If you saw this headline and said to yourself, "I think I've already read about that secretary," think again. There are actually plenty of secretaries who have become millionaires by retirement. I recently wrote about one, Sylvia Bloom, late last year. (I've reported on a millionaire retired janitor, as well.)

Here's another secretary, though, who's just as inspiring -- and instructive: Grace Groner. Read on to learn more about her, and the lessons we can draw from her success that can help us grow much wealthier.

A green road sign says Millionaire Next Exit, with an arrow.

Image source: Getty Images.

Meet Grace Groner

Grace Groner attended Lake Forest College. That's relevant because upon her death at age 100 in 2010, the college received a rather hefty donation from her -- to the tune of $7 million. Was she a socialite from a famous, wealthy family? Someone who created a multimillion-dollar business? The wife of a billionaire? Nope -- she was a woman who lost both parents when she was still a child, and ended up adopted by a family in town.

Grace grew up, went to college, got a job as a secretary at Abbott Laboratories, and stayed at Abbott for 43 years. She never married or had children, and lived in a simple one-bedroom apartment until someone left her a small one-bedroom house. She didn't own a car, but did enjoy traveling.

What Grace did right

So how, exactly, did Grace end up a multimillionaire by the time she passed away? Well, she had invested in stocks, and as you may know, the stock market is one of the best ways to build long-term wealth. It seems she actually only bought three shares of stock (for $180, at about $60 per share), in her employer, Abbott Labs. She bought them in 1935 and held on to them -- for decades.

So what did she do right, that we too might do, in order to get as wealthy as we can? Here are the smart things she did:

  • She invested in stocks, and didn't just stick with a low-interest rate savings account or government bonds.
  • She started investing early in life, giving her money a long time to grow.
  • She invested in a company she was quite familiar with, instead of one she just heard a few exciting things about from someone (or some article).
  • She bought shares of a healthy dividend-paying stock, which means she got quarterly payments from the company no matter whether the country was prospering or in the throes of the Great Depression. (Abbott has paid dividends for 385 consecutive quarters -- that's more than 96 years.)
  • She hung on to those (three) shares, through thick and thin. It's been demonstrated that trying to time the market, guessing when it will rise or fall, is not a dependable or smart thing to do.
  • She wasn't swayed by emotions, selling in a panic when the market crashed or getting greedy and looking for more exciting stocks.
  • She reinvested her dividends, which helps investments grow even faster.
  • She let the principle of compounded growth work its magic on her investment -- over 75 years, from 1935 to 2010.

You get the idea by now. You, too, might find some healthy and growing dividend-paying stocks and invest in them for many decades, reinvesting your dividends.

What Grace did wrong

Despite all the things she did right, Grace did commit one big error, and purely by luck, she escaped being burned by it. Her major mistake was putting all her eggs in one basket -- all her shares of stock were in the same company. If it had gone belly up, her growing nest egg would have imploded. Even if she'd bought three shares in three different companies, that's not very diversified: If one-third of your portfolio is cut down by 50%, your portfolio will suffer a drop of almost 17%, which can be painful.

Being ultraconcentrated in your investments can be less problematic if you're an expert investor and are supremely confident in your investments. But most of us should aim to hold between 10 and 20 different stocks -- or, better still, we might just invest in the stock market via a low-fee broad-market index fund, such as one based on the S&P 500.

Another error by Ms. Groner was that she had all her investments in her employer's stock. Yes, it was a company she knew far better than most others, but the downside offsets that advantage: If Abbott Labs had gone out of business, she could have lost both her job and her retirement savings. That has happened to many Americans when their companies have declared bankruptcy, often to their surprise.

Many of us rather ordinary people have the ability to amass great big nest eggs -- and, very often, a million dollars or more. Grace's example shows us how much can be achieved even if you have a very modest start.