Tuesday, November 2, 2010

The Effects of Time on money

Let's assume you save $1 day. Can you save a $1? Realistically yes you can easily, but lets even say that every dollar of your income is spoken for. I would be willing to bet that if you look hard enough you can find 100 pennies or one dollar worth of change on the ground, it may take lots of searching but you will be able to find it. So lets assume you can save a dollar a day and get a return of 8% with 365 days a year and forty years you would have $102,120. $87,520 would be interest you would have only contributed approximately $14,000. Now if you wait five years to start your savings will only 67,927 that's almost half of what someone who started five years earlier than you. you would have about $12,000 of your contributions, and $55,152 of interest.

No comments:

Post a Comment