Personal Finance > Real People
Real People:
A steady march to retirement
Louisiana natives Trish and Mark Crochet share a love of music and a million-dollar nest egg.
March 24, 2003: 4:22 PM EST
By Sarah Max, CNN/Money Staff Writer

New York (CNN/Money) - Nearly three decades ago, Trish and Mark Crochet met while playing fight songs with the Louisiana State University marching band.

Today, music continues to be an important influence on the Crochet family. With Mark on tuba and Trish on clarinet, the couple regularly play with the Baton Rouge Concert Band, and their 13-year-old son, Jason, practices his coronet with the goal of some day playing in LSU's celebrated band like his folks did.

Over the years, the Crochets have applied the same discipline and patience it takes to learn a musical instrument to other areas of their lives, including their finances.

"Our big goal from the start was to save for retirement," said Mark, 48, who is an analytical chemist by training and manager of the environmental lab at BASF near Baton Rouge.

By steadily saving in their company's retirement plans, investing in local real estate and keeping close tabs on their spending, Mark and Trish have accumulated more than $1 million in savings and property, and they are on track to retire when Mark turns 55.

Although Trish and Mark have always shared the same philosophy on money matters, they each have a distinct role when it comes to managing their finances. Trish, who is 46 and works as a paralegal, is the family bookkeeper and bargain shopper. It's her job to stretch the couple's combined income, which is $130,000 before taxes, to its fullest.

"I keep Mark in check in terms of spending," says Trish. "He's more of an entrepreneur than I am and far more interested in learning about investments."

Technical analyst by night

The bulk of the family's savings is in their companies' 401(k) plans, which are worth about $779,000. "I don't really care for single stocks," says Mark. "I don't want to wake up one morning and find I own an Enron."

Still, their portfolios are hardly on auto pilot.

In the early 1990s, Mark began studying technical analysis and allocating his retirement funds according to which direction he thought the stock market was heading. "I spend about two hours a night doing technical analysis," said Mark, who in mid-January shifted the bulk of his and Trish's investments into stable value funds based on his analysis. It's not uncommon for him to reallocate holdings as frequently as a couple of times a week, though he generally sticks to the same six mutual funds.

"I don't think most people are willing to put in the kind of time I do studying their investments," said Mark, who recognizes that this is not a conventional way of investing for retirement.

In fact, most financial planners recommend a more hands-off approach for managing investments, particularly those earmarked for retirement.

While company 401(k) plans usually don't penalize participants for moving between funds, mutual fund companies and brokerage firms do discourage actively trading in and out of mutual funds.

But for Mark, the strategy seems to be working. Since January of 1995 his 401(k) balance has grown ten-fold, even with average annual contributions of typically no more than 10 percent of his salary.

Handyman (woman, and boy) on the weekends

The other area the Crochets have been focused on is real estate. In addition to their home, they own four other houses in Baton Rouge, which they rent out.

The first two rental properties that Mark and Trish took on were actually houses they had lived in. About 20 years ago, they decided to keep their first house and rent it out rather than selling it. "We used money from our savings to pay for our second house," said Mark, "Ten years later we did the same thing again."

Five years ago the Crochets bought two more properties. "I don't buy a property as an investment unless I can rent it out for $200 more than the monthly loan payment," said Mark, who says they try to save the proceeds, totaling almost $10,000 a year, to finance future real estate purchases.

In order to keep close tabs on their property and make regular maintenance less time- consuming, the Crochets make a rule of keeping their properties within 10 miles of their home. They also do all of their own upkeep. "We now own every power tool you can imagine," said Mark, who's learned about plumbing, become a speed painter, and enlisted Jason's help with lawn-mowing duties.

Sailing through retirement

The Crochets face quite a few life changes in the coming decade. For one, Jason will be starting college in less than five years. Mark and Trish have not saved specifically for Jason's education, but say they are not concerned about coming up with the funds to finance it, particularly if Jason goes to LSU where he'll get in-state tuition.

Then, about two years after their only child heads to college, Mark and Trish hope to retire. At that time, Mark will get an additional lump sum from his company pension, now worth $104,000, which will be a nice addition to their portfolio of mutual funds.

The couple says they'll focus on managing their rental properties and even consider buying others. They'll also spend more time working with some of community organizations they're already involved with, including Habitat for Humanity, the American Heart Association and the March of Dimes.

Of course, they plan to have some fun once their day jobs are behind them. "They have cruises where they give you a sharply reduced rate for playing in the band," said Mark. "We love to travel and you know we love music."  Top of page

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