The Miracle of Compounding Interest

In fact, if you leave this dollar invested, its value will increase over time through the miracle of compounding. As you earn investment returns, your returns begin to gain returns as well, allowing you to turn a measly dollar into thousands of dollars if you leave it invested long enough.

The more money you save and invest today, the more you’ll have in the future. Real wealth, the stuff of dreams, is in fact created almost magically through the most mundane and commonplace principles: patience, time, and the power of compounding. To heck with your lousy odds in the lottery! Look at it another way — if you were to take a mere $20 a week and put it into a index fund, then at the end of 40 years, assuming a modest 12% return, you would have just over a million bucks. In short, you would basically have won the lottery — for $20 a week, or a total of $40,800 out-of-pocket along the way.

We like those odds.