Ronald Read: The World’s Most Unexpected Millionaire

On June 2nd 2014, a 92-year-old man died in Vermont. His name was Ronald Read, and he was a retired janitor and gas station attendant. His favorite hobbies included wood-chopping and stamp-collecting. He grew up having to hitchhike to school, and served in the US military during World War II. He liked drinking coffee, and English muffins with peanut butter.

Soon after he died, Read’s name was all over the news headlines. In his will, he left $2 million to his two stepchildren and gave $6 million to his local hospital and library. Where on Earth did a retired janitor and gas station attendant get all that money from? He had lived frugally, and purchased blue-chip stocks throughout his working life. And then he waited, reinvested his dividends and watched his portfolio grow. By the time he died, the value of his holdings amounted to more than $8 million. Read went from janitor, to gas station attendant, to the greatest philanthropist his town had ever produced.

This story just demonstrates that wealth-building comes more from saving and investing than on income. Forming the habit of paying yourself first, and funding investment and savings before paying for expenses is probably one of the most valuable skills I have learned in the last few years. Many people postpone saving and investing for when their income rises to a particular level, but in reality when earnings increase it’s much easier just to spend the equivalent increase in money instead of growing wealth.

It also shows that pretty much anyone in the Western world can achieve this level of wealth, insofar as they live long enough and stay disciplined enough. The capability of the compound effect in investing is so powerful, but only when enough time is given to the compounding process. $82.6 billion of 90-year-old Warren Buffett’s $85.6 billion net worth came after his 65th birthday. And that’s not because he got way better at investing after 65, it’s just the absurdity of the compound effect.

Published by

dongminglau

British-born Chinese guy who wants to inspire and help others by sharing wisdom and learning through one's own experiences. Main interests are health and fitness, psychology, sales and sports.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s