I was raised to believe that if you save your nickels, the dollars will come to hand. But the American nickel (5 cent piece) has another story to be taught to re-emphasize that point.
On the back of the five cent piece is a picture of Thomas Jefferson’s mansion that he called Monticello.
The house, which Jefferson designed, was based on the neoclassical principles described in the books of the Italian renaissance architect Andrea Palladio. He reworked it through much of his presidency to include design elements popular in late 18th-century Europe. It contains many of his own design solutions. In other words, the house was fancy and much more than a farm house.
At the age of 27, Thomas Jefferson built this mansion after he took over his daddy’s 5,000 acre plantation. Jefferson wasn’t a self-made man; he used his family capital to build a house to fit his ego.
Jefferson wasn’t just the third president of the United States of America; he was the third generation farmer. He exemplified what I call “The Third Generation Curse”. By the end of his life he has misspent the family fortune so that his daughter had to sell the plantation, nearly going into poverty. A witness, Samuel Whitcomb Jr., who visited Jefferson in 1824 towards the end of Jefferson’s life thought it was run down. He said, "His house is rather old and going to decay; appearances about his yard and hill are rather slovenly. It commands an extensive prospect but it being a misty cloudy day, I could see but little of the surrounding scenery”. After Jefferson died on July 4, 1826, his only surviving daughter Martha Jefferson Randolph inherited Monticello. The estate was encumbered with debt and in 1831 she sold it.
Jefferson lived what is commonly referred to as the third generation curse. They say it takes the first generation to start a farm, the second generation to grow it into an empire and the third generation to fritter it away. Jefferson had inherited a flourishing 5,000 acre plantation which in it’s day would have been significant sized farming operation and in his lifetime had mismanaged the family farm away.
Jefferson lost perspective of who he was. He forgot that he was a farmer first and instead of reinvesting capital back into the farm to grow it; he spent it on his own lavish lifestyle and lost focus on squeezing every nickel out of his operation. For the short term, he could pull off the bad investment of family capital but in the long term it left him living in squalor. Weekly I see farm families living this way!
Now I should state, that Jefferson is one of my favorite presidents and I am spinning a negative story on a man whose impact on history was enormous and whom I greatly admire. However, the vast majority of third generation farmers will never achieve much beyond their farm. Yet they will think that they are rock stars in their community like Thomas Jefferson, but never will be.
A survey of the top dairy operations in Minnesota revealed that the biggest issues these dairies were having was the disagreement between father and son about how much time the son spends in the barn. Often I see sons who say “I’m not going to spend my life working like my dad did. I’m going to enjoy my life and spend more time with my family”. I remember one son shutting down the combine at 5pm because he wanted to go watch his son’s hockey game and thus the entire operation came to a halt. The neighbors worked until midnight and got another fifty acres off that operation, while the son played pickup hockey in a men’s rec league after watching his son’s game. It rained the next day and 50 acres of uninsured white beans never got off the field, costing the farm >$20,000. Yet the son felt entitled to building a new house, similar to Monticello because he “deserved it” after working so hard.
How many third generation farmers spend family capital on building a lavish home in their mid 20’s or 30’s instead of pouring cement for new barn foundations? How many couples do you see spend money on holidays, not reinvesting capital into replacing machinery and being stuck fixing scrap iron later in life. How many third generation farmers get involved in non-farming activities/passions completely loosing perspective of who they are and where they need to focus their attention?
If you think you are Thomas Jefferson and are going to change the world, then sell your family’s farm and put your inheritance into mutual funds. Make 5% interest or greater off your family’s wealth instead of losing it. Buy a nice house in town and live off the dividends. However, if you are a farmer be a farmer. Don’t pretend to be a farmer, disappointing your family and squandering your family’s capital.
Are you a farmer or a playboy? Decide!