Mathijs Frencken
Netherlands
4m
The Magic of Compound Interest in Action Have you ever wondered how powerful compounding really is? Here’s a real example I ran using The Calculator Site: www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php Scenario: Initial investment: $50,000 Additional monthly deposits: $500 Annual interest rate: 27.5% this is where my annualized return currently sits after 5 years: (my goal is 20+) bullaware.com/factsheet/ZwoopsTech Time horizon: 10 years Compounded monthly 📈 Results after 10 years: ✅ Future value: $1,074,357.13 ✅ Total interest earned: $964,357.13 ✅ Time-weighted return: +1,416% This means a disciplined approach—adding just $500 every month and letting returns reinvest—turned $50K into over $1 million in a decade. 🔥 Why does this happen? Because compounding doesn’t just grow your money—it accelerates your gains as your profits generate their own profits. The longer you stay invested, the more powerful it becomes. The urge to pull out of the market once you made some money will actually costs you the biggest steps once your portfolio takes off. At my current portfolio performance of 27,5% my 10th year brings in almost €200.000. As of today I outperform the market but this may change in the future so this is not investment advice. A more realistic return over the long term (10+ years) with medium risk assets would be between 10% - 20% annualized. ✅ Takeaways for investors: • Start early • Be consistent with contributions (automatic deposit if possible) • Reinvest earnings (dividends etc) • Stay patient—compounding needs time If you’re serious about building wealth, make compound interest your best friend. I know starting with 50.000 is unrealistic for people but with enough time even starting from 0 will net you very positive results. Thanks for reading my post.
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