Re: The Power of Compound Interest: How to Own Manhattan
Assume a 10% return.
Person A could save $1000 a year from age 25 to 35. $11000 total. Not invest another
dime and end up with $430k at age 67.
Person B could skip saving until age 36, save $1000 a year until age 67 ($33,000 total) and end up with only $221,000. Invested 3X as much ($33,000) and ended up with half the overall amount. 10 years makes a HUGE difference
Person C could skip saving until age 36, save $2000 a year until age 67 ($66,000 total) and end up with $442,000. Invested 6X what person A did to end up slightly ahead.
Compouding requires time to do the heavy lifting.
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