After making average wages his whole life… one man wrote a $100 million check to Boston University’s School of Medicine.

Edward Avedisian didn’t have rich parents. He didn’t inherit money from a deceased relative. And he didn’t patent a life-changing product.

He played the clarinet for 35 years for the Boston Pops Orchestra and 43 seasons with the Boston Ballet Orchestra. When asked whether clarinetists get paid well, Avedisian responded, “For sure, they don’t.”

Yet this talented musician ended up becoming extraordinarily rich.

He stayed out of the limelight for most of his life… Until recently, when he made headlines with his generous donation.

Avedisian passed away late last year. But thankfully, he discussed his wealth-building philosophies before he did.

His strategy was simple and straightforward.

This wasn’t surprising to me – the best plans usually are.

Now, while I can’t promise reading this essay will balloon your bank account to $100 million overnight… I can promise that following Avedisian’s simple steps will help you build significant wealth over the long term.

A Little Goes a Long Way

To see his meager income grow, Avedisian turned to investing.

But early in his investing career, he used strategies that involved high degrees of risk. These included investing on margin and in speculative initial public offerings (IPOs).

These are practices I wouldn’t recommend. Using margin debt, for example, is a great way to lose your hard-earned savings… and then some.

It turns out, with the benefit of hindsight, Avedisian agreed.

Discussing risk and his early investing decisions, he said, “You’ve got to be crazy… I could’ve lost my shirt.”

But as Avedisian learned, you don’t have to use debt or speculate to build immense wealth.

All you have to do is accumulate shares of high-quality companies and let them do the work for you.

It’s all thanks to the power of compound interest over time.

Understanding the concept isn’t complicated. Imagine a snowball rolling down a hill…

No matter how small it starts off, once it gains momentum, each rotation causes it to multiply in size.

This exponential growth is the most powerful force I know of in the markets.

With that snowball in mind, the first step to building wealth is learning to live below your means.

I get it… a frugal lifestyle is far from glamorous. But figuring out a way to spend less than you make is key to starting the compounding process – it gives you the foundation you need.

Avedisian used nothing more than his modest pay to begin his investing journey. And after decades, it compounded into extraordinary wealth.

The Most “Fabulous” Investment You Can Make Today

One of Avedisian’s favorite investments to benefit from compounding was Microsoft (MSFT).

He called Bill Gates a genius and said companies like Microsoft that make life easier for people can collect more money. That’s how they compound faster over time.

I couldn’t agree more.

Microsoft is one of the largest companies in the world. It has a AAA-rated balance sheet – one of only two companies in the world with that designation. And it’s grown its dividend for 21 years in a row.

Obviously, long-term investors have done quite well…

Over the last decade, Microsoft’s earnings per share (EPS) increased from $2.78 to $9.21. And it increased its dividend from $0.76 to $2.42 per share.

In other words, Microsoft’s dividend increased by more than 3x over the last decade. Yet because of strong fundamental growth, its payout ratio is just 25%.

Shares are up by nearly 797% during the last 10 years. This beats the S&P 500, which was up by nearly 162% during the past decade.

Moving forward, I expect this outperformance to continue.

Today, Microsoft has a leading competitive position across many business segments. And those segments are poised to benefit from long-term growth tailwinds.

• It’s a major player in the ongoing shift to cloud computing through its Azure application, a $406 billion market.

• It has a substantial social media presence with its LinkedIn assets.

• It’s a global leader in the artificial intelligence and digital security industries.

• And it’s increasing its position in the fast-growing $221 billion gaming industry.

Microsoft’s market dominance, low payout ratio, and growing dividend are likely to continue compounding shareholder wealth for decades to come.

Today, Edward Avedisian has a school named after him. And all it took was allowing the power of compounding to work for him.

“It’s a fabulous time to get started,” the clarinetist-turned-philanthropist said late last year. “Look at what we’re doing with energy, climate, everything. Stuff is just going to explode… It’s fabulous.”

And as a best-in-breed company that’s on the cutting edge of multiple technologies, Microsoft has what it takes to benefit from this “fabulous” growth opportunity.

This company makes it clear that all you have to do to get rich over time is buy great companies, reinvest their dividends, stand back, and watch that snowball roll.

Happy SWAN (sleep well at night) investing,

Brad Thomas
Editor, Intelligent Income Daily

P.S. Thanks to the volatile stock market we’re continuing to see, we have no shortage of fabulous investment opportunities. That’s why I put together a list of stocks I believe can help you build your own compounding portfolio.

In addition to Microsoft, it holds dozens of dividend-paying stocks that can help you grow your wealth, starting today. Click here to learn more.