This is the most important tool I've learned. Once you understand what compounding interest is, you'll understand how to make time you're best friend.
After all "Time is Money"
So what is Compounding Interest? It's complicated. All you need to understand is the result of it and how you can use it to you're advantage.
It's not hard. All you need to know is that it means invest early.
So, to paint a picture for you I'm providing an example that I read from one of my favorite authors, Tony Robbins. Since I'm using his example I have to give credit where it's due.
Credit to Tony Robbin's book for completely changing my life and making me realize finance is my passion, and credit to Cassie Harris for giving me the book.
In the book, it creates this long elaborate story but there are three main points of his example.
There are two people below that invested the same amount at different ages.
Take a look at the amounts. Joe made more than double just because he invested 8 years earlier. Here are the key points to the example:
- Get started early
- Don't miss a deposit
- Don't touch it (so don't overcommit)
The important part is if you haven't started investing.... you're playing a losing game.
If you haven't started and have no idea how, i've got some really easy and safe ways to get started investing.
Here's the easiest one.... and it makes the world a better place.
Interested? Click Here to take a look.