A Financial Sherlock Holmes I Was Not


I’ll never forget Lori. I met her one weekend during my Junior year at Buffalo University.

Lori was in town visiting her best friend Mary (my housemate’s girlfriend). And, as luck would have it, Lori’s visit coincided with a house party we were throwing.

So there we were, 50 to 60 of America’s somewhat best and brightest, imbibing heavily on Genny Cream Ale, and rocking to the musical styling’s of the Doors, the Ramones, and the J. Geils Band. And, then, out of nowhere, Lori challenged me to a shot contest.

I was aghast. Where did she get the chutzpah to challenge me? I was in prime drinking shape, for heaven’s sake! In a battle of livers, she was severely outgunned. But what was I to do? Decline? Walk away? She challenged my manhood! In front of my housemates, no less! I had no choice but to school the young lady.

Well, I won’t get into the gory details, but things didn’t exactly go my way. Lori buried my sorry arse. Or at least I thought so. It wasn’t until a few months after this infamy that the truth was finally revealed. “Didn’t you notice that the Jack Daniels was being poured from two different bottles?” one of my housemates chortled. “Your shots were filled with Jacks. Hers were filled with ice tea.”

Well, I”ll be damned, I thought to myself. What a clueless bastard I was!

Missing Vital Financial Clues

Sadly, my inability to discern important clues wasn’t limited to social settings involving alcohol and unscrupulous housemates. It also dogged my financial life. In fact, up until my forties, my failure to recognize financial clues had left my financial condition so racked by mediocrity that I used to jokingly describe my situation as follows:

“Never hath God given a man so much talent and seen so little come of it.”

My humble brain missed so many key financial clues, it took me decades to turn my financial life around. Here, then, are some of those clues.

Clue Number One: There is life outside of New York.

While growing up on Long Island, I was very parochial. In my mind, New York City and its suburbs were the center of universe. If you lived elsewhere, you surely had a bleak, dreary existence. “New York, New York. So nice they had to name it twice.”

But then I went to college in Buffalo, New York, and a funny thing happened. I was no longer in the center of the universe, but life was still good. Sure, Buffalo didn’t have a cultural scene comparable to New York. But what scene it did have was more than adequate for my needs. And the people of Buffalo were hardly a sorry lot. They were great, fun-loving people. In fact—you haven’t lived until you’ve gone bowling with a bunch of Polish-Americans!

So here was a great financial clue. No single city in America is the center of the universe. If one city isn’t meeting your needs, whether that’s socially, spiritually, or FINANCIALLY, there are plenty of others that will. You have options.

But because I was clueless—and a snob—I stayed on Long Island after college and suffered financially for over twenty years.

Clue Number Two: Learning never ends.

A day or two after my last final of my freshman year, I remember walking into the room of a floor-mate while he was packing for home. And what he was packing at that particular moment almost floored me. He was packing his books! I had just sold every freakin’ book I bought for the recent semester back to the college bookstore.

“You’re packing your books?” I asked rather perplexed.

“Yes,” he retorted. “I’ll read them again this summer. Besides, they’re nice to have around for a reference.”

“Read again?” I remember thinking. “Use for a reference?” What an effing weirdo.

But this effing weirdo was studying to be a chemical engineer. After he graduated the following year, a major chemical company offered him a starting salary of over $60K. And $60K back in 1981 was very good money for a 22-year-old. Heck, it’s very good money for a 22-year-old now.

So let me tease out the financial clue here. Learning isn’t something you do for a certain number of hours over a certain number of weeks. In others words, learning doesn’t stop after school. Learning is something you do every day. Learning is how you grow. Learning is how you become more valuable to others—especially to those others who are looking to hire or promote you.

But because I was clueless—and a partial philistine—I didn’t grasp the power of relentlessly pursuing personal development until I was well into my 30s.

Clue Number Three: Don’t buy things to impress others.

In the late 1980s, I went to Boston for a cousin’s wedding and forgot my shoes. To rectify this oversight, my grandfather took me to one of the last remaining shoe factories in New England.

The shoes available at this factory’s showroom weren’t very appealing. They were all clunky looking, very old-man like. But there was nothing I could do. I needed a pair of shoes, and grandpa was all excited about my feet being wrapped in the last vestiges of the once great Yankee shoe industry. So I plunked down twenty-five bucks for some unsightly shoes.

The next day at the wedding ceremony, I was sitting in the church pew and feeling very self-conscious about the fashion statement my shoes were making. How was I going to impress any of the bridesmaids with these boats on my feet? And who sits next to me, of course? Jay.

