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There is some justice for school teachers, who have the dubious distinction of playing a vital role in society while earning a comparatively low annual income.
That fairness is manifested in the millions of dollars that many of them constantly keep in their savings and investment accounts, according to the “National Millionaire Study,” a research project by Ramsey Solutions, whose executive director is personal finance expert Dave Ramsey.
Teachers rank third, behind engineers and accountants, in a list of the five careers most likely to have millionaires among their ranks.
How can it be that teachers, who earn a median annual income of $61,690 according to the U.S. Bureau of Labor Statistics, rank third, while doctors don’t even make the top five?
The top five list came from a survey of millionaires that garnered responses from 10,000 participants. The majority (79%) had not received an inheritance. Eight in 10 had invested in a 401(k) plan. And contrary to expectations, most of the millionaires surveyed did not have high-paying jobs. Instead, 3 in 4 said they had created wealth simply by working hard.
“In other words, you can’t make money your way out of stupidity,” Ramsey said of the study results.
They may not have high-paying jobs, but millionaires are an educated bunch: 88% have graduated from college. However, few went to elite schools (only 8%). And 52% earned a graduate degree, the study shows.
What they all have in common is the steadfastness of investing for the long term and sticking with it. They are also methodical shoppers: 85% of respondents use a shopping list. Almost a third (28%) always stick to their list, while 57% more or less stick to it.
One way to invest your money to grow over a period of time is through certificates of deposit (CDs), which offer competitive interest rates on fixed terms. But if you withdraw the money before the deadline is up, you could face a fine.
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“They’re systems people. They work with a set of principles and don’t have free rein to make their own rules,” Ramsey said in his on-air review of the results. “When you’re a lawyer and you go before a judge, you have to follow exact procedures… You don’t have a choice. You don’t have a choice when you’re designing a bridge. There’s a way, otherwise it fails.”
If you also consider yourself a “systems person,” a high-yield savings account could be the ideal ticket to your potential millionaire. A high-yield savings account could offer returns of more than 4%, while the standard US bank savings APY is 0.01%. As long as you make sure you set aside savings, opening a savings account will make that money grow.
Read more: Warren Buffett says you can’t buy time, but real estate investors have found this loophole. See how they buy back hundreds of hours a year (completely free)
Teachers likely love their jobs and have figured out a way to create a lifestyle that supports their work, not the other way around.
“Don’t choose your career based solely on the amount of money you can make,” Ramsey said. “Also, don’t choose a career that says you’ll be happy but broke. That won’t work either. You should make more money if you’re doing something you love, because you’re good at it, you care about it, you’re creative, and you have energy. You should make more money, not less.”
That said, you don’t need to bring home a huge salary to build a solid financial future. That’s where a professional can help. With Advisor.com, you can find the best advisor for your needs, both in terms of what they can offer your finances and what they will charge to work for you.
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You can then schedule a free, no-obligation consultation to see if they are the right fit for you.
The average doctor leaves medical school with $200,000 in debt and takes 13 years to pay it off, according to podcast host Brent Lacey. The scope of practicewho advises doctors on their finances.
Consequently, doctors can lose years of investment as they work to establish themselves and eventually earn a large salary.
And even when they get payday, they may feel pressured to buy the big house and the fancy car, Lacey said on a recent episode. After so much sacrifice, a young doctor might think, “It’s my turn.”
In contrast, Lacey said, her own grandmother was a frugal public school teacher who retired a millionaire.
But if you discount these crucial things, your finances could take a hit. Fortunately, with Acorns, an automated savings and investing app, securing your financial future can become second nature.
Acorns is a mobile app that automatically invests your leftover change so you can reap the benefits of compound interest with recurring investments.
All you have to do is open an account and link your cards. Then, as long as you spend as you normally would, Acorns will automatically round up your recent purchases to the nearest dollar and invest the difference in a diversified portfolio.
Sign up now and you can get a $20 investment bonus.
It may seem like nickels and dimes right now, but that extra change can add up quickly and help you start systematically growing your wealth.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
