#Compounding - A Real life story

Most people haven’t heard of Sylvia Bloom.

She managed to amass a $9.2m fortune whilst spending her entire 67 year-long career as a legal secretary. @dmuthuk #Investing #Thread 1/8

Even her closest friends and relatives had no idea she had amassed such a sum, until, upon her death in 2016, her will provided for $8.2m in donations to various charities for needy children. 2/8

But how did she accumulate such a massive pot for someone who never earned more than a secretary’s salary? By all accounts, she was a frugal person, living in a rent-controlled apartment in New York and avoiding all trappings that come with wealth. 3/8

A colleague of hers for over 35 years said of her, “She never talked money and she didn’t live the high life. She wasn’t showy and didn’t want to call attention to herself”.

But Sylvia’s success is due to more than just a frugal lifestyle. 4/8

She also had the massive advantage of living to the age of 96, and spending 67 years in employment. Calculations by investment research company 5/8

Morningstar estimate that, to reach $9.2m in 2016, she would only have needed to contribute $652 a year when she started investing in 1948, increasing every year with inflation. 6/8

Whilst $652 a year would have been worth much more in 1948 than it would today, it was certainly possible for someone on a modest salary to save. 7/8

Sylvia understood that small amounts invested regularly could quickly add up and, if left uninterrupted, could eventually snowball into an enormous portfolio. In short, she understood the power of compounding.
Source - occaminvesting. 8/8