THE "MAGIC" OF COMPOUNDING

Rule of 72

• In it's most simplified form: this basically means that by adding the growth of one year to the next and continuing to do so over a 10 year period, at a rate of return of 7% per year, you should be able to double the initial amount.
• This is indicated by the red line in the chart above.
• This does not include any additional amounts.

Add in some annual savings

• The blue line takes into consideration the addition of some savings each year (in this case $12,000 per year, $1,000 per month).
• Think about how that would look over 20 years (or longer!)
• Powerful !!

Parents:

As the great Crosby, Stills and Nash once wrote in a song:

Teach your children well!!