How I Invest
Dave Welty | April 7, 2021
What drives my investing? It’s understanding that investing is for the long-term. It’s not a race to capitalize on market fluctuations. I don’t try to beat the market or to strike it big on a few trades and call it good. What drives my investing is what drives me in life. I don’t invest for the sake of making money, I invest so I can achieve my long-term goals and more importantly fulfill commitments I have made to my family and community. This commitment is grounded off my upbringing and is a promise to my family that they would never have struggle with some of the financial hardships my parents and I had to endure when I was a child.
Growing up, the most knowledge I had about finance was that money, or the lack thereof, caused stress. Lots of it. My parents grew up with little means and were married at age 16. By 19, my dad had three children and had to work multiple jobs to ensure there was food on the table and pay the rent. My parents never had an opportunity to get an education past the first few years of high school, although my father did go to college much later in life. They worked their tails off and despite working multiple jobs, our family still found ourselves struggling at every turn. I remember myself in high school, roaming the aisles of the grocery store waiting for the coast to be clear so I could check out with food stamps. Back in the day food stamps were literally little booklets of coupons that looked more like Monopoly money than anything else. I was embarrassed to use these coupons. I was scared of the undeserving judgement people often bestow upon people like my teenage self for having to use government assistance to buy basic groceries.
My parents never failed to meet my basic needs despite the obstacles they faced, but they did endure a lot of stress while trying to do so. They divorced before I graduated from high school and headed to college. I was the first in my family to attend college, it took me 7 years to graduate with a Bachelors in Geology. I was determined to finish college and paid for it myself. As a child, and even as a young adult, I lacked almost any financial literacy – all I knew was I needed to work hard to support myself and pay for my education. Our family didn’t have money to invest when I was growing up. We never discussed the stock market, how to save for college, or anything to do with financial planning. After graduating, I eventually found my true passion – financial planning. I realized the impact good financial planning and insight can have on a family, and people’s individual lives.
As the years passed, I gained valuable experience in the financial advising industry and started my own firm. When I started Avier Wealth Advisors, I had 2 goals in mind. One was to serve my community, the second was to ensure my wife and children would not endure the struggles I had as a child. I swore to myself that I would make sure my children would never need to face the embarrassment of paying for food using food stamps, we wouldn’t lose our home to the bank, and my wife would never need to lose sleep over where our next paycheck was coming from. In many ways, my childhood shaped my career and how I invest my money.
Avier Wealth Advisors is my biggest investment, both financially and personally. Not only did I invest into a business, but I invested in myself, my employees, and my family. When I started the business, I invested our family funds to get it off the ground. I was fortunate that my wife had a job at Microsoft, so our basic needs were met without huge amounts of stress. Having that stability for the first few years was more important than I realized. Knowing our basic needs were met, meant the mortgage and healthcare were always paid. What a relief it was.
Every financial decision I had to make when building my business impacted how my business and co-workers would be affected AND how my family’s finances would be affected. There was little barrier between the finances of the firm and the finances of my family, and that made every decision a group decision — often at the dinner table or on evening walks.
Investing in myself by funding my education provided me with the opportunity to start Avier. It allowed me to fulfill my commitment of serving my community, providing for my family, and ensure I could send my children to college. My wife and I value education over almost anything else. Growing up, I saw how hard my parents had to work due to the lack of education they had. To me, there is no index, or mutual fund, or stock, that will ever pay you a better return than education. An education is an investment purely in yourself, and you have 100% control of what you can do with it.
My wife and I are fortunate enough to have been able to set up a family endowment that allows us to merge our passion for education and soccer. We have partnered with a local soccer organization to fund scholarships for soccer players who can play at the college level but need assistance with travel in order to catch the eye of a coach. Our criteria are simple: decent grades, financial need, and the ability to play at any college level. Cam, our oldest son, plays soccer in college. The experience has been wonderful. We hope to play a small role in making this happen for others who are less fortunate.
Though Avier continues to be my, and my family’s biggest financial investment. This is an article about how I invest, so I’d be remiss to not share the deep and valuable secrets of my portfolio.
Spoiler alert – there are no secrets!
I use virtually the same methods I advise our clients use. I am what you call a “warm milk and dry toast” investor. I take a market-based approach. Global diversification is the name of the game — own the world! I believe in tilting the portfolio to small, value, and Emerging Markets. I firmly believe that attempting to beat the market will only result in more gray hair, and a higher likelihood of underperformance. I don’t wake up at 4:30 AM to place pre-market buys, and I have never considered myself a day trader. In fact, I invest so that I can go off the grid for as long as I want, and not have to worry about missing a dip or setting stop losses. My investments ensure the longevity of my wealth, but they don’t control my life. If you ask anyone who knows me, they will agree that my investment strategy falls in line with my temperament — long-term, consistent, and predictable. This strategy hasn’t changed and never will. I find myself slowly reducing the risk in my portfolio as I get older, just like we do with our clients.
Like many investors, a decent portion of my portfolio is in bonds. I try to avoid high yield bonds, as they tend to act like stocks. High yield bonds in my view are counterintuitive to the benefit of owning the security itself. You own bonds because they behave like bonds. Bonds are low risk and consistent, they can endure a market dip. High yield bonds are too volatile, and for their risk, I’d rather invest in the stock market and purchase lower yield bonds. This is the same recommendation my team and I make to our clients for their portfolios. As a financial advisor, I believe that if we aren’t eating the food that we cook, we aren’t doing our job correctly.
My investments enable me to achieve my personal and professional commitments and as advisors, we do the same with our clients. We ask what type of lives our clients want to live. What are their goals? What do they want for their families? Some prioritize travel and adventure, some want to save for their children’s education, and some value real estate. It’s not all black and white, but as advisors, our goal is not to invest for the sake of investing but for a purpose. You invest so you can achieve what you want in life and fulfill your commitments to yourself and others. For many, this is financial freedom, or peace of mind, or seeing their children attend college, or being the first in the family to buy a home. It’s different for everyone, and there is never a right answer, only your answer.
As I share my thoughts with you all, I can say that I am fortunate enough to have investments that have paid off. This isn’t just due to careful and consistent investing, but due to the loyalty and hard work of my team at Avier, the support of my wife, children, and friends, and the hard work of my parents.
I have been fortunate enough to fulfill the commitments I made to myself, my family, and community through the personal and financial investments I made and perhaps one of the biggest returns I have experienced is being able to help others. I truly enjoy working with people, learning about where they want to go, and helping them get there. I want to help people realize that when you invest in yourself you are able to fulfill the commitments you have made to others and truly make an impact.
This article was inspired by: “How I Invest My Money: Finance Experts Reveal How They Save, Spend, and Invest”
Joshua Brown and Brian Portnoy