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Investing Together

Sonja Haggert

MY 1975 GRADUATION from college was a momentous occasion for my parents. We had emigrated from Germany, first to Canada and then to New Jersey. They didn’t have college degrees, but they had worked hard and epitomized the American dream. Proud that they’d been able to pay for my education but also relieved that college costs were over, they were looking forward to the start of my career.

Wait, what about marriage and a house in the suburbs? They wished those things for me, just not right away. My mother, in particular, wanted me to have a career. She’d had hers at Flemington Furs in Flemington, New Jersey, as the firm’s seamstress extraordinaire. I’ll be forever grateful for her inspiration and direction at a time when women weren’t encouraged to pursue a career. She earned more than my father and retired with a healthy pension.

My mother was also the ultimate “what if” person. What if you never marry or you get divorced? Would you be able to support yourself? What if you lose your job? How will you live? What if you get sick? Could you pay your medical bills? What if you don’t save and something happens?

Being immigrants and anxious about financial security, my parents were savers. I was not.

Off to work. When I graduated college, jobs were scarce. I was lucky. A professor I worked for secured an internship for me at a Philadelphia department store during my junior year. After graduation, the store hired me. I spent every penny I earned.

I met my husband at college. He had plans for graduate school and none for marriage. He took a teaching assistantship and subsisted on almost nothing. Growing up, he had learned how to save by doing jobs around the house for his parents, earning dimes and quarters along the way. Being frugal came naturally.

All that changed when we married in 1980. It was the start of our ongoing partnership—financial and otherwise—that’s seen us make countless joint decisions, often for the better. But sometimes not. Being among the lucky ones without college debt and with good jobs, we thought nothing of becoming big spenders. We bought a house with a 16% mortgage, a timeshare for our vacations and, not long afterwards, a piece of property in Maine. The house we bought was a duplex, a relatively intelligent purchase because our renters helped pay the mortgage. It was the only way we could afford that 16% mortgage. But we also discovered that we didn’t like being landlords.

Writing those mortgage checks and having little left over for fun made us realize that we needed to make some changes. Fortunately, I had moved on from retailing, where I bought everything in sight, to a manufacturing company where the products were decidedly less glamorous and the potential for career advancement greater.

Meanwhile, my husband took a position with a large pharmaceutical company. He initially hoped to spend his career in the chemistry lab but changed course and went into sales. Making that sort of a career change could have been a significant undertaking, but he was able to do it within the confines of his current employer. The relative security that provided, along with the greater career opportunities, made it easier to take the plunge. We were now looking at two pensions. We thought we were set and acted as such, continuing our high-spending ways.

Then my husband went back to school to get an MBA—and that would eventually change everything. How so? His favorite course was finance. The final project was to outline a path to retirement. He got an A. We decided we’d follow the plan he drew up, one that would allow us to retire at age 55. The only problem: It took us a decade to implement the plan.

Instead, in the late 1980s and early 1990s, we purchased not one property but two, invested in a startup, and decided we needed another timeshare to enjoy our vacations. When I think back on the debt we accumulated, I marvel that we could juggle it all.

The properties turned out okay. We sold one for a substantial gain during a real estate boom. We used that money to remodel our existing home. We held onto the other property for a long time and, in the end, managed to do reasonably well.

The startup, however, was a complete disaster. What in the world did we know about startups? The company was called Flea Fare, which provided franchise services to flea markets. Yes, really. Today that sounds like a laughable concept. At the time, we were enamored, in large part because we spent many a weekend with my in-laws visiting flea markets.

What about the timeshares? They provided some beautiful vacations for us and family members. Eventually, we gifted the timeshares to our nieces, who still enjoy them, so we don’t regret the purchases, except the steep financing charges that were involved.

Getting serious. In our 40s, we were doing reasonably well financially. We had a few promotions under our belts but started to tire of the constant travel our jobs required. It was time to get serious about following that retirement plan my husband drew up in his MBA course. Our age 55 goal wasn’t that far away. We saw our parents, who were already retired, enjoying their lives. They were traveling, and spending more and more time with family and friends. We wanted those things for ourselves.

Up until then, our investments consisted of certificates of deposit and some randomly selected mutual funds. We decided we needed a financial advisor. In 1996, we picked one based on an American Express promotion—not the greatest reason. At the time, Ameriprise was under the American Express umbrella, and signing on with Ameriprise earned us Amex credit card points.

