Everyone should be saving for their own personal retirement.... By saving more now, getting a great interest rate, and letting it grow over time, makes a small amount today grow into a very significant amount tomorrow.
A lot of types of investments have a special “growth agent” known as Compound Interest. This is where the interest earned on the account adds to the principal, and then starts to generate its own interest. This is similar to successful swing trading of stocks, because gains made on previous trades can immediately be used in the next trades, and hopefully make even more gains.
And the longer this process continues, the more it has the Rolling Snowball Effect…. Hence the term “Compounding Magic.”
Here's a Video on How Compound Magic can really Snowball Your Money!
Say you invest $5,000 in a retirement account (no taxes taken out) with compound interest, and then add $100 every month, for the next 20 years. Here’s what you would end up with after 20 years, at different interest rates, with “Compounding Magic” at work.
| Interest Rate | Value at 20 Years |
|---|---|
| 5 | $54,800 |
| 10 | $113,100 |
| 15 | $249,600 |
| 20 | $577,500 |
| 25 | $1,379,500 |
| 30 | $3,364,400 |
Hopefully, you understand the point that investing now, and getting a great return has a big impact on the amount of money you can grow over time. Of course taxes can take a big chunk out of your gains/returns, so the best way to Swing Trade Stocks is in a retirement account, where gains are not taxed (until monies are taken out), and allowed to Grow Big!
*The Market Ladder’s goal is to help customers maximize their investment returns, but can not guarantee any specific levels of return.
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Stock Market Trades and Commentary shown by The Market Ladder, LLC, are for informational purposes only, and should not be considered Investment advice.