The picture there on the left is of my first car – a 1967 Mustang Convertible.
This is a story of a boy’s love of cars and his first lessons in budgeting, saving money and building his first business.
This boy is me and this is my story.
Getting off the “Allowance Dole”
I put my first budget together when I was 12 years old. It was handwritten and one page long. I had started mowing lawns when I was 10 years old. In 1981 when I started, $10 per lawn for an 10 year old was like easy money. Be outside, make lawn look beautiful, get free lemonade and get paid? Sign me up!
When I started my entrepreneurial journey, my grandmother was my first customer and my dad taught me how to mow. Whether it was his grand master plan so he didn’t have to do it or to get me off the “allowance dole” as he liked to call it – probably it was both and I didn’t care. I had money to buy Star Wars toys, Baseball cards and whatever junky thing I could afford that came across my path.
Over the summer I was really good at it and next summer when I was the ripe old age of 11, started to put flyers out around the neighborhood. I got calls within a few days to the single phone we had in the house. I felt like I could do anything. The first summer I had about 10 customers and made about $10-15 a lawn depending on the size. I was rich.
Cars, Guitars and Girls
Then I turned 12 and three things came into my life – cars, guitars and girls. I was far off from actually getting a date, but man I knew I wanted a car when I turned 16. I looked at the new cars and nothing really did it for me but it was the classic cars that really caught my eye. Soon that was all I could talk about. Being that it was 1987, this car was a classic and kind of expensive. I needed a plan.
At the ripe old age of 12 I told my father this is the car I wanted to buy. He told me as incentive that he would match whatever I saved. Sometimes I wonder if he regrets that statement because now I was on a mission. Through my thorough research at the 7-11 reading auto trader (no we didn’t have the Internet back then), I figure out that these cars cost between $2000-8000 depending on their condition and features. I new that I needed to save at least $3000 by the age of 16 to have any hope of buying something decent that I could rebuild/restore but still drive to school.
I also figured out that I liked to play with $500-1000 a year, so I needed to grow my cash base over a 36 month period while still having room to play.
Build Budget and Expect the Unexpected
I built a budget based on a few facts - I needed to make about $2000 a year and keep half over a three year period to hit the $3K mark. I also upped my customer base to 15 lawns at $10 a lawn, mowed them once a week and over a 6 month period it worked out to about $3600 gross for the year. This is when the budgeting stuff really started to get interesting.
I forgot little things like gas, repairs, and upgrading the mower to do more jobs cost extra money. I also learned a hard lesson that investment in resources does have an impact but usually doesn’t scale at the same rate. That took me down to about $2800 for the year in the end.
This meant that in order to get the car I had to build another budget to make the $800 last over a 12 month period. It’s not hard when you are 12 years old but when you are used to having lots of money and buying what you want, changing this behavior is hard.
So what happened?
Well, I was able to save $3200 by mid-summer 1987 and my dad matched it and we shopped for months to find the right car. The story of shopping for the car is something to write about at another time because it was my first lesson in partnerships (me and my Dad bought the car). We did find that beautiful forest green with metal flake and black interior 1967 Ford Mustang Convertible (pictured above) about three weeks before I started school that year as a junior.
I had my first date three days after I got the car.
So what did I learn?
- Don’t spend more than you make or beyond your means
- You will get hit with unrelated/unexpected expenses when you least expect it
- What you invest in might not provide the return you expect
- Saving is better than buying junk you won’t even use in 3 months
- Girls go out with guys that drive 1967 Mustang Convertibles (vain and shallow, but when you are 16, it is true)
- Black vinyl interiors are REALLY hot when the top is left down in the summer sun all day
These lessons I think we all apply to our personal spending habits and our growing businesses in today’s economy. I hope you enjoyed my walk down memory lane. And yes, the car was fast, fun to drive.
Brought to you by Network Solutions®
