Compound Interest-The Real Wealth Killer

[KING WILL]

It Takes Time...A Long Time

How long are you willing to wait? Because compound interest doesn't work well over 10 years, and it isn’t even that good over 20. Where compound interest really gets the kind of exponential growth is around 30 years. Compound interest makes you wait for so long that you don’t even know how if it’s working. Much of that time entrepreneurs are taking money from their business by scrimping, sacrificing, saving, and setting money aside to invest in the stock market that they don’t know or control. This is done with the rationale of once “you get there” and retire, you are supposed to have a “nest egg”. But why not invest that money into your current endeavors and ventures so you don’t have to wait until retirement to build more cash flow and equity in what you know- your business?


Compound Interest-The Real Wealth Killer

I've never seen compounding interest argued against before.

Thoughts?

 

[Sugarbush]

I’ll take my chances

 

[dark_magic]

It Takes Time...A Long Time

How long are you willing to wait? Because compound interest doesn't work well over 10 years, and it isn’t even that good over 20. Where compound interest really gets the kind of exponential growth is around 30 years. Compound interest makes you wait for so long that you don’t even know how if it’s working. Much of that time entrepreneurs are taking money from their business by scrimping, sacrificing, saving, and setting money aside to invest in the stock market that they don’t know or control. This is done with the rationale of once “you get there” and retire, you are supposed to have a “nest egg”. But why not invest that money into your current endeavors and ventures so you don’t have to wait until retirement to build more cash flow and equity in what you know- your business?


Compound Interest-The Real Wealth Killer

I've never seen compounding interest argued against before.

Thoughts?

I really like Garrett Gunderson. His book, "Killing Sacred Cows ...", is a must read if you want to transform your views on money and finance.

Yes, compound interest does take time to work. Not only that, the majority of your work at the beginning is from new deposits, not from the growth of the fund due to yields. Every time money is withdrawn from an account, the withdrawal interrupts and dampens the compounding effect as well as decrease the total yield of the account.

Cash flow is sorely neglected by the majority of people. Cash flow is the most important element of one's personal economy. This is even more important than saving money.

Coupling compounding interest with a high cash value, dividend paying whole life insurance policy with a mutual insurance company provides you several benefits such as:

1) Uninterrupted compound interest
2) Liquidity of funds by way of the cash value
3) Tax-deferred growth
4) No red tape and no reporting to credit bureaus
5) "Dry powder" to use for capitalizing on new, profitable opportunities which present themselves

For most banking accounts, securities, or other investments, the yield is lower than the percentages of interest paid on debts or taxes. Interest and principal paid on debts as well as taxes are your number 2 and 1 expenses in your lifetime. Mitigating these expenses are essential for increasing one's wealth.