1/29/2014 6:15 PM ET|
The magic of compound interest
Saving even just a small amount of money every week can eventually turn into a sizable pile of cash over time.
Patience and financial discipline can pay off. Check the infographic below to see how savings can add up.
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Really? Yes, compound interest is good, however.....
With interest rates at historic lows of as little as .10%. Yes, read and weep--that's one-tenth of one percent. Thank you.
And as the Federal Government continues to print money to support Wall Street (crash!) and their cronies, the elders that saved to survive on interest on their hard-earned money, go begging.
I can give you better advice than this article. Here's what I did for my brother who only makes about $12 hour:
I asked him for $50/month to go into his savings account. Once that reached $2500 we bought shares in a state and federal tax-free fund. Then changed the contribution to the mutual fund and bumped it up to $100 per month.
We started that in February of 1993 and now in his mid 40s, he is enjoying a monthly dividend (reinvested) of over $500 per month and still growing. It is nearly 100% tax free except for capital gains and a few dollars from some income that isn't tax free.
His average annual return is about 2.75% recently.
I remember having a compound interest bearing savings account my grand parents' funded in my name for several years after I was born. Wonder what ever happened to it?
Now the Banks Charge You for Them Using Your Money!
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