Make Millions Using Compound Interest in Investing Money

Posted by Grace under Investing on February 22, 2016

This post “Make Millions Using Compound Interest in Investing Money” was migrated from Compound-Interest.Net

Do you want to know how does compound interest help you? It can help you accumulate faster! Compound interest can help you make millions! The effect of compound interest is amazing. I have noticed that compound interest can help anyone to make their first million easily. I am trying to prove it to you. Maybe few years from now, I will show evidence that compound interest is really amazing. Today I will just show some calculation of a small amount of money that invest in a vehicle that earns different percentage of interest.

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To take advantage of compound interest, all you need to do is to reinvest your profit. And the profit of your capital will also reinvest until you are satisfied with the return.

Example, if you invest one thousand dollars in the stock market and your portfolio is earning 8% per year, you are making $80 per year. If you reinvest your profits, the next year, your total investment is $1,080

Investment: $1,000
Interest Earned: 8%
Profit: $80
Total: $1,080

Compound Interest Can Help You If You’re Willing to Reinvest Your Profits

If you reinvest your profits over and over again without making any withdrawal in your capital, your money will grow overtime. Let’s see this sample computation using compound interest calculator I personally use.

If you make an initial investment worth $100,000 that earns 8% per year within 20 years, you will have a total savings amounting to $466,000.

If you make an initial investment worth $100,000 that earns 8% per year within 30 years, you will have a total savings amounting to $1,006,000.

Make Millions Using Compound Interest

Do you think your $100,000 will turn into millions in 30 years if you keep on getting your profits? I think maybe. Maybe, but it takes time. Maybe you ask, 30 years is very long. I can’t wait that much.

Then, you should keep on investing small amount of money every month aside from your initial investment;

Initial Investment: $100,000
Monthly Additional: $1,000
Earned Interest: 8% Per Year
Total Savings After 20 Years: $1,015,000
Note: Inflation rate is not calculated in this example. The sales loads and charges are not also calculated.

You can invest in stocks, mutual funds or even in 401k plans if you are an employee. Make sure your investment is earning 3 to 4 percent above the inflation rate. If you can get 8 percent or more every year, you’re doing great.

I hope you find this page useful. Now you know that it is possible to make millions using compound interest! Invest money now, don’t procrastinate. Otherwise, you will not get benefits from compounding interest. Share this with your friends. Subscribe to InvestmentTotal.com now. Leave a comment if you want to say something about this post.

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