Wait... $5,000 x 40 $200,000. How did you get $1.2 million? The extra $1million is due to compounding.
Writing for MarketWatch, Mitch Tuchman explains compound interest.
“Shark Tank” star Kevin O’Leary has some simple advice for anyone who finds investing scary: Just do it. Now.
you’re 21 years old, or 20 or 18 or 19 and you start putting aside 10%
of what you make, you’ll [have] over $1 million by the time you’re 65,”
O’Leary told CNBC.
“If no one else is going to worry about your retirement, I want you to worry about it.”
Of course, investing never provides a guaranteed annual return but the example should motivate you, whatever your age, to convert your daily impulse spending into future financial security....even if you have less than 40 years until your "financial freedom" goal.