3 minute read

The Janitor Worth $8 Million

This story is amazing. A janitor ended up building an investment portfolio worth $8 million in his lifetime.

So who is this mystery $8 million janitor?

Ronald Read. The man. Ronald has a phenomenal story that teaches us how the power of consistency & smart money management can help you build wealth.

The best thing about this story is he never earned a high income. Being a janitor, his salary was not great. But that did not matter as much as what he did with the money he made. Rather than spend it all, Ronald saved & invested. His neighbor said “I’m sure if he earned $50 in a week, he probably invested $40 of it”.

The 4 things we can learn from it?

1. Don't Spend More Than You Make

While this was in the mid 1900s, making $50 a week was not a great income, Ronald knew one thing… don't spend more than you make. According to his neighbor, he was spending only 20% of what he made.

This is a powerful lesson.

Even though he was not making a high income, he was able to find a way to save 80%!!! of his income. Now I am not saying you need to go save 80%, but the takeaway is, find a way to spend less than you make.

If you make 50K but spend 50K… you are going to have zeroK left over for the second important lesson…

2. Buy Assets With The Money Left Over

The income Ronald had was low, but his knowledge on building wealth was high (see what I did there 😉).

I am sure had Ronald just kept that money in a savings account, his money would not have been at the $8 million he had saved.

Probably way less.

This is because you cannot build wealth in a savings account!

If you have a long time horizon & in the correct places, investing that money into assets, is what will help grow your money.

3. Be Consistent

One thing that Ronald did was be consistent.

Investing 80% a week, just once is not going to move the needle. Investing 80% a week for 1 year isn’t what grew his money to $8 million.

It was investing a % of his income every month, every year, for as long as he could. The consistency he had is what helped grow his investments to where they were.

4. Be Patient

The last, but most important (in my opinion).

He was patient…………..

He lived to 92 years old. That is a long time! While consistency is key, so is patience. Understand it is not going to happen over night, but if you keep at it & stay patient. It can happen. But you have to be patient.

Just remember that the share price is linked to a company, and a company needs time to grow, for the share price to go up…

I think his story is super valuable to learn from. While I do think living on just 20% of your income is not viable for a long time, the bigger lesson is to live below your means, invest into assets & do it consistently over a long period of time. This is the lesson. This is the takeaway from Ronald Read’s story.

Thank you so much for reading & I will see you next week! Until then, keep buying assets. 🙂 

- Stefan