WHO IS RICHER? CAN YOU FIGURE IT OUT?
MILLIONAIRES ARE DIFFICULT TO IDENTIFY
The Cell Phone Millionaire
Jenna was a 40 something, telecommuting (she worked from home) millionaire. She gained her wealth through smart investing of her family’s income
including her salaried job and her husbands job as a University Professor. In spite of the fact that Jenna took some time off to raise her two kids, by her late 40’s her family amassed over 1 million dollars. You would never think Jenna was wealthy. Her car was a ten year old mid range SUV and her spouse had an eight year old compact. They lived in an upper middle class neighborhood surrounded by a much more exclusive neighborhood. They followed the real estate rule of buying a low priced home in a more expensive neighborhood.
A Visit to the Plumbing Supply Company
She enjoyed do-it-yourself projects and wasn’t afraid to take apart the plumbing and fix a leak. While trying to find the correct replacement hose for the one leaking under the sink, she sauntered in to the gritty plumbing supply shop. The witty parts guy said asked if Jenna knew the manufacturer of the faucet. When Jenna said she couldn’t find it, he cavalierly asked, “Why didn’t you take a picture of it with your fancy phone?” That was all Jenna needed to whip out her five year old LG flip phone with pride. She replied, “I have a flip phone” to sounds of outrageous laughter.
Instead of feeling embarrassed that she didn’t have a fancy smart phone, she regarded her phone as a sign of her smart money decisions. Jenna had so much self confidence and such high self esteem, she considered that phone a badge of pride. In fact, Jenna knew that part of the reason she was among the wealthiest percent of the population in her age range was exactly because she chose to spend on what mattered to her. She didn’t need to spend a lot on a phone, or be connected 24/7. And no one could tell her otherwise.
Jenna’s net worth was one million and two hundred thousand dollars.
I know Jenna’s net worth, because as a friend, I looked over her financial statements and provided a second opinion to that of her financial advisor. How did she become so wealthy with just average salaries? Did they live a life of deprivation and self sacrifice?
How Did Jenna Get Rich?
Jenna and her family spent on what mattered to them. They wanted their children to go to top schools, so they chose to live in a relatively “low cost of living” midwestern city. They bought a smaller home with no wasted space. When they vacationed, they found a resort which included food and entertainment in one of the less popular spots. They ate out infrequently and shopped smartly. Transportation, after housing is the largest expense for most families. They kept those bills very low by living near work, maintaining their vehicles, and avoiding unnecessary driving. She started investing the family’s savings as soon as they started working and put as much as possible into their workplace retirement accounts.
There was no magic windfall. Oh wait, she did inherit a bit of money from an aunt when she was 33. And she took every penny of her inheritance and invested it.
So, who do you think is wealthier, the parts guy at the plumbing supply company with a smart phone or Jenna?
image credit; news cnet google images