she puts it simply, “I don’t save when I don’t have. I save when I have.”
There’s a lesson here. Stick with me. Luiza informs me that she has a reversible Chinese silk jacket, made for her in Hong Kong, I presume, but don’t dare ask. This jacket has four pockets, two on each side, and each pocket is for a different kind of savings. Any money she earns above and beyond her paycheck -- doing catering, for example -- goes into one of the pockets. (At this point I wrest my hand from her firm grip and start taking notes on the margin of the Wall Street Journal in my lap.)
One pocket is for “emergency savings.” One pocket is for spending on gifts. One pocket is for spending on travel. And the other pocket is “Don’t have.”
I tilt my head. Don’t have? Yes, she replies, “It’s for money I just don’t want to think I have.”
Other lessons? She says she learned early on to work for a big company that offered benefits. So for 20 years she worked in the accounting department of Combined Insurance, now Aon, never earning over $30,000 a year. But she also earned a pension, which helps support her today. And she contributed to a 401(k) plan that has grown dramatically. Luiza retired 10 years ago, at age 62, and since then has concentrated on nails.
She’s an incredible bargain shopper, showing me a pair of slacks that she got on sale at Marshall’s for just $5. How did she find such a great deal?
“If you have more time than money, then when you shop you spend the time, not the money!”
More: “When I shop and find a bargain, and I save $5, that money I saved goes in the savings pockets.” And: “Don’t buy anything that is not high quality.”
And the best lesson of all, taught to her by her father: “Save when you have. That’s when you must be most frugal.”
Also: “Pay in advance for vacations. Don’t use credit cards.”
Her daughter is married to a neurosurgeon; her son is a successful designer of electronic pinball games. Luiza passes on her money lessons to her grandchildren. And the entire family is grateful to be in America.
Happiness, she reminds me, is a state of mind. “All Americans should be happy,” she says, “if only because they live in this country.”
And that’s The Savage Truth.
Terry Savage is a registered investment adviser, and appears weekly on WMAQ-Channel 5’s newscasts. Distributed by Creators Syndicate.