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WHO’S YOUR FINANCIAL hero? This should be someone whose qualities and character lend themselves to emulation in your own financial life.
Let’s set some ground rules here for picking a financial hero. First, your hero probably shouldn’t be the usual suspect: Warren Buffett. While Buffett is certainly a very successful investor, the investment game that he’s playing is very different from the one most of the rest of us are.
The same goes for folks like Elon Musk, Jeff Bezos and Bill Gates. People can certainly admire these titans. But they’re systems changers, not just people looking to do well in a particular industry. They’re as appropriate for emulation by common investors or business owners as is George Patton for someone wanting a standard military career.
Second, you probably shouldn’t be related to your hero. You would be too close to that person to see clearly. And if your potential heroes are your parents, they probably played the financial game 40 or 50 years ago. The rules have changed.
Your financial hero should be basically a normal person not related to you who exhibited extraordinary qualities. For me, that person is a guy named Harry. He’s about 10 years older than I am. While I’ve never met Harry—and probably never will—we actually have the same hometown, Erie, Pennsylvania.
Indeed, Harry and I went to the same high school: Cathedral Prep. When he and I attended a decade apart, Prep was all male, academically rigorous and full of hazing. Spending four years there was a rough-and-tumble experience in the 1970s and 1980s.
I imagine a 14-year-old Harry having English with the ruler-wielding nuns who taught me. I also think about Harry perhaps playing dodgeball, and giving and receiving wedgies. Harry probably did calculus and trig problems at the same blackboards I stood at.
After graduation, Harry—as most of us from Prep did—went to college. He earned a bachelor’s degree in business administration from Loyola University of Maryland and, eventually, a master’s in finance from Boston College. He got married and had a couple of kids, while working in the financial services industry in Massachusetts.
Harry was enjoying, by almost all measures, a successful professional and personal life. Then he did something truly remarkable. Harry uncovered the biggest financial fraudster in U.S. history: Bernie Madoff.
Madoff’s Ponzi scheme swindled investors—including actors John Malkovich and Kevin Bacon—of about $65 billion. In his work to expose Madoff, Harry Markopolos displayed several qualities that make him worthy of emulation in personal finance.
First, Markopolos did his homework and knew that, if something seems too good to be true, it probably is. Markopolos discovered that Madoff’s hedge fund was returning 1% to 2% each month to investors consistently. If there’s one rule in investing that I’ve learned, it’s that to expect consistent returns is foolish. Volatility is the norm. Using common sense and math, Markopolos realized almost instantly that Madoff’s returns were impossible to achieve in any legal way.
Being proactive in research and being able to recognize when somebody or something is promising too much are excellent qualities to have in personal finance. From television-celebrity whole-life insurance salespeople to sharky advisors, folks can and will promise almost anything to part you from your money. Being possessed of what Ernest Hemingway called a “bullshit detector” can help to make you safe.
Second, once Markopolos realized that he was right about Madoff, he believed in himself and his abilities enough to relentlessly pursue his goal of exposing the fraudster. From 2000 to 2005, Markopolos kept nudging the Securities and Exchange Commission to investigate Madoff. Initially ignored, he pursued his goal. It took Madoff’s sons confessing to the SEC in 2008 to finally bring down the fraudster. If the Feds would have listened to Markopolos, some family fortunes might not have been completely lost.
This kind of persistence is a great quality for an investor to have. It takes a lot of fortitude to invest in the stock market. You have to begin, and you have to keep doing the same thing over and over again for years and decades, to achieve a result. According to an article on the website Liquidity Provider, the market is up only about 54% of trading days each year. Having Markopolos’ tenacity can serve you well over a long investing career.
Third, Markopolos displayed courage. While the late Bernie Madoff spent his last years in disgrace and in prison, earlier in his life, he was quite powerful. Having given donations to the likes of Senator Chuck Schumer, now the Majority Leader, Madoff had friends in high places. Some of those friends included people in positions of power at the SEC. In addition, Madoff was once chairman of the Nasdaq stock exchange. To start accusing somebody like Madoff took a lot of courage.
This ability to control your fear will serve you well in investing. For example, even though I knew in 2020 that the absolutely gut-wrenching declines occasioned by the pandemic would reverse, there were moments in which I struggled to control very strong impulses. No doubt exists that these kinds of disasters will occur again. Having the ability to be brave in the face of overwhelming market losses is key to success.
Markopolos is a hero to me because he was just a regular person who stumbled onto something massive, and he had the internal fortitude to forge ahead with what he knew was right. He was smart, persistent and brave. I endeavor to bring those qualities to my own financial life.
Who is your financial hero or heroine? What qualities does he or she possess that you admire? For me, there will always be something about Harry.
Douglas W. Texter is an associate professor of English at Johnson County Community College in Overland Park, Kansas. Doug teaches a composition I course that focuses on personal finance. His essays and fiction have appeared in venues such as the Chronicle of Higher Education, Utopian Studies, New English Review and The Writers of the Future Anthology. Check out Doug’s previous articles.
