The following diary is not about politics or my experience as an activist or elected official. This is a true story.
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Some of you may know that professionally, I have been a Financial Advisor at Morgan Stanley for the past 19 years. At a base level, what that means is that I manage stock portfolios for other people. It’s much more than that, but you get the idea.
In 2004, I on-boarded a new client. This couple was in their early-sixties and the husband was planning on retiring in late 2007. The wife had not worked in years, save for her many volunteer jobs. Individually and as a couple, they are simply delightful and wonderful people. They had been married for nearly 40 years at that point, and had never had children. Also, and interestingly, they had never purchased a house. They claimed that they liked the freedom of moving to different locations every few years for “a change of view.” Their only safety net was their life savings, which at the time of his retirement was about $1.2 million. This after working for the same corporation for 35 years.
Expecting turbulence and volatility, in early 2008, I adjusted his accounts to be more conservative, but apparently not conservative enough, as it turned out. The second half of 2008 was simply brutal. Before you could say “boo,” 25% of his market value was wiped away. On a relative basis, he was beating the market because it was dropping much faster than his accounts, but that was of little comfort when you just started your retirement and much of your savings had evaporated within the first year. Quite frankly, it was terrifying. I’ll never forget the meeting we had in my office in October, 2008. It was the longest and most challenging meeting I had ever had up to that point in time….and ever since. It lasted just over 3 hours. He was crying. He was angry. He was sad. And most importantly, he was scared as there was no house to sell for extra money and no kids to care for him. He was afraid to tell his wife what had happened.
By the end of that meeting, we had worked out a personal plan for recovery. I promised weekly status updates on market conditions and any changes I was making for the portfolio. He agreed to be more aggressive, where appropriate, to try and claw back to par. It wasn’t easy. Those phone calls were tough. He asked good questions and he kept me focused. When you retire, you no longer receive a paycheck, so your savings and social security are all you have in the way of income. Some are lucky to have a pension and/or rental income, but not him. It was up to me to help. In March of 2009, the market stopped going down and we were able to start recovery in earnest. The weekly phone calls started getting a little easier. In a year’s time, I had him squarely on the path to complete recovery.
Ever since, he has learned not to worry about market fluctuations and dips. He knows I am there to see him through. I don’t have precise information, but I know since 2009 he has taken out a great deal over $500,000 to live. Some of that went to taxes and fees, of course. His account valuation is presently well in excess of that $1.2M he had at retirement.
I just returned from his house. You see, just last week after helping him with his mortgage, he closed escrow on his first house in his 79 years. I called to let him know that I was going to swing by to drop something off. It would be nice to see them both again. [I *really* miss my clients]. He and his wife were so happy to receive me. I brought over “a gift from my heart” I called it. Although we were never closer than 10 feet away and I couldn’t go inside, they expressed such a heartwarming appreciation for all that I did for them. But in reality, it’s what they did for me. They gave me their complete trust and confidence so I couldn’t let them down. And ultimately, they made me a much much better financial advisor.