John’s Story

As I was coming off the elevator in the apartment building where I live, John, the building superintendent, stopped me and asked if we could chat for a minute.

“Sure, what’s up?”

“My wife and I need some advice on what to invest in.”

I told John that I am not an investment professional. Still, trying to be helpful, I asked him why he brought it up.

He said, “My wife works, I work, and we have 13-month-old twin boys. I want to do the right thing.”

John is 39, his wife is 33. They have minimal life insurance.

I asked, “How much can you invest each month?”

He said he would discuss it with his wife and let me know.

The more I thought about John’s request, the more I realized he was asking the wrong question.

I pictured the infield of a baseball diamond. To be safe at first, you must have health insurance. To advance to second, consider disability insurance. To make it to third, John has to have ample term life insurance on himself and his wife. To reach home plate, score by putting the balance from what you can afford each month—half into a Roth IRA and half into a conventional investment account. An exchange-traded fund (ETF) that tracks the S&P 500 is a good investment.