What I Learned From The First Issue of Money Magazine

Since Money Magazine recently celebrated their 35th anniversary, I thought it might be useful to go back and look at the inaugural issue of Money Magazine. Cover-dated October 1972, the first issue is in many ways surprisingly similar to Money in its current incarnation – very direct and specific personal finance advice. Here are seven things that really caught my attention.

8 Lessons Learned From the First Issue of Money Magazine

1. The majority of financial firms advertising in the issue are completely defunct

Brokerages and various investment opportunities took out many, many ads in this issue. The vast majority of them are now defunct – I tried tracking down several to see what became of their business but they seem to have completely folded. The only ones to have survived are the monsters – Bank of America and American Express, most notably.

What does this mean for you? There’s a decent likelihood that the companies managing your money right now are not going to be around when you go to retire. Interesting thought, isn’t it?

2. Credit cards were very, very different

The entire issue only had two advertisements for credit cards, one for American Express and the other for BankAmericard (the forerunner to Visa). The American Express card featured a straight 12% annual interest rate. The best part? This fine print from the American Express ad:

The undersigned aggres to be bound by the terms and conditions that accompany each Card (original, renewal, or replacement) unless he cuts the card in half and returns both halves.

Cut the card in half and return both halves? I can’t even conceive of a modern credit card issuer wanting to deal with that.

3. A generous budget for a seven day trip for two in the south of France? $500

At first, that’s almost shocking, but when you figure in inflation over the period since 1973, the price becomes $2,327.64, which seems much more reasonable for a solid, not overly extravagant vacation for two in the south of France. It ends up being more of a commentary on inflation than anything else. As I read the article, I realized that it’s a pretty solid travelogue for the time and aspects of it are still applicable today.

4. Ma Bell

The ad for Ma Bell (aka American Telephone and Telegraph) was telling not only of the telephone service at the time, but the fact that there was a stranglehold on long distance telephone service in the United States. Person-to-person long distance calls on weekdays (8 AM to 5 PM) were $3.55 for the first 3 minutes. That’s in 1973 dollars – $16.53 in today’s dollars. Yes, if Ma Bell still ran the show, you would be paying $16.53 for a three minute long person to person call in the United States. (For those unaware, person-to-person means that the operator would verify who was being called – remember, this was the days before caller ID). This rate is actually advertised, meaning that apparently these rates were good enough to warrant extra attention. If you’re willing to accept a number of limitations, you can even get a lower rate of $1.35 for the first three minutes (yes, still in 1973 dollars)!

Kind of makes you thankful for today’s providers, doesn’t it? Some prices have certainly lowered since 1973.

5. Contaminated food was a major concern in this first issue

Basically, many people complained about unwanted stuff in foods, like impurities in flour and such. Today, the bigger concern is that these impurities are natural – that’s why organics have become a popular item. People are far less worried about slight natural impurities in flour and are much more worried about chemical treatment of food, but the concern about the food supply still persists. Why? Food is one of our base needs, and thus it is something that many care deeply about.

6. Working women in the 1970s had a very raw deal

Compared to then, the genders are much closer to equality. I’m amazed that mothers worked at all in those times, considering their jobs would barely break even. One of the issue’s feature articles focuses on a few of their experiences, including stories of women working full time and only actually netting $45 after the whole week. Seriously, why work? That net pay is far, far less than minimum wage, and a good bit of frugality would have made that difference even in 1973.

7. People were far less prone to debt

In this issue, people with just a few thousand in total debt were nearly panicking, and there was basically no concept of easy credit. The only mortgages mentioned were very solid fixed rate mortgages with a relatively low interest rate and a low principal, likely due to the firm requirement of a down payment. Credit has gone crazy in this country since 1973.

8. The subscription price hasn’t changed in thirty five years

The subscription card in the magazine offers one year’s worth of Money for $12 – the exact same price you can get from such insert cards today. Of course, today’s magazine has a much higher ad-to-content ratio, which makes all the difference. I would much rather pay a higher rate for a magazine with minimal ads.

Note: this is a pared-down version of what I originally had intended to present here. I attempted to gain permission to use a small number of scanned pages from the issue, but I was unable to secure permission for these scans from Time-Warner.

If you enjoyed reading this, sign up for free updates!

Loading Disqus Comments ...
Loading Facebook Comments ...
  1. Very cool article!

