At the height of the Great Depression, Anne Scheiber, who was already 38 years old and had an annual income of just over $3,000, invested a large portion of her life savings in stocks. She entrusted the money to Bernard, the youngest of her four brothers, who started working as a broker on Wall Street at the age of 22.

In 1933 and 1934, the market was going up, and he was doing well picking stocks for Anne. But his company was not. Suddenly, the company went bankrupt, and Anne lost all her money.

“She held a grudge against my father her entire life,” recalled Bernard’s son, Lawrence, 41, a financial services salesman in New York. “In fact, the older she got and the wealthier she got, the more resentful she became.”

Her anger at her broker brother seemed understandable. After all, she had saved the money over the years by skipping meals, wearing ragged clothes, and even walking to work in the rain to save on bus fare. You might have thought she would be against investing, too. But Anne wasn't, not for a minute.

She threw herself back into the life of saving and investing, a mania that would take over her life—and make her staggeringly wealthy. Though she never married or even had a significant other, she did have one hobby: investing.

In 1944, 10 years after suffering huge losses, she started over with a $5,000 account at Merrill Lynch Pierce Fenner & Beane, and slowly built up her savings to $20 million by the time she died last January, alone and without a lover at the age of 101. Today, that money is worth $22 million.

Few investors, including the most celebrated professionals of our time, can match her record. Her annual return of 22.1% is higher than John Neff (13.9%), better than Benjamin Graham (17.4%), and just below Warren Buffett (22.7%) and Fidelity Magellan's Peter Lynch (29.2%).

More importantly, Anne's basic investing style is time-tested and can be easily adopted by any small investor. It relies more on dedication than dazzling financial analysis, faith in great companies than a prescient stock-picking talent, and patience than the pursuit of immediate profits.

Given Anne’s performance, it’s reasonable to assume that a 25-year-old with $5,000 today could accumulate millions of dollars by age 65 if they followed her example.

Then, like Anne, they can have all the money they need and the peace of mind of knowing that they can ultimately pass on this multimillion-dollar asset in accordance with their wishes.

In Anne's case, she was so estranged from her family that she left just $50,000 in her 1975 will to one of her nine relatives, her niece who visited from time to time.

She donated nearly all of her $22 million to Yeshiva University in New York City, even though she had never attended the school. She dedicated the money specifically to helping educate the bright but poor young women among the coeducational school’s 6,200 students—women not unlike herself during World War I.

"Annie was smart but quirky about money," said her longtime New York City attorney, Ben Clark.

Relatives added that her obsession with money ran in the family. "The Shebels are like that," Lawrence said. No matter how much they had, they feared losing it all, and maybe there was some truth to that; it happened twice in their family.

“In Poland during World War I,” recalled Lawrence’s mother, Lillian, “the Shebels had gold buried in the ground. But they traded it for paper money, and the paper money became worthless.” Back in America at the time, Anne’s father suffered severe real estate losses before his untimely death, forcing her mother to manage the estate to support her nine children.

For Anne, at least, the money anxieties that plagued her early years were compounded by her family’s European values. All the money the family earned went to school for the four sons; the five daughters were left to fend for themselves. Yet Anne persevered.

At 15, she began working as a bookkeeper, using her wages to advance herself, eventually attending night school at the forerunner of George Washington University's Law School in Washington, D.C. In 1920, she joined the IRS as an auditor and passed the bar in 1926 at age 32.

Years later, Anne would often recall the lesson she learned during her 23 years with the IRS.

The lesson she learned from studying other people's tax returns was that the surest way to get rich in America was to invest in stocks. She eventually concluded that she couldn't change other people's biases, but she could do a lot to take care of herself.

Anne began saving like crazy. "She saved at least 80 percent of her paycheck," Clark said. "For example, she spent no more than $2 a week on food. Back then, you could get a hot dog lunch at Nedick for 15 cents, but I know she found places that were cheaper."

“I don’t think she spent more than $2 on food in 1985,” said William Fay, a Merrill Lynch broker who worked for her for 22 years.

"She would wear the same black coat and hat every day, summer or winter. One time, one of her nieces bought her a new black coat. But Anne found out it cost $150 and refused to wear it."

Anne put every penny she had into the market. Relying on her own systematic research and Merrill Lynch analyst reports, she steadily bought leading brand companies in industries she thought she understood, including pharmaceuticals, beverages, and entertainment.

"She rarely bought more than 100 shares at a time," Fahey said. "The only time she bought more than 200 shares was in the early 1950s, when she bought 1,000 shares of Schering-Plough for $10,000." Today, her Schering-Plough stock alone is worth about $3.8 million.

