Did You Hear About the Millionaire Janitor?
I remember reading an article last year on CNBC about a janitor who left $8 million to his local library and hospital upon his death.
Here’s the CNBC article: Janitor Secretly Amassed an $8 Million Fortune
Thinking you need to make a lot of money, to save a lot of money
I see this type of misguided thinking and it’s simply not true.
The iron-clad law of compounding does not play favorites.
Whether you’re compounding $1 or $1 million. Compounding works the same. The average Joe has a really tough time even amassing $100,000, let alone $1 million. And $8 million like this janitor did? There’s a reason why the story is newsworthy. But it goes to show that it’s not how much you make, but how much you keep of what you make; and how consistently you save and invest.
Did he come from money?
According to Reuters, “even Read’s family was tremendously surprised upon finding out about his hidden wealth… [he] came from humble beginnings. He was the first in his family to graduate from high school and served in North Africa, Italy and the Pacific theater during World War II. After the war, he came home to work at a gas station and as a janitor at JCPenney, and married a woman who had two children.”
So how did he do it?
He worked as a gas station attendant and a janitor. So it goes without saying, it wasn’t from a big paycheck. According to CNBC, he “maintained a frugal lifestyle, never spending money unless he had to. Friends remember him driving a second-hand Toyota Yaris, using safety pins to hold his coat together and cutting his own firewood well into his 90s.
According to the Wall Street Journal, he held a portfolio of 95 blue-chip stocks for decades (a blue-chip company is a company that’s typically a household name; a big multinational that’s been around for a long time and is usually a leader within their industry).
Does this mean we have to live as frugally as he did?
That isn’t the take-away message I’m aiming for.
It’s obvious that Ronald Read was a prodigious saver. Here’s a guy who comes from a humble background, no hand-outs from anyone, he graduates high school and then serves in the military. A life time of less-than-modest income, and somehow he’s able to generate an extraordinary amount of wealth.
So I don’t want to take anything away from his accomplishments. Because it deserves recognition.
But seeing that he managed to amass $8 million on a super modest income. That should tell you, as cliche as this sounds: if he could do it, then anyone can do it. And you don’t have to be as frugal as he was. Why? Because you probably don’t need $8 million! If you were a far bigger spender than him, by a factor of 8, you’d still be a millionaire!
What do you think about this janitor and what he accomplished?
Why do you think that so many people view becoming a millionaire, as simply being “not in the cards” for them?
Did this real-life example change your mind about how you feel about your finances and the future potential for you and your family?