The Investing Marathon Is On
By firstname.lastname@example.org (Mark Bosje)
October 20, 2000
I bought my first shares a few weeks ago.
About two and a half years ago, I stumbled across The Motley Fool for the first time. At the time, I was a fool, spelled with a huge, lower case "f." I had no control of my finances. I was thousands of dollars in debt to my credit cards, and what little money I did have set aside was in a poorly performing mutual fund. Through Amazon, I purchased two of the Gardners' books: You Have More Than You Think, and The Motley Fool Investment Guide. I later bought Rule Breakers, Rule Makers. I read all of them twice and began to understand why I had failed so miserably, as well as where I wanted to be.
Over the following months I began putting my house in order. A regular amount, well above the minimum payments, was assigned to pay off my credit cards. This often made things very tight, and occasionally I was even forced to charge some additional things on them. Over time, however, the balances began to shrink -- slowly at first, and then more quickly as the finance charges shrank accordingly. I closed my mutual fund account and paid the whole amount onto the credit cards. I agonized over that for a little while, but finally decided that losing about 5% a year with the mutual fund (during a bull market, no less) couldn't be as good as NOT paying 18% a year on the credit card. Sometimes I am struck by moments of pure genius.
I also paid off a college debt (borrowed from my Dad), which had been hanging over my head for nearly ten years. Eventually the last credit card statement came, with the owed amount showing $0.00! I didn't actually frame it, although I was tempted. Instead it was relegated to a special place in my filing cabinet. I fought the Visa, and the law won. That would be the law of common sense.
I then began saving up the minimum amount to open an online brokerage account. That took a few more months, and my imaginary portfolios were doing a tremendous job with my imaginary money, which wasn't helping my retirement one little bit. I was, however, learning a tremendous amount of patience, as well as getting used to the fact that the value of my portfolio was going to go up AND down. Finally, the day arrived when I was able to mail off the application with a sizable check to my chosen online brokerage. Not the cheapest per trade, but since I intend to do very little trading, I decided to pay a little more and get a few small perks that will be useful to me.
When the notice came that my account was activated, I was on pins and needles, so I made myself wait one more day, and do a little more research. Not that I needed to. I already knew what I was going to buy and had researched the living daylights out of it. The next morning I sat down at my computer, logged in to my brokerage account, and began downloading real-time quotes. I had already figured out how many shares I could buy at what price, and if and when the price got that low, I would buy. With the cost of the trade added in, I would have about a dollar left in my cash account.
Suddenly, it was there! The moment I had been waiting for! I took a breath, clicked the mouse, and Zowie! For the first time in my life, I was a shareholder in a publicly owned company.
The next day the price dropped 4 1/2%. The following day it went down another 3%. I went through the weekend smiling to myself, confident of my research and used to the ups and downs. I was pretty smug about the fact that I was LTBH (long-term buy-and-hold) and that I even knew what that acronym meant. Monday morning came and it was down another 3 1/2%. Now I was perturbed. I could have waited and gotten a couple of extra shares. But then I reminded myself that I am not smart enough to time the market. I absolutely, positively would have missed it. Sure enough, Tuesday it was up 4 1/2%. Finally, this morning, my portfolio is up 2%. I am winning.
I am in my early thirties, probably with many years of investing ahead of me. There will be many more ups and downs. When I am older, I will be able to retire comfortably if I wish, and my children will do well. I am off the starting blocks, into the race, and the sun is shining.
A special "thank you" to David and Tom!