Manny was my very first client. I met him 25 years ago but I remember him to this day.
He walked into my office a little shy. English was not his native language and I think he felt a little self-conscious about it. But as soon as Manny started telling me his story, I knew I was talking to someone who I wouldn’t soon forget.
He told me that he came to the United States at a very young age and that he started working at age 14.
When I asked Manny what he did for a living he told me that he drove trucks for Waste Management. I knew what that meant. Manny was a trash collector.
He told me he’d been driving for 25 years and I’m ashamed to admit it but when he told me that, my spirits sank. I was selfish. My hopes of making a big sale plummeted. I mean, how much money could a trash collector have?
Manny told me he wanted to invest $50,000. Yours truly, Mr. Know-It-All, assumed that this was all the money he had. (Remember I was young and dumb). I was young and dumb but I didn’t want Manny to put all his money in one place. I suggested he keep some of the money liquid in a CD or savings account.
That’s when Manny told me about his multi-million dollar portfolio of stocks, bonds and real estate.
After a few minutes of trying to extract my foot from my mouth. I asked him how he’d amassed his wealth. Manny was a humble man and very kind. Somebody else may have been offended by my intrusive questions (see young and dumb remark above) but Manny was happy to tell me his story.
He told me that his secret to building wealth was to spend less than he earned. His priority was to save & invest $15,000 every year. He did this throughout his career come rain or shine. He paid himself first. He bought rental homes when they were cheap and he bought stocks when they were selling at a discount. He raised a family of 5. While they lived frugally, they were all clear on the goals and they were all committed to them. He never looked for a quick fix.
Sure its conventional wisdom. It’s not ground-breaking – but that is the really exciting lesson here.
You know everything you need to know to achieve financial success. There are no secrets. All you have to do is take action without making excuses.
Lots of people have very complicated investment plans and budget tracking systems. I have nothing against those tools. Whatever works. There is no one best way to live financially. But the thing that really stuck out about Manny was that he didn’t just talk about his financial plans – he took action even when it meant sacrifice. Nobody ever told him to save or invest. He didn’t need any sophisticated approach or infomercial. He just used his common sense.
I think that Manny is living proof that anyone who is focused can succeed. Do you think that it’s still possible to succeed now? Is it harder or easier to be financially successful these days?
This is a guest post by Neal Frankle, who found himself in a financially fragile situation at the age of 17. Both his parents passed away while he was still in high school, leaving behind a small insurance settlement. Neal sought out a financial advisor to help him invest his nest egg so that it would help put him through college. Instead, the advisor charted a self-serving course and was on the verge of burning through the money when Neal realized what was happening. Luckily, he fired him just in time to avoid losing everything.
The experience had a deep impact on Neal and formed in him a lifelong desire to help people learn to make smart financial decisions. Today, with more than twenty-five years of experience in the financial services industry, Neal is an author and avid blogger. To learn more, visit www.wealthpilgrim.com.
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{ 9 comments… read them below or add one }
“Sure its conventional wisdom. It’s not ground-breaking – but that is the really exciting lesson here.”
Bingo! I love that point, and I don’t make it often enough. The best part about personal finance principles is that they’re common sense. We already know them; we just need to be reminded to stick to ‘em.
Oblivious,
That is exactly it. I agree completely.
Neal
Love this story, thanks for sharing. And congrats to Manny, wherever he is! As a grad student heading into academia, hopefully my initial years (including today!) with lower incomes don’t need to be setbacks to attaining wealth (as Manny’s example shows, although it’s an interesting exercise to compare how much trash collecting pays compared to graduate student employment:)).
MoneyEnergy: There are tons of examples on how middle class families were able to amass wealth just by being responsible with spending. I know many people who are millionaires just because they saved, while I know many people who are high income earners who are broke.
One of my friends is married and together, they earn over $200,000 yet they aren’t able to keep up with their mortgages and is facing foreclosure. It’s not how much you make but how much you are able to keep!
Yes, Ning….its amazing! Just amazing that financial success if 90% attitude and willingness….not really about ability at all.
I actually think that success (not just financial success, I mean everything) is more about attitude and willingness than ability.
Talent is great but if it’s more important to get it done than about how long it takes most of the time (to a certain extend of course).
This is a very amazing story and has been very nicely told by Neal too.
Good points in this article.
People should look at your financial situation from a balance sheet perspective, not an income statement!
Increasing your net worth, which is assets minus debt, is the key. It doesn’t matter how much you make, what matters is how much you can add to your assets and pay down your debt.
This sounds like the Mcintyres from Automatic Millionaire, same scenerio