A month ago I decided to climb Mt. Rainier with a couple of friends.
Because the mountain is almost in my back yard, I try to hike or climb it a couple of times a year. This time we planned on leaving early Sunday morning to begin our climb, hoping to summit on Tuesday and return Wednesday evening.
My Sunday morning alarm rang at 4:30 a.m. After one of the longest stretches of sunny, early summer weather that I can remember in the 26 years of living in Seattle, I woke up to thunderstorms and pouring rain as I loaded my car with climbing gear for the two hour drive to Paradise.
Driving south on Interstate-5 in the driving rain, I muttered, “Boy, have I got a long, miserable, wet climb ahead of me.” But I reminded myself not to get too far ahead of things, and just enjoy the scenery and drive down to Mt. Rainier.
By the time I got to Paradise, the staging area for the climb, the rain had almost stopped, and after registering at the ranger station, I slung my 50-pound pack on my back and started off on the climb to Anvil Rock, just below Camp Muir, where I connected with my two friends and spent the first night.
For some folks, hiking up a steep snow hill for six hours with a heavy back-pack and 4500 foot elevation gain wouldn’t seem like much fun. For me, it is the best form of meditation I could experience. I love it. It had been a while since I had been climbing, and my thoughts, as they usually do, turned to the Coffeehouse Investor, and how I could be more effective in getting the message out to investors across the country.
I remember beginning the Coffeehouse journey back in 1993, when I wrote a few sample chapters and sent them off to several publishers across the nation, hoping to interest them in a book deal.
Over the following sixteen years my goal has always been straightforward: Introduce the book’s message to every investor in the country who is responsible for building a portfolio for their retirement years.
I have approached this journey with the same way I approach mountain climbing; one step at a time, never getting too disappointed or elated with the inevitable setbacks and accomplishments of the journey.
Every step of the way, I have always felt that The Coffeehouse Investor could play a critical role in offering intelligent, creative education to the millions of investors who have taken on the responsibility of saving and investing for their retirement years. And if I could explain it in simple terms, enough people would take it upon themselves not only to embrace it, but to share this same philosophy with others in their lives who could benefit just the same.
At the same time, I have always been extremely vocal of the many shortcomings and pitfalls of self-directed, workplace sponsored 401k plans. For instance, way back on December 19, 1999, in the midst of a red-hot stock market and a time when everyone was in love with their retirement accounts that seemed to double each month, in my weekly column I predicted that someday 401k plans would become an investing debacle, the likes of which this country has never seen. Fees are too high, investment choices are abysmal, investor education is nearly worthless, and too many employees were loading up on too much company stock.
There are a couple of things that happened last week that made this journey noteworthy for me.
First, we didn’t make it to the top of Mt. Rainier. We got as high as 11,500 feet, and with my right ankle killing me and one of my climbing partners feeling the affects of altitude, we decided to stay put and have a two-day party instead of heading for the summit.
When I got home on Wednesday night, I had received a few e mails from friends and clients across the country, alerting me to a prominent book review of The New Coffeehouse Investor that appeared in Sunday’s New York Times. For the past ten years, I had been working on getting a review in this national daily, not because I wanted the attention, but because I am obsessed with getting the book’s message out. The author of the article couldn’t have said it better; it is time to get back to the fundamentals of investing.
Then, one week later, an article appeared in The Wall Street Journal, titled, “More Index Funds sought for 401(k)s”. The WSJ columnist discusses the overwhelming benefits of including a diversified lineup of low-cost index funds within a 401(k) plan. Despite that, nearly 90% of 401(k) money is invested in actively managed funds.
Ever so slowly people are getting the message; low cost index funds are the intelligent way to invest in common stocks. A side benefit to this strategy is that it allows you to focus your entire attention on investing principles that matter most of all; your long term financial plan and asset allocation.
When I started out 16 years ago, my goal was to introduce this message to every investor in the country who is responsible for saving for their retirement years. Last week was just another step in that journey.