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A lot of good people out there! However, it really does have to be Jonathan Clements. It’s not just about the money itself. It’s about what it signifies and the place it has in maneuvering through a tricky life. It’s great to be able to discuss asset allocation, staying the course, and low cost index funds, but it’s how you use the money that ultimately matters in the end. Jonathan has taught me that year after year, and just gets more meaningful over time.
Hands down, for me and for you, Ben Franklin.
My favorite? Read: Michael Meyer’s, Benjamin Franklin’s Last Bet : The Favorite Founder’s Divisive Death, Enduring Afterlife, and Blueprint for American Prosperity
A copy should be in every library, and it should be required reading for every parent and grandparent.
All who have children obviously believe in a future. Ben provided for many children of others, individuals he would never meet, never know …
Ben believed in America’s future … so should we all.
Harry held a CFA designation which the Association should have made an icon. Harry badgered the SEC which should be ashamed for neglecting it’s mission. Bravo Harry!
I Second Andrew Forsythe’s living choice, as he so ably wrote in his comments below mine.
but prior to Jonathan, I had Great respect and esteem for the late Henry K. “Bud” Hebeler who died in 2017. Budd spent most of his working life at Boeing aerospace company where he became president of the most profitable part of the corporation. When he retired from Boeing at age 55, he adopted a second calling as an enthusiastic and tireless evangelist for personal finance and retirement planning education— Developing free calculators, and an advice column On http://www.analyzenow.com; As well as writing for the Wall Street Journal, MarketWatch and others.
I became aware of Bud during the time we were making a decision about my husband‘s social security, claiming choice. After much research, Bud’s, articles and books left no doubt in my mind as to the right choice. I credit his clear and sensible views. I may not always know the correct answer to a given question but I know what makes sense and what doesn’t. whatever knowledge I may lack is somewhat balanced by my ability to discern the facts
Last,but not least,Bud was a man whose faith guided his precepts. And this shone through his writings. He was a true gentleman.
I never post on any social media, but one day I
got my opportunity to thank Bud when I replied to an article He wrote on MarketWatch. Some wise guy then remarked “you must be his daughter.”My reply was “I only wish I were”.There are those who spend their precious time making snarky remarks and those who spend their time giving us gifts of gold.
I second the motion for Bud Hebeler. I bought both his books, which are excellent, and spent a great deal of time on analyzenow.com. Bud was also an avid skier and sportsman and managed to enjoy his life along the way.
Bud wrote two articles for HD:
https://humbledollar.com/2017/05/truly-taxing-2/
https://humbledollar.com/2017/02/unhealthy-increases/
I also wrote a piece about a booklet he prepared for his children and grandchildren:
https://humbledollar.com/2017/09/parting-thoughts/
Thanks, Jonathan. Bud was an exemplary human being.
At the risk of sounding like a “fanboy”, my financial hero is our own Jonathan Clements. Jonathan’s great strength, and the quality which has done so much to put me on the right financial path, is his ability to explain personal finance in a clear and simple way that even a math challenged sort like me can understand.
He has been relentless in exposing so much of the b.s. and outright deception that the finance and investment industry has perpetrated on us for decades. He has emphasized the fundamentals, over and over to the point he’s probably sick of it, so that simple types like me can understand them and follow them.
He has taught that it doesn’t really have to be so complicated as the “experts” (read: salesmen) would have us believe. And that anyone who is reasonably intelligent and disciplined can be quite successful with a do-it-yourself approach. He has been a major factor in giving me the knowledge and confidence to do just that.
Thanks, Jonathan. I nominate you.
Yep, totally agree. Starting with the ‘Getting Going’ column in the WSJ to today, Jonathan always has a way of discussing personal finance in a way that was engaging, real and can be applied immediately. I never felt like I was being pitched something nor was he talking over my head.
A couple of themes he highlighted that really stuck with me were –
I concur. When I was in my 40’s, I realized I had very little knowledge about personal finance. When I went to the library, I found most of the books about finance filled with more details than I was looking for. Then I found Jonathan’s book Money Guide and instantly became a fan.
Harry’s origin story featured on a recent BBC podcast
https://www.bbc.co.uk/programmes/m0023096#:~:text=An%20ambitious%20portfolio%20manager%20stumbles,could%20this%20graph%20be%20accurate%3F
It’s a short listen
Awesome article Douglas. We need more guys like Harry!
Douglas, thanks for an interesting article. Reading about this years later, it seems amazing that smart people fell for it, and that regulators ignored it. Unfortunately, human nature being what it is, it will likely happen again. As I progressed in my career, one of the attributes I grew to value was judgment. We dealt with highly complex systems, that served many different groups with different needs and wants. I greatly admire people who can apply knowledge, experience, professionalism, and judgment to complex problems. I think a big part of developing sound judgment is the willingness, and humility, to evaluate your previous decisions and actions, and learn from them. Underpinning this, and I think strongly in Harry’s case, is integrity.