As a federal employee, how much money do you expect to stash in your Thrift Savings Plan? You will enjoy two other sources of retirement income, of course (Social Security benefits and your annuity), but you also have the power to create additional savings for yourself. Perhaps more importantly, you also have the opportunity to invest that money via a variety of different options.
Despite that terrific opportunity, you might not believe you could accumulate millions of dollars. And yet, many federal employees do exactly that! One in particular, a woman named Anne Scheiber, managed to accumulate a fortune worth 22 million dollars!
Scheiber didn’t save 22 million during her career, of course. After graduating law school, she took a job as an auditor with the IRS, where she worked until retirement at age 51. At that point, she had managed to save 5,000 dollars on her own. Scheiber never took another job, and lived off of her pension until the ripe old age of 101. She was known for being frugal, and apparently never touched her life savings. Instead, she invested in the stock market, and managed to grow her fortune to an impressive 22 million dollars. When she died, Scheiber left that fortune to Yeshiva University.
So how did she do it? According to her broker, Scheiber developed a long-term vision and stuck with it. She invested in stocks that she understood, and reinvested her dividends over the decades. She didn’t look for a quick buck, and rarely sold her stocks except during downturns. Toward the end of her life, Scheiber’s portfolio was generating about $750,000 in annual income, but due to her frugal lifestyle, she simply reinvested that money each year.
Most people don’t desire to live such a frugal life, and of course some amount of luck (good or bad) will impact us all. But the takeaway lesson here is that Ms Scheiber charted a long-term course and then stuck to it. While she did periodically rebalance her portfolio a bit, she didn’t let emotions cloud her judgment. Long-term, steady growth was always prized above risky investments and potentially empty promises.
As a federal employee, you enjoy unique opportunities with regard to your retirement planning. Schedule an appointment with us, and we can help you better understand your retirement system, and help you reap the most possible benefit from it.