Rayeiris Maduro Rondon @Rayeiris: "🌸 𝓦𝓱𝓪𝓽 𝓪𝓶 𝓘 𝓭𝓸𝓲𝓷𝓰..."

Australia

🌸 𝓦𝓱𝓪𝓽 𝓪𝓶 𝓘 𝓭𝓸𝓲𝓷𝓰 𝓷𝓸𝔀? 🌸 When I approached investing for the first time, I learned that compounding is very important. Compounding consists of reinvesting the earnings that you generate through your investments to grow the capital. These reinvestments allow you to increase your wealth in an exponential way instead of a linear one. For example: Say that you invest $1.000, earning 10% every year. Thus: 𝓢𝓲𝓶𝓹𝓵𝓮 𝓲𝓷𝓽𝓮𝓻𝓮𝓼𝓽: 💃🏽 Year 1: $1.000 invested, $100 earned (that you withdraw). Year 2: $1.000 invested, $100 earned (that you withdraw). Year 3: $1.000 invested, $100 earned (that you withdraw). Year 4: $1.000 invested, $100 earned (that you withdraw). Year 5: $1.000 invested, $100 earned (that you withdraw). Total earned: $500. ⛄ 𝓒𝓸𝓶𝓹𝓸𝓾𝓷𝓭 𝓲𝓷𝓽𝓮𝓻𝓮𝓼𝓽: ⛄ Year 1: $1.000 invested, $100 earned (that you reinvest). Year 2: $1.100 invested, $110 earned (that you reinvest). Year 3: $1.210 invested, $121 earned (that you reinvest). Year 4: $1.331 invested, $131 earned (that you reinvest). Year 5: $1.464 invested, $146 earned (that you reinvest). Total earned: $610 The difference is not great in 5 years, but if you keep the snowball for years, compounding gets interesting. In 15 years, you could turn those $1.000 dollars into $4.177 with compound interest. In the meantime, it would turn into $2.500 with the simple interest! 🤑 𝓢𝓸 𝓶𝓪𝓴𝓮 𝓼𝓾𝓻𝓮 𝔂𝓸𝓾 𝓬𝓸𝓶𝓹𝓸𝓾𝓷𝓭 𝔂𝓸𝓾𝓻 𝓶𝓸𝓷𝓮𝔂! 🤑 $SPX500 $GOOG (Alphabet) $META (Meta Platforms Inc) $BABA (Alibaba-ADR) $CROX (Crocs Inc) $BTC $ETH