Saturday, 20 June 2015

Compounding: What Other Financial and Investment Bloggers Seldom Mention it!!!



For the younger ones, do you fully understand the power of compounding?



 Now, open your eyes wide and see closely and very careful. 

What did you see on Right, and on the Left, and back to the Right? 

 Close your eyes. Open wide and focus on the Right side again. 


Think deeply!


 What did you understand about compounding?


You may like to answer in your own free-form!




 


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11 comments:

  1. SMK20 June 2015 at 10:40:00 GMT+8

    Some will get it. Some dont. It is the difference in values. You have a whole new generation looking to make a app and be rich.

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  2. Rokawa20 June 2015 at 13:20:00 GMT+8

    Invest and reinvest to me its not exactly compounding.
    Cpf interest is really compunding. The only prob is the policy changes suka suka till i dunno whose money alrdy

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  3. Siew Mun20 June 2015 at 23:17:00 GMT+8

    This comment has been removed by the author.

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  4. Siew Mun20 June 2015 at 23:18:00 GMT+8

    Compounding outside of CPF takes tremendous discipline comprises of consistency, persistency and patience.

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    Replies
    1. Createwealth888821 June 2015 at 08:42:00 GMT+8

      The period to invest our CPF fund is short. Just that few months of exposure to the bear market..

      Delete
  5. Tacomob21 June 2015 at 14:16:00 GMT+8

    Unfortunately our human brain is not made to easily understand the exponential function (= compounding). We are lazy and prefer to think in linear terms.
    As such the Ninth Wonder of the World can only be understood once you punch a few numbers into a financial spreadsheet and fast forward 30+ years.
    I recently asked a group of Principle of Accounts-Teachers whether they believe that saving 1 Dollar a day can make you a millionaire in your lifetime. Most stared at me with open mouths. In fact one can achieve that feat.
    It just takes about 70 years (which is fairly well within an average lifetime) and an annual return of 8% (historically a broad based stock market investment can achieve that).

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    Replies
    1. Createwealth888821 June 2015 at 14:37:00 GMT+8

      May be some people can visualize it better.

      Delete
    2. Tacomob22 June 2015 at 00:05:00 GMT+8

      I agree your visualization is great.
      And once people punch their numbers into a spreadsheet and plot a chart one would say that everybody should get it.
      Dinkytown has great calculators including visualization: https://www.dinkytown.net/

      Delete
    3. Createwealth888822 June 2015 at 07:19:00 GMT+8

      Great!

      Thank you for sharing.

      Delete
    4. Ambassador Reverend Michael A. Steele, Esq24 June 2015 at 14:43:00 GMT+8

      Thanks for your wealth of experience and the tools you share with us. Kind Regards

      Delete