I am going to start a new series of articles featuring a profile of someone I have met living an example of the Money Outlaw life. It will prove interesting and allow you to learn how others have adopted these philosophies. I recently attended a seminar with one of my mentors and incredible real estate investor, Peter Fortunato. While there, I met John, who was in his early 80s and an excellent real estate investor and Money Outlaw. Later, I asked another friend about John, and his response was that John had lived a pirate life…
As I talked to John, I learned that living a pirate life is much like living a Money Outlaw life. It is one where you value personal freedom above all else and adapt your economic life to this end. John was no different in this regard. He had a rich life that, after I heard his story, I could only marvel at.
A Pirate Life Career
John has lived in Florida most of his life but occasionally spent time living in the Caribbean as well as Central and South America. He owned an airplane, and his early career involved being a freelance tobacco salesman and trader. He worked with a family with a large farm in Nicaragua growing tobacco and flying between Central America to South America and across the Caribbean, selling and trading tobacco. He was also a personal property trader of sorts. He would occasionally fly rum and Cuban cigars back and forth to other countries. While he didn’t mention it, I wouldn’t doubt if some of that cargo made its way into the U.S. from time to time.
If John had been born 200 years earlier, he would have lived a pirate life or privateer with his own ship sailing the open seas, living a life of freedom on his terms. Undoubtedly, he would have been crisscrossing the Caribbean, trading goods, and living about as free as one could hope to live. Instead, he did much the same thing but did it by airplane instead. I learned that he did this business for decades until the Sandinistas eventually took over Nicaragua and put the family he had been buying from out of business. At that time, he started trading other stuff and selling different goods to people everywhere across the Caribbean, Florida, and South America.
A Pirate’s Treasure
I found out that John was a precious metals investor. Like any good pirate, he dealt in gold and silver for much of his business. As he would make money with his sales and trading, he would buy bags of silver and occasionally gold. Sometimes, he would be paid in these currencies! While paper currencies were probably in the mix, he had an affinity for precious metals and has used them his entire life. He would transact business using bags of silver; more on that in a minute.
While this may sound like something out of a Treasure Island storybook, it is not only true, but you might be surprised at how many people in our modern day and age still invest, collect, trade, and use precious metals for investment and business. It is one of the few investments with no counter party risk, meaning it doesn’t require someone else to uphold the other side of the transaction to make it work. Precious metals have inherent value.
John primarily owned and used what is referred to as “junk silver.” These are U.S. coins that are dated 1964 and earlier. Before 1964, dimes, quarters, half dollars, and dollars contained silver. We used them every day, and nobody gave it a second thought until 1965 when the government removed all the silver from U.S. coins.
Gresham’s Law dictates that bad money will drive out good money, which is precisely what happened in the U.S. People started hoarding pre-64 coins because they contained silver and used the fake crap the government called money without silver for everyday transactions. A pre-1964 time with silver is worth far more than 10 cents. Today, as I write this it is worth about $1.70! So, if you need a dime at a store and the store is going to count a 1995 and a 1964 dime as 10 cents why would you give them a silver dime worth $1.70? The answer is you wouldn’t. You would give them the 1995 dime with no silver and hoard the 1964 dime to use with someone that understands its true value of $1.70 because of the silver content.
Today, investors can go to coin dealers and buy bags of these coins, which John did. He wasn’t a big fan of paper currencies and only used them when necessary or to buy precious metals.
Real Estate Investor
As a hard asset type investor, John started buying real estate early in his career. He would construct some incredibly creative deals that never involved a bank. Because he spent a large portion of his life in Florida, he would buy houses and mobile homes and rent them out or occasionally flip them.
John used to purchase some of these houses with bags of silver! Today, in his 80s, he lives in a mobile home, owns several others around him, and lives off the rent they generate. He pointed out his window and said, “That one was two bags of silver.” and “I paid one bag of silver for that one.” This is a man who actually bought investment property using bags of silver coins!
Like most Money Outlaw types and living his own pirate life, he greatly valued his privacy. He would use a variety of land trusts and bags of silver to keep his investments completely private. Today, most people would never know that he owns any of these houses, and he likes it that way. Many might think he is just a poor senior citizen barely hanging on. Camouflage is a wonderful tool in the Money Outlaw life 🙂
If he ever sold the property to people, he would insist on being paid in silver or gold, at least, for part of the monthly payment he would receive. He never mentioned if he had a bank account, and I didn’t ask, but given how his story unfolded, I very much doubt this man ever walked into a bank in his entire life. Instead, he would deal in cash, silver, and barter.
