The Power of Compounding

I was playing around with a financial calculator tonight and wanted to shed some light on some pretty neat results about compounding and investing.


A $10,000 investment with a 15% rate of return will grow to $40,455 in 10 years. 

If held for 20 years, that $10,000 would grow to $163,665.

If held for 50 years, that $10,000 would grow to $10,836,574.

Now here's the cool part. If you can earn just a 1% higher rate of return per year, the dollar change in your investment becomes increasingly profound over time. 

For instance, if held for 50 years, $10,000 with a 16% rate of return will grow to $16,707,038 or about $6 million more than if it was earning 15% per year.

Moral of the story? Do everything you can to get that extra % point!! 

HKX9J4JFKFVD