She almost never sold any stocks, even those that had been depressed for years—partly because she hated paying commissions. “She would say to me, ‘Why should I let my brokers make a killing? I just buy and hold,’ ” Clark recalls.

Her buy-and-hold strategy often yielded windfalls. “Some of her stocks, especially in the entertainment industry, were bought at a three- or four-fold premium, like Capital One, which became Disney,” Ms. Fahey said.

By the early 1980s, when Anne was almost 90, she was irritated to find herself paying rising income taxes on her $10 million portfolio of about 100 stocks.

At Fay’s urging, she decided to convert the $40,000 in monthly dividends she was collecting into tax-free bonds and notes, some of which yielded more than 8% and were completely tax-free. “She never sold a stock to buy a bond,” Fay says. Still, within a few years, her cash flow had climbed from $500,000 a year to around $750,000, all while keeping her tax bill under control.

Anne bought her last two stocks, 100 shares each of Apple and MCI, in 1985. "She didn't trust technology because she didn't understand it. So she refused to invest in it," Fahey said. "Also, she didn't want to bother remembering the names of new stocks at that time."

"She kept saying, 'Don't ever tell anyone in my family how much money I have. I'm going to give it all to education,' " Fahey recalled. "And of course, she did."

What lessons can we learn from Anne Scheiber’s story? 

Here are eight investment tips, plus two concluding thoughts.

1. Invest in leading brands. Anne calls them franchise brands, and she means leading companies that make products she admires. For example, she owns Bristol-Myers Squibb, United Chemical, and Coca-Cola, and she also invests in untested companies based on her intuition.

“When Pepsi came along, she tried it,” Fahey said, “and then bought Pepsi when it was still the new kid on the block.”

2. Favor companies with growing earnings. Anne tends to ignore the price-to-earnings ratio of a stock. Instead, she focuses on the company's ability to increase its profits. She believes that stocks are sometimes overvalued and sometimes undervalued, but if a company's earnings increase year after year, everything will be fine in the end.

3. Take advantage of your interests. Anne has always loved watching movies. Therefore, she turned this interest into one of her investment themes. She looked for the best entertainment companies by reading Variety magazine. She had great success with Columbia, Paramount, Los and Capital Broadcasting Company.

4. Invest in small stocks. In addition to increasing the diversity of her portfolio, this rule automatically allows her to buy additional stocks when prices are low and avoid overinvesting when prices are high.

5. Reinvest your dividends. This is the same as playing with the house money in gambling, but with one advantage - it is a sure-fire way to make money in the long run.

6. Never sell. Or at least, never sell a stock you believe in. "During the long bear market of the 1970s, many of her drug stocks went down, some by 50 percent," Fahey said.

“But she held on because she believed in the stocks. She didn’t panic in the ’87 crash. She thought the whole market was overvalued, and she believed her stocks would rebound.”

7. Stay informed. Anne attends all of her company's shareholder meetings in New York City. Rain or shine, she emerges from her rent-stabilized, $450-a-month studio apartment in her signature black coat and hat to grab the CEO and demand questions, just as she did when she was an auditor.

She would then compare her notes with what the Merrill Lynch analysts said. However, Fay added that she also attended meetings to get the freebies. "Even if she had millions of dollars, she would show up with a bag," a relative confirmed. "If there was food available, she would fill a bag and eat for days."

8. Save in tax-free bonds. They are safer than stocks and reduce her tax bill. When she died, 60% of her assets were stocks, 30% were bonds, and 10% were cash.

In addition to these investment ideas, Anne's life also teaches us two other lessons worth considering, especially if you want to be as rich as she is:

9. Give back to the community. She donated $22 million to Yeshiva University and an additional $100,000 to Israeli education groups, which will help countless young women realize their full potential in the coming years.

“Anne Scheiber lived to be 101, but her vision and legacy will live on forever at Yeshiva University,” said Yeshiva University President Norman Lamm.

One of her relatives, New York City bank official Dolly Acheson, who left none of the money, added that the Yeshiva University donation gave her a "feeling of redemption." As she put it, "At least in the end, all the money went to a very good cause."

10. Finally, enjoy your money. Although Anne Scheiber was very smart, she failed miserably with money. She died without a single real friend and did not receive a single phone call in the last five years of her life.

"At some point, a recluse like her has to be rewarded for continuing to live like this," said Fahey, her former agent. "But to you and me, her life was terrible. The highlight of her day was walking to the Merrill Lynch vault near Wall Street to check her stock certificates. She did that all the time."

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