The Secret to Wealth

Ever heard of the old lady who swallowed a fly? Well this story’s about the old lady who gave away eight figures. Born October 1, 1893 in Brooklyn, New York was an ordinary , yet frugal woman named Anne Scheiber. She didn't have nice clothes and was not treated very nicely by others. You may have heard of her. There’s a scholarship named after her at Yeshiva University. A college, in which she did not attend. I’ll tell you the secret to how she achieved such a large lump sum.

After the market crash in the 1930's Great Depression, virtually no one was willing to invest for a while, hence being burned by the markets. Anne herself, had taken a loss as well as everyone else during this period. She’d made bad investments receiving advice from friends and her stockbroker. Scheiber worked as an auditor for the Internal Revenue Service making only $3,200 annually until she retired in 1943 at age 51. The small, dainty Manhattan apartment Anne resided in cost every bit of four hundred dollars a month. She didn't spend money on herself, decent furniture, nor a newspaper subscription. Being retired, she was only receiving one monthly pension so clearly, she didn't have money to waste. Even so, Scheiber had saved about $5,000 and the spinster was certain that she wanted to reinvest; this time, taking her own advice using a self-directed investing approach.

Once a week, Anne would head over to the public library to read The Wall Street Journal trying to retain all the information she could about stocks. In 1944, Anne Scheiber opened a Merryl Lynch account making a deposit of $5,000 using her life’s savings. She had to have been saving every dollar she could for this. In 1950, she’d profited enough to buy 1,000 shares of Schering-Plough Corporation stock valued at $10,000 each. Those shares split enough times to produce about 130,000 shares making them worth roughly $8 million dollars. You see, the key here was the fact that she never touched her stock whether it fluctuated or not. Her strategy was to buy and to hold, that's the secret. The dividends she had grew larger and larger so she reinvested them into additional stocks still, never touching the originals. At some point in the 1970's, Anne’s stockbroker informed her that her portfolio was down almost fifty percent. Anne refused to sell. She was definitely in it for the long haul.

Most senior citizens are worried about running out of their retirement funds too quickly, but not Scheiber. The older she got, the wealthier she became. Anne was both patient and possessed the ability to make non-emotional decisions in the market. These are trademark characteristics that every trader-investor should have. She’d saved about eighty percent of her income to invest it. She wore the same clothes, never married, no children, had a paint chipping apartment and was rich. The silent multi-millionaire.

In closing, Anne wanted to give her contribution to Jewish women whom she felt were highly discriminated against as she witnessed during her 23 years with the IRS. Yeshiva University’s Stern College was an all girls campus which is why she made the decision to leave the estate with them. There’s definitely a mouthful to be said about Anne Scheiber’s story. What discipline she instilled in herself. One thing we could all learn from her is prioritizing your finances to do what’s best for your future. I just can't imagine living an entire lifetime with nothing. She never tasted luxury, but maybe she didn't want to. Anne understood the law of process and finances.