Today, I saw an interesting news about Grace Groner who bequeaths $7 million to her alma mater, Lake Forest College. What's the secret of her great fortune? She bought 3 units of Abbott Laboratories's shares at $60 each in 1935, during the Great Depression and hold them until now. Guess how much her 3 shares bought at $60 each worth altogether now? Yes, you can guess from my first sentence above: $7 million!
See the news here: http://news.yahoo.com/video/us-15749625/secret-millionaire-donates-her-fortune-18460698
Mrs. Groner's story is a truly inspirational one we should all use her life lesson frugality and saving to heart. However, as a novice investor I do not understand how $180.00 can turn into $7,000,000.00 her lawyer chalked it up to stock splits and divident reinvestment. But Abbott stock has only split 8 times. the first was a 3:1 split the other 7 were 2:1 splits. This would have given her 1,152 shares by the time of the last split in 1998. When she died in Jan 2010 Abbott was at about $54.00 per share. This totals $62,737.92. Does anyone know if divident reinvestment can account for the remaining $6,937,622.08 in her estate?
My guess is that she might have reinvested her dividends as well :)