    Returning BOTH HALVES of the credit card is hilarious.

    The cost of a long distance phone call is insane. No wonder my parents still act like calling long distance is a special event.

  2. Melissa says:

    This is a very interesting look at the past, Trent. I love this kind of retro stuff – it really gives you a feel for how things have changed.

    Cutting up a card and returning it? What a strange requirement.

  3. chris says:

    maybe the cutting up the card requirement was because the credit card network wasn’t as instantaneous a sit is now. If you canceled your card, they probably couldn’t just press a button and make sure every retailer in the nation rejected your card. The only way to assure that you didn’t ring up phony charges after calling to cancel and then later protesting those charges was to ensure that they had your card in their hands. Cutting it up was likely to ensure that no one stole it from the mail.

  4. Andrew Stevens says:

    Wow, I must say that paying a higher rate for less ads seems a bit nuts to me, especially for a frugal person. I can understand being willing to pay more for fewer ads on television, but you can just skip the ads in the magazine. (Unless you’re saying that you’d prefer to pay more money for more content, i.e. that they’d replace those ads with articles.)

  5. icup says:

    Why don’t the women’s end of week wages merit the same adjustment for inflation as the trip to France?

  6. Wolf says:

    I’m almost embarrassed to say that I can remember living on less than $500 for a 2 weeks vacation in Southern France in 1973.(It might give away my age,ugh, but I also have still the photos to prove it). All I needed was a couple of friends from the German Law School I was attending at that time, a VW Beetle, some sunshine, and an open mind.
    I had a hard-to-get Amex card. When you used it in spare locations, the salesperson had to look up the card number in a printed book for lack of computers, the book was always 2 weeks behind actual listings of bad dudes.
    And yes, it’s true: ALL the investment institutions I dealt with at that time ARE DEFUNCT. I never trust those guys again and manage my own money. It works!
    Wolf

  7. Andrew Stevens says:

    I’m glad to see you doing this research, Trent. I remember in your review of Generation Debt, you claimed that “there were manufacturing jobs available to people with work ethic, jobs on the floors of factories that paid $15-$20 an hour in wages in 1970 dollars.” Had you run this through an inflation calculator, you would never have made such a claim. That would mean that people on the floors of factories were making the 2007 equivalent of $160,000-$200,000 a year. Believe me, the good ol’ days were never that good. In fact, the average (not the starting) manufacturing wage was never more than $14 per hour in today’s dollars, nevertheless 1970 dollars.

    This sort of misunderstanding comes from talking to old men with long memories who are convinced that the world is going to hell in a handbasket and things were so much better back in the day. It is shocking to me how little historical perspective even people who lived through the history seem to have.

    By the way, icup, using Trent’s 1973-2006 conversion (which is underestimating inflation just a bit, since he actually wants 1972-2007 or 1973-2008), $45 per week equals about $210 per week. The net is still lower than today’s minimum wage, of course.

  8. Jessica says:

    Maybe women worked because it wasn’t just about making money for them. It could have been the job was interesting, or just the fact that they were able to work a paid job outside the home. Equality/equity had to start at some point…

  9. call center rep says:

    I worked at a call center for Visa, last year, and part of the legal disclosure we tell you when you cancel an authorized user’s card over the phone does say, “cut up the authorized user’s card and return it to VISA”

    but it’s expected (by those of us on the phone, anyways) that nobody will return the card. If you’re just cancelling your own, primary user card, we tell you to cut up your card. (no returns!)

  10. icup says:

    @Andrew Stevens, I agree its close to min wage, but he said it was ‘far far less than min wage’, and then questions why they even bothered to work. I still think at that number it would have made sense for women to go to work. A net of $210 a week for 40 hours work would be $5.25 an hour. Just a rough guess, but wouldn’t that put the gross at something like $7-something, depending on how much her husband made. Not great, to be sure, but certainly well within the realm of ‘its-kinda-worth-it-to-go-to-my-job-for-some-extra-cash’ and not you-can-do-better-than-that-just-by-being-frugal as trent asserts.

  11. Trent says:

    When I reviewed Generation Debt, I used Anya’s numbers, not my own.