Jay was the husband of another cousin. He graduated from Dartmouth a few years earlier with an MBA and was working at Fidelity. What he did at Fidelity, I couldn’t say. But he was making over half a million dollars a year. And sure enough, not too long after we exchanged pleasantries, he looked down at my feet and said, “Nice shoes.”

I, of course, thought he was mocking me. But just before I threw grandpa under the bus, I looked down at his shoes and noticed that they were even more clunky looking than mine.

“Where did you get your shoes?” I asked.

“They were selling surplus stuff at the national guard airbase a few weeks ago,” he answered. “I got these beauties for ten dollars.”

So let’s see what we got here. The millionaire was wearing ten dollar shoes and was proud of it. The zero-aire was wearing shoes two and half-times more expensive and was mortified by it. Could a financial clue be any more clear? You don’t buy things to impress others. You buy what you need. And if ten dollar shoes get the job done, you buy ten dollar shoes. You don’t buy twenty-five dollar shoes.

But because I was clueless—and very much sucked into the hedonic treadmill—I spent decades, “buying stuff I didn’t need with money I didn’t have to impress people I didn’t like.”

Clue Number Four: Don’t buy individual stocks.

In the early 1990s, my father and I joined forces to make our mark in the world of investing. We had each read Peter Lynch’s One Up on Wall Street, so we knew everything we needed to know about buying stocks.

We began our assault on Wall Street by each contributing $5,000 to our joint brokerage account. But things quickly went south. In a little over a year, our portfolio’s value dived from $10K to slightly more than $1K. Our worst bet was throwing $5K at a company trying to develop an erection cream (I kid you not). And when this company failed to get FDA approval, our $5K turned into $0K overnight.

The financial clue here, of course, was to not invest in individual stocks. But because I was clueless—and full of hubris—I blamed my father for our demise. Yes, it was all his fault. He was the one who came up with the erection cream company, for heaven’s sake! Sure, I failed to study the fundamentals of the companies we invested in. How important was a company’s P/E ratio anyway? And, sure, I thought every company we invested in—especially the erection cream company—was going to make us rich. But these inconvenient facts were beside the point. Dad was the real problem. And I vowed that the next time I had money to invest, I would show him and the world how to pick stocks.

Clue Number Five: Get money to invest and invest in a mutual fund.

Anthony was a co-worker at my previous job. We had the same title and the same salary.

One day after we had lunch together, he asked if we could stop by his bank before we headed back to the job site. He needed to make a deposit. And since there was nothing pressing at the job site (it was a government job, after all), I readily agreed.

Anthony wasn’t making a deposit into a savings account. He was making a deposit into a mutual fund. Since high school, he had a one-man landscaping business. And every dime he made from this side-hustle went into that mutual fund—over twelve years of methodical investing.

After he made the deposit, he asked the teller for a print out of his account balance. He then took the print out and showed it to me. He had over half a million dollars in his account.

So let me paint a scene for you. It’s the mid-1990s. We have two fellows. One is a few years older and college educated. The other isn’t book smart, but has a knack for earning extra money and a knack for saving. The older, wiser fellow is broke. The younger, industrious fellow is a financial rock star. And he didn’t get that way with smoke and mirrors (or an inheritance). He got that way by taking the $10K-$15K in profits his landscaping business generated every year and putting that money into a boring mutual fund.

The financial clue that Anthony provided was breathtakingly simple. Get a second job and use the money from that gig to invest in a mutual fund. Anyone could do it. But because I was clueless—and an egomaniac—I couldn’t admit that unsophisticated Anthony had put me to shame. No, I had to make excuses for why my financial life wasn’t on a similar trajectory. Anthony was a workaholic—and a miser. Who wanted that kind of life? Not me. I wanted to enjoy life while I was young.

But Anthony wasn’t a workaholic (his side-hustle entailed ten hours a week for six months out of the year), and he wasn’t a miser (he had just as much stuff as I had). I simply preferred fiction to the cold, hard truth. And because of this, my financial renaissance had to wait another ten years.

Final Thoughts

Thankfully, I’m no longer a financial ignoramus. Mrs. Groovy came into my life roughly sixteen years ago and introduced me to Dave Ramsey. I’ve been studying personal finance ever since, and sniffing out financial clues is now second nature to me. But what about you? Have you missed financial clues in your past? Are you still missing financial clues? I’d love to hear about your adventures in financial sleuthing.

Okay, groovy freedomists, that’s all I got. Have a great weekend!

