Many employees at my company look forward to the first Friday each December because it's bonus payday. Today was no exception.

Like most, for weeks, I waited in anticipation of the announcement as to how we did, planning what I was going to do with the bonus. By mid-November we received the news - my bonus was a bit over 20% of my base annual salary. Very nice! And so I continued to plot and plan, waiting for today, when the company would pay the bonus via direct deposit.

Six of us dined together for lunch today. Much of the conversation centered around what we were doing with our bonuses. Most noted it was perfect timing for the holidays. I listened to everyone's plans. One person was planning to buy a 72" HDTV. Another was talking about a boat. Without exception, each person spoke of what they were going to buy.

As we talked, I shared a story from a colleague who lived in a mid-west town, which is the headquarters of our 20,000-person firm. About 10,000 of the 110,000 people in the community work for my company. A couple of years ago on bonus payday, the community had a run on big-screen TVs at the local Best Buy store. By the end of the weekend the store had run out of TVs.

I was amazed at this account and assume it will happen again this weekend, based on the talk at lunch.

Now here’s what I did with my bonus – after the stock market opened this morning, I used a third of the bonus to buy FMC Technologies, Inc. (NYSE symbol FTI). I had patiently waited for the right time to buy FTI, based on Phil Town’s Rule #1 approach, and surprisingly, today was the time to make the value play (buying the stock at a margin of safety of 50% off the fair market value).

I am really excited about FTI. I guess I could have bought a TV or maybe even a car. But why should I? These items are depreciating assets. I want appreciating assets - things that can grow and make me rich. I plan to spend my entire bonus buying value stocks, using Phil Town’s approach. I will be patient and wait for the right moment to “spend” the rest of my bonus on stocks, like I did last year, when I put it all on the Procter and Gamble Company (NYSE symbol PG) in March (and have enjoyed a 22.7% return on investment in nine months).

Oh by the way, you might ask, “What is Rule #1?”

Rule #1 is – don’t lose money. Warren Buffett teaches this rule. If it’s good enough for Warren, then it’s good enough for me.

I wonder how many people used their bonus to invest in an appreciating asset today? I bet not many. And that’s what’s sad about Americans – they are not setting themselves up to financially succeed. Can you imagine what Warren Buffett would think about the behaviors of my co-workers on bonus payday?

Pierre Cutler
The Sacramento Executive

About FMC Technologies: FMC Technologies, Inc. (FMC Technologies) is a global provider of technology solutions for the energy industry and other industrial markets. The Company designs, manufactures and services systems and products, such as subsea production and processing systems, surface wellhead production systems, high-pressure fluid control equipment, measurement solutions, and marine loading systems for the oil and gas industry. It also produces food processing equipment for the food industry and specialized equipment to service the aviation industry.