Business & Investment

Me and my money: Alvin Hall grew up poor in America

Alvin Hall, a financial guru, says the best money decision he has ever made was investing in several tech stocks in the 1990s.

Hall, 68, became famous on Wall Street for his work as a financial trainer and his ability to translate complex financial concepts into simple English.

He lives in a £ 1.5m apartment in Manhattan, New York, but never forgot that he was poor and black in the southern United States in the 1950s. He talked to Donna Ferguson.

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What did your parents teach you about money?

Treat it carefully and make sure you know what your priorities are. My parents were very poor. I grew up in the isolated south of America.

My mother worked as a maid, earned $ 25 a day, and my father was a chef at a Greek restaurant. He died when I was 10 years old. My mother remarried several times and had seven children. I was the eldest son.

I lived in a small village of 52 people in Florida Panhandle. All were my relatives. I didn’t have much money, but living in the country doesn’t mean I’m poor.

As a kid, I learned to fish, hunt, and grow vegetables. Once a month, my mother went to town to buy flour, corn, sugar and coffee, but everything else we ate was caught, killed and raised. Every day, no matter how hot it was, we did chores, lined up and cheated. It taught me a lot about self-discipline.

Have you ever had a hard time achieving your goals?

Yes. The worst time was when I was in my twenties. I’ve just graduated from college and have made more money than I’ve ever seen since my first job as a high school teacher.

I have so many credit cards (about 20) that I overused until I couldn’t make the minimum repayments. I suffered enough to get a weekend job at a “men’s clothing” department store that sells underwear and socks. It took about 18 months to repay all the debt. At that time, I became more responsible for money. I learned about budgets directly, always had a safety net, and never borrowed again. It all dates back to that era.

Have you ever been paid stupid money?

Yes. A 45-minute speech paid $ 20,000 (£ 14,600). It was a corporate event of the Wealth Management Group. I was an “entertainer”.

What was the best year of your financial life?

I think it was 1998. It was the year that Lehman Brothers hired me to provide information training on how financial markets work. I probably earned about $ 500,000 that year. It’s like making about £ 585,000 today.

The most expensive thing you bought for fun?

It was an abstract painting by American artist Carroll Dunham. I bought it with the income I earned in 1998. That is one of my rules. I only buy the art and other things I really want from my current income. I don’t buy from savings.The cost is about $ 65,000 [the equivalent of £75,000 today]..

I didn’t buy it as an investment. I bought it because I liked the picture. But in 2008, I sold it for at least eight times the amount I paid for it. Then I took 10% of that money and bought another piece (a huge painting) by Dunham that is currently hanging in my bedroom.

What is your biggest money mistake?

Trust close friends about your investment. This was the early 1985 of my career on Wall Street. He was an impressive person. Believing what he told me about the healthcare company, I invested in it without any research.

The stock collapsed and I lost $ 30,000. This is like losing £ 64,000 with today’s money. At that time, it was about half of my savings and half of everything I had in the world.

The best money decision you made?

Purchased shares of Dell (now Dell Technologies) in the 1990s. I have invested $ 4,000 in each company. Each investment brought me hundreds of thousands of dollars.

Do you want to save on your pension?

Yes, I’ve been doing that since I was 21. I grew up when blacks didn’t have the option to save, had no bank account, and few had a pension. I remember seeing what happened to a teacher who worked in a school system and was one of the few groups of people who could retire financially and safely. Everyone else struggled in their old age. For example, when my mother stopped working as a maid, that was it. No money came in other than social security.

It taught me the importance of saving for pensions when I was young, and I was keen to do so throughout my life.

Now my pension is worth a 7 digit amount. But when you grow up poor, no matter how much money you have in the bank, it feels like it’s not enough. You are always thinking: what if it is wiped out? So I think it’s a decent amount of pension and you can sleep at night. But that didn’t diminish my desire to save, work, and make money.

Are you investing directly in non-pension equity markets?

Yes. I call it a “go for it” account. I enjoy investing in the stock market. Because we like to invest in growing businesses and those who have great long-term ideas and create things that change our functioning in the world. Take a look at what technology has brought us and the medical advances that have taken place in biotechnology. It’s amazing. Putting my money into something like that-being part of its growth-is exciting. Besides, I don’t want to invest in real estate. You don’t have to worry about water leaks on the roof or maintenance costs. I don’t want that responsibility.

Do you have a property?

Yes, I live in a two bedroom apartment on Madison Avenue in Manhattan, New York. It has high ceilings, a beautiful terrace that opens into the sky, and a 24-hour doorman. I paid $ 422,000 in the early 1990s and now I think it’s worth $ 2 million. [£1.5million]..

What is one luxury you treat yourself?

caviar. I love it. I eat about 4 times a year. 5 ounces costs about £ 300.

What would you do if you were the prime minister?

Improves financial literacy on interest rates on mortgages, credit cards, loans and savings accounts, especially when it comes to compound interest. Understanding how these rates relate to each other, what changes them, and how they are calculated is for everyone, especially when using credits responsibly. I think it is the basis of financial literacy and money comfort.

What are your top financial priorities?

Make sure you have enough pension pots so you don’t feel anxious when you start drawing them.

Alvin’s podcast series, Driving The Green Book, is his journey through the isolated southern part.

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Me and my money: Alvin Hall grew up poor in America

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