How many of you wish you were rich? Do you wish you didn’t have to worry about money? Are you intrigued or worse yet seduced by those ads that promise you to show you how to get rich quickly? This ads promise to send free information about how to get rich quick. Have you requested that information? What did you receive? Most likely you received a sales letter asking you to send in anywhere $10 to $199 or maybe more for information/details. Then, if you send in the money, you receive this nice booklet(s), CD, or whatever explaining how to implement the surefire program.
My friend the only person with the surefire program is the one to whom you sent in the money. They are getting rich off of you. There is no magic formula or scheme to get rich quick. Have you heard of Bernard Madoff ($50 Billion Dollar Ponzi Scheme)? How about Perry and Rachelle Griggs ($3 Million Dollar Ponzi Scheme)? Vander Tuig, Jonathan Carman, Mark Sostak, Soren Svendsen, Scott Yard and Robert Waldman have been charged with grand theft and securities fraud. All six men were affiliated with the Carolina Development company and were alleged to have defrauded over 1000 victims out of a total of $52 million. Frank Castaldi is alleged to have stolen tens of millions of dollars from about 200 to 300 clients. Since 1985, he allegedly promised investors returns of 10 percent to 15 percent on six-month promissory notes. David Lewalski was arrested for his alleged involvement in Botfly, a $30 million investment fraud scheme.
These are just a few of the “money gurus” AKA scammers that have gotten caught. There are thousands of individuals out there looking to make a quick buck at your expense. Don’t believe that you can invest a few dollars or your life’s savings and receive huge returns. That does not work.
The best way to get rich is through perseverance and investing regularly. If you start young and deposit money into a savings account where the interest is compounded, then your money grows. Have you heard of the power of compound interest? Compound interest helps your money grow. While it does not make you rich quickly, you can accumulate a significant amount of money. Albert Einstein said, “The most powerful force in the universe is compound interest.”
The way compound interest works is that on the first year you earn interest on your original deposit. The second year you earn interest on you original deposit plus on the interest you earned the first year. The year you earn interest on original deposit and on the interest you accumulated the prior years. This continues until you withdraw the money.
Try the calculator below and see how an investment can grow. The younger you are when you start investing Here’s an example: For example, two individuals began investing at age 22 and have $2,000 a year to invest or spend. One opens an Individual Retirement Account (IRA) to start saving. The other spends $2,000.
Let’s say the IRA earns 12% per year. Individual one saves $2,000 per year for six years, then never puts another cent into the IRA. Individual two spends the $2,000 per year for six years. Then, begins investing $2,000 a year until the age of 65. The IRA earns the same 12% interest per year as the first’s individual.
The chart below shows how both respective IRAs, from the time they are 22 years old all the way to 65. Remember the first individual’s total investment is $12,000 ($2,000 per year for the first six years), while the second’s is $74,000 ($2,000 per year for the last 37 years).
Age A B
22 $2,240 $0
23 4,509 0
24 7,050 0
25 9,896 0
26 13,083 0
27 16,653 0
28 18,652 2,240
29 20,890 4,509
30 23,397 7,050
35 41,233 25,130
40 72,667 56,993
45 128,064 113,147
50 225,692 212,598
55 397,746 386,516
60 700,965 693,879
65 1,235,339 1,235,557
This is the power of compound interest, the earlier you start saving, the greater the accumulated interest on your original investment. Remember that the important thing is to start saving your money. Don’t put it off begin today. Invest however much you can afford. The right time is now. Start saving now for your retirement. Use the calculator below to see how your money can grow.[compounding-calculator]