I will readily admit that I have never really understood my parents’ finances. 65 years ago our family income was around $17,000—a tidy sum at that time. It put us in the top 5% of households. Digging into their tax returns (they saved everything) I saw that nearly 20% of their income came from rents and dividends. That’s quite a bit of dividend income. The balance came from my dad’s law practice.
Adding to the confusion I have learned that my parents regularly got lines of credit with their bank, secured by the properties and equities they owned, something like a home equity line of credit today. I assume that was their strategy for maintaining liquidity for their ordinary expenses back in those days when credit cards were not nearly as omnipresent as they are today.
One thing I learned about which I had not been aware was that my dad continued his grandfather’s dairy business for more than 20 years after his father and grandfather’s deaths. My grandfather, then my great-grandfather died within months of each other.
