I received a government-backed student loan for my first year of college: $2,500 in 1984 to cover the cost of tuition, fees, and books at the University of Texas at Austin. However, since my parents were already covering those costs, I instead used that loan to purchase a brand new Macintosh computer. This was one of the original Macs, and my purchase was within months of its first release. It had 128k of RAM memory, a 3.5” floppy drive, a black and white screen, and all-in-one casing. After my first year of college, I ended up on scholastic dismissal (i.e., I flunked out) and didn’t end up obtaining my college degree until nine years later, and by that time I was already having to make payments on that student loan.
Instead, what if I had invested that money in Apple stock rather than purchasing that Mac?
Apple shares were selling for $28 per share in 1984. I could have purchased 89 shares instead of the $2,495 Macintosh (approximately $5,700 in today’s dollars). Apple didn’t start paying dividends until 1987, but the average yield was 2.5% yearly through 1995. The stock split 2 for 1 in 1987, 2000, and 2005. They restarted paying dividends in 2012, and had an amazing 7 for 1 stock split in 2014. If I had held on to the stock, reinvesting the dividends back into additional shares, I would have grown those 89 shares into 6,870 shares, which at today’s Apple share price of $117.45 would total an investment of $806,882. (A classic example of the power of investing over time.)
However, I don’t regret that purchase. Because buying that little Apple computer was actually a wise investment in myself. That Macintosh was my entry into what became my professional career in communications, and eventually a better education than the one I initially failed. On that computer, I learned how to program and I learned how to write and to layout a magazine. With a 1200-baud modem, I was an early adopter of social media, starting on Austin’s various electronic bulletin boards and eventually GEnie, Delphi, and Usenet. In those online conversations, I learned how to express myself so people would find what I wrote interesting and I learned how to present an opinion that went beyond just personal preference, but was backed with researched evidence. I learned how to engage people from different backgrounds and opinions. I learned spreadsheets, graphic design, presentations, and desktop publishing.
Buying Apple stock in 1984 and holding on to it for 32 years would have taken an incredible amount of faith in the company, especially in that first decade, when it wasn’t clear at all that Apple would survive. Whereas having that computer gave me faith in myself, and my abilities, to land that first database programming administration job. Communicating via computers continues to be the bedrock of my current career.
The point is that investing is all about making decisions, the most important of which is that you shouldn’t delay in starting to make those investments. The earlier you begin to do so, the stronger your eventual position will be. And the wisest investment to make is the one you make in yourself.