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  1. Wow, fantastic article… Sorry I missed it last June but maybe I’m more ready for it now. I’ve always been a bit of a saving squirrel, squirreling away the pennies. But I am more blasé about buying expensive items than I should really be and this is a timely reminder!

    • Mr. Groovy

      Thank you, Sarah. Expensive isn’t always better or prudent. We all need that reminder every once in a while.

  2. I feel so lucky to be in the era of online banking and index funds with low fees.
    Our parents started saving with so few options and they were often taken advantage of by advisors and funds with high commissions. Today, there’s so much more information and it’s easier to DIY. Yay!

    • Mr. Groovy

      I hear ya, Julie. I vaguely remember my parents talking about this new thing called the IRA. But no one I knew had one. My parents certainly didn’t. They never even counseled me to get one. IRAs and mutual funds just weren’t on the radar of the middle class in the 70s and 80s. Heck, the Roth IRA didn’t come around until 1997! And, yes, brokers were even more abusive back in the day. But thanks to Vanguard, and the internet, and the FI blogosphere, the average person can get a handle on his or her finances with relatively little effort. In many ways we’re in the golden age of investing and wealth-building.

  3. Love how you were able to tie in a story with all of your experiences. I’ve tried to remain as “clued in” as possible and always telling myself there is more to learn. I wish I hadn’t been so clueless as I piled up more student loans each year at college though.

    I was also able to recently visit Buffalo, really nice city! Saw a free concert at canalside and was a great experience. Obviously not many places have the same effect as NYC, but like you said – that’s OK.

    • Mr. Groovy

      Hey, Debt Hater. The one financial “doh” I missed was student debt. But that wasn’t because I had a clue. It was timing. For my last semester at Buffalo University (Spring 1984), tuition and fees for a full coarse load (15 credits) came to $540. I was able to handle it with a little help from my parents and a minimum wage job ($3.35/hr). Haven’t been back to Buffalo in close to thirty years now. Glad to hear it’s hanging in there. The people there are very nice and they deserve a rebound of sorts.

  4. Exactly! Personal finance is only now seeping into the national consciousness. When I was growing up (in the 60s and 70s), the essence of personal finance could have been distilled down to two edicts: work and pay your bills on time. That was it. No one in my social circle knew what a mutual fund was. And we didn’t get any PF instruction in high school or college. In other words, we had no idea how ignorant we were. But thankfully that is changing. The means to self-educate yourself on PF are now readily available–and largely free. And as long as you’re in the game, and learning something about PF every day, you’ll be fine. Like you said, Harmony, “everything happens for a reason.” Live, fall, learn, grow. Thanks for stopping by, Harmony. Always appreciate your contributions.

  5. I wouldn’t even know where to start with our bad financial mistakes . . . maybe the fact that we never really paid much attention to our money. And there were plenty of clues along the way. Like when we had to take a loan from Mr. Smith’s brother in order to pay for emergency surgery for our dog. That should have been a sign that we needed to get rid of debt and build up our savings.

    I definitely believe in the mantra that “everything happens for a reason.” We made the mistakes so we could learn from them. Just look at those lessons as affirmance that you’re heading in the right direction now 🙂

  6. We definitely should have been prioritizing retirement the last few years, but there have been too many other things. When we were paying down debt, we thought my husband’s unemployment would run out and then we’d be stuck with two people on disability (once his eventually came through — so one person on disability for an indefinite period of time). This meant a pittance into a single IRA had to be good enough. Then I was able to find a job. So we should have put more against retirement — but it was the smart thing to do with the information we had at the time.

    But six years later, we’re still not putting much in. Because I’ve been prioritizing the mortgage and my husband’s $27,000 dental implants. The latter could’ve been put off but… it’s been hanging over my head for 8 years!

    So those two factors are due to panic-induced stupidity. Not much to be done now but fund a SEP asap and try to make up for lost time. We still have around 30 years, as long as my health doesn’t take an even bigger turn for the worse. But given that I work at home, it’s probably pretty safe.

    • Hey, Abigail. Thanks for stopping by, and thanks for sharing your trials and tribulations. In all honesty, you’re doing a amazing job. Once health and dental issues are involved, “normal” personal finance is out the window. I get so disheartened when it comes to health care. For the life of me, I don’t understand why there’s so little competition between doctors and why there’s so little price transparency. I’m going through the dental implant process right now, so I know your pain. One tooth and I my out-of-pocket expenses will be around $3K. Perhaps medical tourism will become a viable option soon and we’ll some recourse to our failed system. Stay strong Mrs. A. And keep being an inspiration.

