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Portfolio Life

Five Questions for Part-time Lecturer Richard A. Spillane Jr., who directs the Babson College Fund program. He spent 30 years in the money management business, most recently in senior leadership positions at Fidelity Investments.

What makes Babson stand out to you?  Number one: the students are top rate. Number two: the other faculty members are top notch as well. And number three: there’s no divide between the practitioners and the research faculty. At other schools, they are like oil and water, but I don’t find that here at all. It’s a great mix of theory and practice.

You spent 20 years running investment practices at Fidelity. Contrast the life of a financial executive with this one.  I can afford to be a little bit more ad hoc, less focused on one thing. Yesterday, I spent a couple of hours preparing for today’s class. Then, I was at two nonprofit board meetings. In the late afternoon, I attended a corporate, conference call board meeting. A person in my position can be like a kid in a candy store, just signing up for interesting new projects. You have to figure out where you really want to spend your time. But it’s not dull at all!

Is this a Portfolio Career?  Yes, I’m very much doing that, and it’s been great. Besides my work with the students of the Babson College Fund, I’m chairman of the board at Xaverian Brothers High School in Westwood, Massachusetts. I’ve joined the Lynch Foundation and we’re working on a project called the Lynch Leadership Academy, which trains school principals in leadership skills. I am on a variety of finance boards. I’m here teaching two days a week, but I’m on campus more than that.

Beyond the ups and downs of the market, what’s the burning issue in investing today?  The biggest thing I see is the risk aversion among investors. It used to be that you’d get one market crash every 30 years. Now, it seems like you get one every 10. So people are rightfully very cautious. You can see that in the flows of equities out of equity mutual funds into more conservative-type investments. And, the irony of that is if you retire at 65 in America today, that means you have about 15 years to live off your money. So you’re still a long-term investor at age 65.

What’s the next wave of career opportunities in investing?  The outstanding opportunity is advising confused and befuddled investors. Today, three crosscurrents are in play: the first is risk aversion; the second is the risk of running out of money before you die; and, the third is the government saying, “You’re on your own, so figure it out.” Whether it’s managing a 401K or setting aside a health savings account, or for that matter building wealth for college tuition, people want complete solutions to their problems. They aren’t interested in individual investment products any more.

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