Building wealth is a function of amount invested, the rate
of return and time. Yesterday, I illustrated
how much 2%, which represents a risk free rate of return, can get you over time
given a $1,000 investment. Today, I will illustrate what 10% will get you. You
have to take a little more risk to get this rate of return by investing in a
mutual fund and there is no guarantee you will get it (see table below).
|
$1,000 Amount
|
||
|
Time
|
Rate
|
Amount After Compounding
|
|
10 Years
|
10%
|
$2,593.74
|
|
20 Years
|
10%
|
$6,727.50
|
|
30 Years
|
10%
|
$17,449.40
|
|
40 Years
|
10%
|
$45,259.26
|
|
50 Years
|
10%
|
$117,390.85
|
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