For those of you who don’t know, I’m kind of a big history nerd. Specifically American history, though ancient history has always fascinated me as well.
That’s a big reason why I’ve always wanted to live in Washington DC: there‘s so much American history located within the city and the surrounding areas.
Philosopher George Santayana (supposedly) once said:
“Those who do not learn history are doomed to repeat it.”
How is this relevant to a Financial Independence blog?
What I want to examine is how some well-known and influential historical figures fared in their financial lives, and if there is anything we can learn from them as a result.
The thinking is, as these were all very smart and formidable men and women, surely they must’ve been doing something right!
Though modern day Financial Independence strategies may not have been around back in their time, I’m interested to see what financial methods (or lack thereof) these people employed to gain success and prominence.
I totally understand how some get bored by history. Personally, I blame that mostly on the methods upon which it’s traditionally taught: lecture format.
I hope to make these posts more fun and lighthearted and hope you all can learn some good financial strategies while getting a little history lesson as well!
First up, we have the man, the myth, the real estate mogul? George Washington!
Name: George Washington
Nickname(s): Father of His Country, The Sage of Mount Vernon, The OG President (probably)
Birth: February 22, 1732 (Pope’s Creek, VA)
Death: December 14, 1799 (Age 67)
Height/Weight: 6’2” 200-210 lbs.
Claim to Fame: Chopping down that cherry tree! (maybe)
Other Professions: Commander-in-Chief of the Continental Army, Plantation owner and distiller, oh and you know, the first President of the USA!
Strengths: Leadership, Courage, Intelligence
Weaknesses: Oral Hygiene (seriously)
Fun Facts: Excellent & energetic dancer, never had kids of his own, dog lover (he had over 50!)
Born in 1732 to little fanfare, George Washington would work his entire life to become the man we all know today.
When his father died, George was unable to receive proper schooling in England like his brothers and thus only received the equivalent of an elementary school education.
Think about that, our first president didn’t even make it to middle school!
At age 16, after a career path in the British Royal Navy was blocked by his mother (they always know best!), George became a land surveyor and mapped out the Virginia wilderness for several years.
In 1754, the French and Indian War began. Washington, then lieutenant colonel of the Virginia regiment, actually led the attack that started the whole thing!
Throughout the war George would gain invaluable experience on the battlefield as well as attaining qualities that would prove instrumental in the years to come.
Afterwards, George would marry the wealthy widow, Martha Custis, and settle into his home at Mount Vernon.
Here, he tried his hand at farming as well as serving in the Virginia House of Burgesses (the legislative body).
At the onset of the American Revolution, Washington was held in such high regard that he was appointed as Commander in Chief of the Continental Army.
Although he eventually lost more battles than he won, his leadership and ability to keep the army together were essential to ultimately winning the war.
With the war over and his job at an end, George happily resigned his commission, giving the power back to the people (which was unheard of at the time).
Although determined to stay out of public life and retire early (!!), he was pulled back into it when his nation needed him most during the Constitutional Convention in 1787.
Unanimously elected president in 1789, George served two terms until 1797, then chose to leave office and set the current precedent of a two term limit.
Just two years later, George passed away from infection at his home in Mount Vernon, surrounded by loved ones.
Though not royalty by any means, the Washington family was very well off.
As plantation owners, they owned good land for farming and possessed many slaves to work their fields (this cannot be ignored in examining his Financials).
Eventually, George would inherit majority of this land, due to the death of his father and older half-brother, Lawrence.
However, he wasn’t simply given everything, much of what he gained, he worked for and acquired on his own.
Becoming a land surveyor came with great pay along with the side benefit of identifying the best land on the frontier.
Do you think that helped him out when later acquiring nearly 50,000 acres?
When George married Martha, this also brought substantial wealth through prime land to his holdings.
While he was busy snatching up property, George also tried his hand at tobacco farming. Realizing little to no profit, he switched to other agricultural ventures (diversifying) and established one of the largest distilleries at the time (entrepreneurship!).
Although certainly wealthy by all accounts, the Washington’s had a severe case of “Keeping up with the Joneses” that led them into debt.
To decorate his mansion, George bought luxuries from Europe, and he threw many expensive parties to establish himself among the political elite.
Eventually, he settled his debts, however, just in time for the American Revolution.
Throughout his 8 years as commander in chief, Washington refused to accept pay for his services. In addition, he ended up paying for many wartime expenses out of his own pocket.
Though eventually reimbursed after the war, he was paid with Continental dollars, which lost up to 9,000% of its value to inflation!
However, when he assumed the office of presidency, George was paid $25,000. Doesn’t sound like much?
That was nearly 2% of the entire Federal budget!
So what does all this add up to?
Estimated Net Worth
George Washington acquired nearly $580M (in 2016 dollars) at his peak! That makes him the second wealthiest US president in history, behind our current president.
As mentioned, a vast majority of that was due to the value of his substantial real estate holdings he accumulated through surveying, inheritance and his wife’s inheritance.
Anyone else want to become a real estate mogul!?
Connections are key
- As his older half-brother, Lawrence, was married to the daughter of a wealthy Virginia aristocrat, this opened up a few doors for George to land a high paying job as a land surveyor.
Real Estate can be a great investment, just don’t forget it isn’t very liquid!
- Also, make use of your property. Find viable uses of your property or land to earn another income stream from it.
Cash Flow needs to be considered
- What’s the use of all that wealth if you have no money on hand to pay for daily/monthly expenses!
Live within your means and don’t try to “Keep up with the Joneses”
- George found himself in debt as he bought luxuries from Europe in order to impress guests and the more affluent families in the region.
Diversify your portfolio
- When his sole tobacco crop failed to earn him a profit, George turned to producing wheat, corn, flax and hemp as well as beginning a profitable distillery.
Optimal Spousal selection 😉
- In 1759, George married Martha Custis, a widow who was one of the wealthiest women in colonial America. She brought with her prime land in Virginia that was worth millions of dollars.
I hope you all enjoyed your brief history lesson and got some fun facts to share at the dinner table! 🙂
Passionate about history too? Let me know if the comments or shoot me an email, I’d love to hear feedback!
(next two found at the library!)
His Excellency: George Washington; by Joseph J. Ellis
George Washington: A Life in Books; by Kevin J. Hayes