American Way You and your company have been very active civically. Why?

SchwabI think it's incumbent upon successful people - it's their responsibility. Helen [Schwab's wife] and I spend zillions of dollars in not-for-profit activities, whether it's on the homeless in San Francisco, addiction problems, or The Museum of Modern Art. It's incumbent upon successful people to offer support. That's why the government gives, in tax policy, encouragement for making contributions.

American Way When you got out of Stanford Business School, what attracted you to being entrepreneurial?

SchwabI guess I've always been entrepreneurial. I was running a chicken operation when I was 12 [Schwab raised chickens, sold eggs, and peddled chicken droppings for use as fertilizer]. When you look back at that, it might have given you a clue that this kid was destined for something [laughs]. I was always a pretty enterprising kid.

Some of that comes out of having come out of the Depression years. Certainly my parents did. They emphasized to me how difficult the Depression was for them. I wanted to be different from that. I didn't want my whole life being driven by fear, and there was only one way to do that - which is hard work.

American Way What's the big issue in investing today?

SchwabWhom do you trust? That's a significant issue for investors. People you once trusted you might not trust anymore. What do you do now? Whom do you trust today?

The only way you can really under-stand whom you can trust is through your own education. You've got to be involved. You need to do research, reading, and arrive at your own understanding of key issues. Talk to people; read newspapers and magazines.

Ask yourself, Who are the successful investors over a long period of time? There's a wide range of people who are in business to provide helpful, useful advice about portfolio diversification and asset allocation. What would be success for me? You have to put your expectations at reasonable levels, and you need to take a long-term approach, where you understand what a successful investment outcome over a lifetime means.