Hello, guys. Welcome to my Youtube channel (I have always wanted to say that).
If you are anything like me, mathematics and anything financially inclined stresses you out.
Health insurance, Pension, Tax, Compound Interest, Black Tax.
But…This year we are being responsible.
So, I decided to find available investments and I stumbled upon a miracle – compound interest.
The greatest wonder of the world – compound Interest – well, after Canada that is.
So, basically it works by putting money away regularly for a long time and not touching it at all (lol).
So, let’s say you put N50,000 away every year (salary has finished) at a 10% interest rate per year.
That means you start with N50,000 and add in N50,000 every other year. You allow everything to roll over to the next year in addition to the interest on it and you don’t touch it at all. You do this year in and out
So, what happens is that you get this chart if you don’t touch the money:
Kini big deal right?
It doesn’t look remarkable but if you do this every year for 30 years, a miracle then starts to occur after the 20th year.
The money starts to grow at an alarming rate.
From the 20th to the 30th year, boom! The money rises (unlike our economy) and you have this:
Suddenly, N50,000 per year will give you 9 million after 30 years. As long as you let the money and interest rollover without touching it.
While it sounds lit on paper, is it possible to put money away consistently for such a long period of time?
The truth is I don’t know but I am going to try.
Crying ahead of time.
If I am not alive before 30 years is over, I am going to be really angry with whoever came up with this concept.
Give me back my compound interest diamonds money.
Was this helpful? Let me know in the comments section. Here is a link to a compound interest calculator I found.