    • You are absolutely doing a stellar job Abby – health issues absolutely throw all ‘normal’ rules out with the bathwater. And unemployment is a real financial drag, too.

      • Mr. Groovy

        Isn’t Abby awesome! Mrs. G and I are big fans of hers. Thanks for stopping by and sharing the love, NZ. I really appreciate it.

  7. I’m 100% missing the boat with investing. I’m getting better (thanks to your input, Mrs. G’s input, other bloggers, and the bazillion books I’m reading), but I know I didn’t do as well with that from the start. Love these lessons!

    • Hey, Penny. No worries. You’re so far ahead of the game temperament-wise, you’ll be fine. Saving is much more important than picking the “right” fund. Start with a total stock market fund, an S&P 500 fund, or even a target-date fund. Which one isn’t terribly important at this stage. The key is to start. You can always adjust your fund allocation in three to six months. For a great tutorial, check out J.L. Collins’s stock series at http://jlcollinsnh.com/stock-series/. It’s awesome.

    • Mr. Groovy

      Thanks, Julie. It truly is common sense. And not having such a fragile ego. One of my favorite insights from Suze Orman was her commandment to “act your wage.” Jay and Anthony certainly took this commandment to heart. I eventually did as well. But I took far too many hits to my wallet before I woke up.

  8. Over the years, I have made many financial mistakes including buying stuff I didn’t need, hiring financial advisors that didn’t know what they were doing, and failing to fully invest in my 401(k).

    I’ve also made big mistakes leaving well-paying jobs too soon. My first “real” job was in a Big 4 firm. I left after less than 2 years because I had an offer for more money. Had I stayed longer, I would have realized that the upside potential was much greater where I was.

    I also left a good job to start a company from scratch. Unfortunately, it was right before the economy tanked in 2008.

    I recovered from both these events, and learned quite a bit, but it was an expensive education.

    • Mr. Groovy

      Hey, Dave. Thanks for sharing your financial “dohs!” The one good thing about your financial missteps is that you were being proactive. You were trying to better yourself, and stuff that nobody could have foreseen just happened (e.g., the 2008 financial meltdown). I on the other hand was utterly clueless about the fundamentals of person finance and had no idea that my “normal” behavior was slowly sabotaging my financial health. But thankfully we both survived our youthful indiscretions–at least when it comes to money, anyway.

  9. I wish I had stuck with my gut and not paid the rent for a girlfriend as we were breaking up. Especially as I had only agreed to pay for half. Her sob story took two weeks worth of my pay. I did not even live with her! I knew we were breaking up, too. I just felt bad for the situation she had gotten herself into and thought I could help. I couldn’t. She had to make better choices.

    Before that I hadn’t had credit card debt, but I let the one bad decision snowball. I’m still digging out from that era/error.

    • Mr. Groovy

      Hey, ZJ. I certainly can sympathize. You got a kind heart. Mrs. Groovy and I have helped out family and friends who brought financial pain upon themselves. We knew it ultimately wasn’t going to help. And we knew we were never going to see the money we gave them again. But it’s hard to say no to people you care about.

  10. I’m really digging the don’t buy things to impress others. It’s something that really kept me down in my 20s because, really, after they see your new shiny “toy” they aren’t impressed after you leave, and you are left with years of payments (in the case of a car) on it. It’s a tough lesson to learn but I’m happy to have it under my belt.

    • Mr. Groovy

      Agreed. I was very bad with cars when I was younger. Had to have a hot car to impress the ladies. But now? I couldn’t care less what my car signals to others. In fact, Mrs. Groovy and I were driving home yesterday after running some errands and we were both overjoyed to observe that our car was the worst on the block. It made our freakin’ day! Thanks for sharing, Andrew. Your insights are spot on.

  11. I think we’d all like a few financial do-overs, Mr. Groovy. Laughing ruefully at our younger selves is one of the glories of middle age.

    I’m still kicking myself for my liberal arts snobbery in college, because if I’d just bothered to take an accounting class at 19 I think I’d have gone into a much more satisfying career (but probably would not have the vast knowledge of useless but entertaining book trivia that I currently enjoy.)

    • Mr. Groovy

      Hey, Emily. I got one for you. When I was home from college after my sophomore year, my best friend was signing up for the New York City firefighters exam and suggested I do so too. But I said, “Screw that.” I wasn’t going to college to be a firefighter. I was above that. Well, fast forward thirty years, my best friend is a battalion chief making close to $200K. When he retires from the NYFD in a year or two, he’ll be getting a $150K annual pension and free health care for life. But, hey, he doesn’t have a liberal arts degree like I do.