Our friend Steve asked how he should prepare for his retirement. I decided to put my secret on this website for him and the rest of my readers.

My wife Dina and I married 64 years ago, in 1960. At that time, I was a First Lieutenant in the US Army, earning $2000 a year. My savings at the time was negligible. I was the sole wage earner. (In 1961, when our daughter Malki was born, I felt I had to give up smoking because we could not afford the cost of cigarettes.) We sat down and discussed our plan for the future. The following is what we decided. We have stayed with our plan for 64 years. Today, we are wealthy.

This is the solution. It is what I recommend for everyone.

We set aside ten percent of our earnings for retirement and invested the ten percent conservatively. We set aside an additional ten percent to purchase Israel Bonds. This twenty percent was not to be used for anything else except the Israel Bond Money, which could, if necessary, be used for our children’s education in a Jewish school and charity.

This left us with only $1600 before taxes. So, we set up a budget. Dina, for example, would only use $25 a week for food and the household. (With inflation, we had to adjust this amount occasionally.) It worked. We did not suffer in any way. On the contrary, we became accustomed to living on a budget and enjoying it. When more money came in, we did not increase our spending. More money went into the retirement account.

For example, many years after I retired, a multi-millionaire offered me a job as director of his foundation for $75,000 a year. I had the job for four years until he died. Dina and I never spent a penny of it. It all went into our retirement account. When we moved to Florida, we used that money and other money in the account to buy a huge house. We lived in that house for over twenty years until our children persuaded us at ages 88 and 84 to move to Maryland to live near them. That house, which is being rented, is now worth more than three times what we paid.

We have three other houses and assets in different places. All because we decided to save, live on a budget, learn to be satisfied, enjoy life in moderation, never overspend, and, if needed, borrow money and pay interest, but pay off the loan within a few years. We never had a house or car loan for more than three years.

A part of our money is in an investment firm. The branch manager visited us in our Maryland home about a week ago. He told us he gave his children the same advice we developed. But instead of ten percent to Israel Bonds, he, not being Jewish, gave the second ten percent to charity. Israel Bonds is not a charity. The money in the funds supports the State of Israel. Israel currently pays us five percent interest annually on our Bonds.  We are not opposed to interest when it is paid to us.

Dina and I are opposed to gambling. I’ll tell you two tales.

I always won when I played poker because I could remember the cards being played. I only did it for fun until I entered the Army. However, in1958, before I was married, several officers invited me to a poker game in the Officers’ Batchler Quarters. The rule was that one could only bet what a person had on him. Everyone had a good hand. There were thousands of dollars in the pot. By counting the cards, I knew I had the winning hand. However, I was out of pocket money. I told my fellow officers that I wanted to continue playing. I knew the rules, but would they permit me to go to my room, get more money, and stay in the game? Each certain he had the winning hand agreed. However, when I won, they reminded me of the rule and said I could not take the thousands. When I reminded them that they made the exception. They said if I took the money, they would kill me. They will return all the money I placed in the pot if I leave. I left. I never played poker again.

I did not gamble again until many years later when I was wealthy. Dina and I went to Germany, rented a car, and visited half a dozen gambling houses, followed by the famous one in Monte Carlo. I gambled in each at the roulette table. I stood by each table for a half hour, watched the winning numbers, and placed my money on the number that did not win at the end of the half-hour. In the first half dozen German gambling houses, I chose the winning number within several turns of the wheel. However, in Monte Carlo, that number was 12. After about 5 or 6 turns, Dina became impatient and said, why don’t you try a different number? I did. And the next turn, the winning number was 12. That was the last time that I gambled.

We also do not gamble or take risks on investments. We are very conservative in that respect.

We do not gamble for three reasons. First, I think it is unfair for me to take advantage of others because of my skill. Second, I realize that my skill is not always practical. Circumstances arise, as they do for all gamblers, that cause them to lose. Third, it simply makes no sense to take a chance on becoming wealthy when I developed a sure method that works.