Schoolteacher David Moehlman has a money problem.

He has a lot of it — more than $1 million in savings accounts and mutual funds, plus half a million or so in real estate. And he has no debt.

Moehlman, 44, didn’t amass the vast majority of this nest egg through an inheritance or other windfall. He worked hard and made some good investments.

And he took savings to an extreme. For example, he eats breakfast and dinner every day at fast-food places where he always orders off the $1 menu, and lunch is usually a 75-cent microwave burrito.


He has a car, but it comes out of the garage only a couple of times a year. Otherwise he rides a motorcycle to save on gas. When the weather turns rainy and cold, he dons a snowsuit for riding.

But he worries constantly about money — especially that he will not have enough for retirement — and has made saving a center of his life.

“If I had $10 million I wouldn’t live any differently because spending money doesn’t make me happy,” said Moehlman, who lives in Moreno Valley. “I don’t know where it comes from, but I’ve always been this way.”

Happiness is not something a financial advisor can guarantee. But Sandra Field, a certified financial planner in Cypress, met with him to go over his finances to offer advice on how he could put his fiscal house in order and better protect the money he’s worked hard to save.


And then maybe he could at least worry less.

“Overall it’s refreshing to run into someone without debt on credit cards,” Field said. “But there’s more to life than money. He could end up like Scrooge.”

Moehlman has about $74,000 in checking and savings accounts. And he has nearly $1.2 million in mutual funds, all of which are exclusively invested in U.S. stocks — a major red flag.

Just as Moehlman follows an extreme regimen for saving, he also goes to extremes in his investments.


“With him, it’s full pedal to the metal or nothing,” Field said.

Although Moehlman had done well lately with his focus on U.S. stocks, Field strongly recommended that he diversify his mutual fund investments. She suggested he put 50% of it in funds that hold U.S. stocks, 13% in international stock funds and 30% in funds that hold bonds.

The remaining 7% would be kept in savings or other cash accounts.

The planner applauded that Moehlman had put about 47% of his mutual fund investments in tax-deferred accounts, which greatly lowered his tax bracket. “It’s really a triumph of tax-deferred growth,” Field said.


She recommended he continue his practice of putting about $38,000 a year into the tax-deferred accounts.

Moehlman makes about $80,000 a year teaching fourth grade. Much of his additional taxable income comes from rental properties.

After the real estate crash, he scooped up five condominiums in Riverside County, which was especially hard hit with depressed property values. At the market’s top, these condos had been valued at $275,000 to $350,000. He bought them last year for $70,000 to $118,000, and paid cash.

Moehlman lives in one and rents out the others. After paying homeowner’s association fees and taxes, the condos generate $2,750 a month in rental income.


He has been so happy with the condo situation that he hopes to buy more. A lot more.

“If the prices drop to $50,000,” he said, “I’ll take all my cash and buy 10 to 15 more.”

Another sign of extremes, and the planner thought it was a terrible idea.

“One earthquake would wipe him out,” Field said. He could get earthquake insurance, but the premiums are expensive and deductibles are high.


Though Moehlman is making better than a 7% return on his rental properties, the $33,000 in annual cash flow they generate is vulnerable to vacancies and surprise repairs. The planner’s recommendation: No more condominiums.

Moehlman’s life has been marked by family tragedies. His two brothers were killed in separate traffic accidents. His father had a stroke and requires round-the-clock care.

The schoolteacher was married at one point, but his extreme saving habits contributed to the relationship ending in divorce.

He said he had dreams of retiring at age 55 or earlier and moving to Mexico or Ecuador for the more affordable lifestyle. He thought it could mark a new beginning.


“I think it would be good for me,” he said. “It would get me out of my box.”

But now he is the only sibling left to help take care of his father.

Field insisted he could feel secure and begin to loosen up without having to leave the country. She showed him that if he kept working until age 55, and stayed on a conservative investment path with a reasonable savings plan, his net worth at retirement would be $3.1 million, figuring annual appreciation at 4%.

At 6% — a scenario Field regarded as more likely — his net worth would be nearly $3.5 million at age 55. Continuing returns on his investments, plus pension benefits, should keep him going quite nicely through his retirement years.


Another worry Moehlman had for the future was being able to take care of himself in case of a debilitating illness. Field suggested he look into getting a long-term-care plan through his employer to pay home healthcare costs, if needed, apart from expenses covered by his regular medical insurance.

Moehlman quickly took much of the planner’s advice to heart. He rearranged his mutual fund portfolio, purchasing funds she recommended.

The diversification meant he could no longer keep a close watch on the Standard & Poor’s 500 stock index to get an idea of how his nest egg was faring. But he considered that a good thing, if it meant a better return.

“When you’re invested with the S&P, it’s easy to know every day if you’ve made or lost money,” Moehlman said. “With Sandra’s plan, the market could go down and I wouldn’t know how much I’d lost.”


She also gave him some advice outside of the financial realm.

Moehlman had mentioned his diet, which was almost entirely devoid of fruits and vegetables. He had never eaten a grape in his life.

“Why can’t he eat a grape?” the planner asked. “I’d like to see him set a goal of doing something outside the box once a month.

“Do something. Change.”


Moehlman, never wanting to do something halfway, bought 25 pounds of oranges from a roadside stand. He also began getting his students to walk with him during recess for more exercise. And he considered volunteering at UC Riverside, where he earned his master’s degree.

Overall, he said, “I definitely feel more confident.”

business@latimes.com