Seeking Stable Ground

A solid investment plan helped Rick Byrd endure life's bumps and bruises

Rick Byrd, 48, of Charlotte, North Carolina, has been on the move since graduating from North Carolina Central University in 1976 with a bachelor’s degree in chemistry. Although he worked as a chemist after graduation, he was intrigued with the real estate industry. So, at age 24, he began investing in properties, starting with a $35,000 townhouse in Boston.

Over the next 12 years, Byrd would move three times, get married and divorced, as well as buy and sell several properties. During that time, he also worked as a successful regional sales manager for Abbott Laboratories in Chicago before moving to BASF Chemical Co. in New Jersey in 1985 to work as a senior product marketing manager.

By 1989, Byrd was ready for another change. “I sold my Chicago home, cashed in my 401(k), and decided to use that to fund my M.B.A. at Wake Forest University,” he says. He used the proceeds to pay his living expenses and the $36,000 tuition before graduating in 1991.

Armed with a new M.B.A., he became a business model and product marketing consultant for the next four years. He then took engineering and sales jobs with several ill-fated Internet companies. By 1999, Byrd had several investment accounts and properties, but no plan for his future. He crossed paths with a fellow Wake Forest graduate, Danny Freeman, who became his financial advisor.

“I had worked with another advisor before, but I believe that your financial advisor should not only share your philosophy about finances but also about life, spirituality, and giving back to the community,” Byrd explains. Freeman is a financial advisor with Raymond James Financial Services in Salem and author of the self-published guide Building Wealth Through Spiritual Health.

Working with the $75,000 that Byrd had to invest, Freeman created a portfolio consisting of 75% stocks and stock mutual funds. That included stocks such as Microsoft (Nasdaq: MSFT), AOL Time Warner (NYSE: AOL), ACXIOM (Nasdaq: ACXM), and Sirius Satellite Radio (Nasdaq: SIRI), as well as the Fidelity Capital Appreciation Fund (FDCAX) and American Century Ultra Fund (TWCUX). The remaining 25% was cash. “My goals were to consolidate, build up a cash position, invest for growth, accumulate assets outside of real estate, and plan for retirement,” Freeman explains.

Byrd says the portfolio grew about 30% from 199932000, “but then we lost it all back in 2001.” But he feels fortunate considering the losses others took over the last two years.

“Today his portfolio has 40% cash and 60% stock and stock mutual funds,” Freeman says. “Ten percent of the cash is in a CD which earns 4%.” Byrd also has four real estate properties valued at $400,000. He collects about $2,700 a month in rents from the properties. Moreover, with his new job as an e-business advisor with Webserve, he has been contributing 7% of his salary into his 401(k) plan. “For the future,” says Freeman, “the aim is to move him away from real estate, put that money toward his retirement, and continue to diversify the portfolio so that

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