  12. Andrew Stevens says:

    Hopefully, she was giving the 1970 income in constant (2005 or whatever) dollars and you simply misunderstood. Otherwise, it’s an unbelievably egregious mistake on her part. Of course, Anya is rather blinded by her ideology and confirmation bias. For example, she decries the fact that college is so expensive due to declining subsidies, but is forced to concede that the debt does end up being worth it (due to higher incomes realized by the degree). So how seriously can we take her argument that the people who are going to be making those higher incomes should be subsidized by everybody else? The fact that this was the case in the 1960′s (and she’s right about that) seems more an indictment of that system than an indictment of today’s. We’re no longer giving as much money to the rich of the future while they’re young. Boo-hoo.

    @icup The median gross wage for working women in 1973 was only $53 per week, so I’m not sure what that $45 per week is net of. If it’s net of child care, transportation, taxes, the whole shebang, then I agree with you that it’s not that terrible a deal. (My wife wouldn’t work for that little net a week, but we can afford it. For many people, an extra $200 a week net would be well worth it. That is, after all, $10,000 a year in spendable or investable cash.) If it’s only net of taxes, I’m not so sure. I couldn’t find any figures on child care costs in 1972, but it would hardly surprise me if that money got eaten up rather quickly by child care and other losses that a household suffers by not having a parent at home.

  13. Marsha says:

    Wonderful! I guess you had to cut a credit card in half and mail it in because it was too expensive to call AmEx to cancel! LOL

    I was in college when “Money” 1st came out. Yeah, no one had debt to speak of – maybe a car loan or a few items on layaway at a department store. Not nearly as many gadget-y things to covet and fritter money on, either. People were generally happy with less material stuff back in those days. This is a generalization, of course – there was still plenty of poverty then, too.

  14. Gayle says:

    The nice thing about Ma Bell was that if you had a problem you dealt with actual operators–without extra charge. They would adjust your bill for inaccuracies on the spot and without argument. Just try that now.

    The actual minimum wage at the time, if I recall correctly was 1.65. My take home was around $50. It made so little difference to our standard of living that it was not really noticeable when I didn’t work. Work was not that easy to come by at the time either.

    By the way, discrimination against women in the workforce was blatant in ways that seem quite unbelievable now. I was asked questions such as 1)Is that your natural hair color? 2)What kind of birth control are you on? 3)When do you plan to start having children? I also recall an interview where I was locked in with the interviewer which I realized when someone pounded on the door demanding entrance.

    One thing that always cracks me up now is when young people tell me that if I had taken advantage of investing 10,000 or so in a retirement plan I would have millions now and been able to retire early. The fact is that our entire income in those years was around 8 to 10,000 and there was no such thing as IRAs and 401Ks

    AS for college expenses, tuition in those days was (personal experience) $220 a semester on the low end ($440/ year) to $400 per quarter on the high end ($1200/ year). We could and did pay for college out of our current earnings. Nobody we knew had any help in either the form of scholarships or loans. Except for the guys who had survived Vietnam and were going on the GI bill.

  15. silver says:

    What’s the $45 a week in today’s dollars? I’m guessing that after taxes, child care, transportation, work clothes, etc, women today don’t do much better, especially since it really just pushes your household into a higher tax bracket. I’m guessing that many women bring in such a small amount of money after all of the cost of work factors are taken into account that they wind up paying all their income in extra taxes.

    *But*, I think a big part of why women today don’t make much is because of the fields they choose to work in. Colleges are just now starting to get a more even balance of men/women in their engineering programs. I’ve seen that if you account for profession and experience (an engineer with 20 years experience will make more than one fresh out of college, and the engineers with 20 years experience tend to be male), women and men make equal pay.

  16. Justin says:

    Wow, I must say that paying a higher rate for less ads seems a bit nuts to me, especially for a frugal person.

    Not to me. It falls under the “pay more for higher quality” blanket: more convenience, less distraction. And as you state later, potentially more content.

    My favorite magazine, The New Yorker, spoils me in this regard. Fewer ads, strong delineation between ads and content, and no stupid “continued on page…” jumps. (Every article’s pages are printed consecutively to completion.) For these reasons – as well as the stellar content, of course – TNY is the only magazine I subscribe to.

  17. Debbie M says:

    One thing that was better in the seventies was interests rates. A regular savings account at a bank, with no minimum, paid 5% interest.

    Also, even private colleges were more affordable because financial aid was so much better. I was in school from 1980 to 1984 when the change happened (hello, Reagan). The first year I was expected to take out a $1000 student loan and the last year I was expected to take out $3500 in loans.