But we lucked out. Our advisor got us through the 2008 crisis with our sanity intact, provided solid investment advice when we wanted to pursue a foolish investment, and gave us more and more leeway as we became comfortable making our own investment decisions. We still use him today.

By 2003, we had managed to pay off our debts, including our mortgage. My mother’s voice echoed in my ears. “Pay off your house as soon as you can because you always want a roof over your head.” In addition to our pensions, we now had two 401(k) accounts, to which we contributed the maximum each year. In 2003, we also reached the magic seven-figure savings number. Still, it was clear to us that we would need more to enjoy the retirement lifestyle we wanted.

How would we fatten our retirement nest egg? My husband and I had tried golf together, taking numerous lessons before deciding it was all too time-consuming. Instead, we decided to take up a new hobby—investing. We told ourselves, “We can do this.” But how were we going to do this? It might seem like the world is divided between investment do-it-yourselfers and those who rely on the advice of others. But we ended up doing a mix of both.

My immigrant parents were all about security. The majority of their investments were in certificates of deposit. Their one foray into the stock market ended badly. They had purchased Sun Microsystems when it was a hot stock and held on too long, seeing their gain shrivel from $50,000 to zero.

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My in-laws were a different story. For years, they had successfully invested in the stock market. Like us, they had a financial advisor, but they also liked to do their own independent research using the Value Line Investment Survey and a financial newsletter. They started passing along those newsletters to us.

I wasn’t convinced my in-law’s financial newsletter was the best option, so I researched others. When I had narrowed our choice down to three, I set up an Excel spreadsheet and tracked the newsletters’ recommendations for six months. During that time, we didn’t buy any of the suggested investments.

After the six months, we opted for The Oxford Communique, the newsletter my in-laws subscribed to. It’s published by the Oxford Club in Baltimore. It would become our key source of investment recommendations.

Every month, the newsletter sends out an in-depth writeup on a stock. This research has provided us with direction on which stocks to buy. Best of all, the newsletter also sends out alerts when it thinks we should sell. That takes away the fear that history will repeat itself and we’ll end up, like my parents, with a stock like Sun Microsystems.

The Oxford Club also provides seminars, where we learned about topics like investment taxes, evaluating dividend payout ratios, how to invest in options (not for us) and using trailing stop-loss orders. At those seminars, we also got to know the people who were providing us with investment recommendations. Putting faces to their names gave us peace of mind.

Our investing hobby has made us money over the years, though I can’t tell you how we’ve done relative to the market averages. Like our attempt at golf, my husband and I enjoyed investing together—but, once again, it started becoming too time-consuming. In addition, we became frustrated with the tax bills from our mutual funds, so we’ve been moving into exchange-traded index funds (ETFs) instead. To guide our index fund investing, we turned to a book, The Gone Fishin’ Portfolio, written by Alexander Green. Green is the editor of the Oxford Club’s Communique.

Our “gone fishin’ portfolio” is made up of 10 different asset classes, each represented by a Vanguard Group ETF. The portfolio only needs to be rebalanced once a year. The premise: The rest of the time, you can go fishing—or whatever it is you enjoy. Today, these index funds account for a quarter of our total portfolio.

Time to retire. In 2004, after 10 years at the helm of one of the company’s manufacturing divisions and working with three different CEOs, I was burned out. My current boss was thinking short-term and I kept stressing long-term goals. He also wanted to bring in his own people to head the various divisions. I was floundering. My life had become defined by my job and my happiness with it. My boss and I agreed to part ways. I found myself in my mother’s “what if” mode. What if I had been more conciliatory—and less insistent that the company focus on long-term goals?

The good news: Being debt-free gave me the option to retire. But first, I had to prove to myself that I was still up for a challenge. I threw myself into a startup with a friend. The premise was to provide courses for women on everything from finances to decorating. The company never took off, but I enjoyed working with a dear friend. When we decided to disband, I once again started questioning myself.

Fortunately, at the time, another friend asked me to join the board of Laurel House, a nonprofit in Norristown, Pennsylvania, that helps women dealing with domestic violence. I threw myself into the work, both as co-president of the board and as a member of various committees. It seems I had found my new purpose and was finally ready to retire. I’m still active in the organization and a huge admirer of the work it does.

