Charles Schwab Biography & Net Worth
|Popular Name:||Charles Schwab|
Charles Robert Schwab
|Birth Date:||July 29, 1937|
Sacramento, California, United States
Susan Cotter (div. 1970s)
|Net Worth:||$8.4 Billion|
|Last Updated:||December, 2020|
Charles Schwab is an investor and financial executive who is best known as the chairman of Charles Schwab Corporation, a brokerage service firm he founded in the 1960s. Starting in 1975, Charles led the way in discount sales of equity securities. His company became the largest discount securities dealer in America by a large margin. He retired as chief executive officer in 2008, but remains the company’s chairman and largest shareholder. Mr. Charles Schwab was named the 76th richest man alive by Forbes in February 2017. He still maintains a spot on the list of the 100 richest men in the world today, and here in this article, we will be looking at Charles Schwab’s biography, business model, personal life, financial data and how he has acquired his massive fortune.
Charles Schwab’s Early Life
Charles Robert Schwab was born on July 29, 1937 in Sacramento, California, United States. He is the son of Lloyd and Terrie Schwab.
He was a student of Santa Barbara High School in Santa Barbara, California, and captained his school’s golf team. He experienced pre-college school at the Holy Rosary Academy in Woodland, California, and attended Stanford University, graduating with a Bachelor of Arts in Economics in 1959. He also attended Stanford Graduate School of Business and graduated in 1961 with a Master of Business Administration.
Charles Schwab’s Career
Three years after he graduated from the Stanford Graduate School of Business, Charles Schwab started an investment newsletter with three partners which he called the Investment Indicator. At its most popular time, the newsletter had 3,000 readers signed up at $84 each a year. In 1971, the three partners incorporated as “First Commander Corporation” to provide brokerage services while continuing to publish the newsletter. The following year, Charles bought out his partners in Commander Industries. He changed the name of the company to Charles Schwab & Company in 1973. Two years later, the SEC changed its policies regarding the securities sector, meaning that firms could charge clients any amount they wanted. Back then, stocks and many other securities were not directly bought by individuals. They were sold by sales agents on commission who may not have had the best interests of clients in mind. Now Schwab cut charges to his clients in half, put his sales agents on hourly salaries, making sure that they were not selling riskier stocks than the client wanted to increase their own commissions. He also put a rule in place to not give customers advice on which stocks to purchase. He also made provision for a toll free number which allowed customers to place orders anytime from anywhere in the world. Other larger and more established securities companies were outraged and fought to sabotage Schwab’s company.
In September 1975, the first branch of the Charles Schwab & Company was launched in Sacramento, and it soon expanded across California. In 1981, Bank of America offered Charles Schwab $53 million in BofA stock for his 37% stake in his company. After the sale he retained his position as president of a largely independent division with sales of $41 million. Within a period of five years, he had grown that to sales worth $308 million. His own unit was flourishing, but BofA was not. In 1987 he reached an agreement to buy back his firm from BofA for $230 million. He then took the company public.
In 2008, Charles Schwab stepped down as chief executive officer of the company. He currently serves as its chairman and is known to be its leading shareholder with a 15% stake. Today, the Charles Schwab Corporation controls more than $1 trillion of its customers’ money across the world. In 2019 Charles eliminated trading commissions and initiated fractional buying of shares in a deliberate attempt to pull younger clients to his firm. Around the same time, he announced is intentions to purchase rival firm TD Ameritrade. The proposed fusion would create a gigantic brokerage with around $5 trillion under management.
Awards & Achievements
In 2018, Fortune concluded that Charles’ company is one of the most admired ones. It currently claims the number one position in terms of social responsibilities, innovation, and utilization of corporate assets as far as Securities and Asset management is concerned. The Charles Schwab Corporation is a recipient of an American Financial Technology Award. On the personal side, Charles was in 1989, honored with a Golden Plate Award by the American Academy of Achievement. In 1997, Forbes Magazine named him the “King of Online Brokers”, and The Museum of American Finance presented him with the Financial Innovation Award in 2016.
Personal Life & Family
This leading business executive has been married twice in his lifetime. From his first marriage to Susan, he had three children including Virginia, Carrie and Charles Jr. After Charles and Susan Schwab’s divorce, he went on to marry Helen O’Neill. They have two children together, namely Helen and Michael.
Charles’ daughter Carrie is married to Gary Pomerantz. She served as council member on President Barrack Obama’s council on financial capability, and currently serves as the president of the Charles & Helen Schwab Foundation. His son Charles is the father of four children including Charlie, Sydney, Samantha, and Haley. He once played quarterback at Northwestern University.
Charles and his wife are deeply involved in philanthropy. Their foundation aims at providing help to children who are dyslexic since Charles himself lives with the disorder. He is a former chair of the San Francisco Museum of Modern Art and currently sits on its Board of Trustees.
He and his wife Helen reside in their mansion in Atherton, California.
Charles Schwab Net Worth
After spending most part of his career life as a businessman and investor, Charles Schwab has built an impressive empire for himself and can now comfortably dine on the table set for the world’s billionaire businessmen. His is the founder of the discount brokerage firm Charles Schwab Corporation, which currently has more than 8 million clients in over 300 different offices in the United States, one in London, and another in Puerto Rico.
Charles Schwab net worth is currently pegged at $8.4 billion. As chairman of Charles Schwab Corporation, he earned more than $6 million in compensation in 2018. This comprised of his salary, stock options and other bonuses.