    All forms of communication (except advertising) are much better now.

  18. russ says:

    great idea trent! what a great way to look a trends, and how the american economy is moving. great idea!

  19. Judith says:

    I’ve been remiss in keeping up with TSD, but read about a month’s worth of Trent’s posts this morning. I just had to comment on this one — it really shows how much the world has changed since 1972. I hadn’t realized, and I lived through it! I WELL remember what a red-letter day it was in the 70′s when my salary as an experienced teacher went above $10,000 for the first time. We had had to threaten strike to get that concession. I can also remember standing in a store, as a married grad student with 2 small children in the late 60′s, agonizing over whether to buy a $.25 halloween decoration item. Times change!

  20. Andrew Stevens says:

    @Debbie M. The ’70s also featured double-digit inflation. The real interest rates weren’t nearly as high as you think.

  21. ScottMGS says:

    “Fair use” should allow you to show snippets of the magazine for review purposes.

  22. Roger says:

    Hunh, this is pretty interesting stuff. Hard to believe there was a time when credit, and particularly credit cards, were rare. And that card cutting thing is pretty interesting; as already mentioned, it was probably the best plan AmEx had available to deal with people who wanted to cancel their cards.

    ‘I would much rather pay a higher rate for a magazine with minimal ads.’ Are you sure about that? The inflation adjusted price for a year’s worth of Money would be $55.85 today. And even that price assumes that the magazine’s expenses have risen only as fast as inflation (if it costs, say, twice as much to produce Money today as it did in 1972 (after adjusting for inflation), it’s been advertisers who’ve been picking up the slack).

    Given these kinds of figures for a magazine subscription, I have no problem with dealing with some extra ads to keep my out of pocket prices lower, but I suppose that’s a personal choice.

  23. Chris says:

    I am replying to the post re: women working for a net of $45 a week,or about $180 a month. An earlier poster made the error of translating that to $210 a week( I’m not sure how). Anyway, a net of $45 a week means after taxes. It’s likely that the woman would have been doing this work during the hours her child or children were in school, thereby not incurring child care costs.
    To make a comparison, my mother was worrking during this period for probably about that same rate. However, the rent on our 6 room apartment in Brooklyn, NYC was $65 a month. In addition, I remember distinctly a phone call around 1966-1967 when she was discussing with a friend of hers on the phone as to whether they should accept the landlord’s offer of a 99 year lease. That is not a misprint, it was for ninety-nine years. They were concerned that the landlord would try to keep them to the terms of the lease re: breaking the lease and paying for extra months. Anyway, they didn’t sign the leases and we continued to pay $65 until December 1968 when they purchased an 8 room house in a very nice section of Brooklyn called Bensonhurst for about $20,000. There was a small down payment involved and the interest rate was fixed at 5.25 % for a monthy payment of $126 a month. It was a 2 family which we used as a one family so the taxes were higher.
    I am sure that the income that my mother made contributed to the down payment necessary. Therefore , it was not all for naught. She was able to quit the job since my father made enough on his own to pay the mortgage and all of our expenses.

    So everything is relative.

  24. C says:

    I am replying to the post re: women working for a net of $45 a week,or about $180 a month. An earlier poster made the error of translating that to $210 a week( I’m not sure how). Anyway, a net of $45 a week means after taxes. It’s likely that the woman would have been doing this work during the hours her child or children were in school, thereby not incurring child care costs. To make a comparison, my mother was working during this period for probably about that same rate. However, the rent on our 6 room apartment in Brooklyn, NYC was $65 a month. In addition, I remember distinctly a phone call around 1966-1967 when she was discussing with a friend of hers on the phone as to whether they should accept the landlord’s offer of a 99 year lease. That is not a misprint, it was for ninety-nine years. They were concerned that the landlord would try to keep them to the terms of the lease re: breaking the lease and paying for extra months. Anyway, they didn’t sign the leases and we continued to pay $65 until December 1968 when they purchased an 8 room house in a very nice section of Brooklyn for about $20,000. There was a small down payment involved and the interest rate was fixed at 5.25 % for a monthy payment of $126 a month. It was a 2 family which we used as a one family, so the taxes were higher. I am sure that the income that my mother made contributed to the down payment necessary. Therefore , it was not all for naught. She was able to quit the job since my father made enough on his own to pay the mortgage and all of our expenses.
    So everything is relative.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>