In Which I Become Very Rich

I was standing around with "the guys" after a dinner here tonight, and a friend was talking about how Apple stock is now trading over $400 a share.

"Did you know they nearly went out of business back in the mid '90s?" someone asked. "Can you imagine if you'd bought stock back then?"

Ah, but you see, I did. Have I mentioned that I'm rich?

Well, that's because I'm not. But here's my "brush with riches" story.

Back in the summer of 1996 I was the right mixture of arty and nerdy to be an Apple fan back when Macs were beige boxes and Steve Jobs was still in exile. I bought an Apple PowerBook (one of the early color ones) and an Apple printer to take to college the next year. I was in the throes of writing a novel, and I'd worn out the keyboard of my dad's old laptop. Somehow, I'd taken to reading the financial section of the newspaper (okay, so I was an odd kid) and I was shocked to discover that Apple stock was selling in the $4 range, so I raided my college savings and invested $2,000 in Apple stock for $4.85 a share.

Apple did well over the next few years. By the fall of 1999 that $2000 has become $9000, which to my eyes was a lot of money. I'd read that it was important to diversify your investments, so I sold two thirds of the Apple stock for $22 per share. I invested a third in other stocks and took a third out in cash to buy a 1989 Honda Accord so I could work off campus and make more than minimum wage.

In 2002 we were a young married couple, short on money, and Apple wasn't doing so well, despite the fact that trendy teenagers were now going around with white earbuds. The stock was selling for around $10 per share. So I sold all the stock that was left (Apple and otherwise), paid off our credit card bill, and put a bit under 2000 into a Roth IRA. I bought a couple different stocks in the IRA, including 60 shares of Apple stock. Being hard up (and having access to a 401k at work where I could put money away without paying taxes on it first) I never put any more money in the IRA, and so never bought any more.

At the time, that was about $600. Now it's $24,000. (Which I hadn't realized till my friend told me Apple was trading so high. Since I haven't touched the account in eight years and I can't access it till I'm in my 60s, I make a point of never looking at it in order to avoid worry.)

Still. I couldn't help thinking that if I'd never taken any money out of that original account, I would have, if I'm doing the math right $166,497. (And the cost of that 1989 Accord, in opportunity cost, was $56,000.) Which maybe isn't rich, but it's a heck of a lot of money from where I sit.

Which I guess just does to underscore that you have to have money to make money. Through the brand loyalty of a 18-year-old -- certainly not any true financial perspicacity -- I stumbled on a 83x return over 15 years. But you still don't make millions unless you have a fair amount of money to invest.