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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 justice comes in the form of the millions of dollars that many of them consistently hold in their savings and investment accounts, according to the “National Study of Millionaires,” a research project by Ramsey Solutions, whose CEO is the personal finance expert Dave Ramsey.
Teachers rank third, behind engineers and accountants, on a top-five list of careers most likely to have millionaires within their ranks.
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How could it be that teachers, who earn an average annual income of $61,690 according to the U.S. Bureau of Labor Statistics, take the third spot, while physicians don’t even rank in the top five?
The top five list came out of a survey of millionaires that drew upon answers from 10,000 participants. The majority — 79% — had not received inheritance. Eight out of 10 had invested in a 401(k) plan. And contrary to expectation, most millionaires surveyed didn’t have high-salary jobs. Instead, 3 out of 4 said they’d created wealth simply by working hard.
“In other words, you can’t earn your way out of stupidity,” Ramsey said of the study results.
Slow and steady wins the race
They might not work at high-paying jobs, but millionaires are an educated bunch, with 88% having graduated from college. However, few went to elite schools (only 8%). And 52% earned a postgraduate degree, the study shows.
What they all have in common is the steadfastness to invest in the long term and stick with it. They’re also methodical shoppers: 85% of respondents use a grocery list. Nearly a third (28%) always stick to their list, while 57% sort of stick with it.
“They are systems people. They work with a set of principles, and they don't have free rein to make up their own rules,” Ramsey said in his on-air review of the results. “When you are a lawyer and you go before the judge, you have to follow exact procedures… You don’t have a choice. You don’t have a choice when you are designing a bridge. There is one way; otherwise it falls."
If you also consider yourself a “systems person,” a high-yield savings account* might just be the ideal entryway to your prospective millionaire-hood. A high-yield savings account could deliver returns of more than 4%, while the U.S. Bank's standard savings APY is 0.01%. As long as you ensure you’re setting savings aside, opening up a savings account will make that money grow.
For a streamlined look at what high-yield savings account is best for you, you can check out our guide to the Best High-Yield Savings Accounts of 2024* to see which is the best place to witness your financial status soar.
Passion finds a way
It’s likely that teachers love their jobs, and they’ve figured out a way to create a lifestyle to support their work — not the other way around.
“Don’t pick your career based on how much money you can make only,” Ramsey said. “Also, don’t pick a career that says you will be happy but broke. That won’t work either. You should make more money if you are doing something you love, because you are good at it, you care about it, and you are creative and you have energy. You should make more money, not less.”
That being said, you don’t need to be bringing home a huge paycheck to forge a solid financial future. As long as you manage your money purposefully, you can build up your wealth — and WiserAdvisor* can help with this.
Read more: This Pennsylvania trio bought a $100K abandoned school and turned it into a 31-unit apartment building — how to invest in real estate without all the heavy lifting
WiserAdvisor is an online platform that connects you to vetted financial advisors. After filling in some information about yourself and your finances, WiserAdvisor matches you with two to three FINRA/SEC registered financial advisers* who are best suited to help you with your financial goals.
You can view the advisors’ profiles, read past client reviews and book an initial consultation for free with no obligation to hire. With WiserAdvisor, you don’t have to worry about going it alone. Instead, you get professional guidance* as you build up your bank account.
Pent-up need to spend
The average physician comes out of medical school with $200,000 in debt, and takes 13 years to pay it back, according to Brent Lacey, who hosts the podcast The Scope of Practice, which coaches physicians on their finances.
Consequently, doctors can miss out on years of investing as they work towards establishing themselves and eventually commanding a big salary.
And even when they get the payday, they might feel pressure to buy the big house and the fancy car, Lacey said on a recent episode. After so much sacrifice, a young physician might think, "It's my turn.”
In contrast, Lacey said, his own grandmother was a frugal public school teacher who retired a millionaire.
On the same episode, Sarah Stanley Fallaw, author of The Next Millionaire Next Door: Enduring Strategies for Building Wealth, said that people with high incomes, such as physicians, can think their big paycheck is automatic wealth.
“It’s very easy to be distracted and not be able to focus on things like finances, especially if you have a high income,” she said. “You think, ‘Everything is OK … that’s my security, I don’t need to worry about having a budget. Why do I need to know about my cash flow?’”
But if you dismiss these crucial things, your finances could suffer. Luckily, with Acorns* — an automated saving and investing app — securing your financial future can become second nature.
Acorns is a mobile app that automatically invests your spare change for you* so you can reap the benefits of compounding interest with recurring investments.
All you have to do is open an account and link your cards.
Then, whenever you spend as you normally would with one of your cards, Acorns will automatically round up your recent purchases to the nearest dollar and invest the difference* in a diversified portfolio.
It may seem like nickels and dimes in the moment, but that spare change can add up quickly and help you start growing your wealth systematically.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
