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This story is true and although I was asked by its subject, my longtime college friend “David" not to reveal his full name, I will include specific details of how he accomplished something I feel is truly a story of American spirit, and personal achievement.
I met David in college while attending the University of Texas, Arlington. We become friends immediately and like our other campus friends, worked several jobs to make ends meet. We all came from middle-class households and having part time jobs was just the way to survive while in college as we earned while we learned. David waited tables at a popular restaurant, went to school and took a job working two nights a week at the local Wal-Mart on the east end of town. This was 1980 and Wal-Mart had not become the retail giant it is today and David took some pretty strong heckling from us about his Wal-Mart uniform and vest. He always laughed us off with his usual jovial good spirits.
David, like myself was going to school full time and always appeared to be on his way to or from work. I lost track of David after the first year of school but ran into him a couple years later. He had dropped out of school after his sophomore year taking a full-time printers assistant job with a well-known printing company, putting in the typical 40 hours a week. Although David no longer waited tables, he still worked at Wal-Mart two nights a week as an overnight stocker.
We all pursued our individual careers and lives and a few months later I heard David bought his first house for $60,000. I was still renting as well as all our other friends. David paid a 10% down payment, $6000.00, as if it was like paying for lunch at McDonalds. My friends and I were duly impressed, as David became the first homeowner of the original college gang.
I did not buy a home until 1985, and then with only a $2500 investment, which was all the money I had saved from my job working as a marketing manager for a West Texas company. At the same time I was purchasing my first home, David had purchased two more homes in the area, which he had immediately rented out to college students, having placed a FOR RENT sign in the yard for only one weekend. The homes were fixer-uppers and he put down 5% when he purchased them. David called me and asked me to do some electrical work for him (One of my previous part-time jobs) and I witnessed first hand what a good investment he was making in buying these properties. By 1987, David had purchased 3 more homes out of a foreclosure offer, all under $80,000, each time putting down a 5% down payment. In 1988, David owned 7 properties, one of which he personally resided. I did some more electrical work on one of his properties and we later went to lunch. At lunch, David shared with me his “plan". He said that he realized that no matter what was happening with gas prices, the economy, the inflation rates or politics, people needed a place to live. (Remember, this was 1987 and we were all dealing with rising gas costs, inflation and double-digit interest rates.) David believed that regardless of what was happening around the world, communities were always going to need basic services provided by people such as electricians, plumbers, policeman, and schoolteachers, and those people needed a place to live. He also felt this way about college students attending school away from home. So David’s investment strategy was this: Buy only homes that those two types of potential renter could afford. By purchasing smaller homes with smaller rent payments, David spread his risk of non-payment over several houses. Interesting enough, there were numerous foreclosures and bank defaults in Texas with our Savings and Loans scandals but David seemed to insulate himself from such things and commented how he always got his rent because it was so affordable. I was really impressed with David’s strategy on buying houses and then I questioned how David came up with the initial investment for down payments of $3000-$5000 each time he bought a new property. Simple he said, “I use my income from the printing company to live on and pay my own house payment and save. But I take all the money from my Wal-Mart job, (about $600-700 per month) to go straight to investing in real estate." By saving paychecks for 6 months, David was letting his Wal-Mart job income serve as his source for real estate investments. He then said, “I wouldn’t keep this job if I was just blowing the money each month. But by taking this money and investing it immediately into real estate, I work two extra nights a week so I am building a future. Its steady and easy work and I have started taking extra shifts at Home Depot too and investing in their stock which I am sure will go up." (Remember: This was 1988). I sat there dumbstruck at the simplicity and genius of his plan. I also recalled the teasing we gave David a few years before about his Wal-Mart uniform. The embarrassment swept over me like a cold chill. I congratulated him on his accomplishments, said our good byes and I promised to keep in touch.
I relocated from 1988 – 1993 and although I stayed in touch with David each Christmas, our lives grew apart and we basically spoke only once a year when all the old friends got together. During that time, David got married, had kids and I started a business. In 1995, I received a call that David had just bought a small apartment building near the college and wanted to know if I wanted to come help out with the remodel. Schedules prevented me from participating but I learned David still worked at Wal-Mart as a forklift operator and that he had a total of 18 rental properties not including the just-purchased apartment complex of 12 units.
In 1998, the printing company that David worked for was being sold by the founder/owner who was retiring. It was a well-established company with numerous corporate accounts and the founder wanted to retire. It made the local paper when it was announced that the company of 50 employees was being purchased by the previous printers-assistant turned Sales Manager in a private undisclosed “cash transaction." Numerous employees wondered where David came up with the money. In 2000, David purchased a new custom home for his family on the golf course. He paid cash.
In 2001, the local college purchased his apartment complex from him to incorporate into their university-housing program. He tripled the original investment in negotiated selling price. In 2003, a national company made a lucrative offer and purchased his printing company to secure the established location and large corporate accounts.
In September of 2004, I was invited to my longtime friends 45th birthday party. After blowing out the candles and opening gifts, David announced that he was retiring. He would spend the rest of his time overseeing his rental properties and his stock portfolio including numerous shares of Wal-Mart and Home Depot stock, with initial purchases going back to 1985.
In writing this story, I contacted David to ask his permission and get the facts and figures straight. In January of 2006, David’s net worth was 6.5 million dollars in real estate, stocks, and liquid assets.
Now here’s the impressive part: David quit college in 1982 to take a job as a printer’s assistant at a rate of $7.75 hour and his starting pay at Wal-Mart was $5.25 hour. Up until the time he purchased the Printing Company in 1998, his highest annual wage earned was $51,000. When he stopped working part time as a forklift driver at Wal-Mart in 1996, his hourly rate was $9.12 per hour.
While at the birthday party at David’s beautiful new home, I was ushered into his home office for a private birthday toast by all the old college gang. That’s when I noticed a framed copy of one of his first Wal-Mart paychecks from 1982 aside a picture of him taken in his Wal-Mart uniform. Inscribed on the brass plate attached to the bottom of frame was this short but valuable message “Let Them Laugh."
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