Five Victory Lessons From Charles R. Schwab

ONE

Do It Your Way. Charles Schwab refused to follow Wall Street’s lead and instead paved his own path to success.  The result: An investing revolution! Schwab believed Main Street was more important than Wall Street and he used this theory to reinvent the brokerage industry.

TWO

Diversification. Schwab started numerous businesses at a very early age.  He sold magazine subscriptions and even raised chickens.  Schwab showed his leadership capabilities at a young age as he was captain of his high school’s golf team.

THREE

Disorder The Disorder. Charles Schwab learned that he was dyslexic at 40 years old.  He learned of the disability in the 1980’s after his son was diagnosed.  When Schwab was young, he noticed his difficulties with taking notes in class, leading him to fail English twice.  He also struggled in his foreign language classes due to the disorder.  The Charles and Helen Schwab Foundation aims to assist children with the disorder. 

FOUR

Stand Up For What You Believe In. Texas ordered Schwab to stop taking newsletter mail orders after the market crashed in 1969.  Schwab fought the order and ended up $100,000 in debt due to legal fees.  Despite his financial woes, the universe was on his side.  His uncle gave him the money to pay the debt and start his business.

FIVE

Take A Chance. In the late 1970’s, Schwab recognized that brokerages were using unregulated procedures to set lower rates to larger institutional clientele.  These brokerages would raise the rates for individual investors so Schwab noticed that he could easily sway the smaller investor market by offering no frills and commission discounts substantially lower than the competitions.  In order to afford these rates, Schwab did not provide research and he paid his staff salary.  He also automated order processing through computers, unlike his competition at the time.