The power of time after investing a lump sum

Your eyes doth not deceive you. This simple bar chart shows the massive power of compound growth.‎

If you invest a sum of money, and receive a 10% per year return, after 5 years your investment will be worth about 1.6X your initial sum. But if you continue to hold that investment 10 times longer to 50 years, you don’t end up with a 16X return (10 times the 5 year return). Your investment ends up worth over 171 times your initial sum.‎

THAT’s the massive power of time when it comes to compound growth. The early years not a lot of magic is happening. But as the years go on, the growth begets more growth and the numbers begin to snowball. As they say, the first million is the hardest to earn. After that they start coming faster and faster.‎

So what do you do? Invest early and often. Even if it’s small. Get started. Your future self will thank you.‎

As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.‎


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