There aren't too many people who can retire at age 41 and live the rest of their lives in Los Altos. But that's exactly what Los Altos resident Kirk Lindstrom did nine years ago when he left the high-tech world to become the new Charles Schwab for investor wannabes.
"What he (Schwab) did for the investment companies, I'd like to do for the individual," Lindstrom said.
The problem with investment companies is they make recommendations from a biased position, according to Lindstrom.
"No one's going to advise you to invest, because they can't charge a fee," he said.
Lindstrom has a formula to change that.
He got his start investing when he was young, collecting coins and stamps with money he earned from household chores.
"Those didn't turn out to be good investments," he said, "but I learned about compounding … that was an eye-opener at 14."
One solid investment was his education. Lindstrom wanted a career in nuclear technology but wanted to be out in the work force in minimal time. Instead, he graduated from UC Berkeley in 1979 with a bachelor's degree in electrical engineering/computer science, a decision that paid off handsomely.
In deciding whether to work for IBM, Hewlett-Packard or a small "hit and miss" company, Lindstrom looked at the companies' revenues for the best stock potential. He chose Hewlett-Packard, where he worked in research and development developing optical communication devices, fiber optics and wireless infrared for personal computers.
Twenty years later and facing a company reorganization, Lindstrom left H-P in 1998.
"I liked the job, but I was really frustrated," he said.
At the time, Lindstrom said he started his portfolio purchasing stock in Lam Research Corporation.
"I was buying LRCX with my spare cash at about $3.33 and $4 a share, knowing from my integrated-circuit design experience that etch was going to be an important process step in the years ahead," Lindstrom said.
The stock is now worth $53.
Lindstrom's secret to success is that he envisions consumers' future needs and demands based on current technology, invents the product in his head and researches small startup companies that market the equipment for his imagined invention. Lindstrom said he actually invented Skype in his head long before it debuted.
"Kirk's Investment Newsletter," offers advice on portfolio management based on a "core and explore" strategy for younger people years away from retirement. Eighty percent of the portfolio purchases stable but well-diversified investments and 20 percent is invested "exploring" the stock market.
Lindstrom said it was his
"explore" portfolio that netted him the quintuple gain in his assets.
He said he never offers advice outside of stocks related to science and technology.
For retirees or older adults close to retirement, Lindstrom uses a different formula to determine portfolio percentages. He also writes a more conservative newsletter, "The Retirement Advisor," which he co-authors with an attorney and a financial analyst.
The most important advice Lindstrom offers is the idea of rebalancing the portfolio every quarter.
"I'd say about 80 percent of my living expenses come from my investment portfolio, and the remainder comes from my writing," Lindstrom said.
He said he can teach people to track their portfolios on a spreadsheet and manage their assets without paying the high fees of brokerage houses.
Lindstrom said it's a shame that high schools don't teach students about inflation, compound interest, brokerage fees and portfolios, but parents can buy their children stock that pays dividends so they can get some first-hand experience about long-term investments.
In the meantime, Lindstrom waits for other winds of opportunity.
"While most engineers are in meetings or with customers," Lindstrom said, "I windsurf in the summer and bike ride, and garden or work out when there is no wind."