Many creative real estate investors use a combination of creative deal structuring, barter, and, in John’s case, silver to buy and sell properties. Real estate investing is one of the last places where it is still possible to do business this way, at least for now. Try calling Charles Schwab and asking if you can trade a bag of silver for some stock. People today might think this is impossible because EVERYONE uses a bank, goes to a title agency, and pays a note secured by a mortgage. Nope. Sure, you can buy real estate that way, but you certainly don’t have to, and John is a living example of someone who never did.
He told me of deals where he would purchase houses and properties using barter, silver, and creative finance. He might trade a car, a bag of silver, and a note to buy a home. This might sound beyond eccentric, but I have other stories of people who did the same thing. It is a life that most people never see, especially today, but it did and does still exist.
An Old Pirate
I discovered that John didn’t collect Social Security because he never paid into the system. Given the state of Social Security today that was probably a very wise decision! Being a freelance salesman, tobacco trader, and real estate investor both inside and outside the U.S. put him so far outside of the 9-5 job and Social Security system that most people can’t even imagine a life like this.
I asked him if he still dealt in silver, and with a twinkle in his eye, he disappeared and returned with two giant bags filled with silver coins! Looking through them, I could only imagine the stories that silver could tell. The deals it helped facilitate and the adventure and financial prosperity it brought to John over the decades of his long life.
John chose to live life on his terms, and that meant that things like Social Security and 9-5 jobs didn’t factor in. Instead, he decided to work as a freelance entrepreneur, real estate investor, personal property trader, and barterer. He facilitated his transactions much like our ancestors did with gold and silver.
His life was one of personal freedom lived at an extreme level, one that almost seems like it wouldn’t be possible in our modern age. It sounds so fantastic that it must be from an adventure story like Robison Crusoe, Treasure Island, or the Count of Monte Cristo. It certainly feels like a life that belongs to something other than the 21st Century.
I explained that I wasn’t sure it was a good idea for a man in his 80s living alone to keep a bunch of silver in bags around his house. I asked him what he would do if someone found out and robbed him. He gave a classic answer that only a pirate would say… He buried a lot of it in places only he knew about 😉
A Life of Freedom Well Lived
Over a few hours, John told me of his business exploits, flying across the Caribbean and South America, buying, selling, and trading tobacco and other products. He used that money to buy silver and that silver to purchase real estate. He had no regrets and couldn’t have imagined living any other way. A pirate life, or as I call it, a Money Outlaw life, was the only way he could live.
Like many others who choose to live a life as a Money Outlaw, I see some common traits. First, he was an entrepreneur. John never would have survived the confines of a typical 9-5 job anywhere. He needed personal freedom to run his own business. Entrepreneurship comes in many forms. I talk about it as a freelancer and not necessarily as building a large company with employees. John fell into this freelance entrepreneur model. He never had employees; his main equipment was an airplane, personal skills, and his wits. He is not the only investor and entrepreneur I have ever met who owned a small airplane and used it extensively in his entrepreneurial efforts.
John was one of the most prolific alternative investors that I ever met. He bought, sold, flipped, and owned real estate. Real estate became the core of his income, taking care of him in his retirement. It allows him to live completely free of financial worries with the personal freedom he values. He also had precious metals and other real estate-based assets, like notes and options. He would occasionally trade these for other investments, cash, precious metals, or live off the income they generated. He never owned stock, mutual funds, or any other “normal” investment everyone thinks of when they are considering retirement, and he has done just fine.
Finally, John understood economics and practiced it authentically. While it is nearly impossible not to have dealt in cash occasionally, he chose to transact a lot of business, primarily in silver and occasionally gold, because he understood the effects of inflation. I never asked, and he never volunteered where the payment of taxes fell into his lifestyle, but it is safe to say that he completely understood how to work in tax-advantaged ways. The fact that he never paid into Social Security is a testament to his understanding of taxes.
While John was my senior by several decades, and he and others would say he lived a pirate life, I would say he was a Money Outlaw to the core. He lived in a way that espoused all three core components I believe every Outlaw should practice. As our time together ended, I was envious of his colorful life of personal freedom. I hope you found his story equally interesting and learned something you can use in your Money Outlaw journey.
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