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Power Of Compound Interest |
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Written by admin
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Nov 12, 2006 at 05:38 PM |
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Compound Interest
The Power of Compound
Interest
Most wealthy
people are familiar with the power
of compound interest. I
can't stress enough on how vital the concept is and how magically it
can work over a period of time to magnify your investment returns.
Compound interest, is interest which is added to the original
principal. New interest is then calculated on the principal plus the
interest earned. The more frequently which can daily, weeky, monthly,
quaterly, or yearly, the interest is compounded, the faster the
principal grows.
According to Albert
Einstein compound interest is the 8th wonder of wonder of world.
To get a realistic view of how powerful compound interest is, pay close
attention to below facts.
- $1 invested only
once at 9% interest compounded annually will become $30.57 million in
200 years.
- $1000 invested only once at 9% interest compounded annualy
will become $74357.52
in 50 years.
- $5000 invested only
once at 15% interest compounded annually will become $5.4 millions
in 50 years.
- $10,000 invested only once at 20% interest compounded
annually will become over $91 millions
in 50 years.
- $15,000 invested only
once at 20% interest compounded annually will become over $136 millions
in 50 years.
Now, you might wonder, I
don't have time frame like 200 or 50 years for investing, which is
quite valid concern or is it? Lets say you are now 40 years, how many
years do your think you will live more. I would say, if you are
healthy, you can easily surpass 90 years life span due to improved
medical facilities. So it means you still have 50 years to live. Even
if you somehow don't get to enjoy your investment fruits at age of 90,
you children would or your favourite charity could.
The most vital key to
success of compound interest is to start as early
as possible in your life without regretting the fact, that how old or
young you are. The magic of compound has worked for my grandfather's
investment, which allowed me to aquire higher education in Australia
and have better life. Now at the age of 30, I have put this magic of
compound interest in motion and I happy with its current results.
Check out the Online Compound Interest
Calculator to see how much you can grow your wealth
Best Wishes for
Compounding Your Money,
Keshav Jha
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Last Updated ( Nov 12, 2006 at 05:51 PM )
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