Writing has been a lifelong dream—one I’ve been able to pursue in retirement. In addition to contributing to HumbleDollar’s website and putting together a book on investing, I write a newsletter, “Simplified Investing for Smart People,” about how the financial news affects us personally.

In 2008, my husband joined me in retirement, which meant we both met our age 55 goal.  A few years later, we decided to do away with the responsibilities of homeownership and move to an over-55 community. We found our ideal home, but it would be four more years before we moved in—because tragedy got in the way. We started losing our parents in rapid succession. There were four lives whose affairs we had to untangle, which meant there was no time to move. The builder of our new home agreed to lease the model we had purchased, and the resulting rent payments helped cover the mortgage on the new place.

In retirement, we continue to invest in individual stocks and bonds, but our focus has shifted. Thanks to a book about dividend stocks, Get Rich with Dividends by Marc Lichtenfeld, we decided that this was our niche. Why not get paid to invest? We had gotten to know Lichtenfeld, another Oxford Club employee. His newsletter is now our go-to source for stock picks. We’ve seen some doubles and triples in stocks like Broadcom, Franklin Resources, Texas Instruments, Eaton and AbbVie. Have we had losers? Of course. Have we made a killing in tech stocks? No. But we’re okay with that.

Being retired means owning more bonds. When Lichtenfeld started a trading service for corporate bond investors, we signed up. Lichtenfeld’s recommendations have allowed us to invest in bonds that provide the comfort of regular income and a known payout at maturity, with the added advantage of the occasional capital gain.

What fun would investing be if there wasn’t a bit of a thrill in it? We’ve gotten involved in startups again—this time through MicroVentures, a crowdfunding website that lets us diversify across numerous venture capital investments. We did well with Spotify, not so much with the others.

We’ve also dipped our toes into cryptocurrency. We started with bitcoin and went on to add others as well. As I write this, we have a comfortable profit on our initial investment, but that could quickly change. Knowing the volatility involved, we cashed out a sum equal to our initial investment, so now we’re playing with “house money.”

My husband and I have many heated discussions about which investments to buy—but that’s part of the fun. You’ll rarely find us silent at the dinner table. Investing is one of the things that keeps us close, along with travel, theater, concerts, museums and fine dining.

In his recent book, The Psychology of Money, Morgan Housel defined happiness as having enough. We enjoy a retirement lifestyle that lets us do what we want when we want and with whom we want. For us, that is indeed enough.

Sonja Haggert is the author of Invest, Reinvest, Rest. You can learn more at SonjaHaggert.com. Follow her on Twitter @SonjaHaggert and check out her earlier articles.

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Olin
Olin
9 days ago

I enjoyed your article very much. A friend introduced me to the Oxford Club and I’ve read one of their books. It sounded interesting, but I never pursued it further. Thanks for sharing your experiences with Oxford. I’ll have to re examine this source again.

Sonja Haggert
Sonja Haggert
8 days ago
Reply to  Olin

Thank you. The Oxford Club has been a wonderful source of information for us.

Andrew Forsythe
Andrew Forsythe
10 days ago

Sonja, thank you for sharing this with us. One of the best things about Humble Dollar is the chance to learn from each other’s experiences, and your detailed account is both interesting and helpful.

Jerry Pinkard
Jerry Pinkard
10 days ago

You and your husband have had an interesting journey with investing. I am glad it has worked well for you.

During the latter years of my work career, I spent a lot of time trying to create a portfolio that beat market averages. When I discovered the Boglehead philosophy of investing in low cost, broad market index funds, I resisted the idea. I was convinced I could do better. Over time, I realized I probably could not beat the market averages, and if I did, I was just lucky and it was probably not worth the time involved.

I now invest only in low cost broad market funds and etfs along with a few CDs. That gives me a lot more time in retirement to do what I consider more meaningful and enjoyable things.

This is not to say that your approach is wrong. We just have different approaches to investing.

Best wishes,
John

Sonja Haggert
Sonja Haggert
10 days ago
Reply to  Jerry Pinkard

Ultimately, it’s all about what works for each of us. Thanks for your comments.

Edwin Belen
Edwin Belen
10 days ago

Great article. It’s inspiring to hear you and your husband finding joy in investing. As someone that’s wanted to retire but realized I haven’t found the what to retire to, this is now my journey.

Sonja Haggert
Sonja Haggert
10 days ago
Reply to  Edwin Belen

Wishing you all the best in your journey!

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