He’s still Coach, even on finances

John Wooden can still identify the worst step he ever took in his retirement planning.

It happened in 1948.

That’s when the storied UCLA basketball coach accepted the post in Westwood. It was a step up from his head coaching job at Indiana State, though his second choice after the University of Minnesota (which was an hour too late in calling to offer him the job).

When the offer came in from UCLA, Wooden told me the other day, he didn’t ask a lot of questions. Consequently, he didn’t know that UC coaches weren’t members of the faculty, but were paid by the student body through its activities arm, Associated Students.

That meant he wasn’t on the university’s retirement plan -- a situation that persisted for 12 years, until athletics were brought under administration control in 1960.

So when he retired in 1975, after 27 straight winning seasons and a record 10 national titles, he was cheated (my word, not his) of 12 years of pension credit.

What’s the lesson? “When you make a judgment that doesn’t work out, it’s not a bad judgment if you’ve checked things out. That one was a bad judgment because I didn’t investigate to begin with.”

There are plenty of luminaries in this world known only by their first names; Wooden is on the higher plane of those identifiable solely by their title. In this case: “Coach.”

So when I heard that he was interested in talking about his investment planning and his retirement principles, I leaped at the chance to listen.

I met him at his condo in Encino, where the walls are covered with plaques and testimonials from admirers and photographs attesting to the respect he gained at UCLA and the teachings with which he endowed several generations of accomplished young people.

He’s 98 -- “98 1/2 ,” he says -- physically rather frail but his voice firm and his judgment as sharp as ever. He was with Rodger Rutter of brokerage LPL Financial, who has been his financial advisor since 1996. They met when Rutter, the manager of Wooden’s local branch of Home Savings of America, offered to help with Wooden’s retirement planning.

When Coach made his surprise decision to retire from UCLA in 1975, he was uncertain what the future would hold for him.

“I knew my retirement income was not good,” he says, alluding to that pension deal. He hoped to maintain his standard of living, ensure that his ailing wife, Nell, would be cared for, and have something left for the children.

As it turned out, retirement opened up a world of new opportunities, including a steady output of books bearing life lessons as well as basketball coaching tips, and steady income from speaking engagements. For years he had a deal with Los Angeles-based Capital Group’s American Funds to speak as often as 30 times a year to its representatives and clients. His last such engagement was this year.

Nell passed away in 1985. When Rutter and Wooden first met, the coach’s chief concern had shifted to taking care of college for his grandchildren (seven) and great-grandchildren (13 at current count). He had a handwritten will, Rutter says, and a family trust that needed to be updated for an estate that had grown sharply since 1975 because of speaking fees and book royalties.

When they considered the coach’s investment allocations, Rutter says, he “left the stock and bond mix up to me. But he handed down his philosophy, to establish a long-term income strategy through market ups and downs.”

To put things in perspective, Wooden served UCLA in relatively modest circumstances. His peak salary was $32,500. The purchasing power of that sum in 1975 would be about $131,000 today. Ben Howland, who took over as men’s basketball coach with the 2003-04 season, received salary and incentive payments last year totaling $2.17 million plus $9,000 in tickets to UCLA sporting events and two “courtesy vehicles,” according to UC records.

To be fair, Howland’s UCLA team reached the NCAA Final Four matchup three years in a row from 2006 (when it lost in the national championship game) through 2008.

Wooden doesn’t dwell on the changes in pay standards in the professional field over which he once reigned.

“I don’t say it wouldn’t have been nice to have more money,” he says. “But if you always think things will be better with more money, your life’s not going to be that good.”

That sounds as though it could be an aphorism from one of the 11 books of wisdom from Wooden that, by my count, are still in print. Normally I don’t have much truck with inspirational books, but Wooden’s life of accomplishment confounds cynicism.

The centerpiece of his teaching is the “pyramid of success,” comprising 15 character traits topped by “competitive greatness” at the summit, that he laid down in 1948. One remarkable thing about the pyramid is how it applies to life off the basketball court.

Take the building block “self-control.” “You cannot function effectively unless your emotions are under control,” Wooden wrote. “Careless mistakes are likely to occur.” Alan Greenspan might have been thinking about that when he warned about “irrational exuberance” infecting the stock market in 1996, or two bubbles ago.

Before dropping in on Coach, I picked out a few other bricks from the pyramid to run past him. He gave me an opening by mentioning that his approach to retirement planning involved not paying attention to the daily ups and downs of the financial markets, but rather relying on “some general principles.”

I started with “condition,” which Wooden defined as not only physical condition but “mental and moral condition.” He amplified this trait by stating: “You need moderation and balance in all you do. Balance is keeping things in perspective. It’s not getting too high from good luck or getting too low from bad luck.”

“Initiative?” “Right,” he said. “Don’t be afraid to fail. We’re all imperfect. We’re going to fail at times. If you’re worried about temporary reversals, you’ll be afraid to make a decision.”

Then “intentness,” which the pyramid says includes “the ability to resist temptation,” or in investment terms, the ability to avoid being tempted by the chance of a home run.

When you put all this together, it seems obvious, but the great fundamental principles of life almost always do. It’s a recipe for taking prudent risks based on sound judgment, focusing on the long term rather than pursuing instant gratification (Wooden’s string of national championships didn’t start until after he’d been on the job for 15 years), and eschewing glamour and flash.

Wooden’s career is the epitome of unostentatious achievement and the elevation of teamwork to a lifestyle.

“I do not like showmanship of any sort,” he says. It’s a testament to making your own luck by applying yourself, certainly a signpost in an era when it’s easy to feel slapped around by economic and financial forces beyond one’s control. As we parted, Coach Wooden left me with his favorite saying, sometimes attributed to Abraham Lincoln: “Things work out best when you make the best of the way things work out.”

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Michael Hiltzik’s column appears Mondays and Thursdays.

Reach him at michael.hiltzik@latimes.com, read previous columns at www.latimes.com/hiltzik, and follow @latimeshiltzik on Twitter.