Want to learn how to double your money without gambling? What is the power of compounding interest and why it’s important for everyone to understand? This may be one of the most powerful videos you have ever seen.
The power of compounding interest takes advantage of the Rule of 72 which was discovered by Albert Einstein, and it worked so well that he went as far as to call it the eighth wonder of the world and the most important formula ever discovered. All along I thought E = mc2 was the most important formula but it’s really just the most famous. If you think about it, even if you are an astrophysicist, you can’t pay your bills on space theories alone unless maybe your name is Neil deGrasse Tyson. Basically, if you don’t know and understand the Rule of 72, then chances are you are paying the interest to some institution and not earning it, and I hope this lesson will entirely change your financial future for the better. The rule of 72 is super simple math that calculates how long it will take to find the number in years that money will double. So the formula is this, take the number 72 and divide it by the interest rate, and the number that it equals is the number of years that the interest rate will double the money you are earning the interest on or paying the interest on a credit card company or student loan as examples. It’s that simple, so let’s say you have money in the bank and it’s earning at today’s rate the 0.01% interest rate in a savings account, well, take the number 72 and divide it by .01 and you get the answer of 7,200 years. I don’t know about you, but I’m pretty sure none of us alive today will be around to enjoy that. On the flip side, if you have a $20,000 credit card balance and you are paying 15% interest on that amount, you are doubling your debt to the credit card companies every 5 years, actually a little less than that. The younger you are, the greater an advantage you have knowing the rule of 72 and taking advantage of it today. So what does compounding interest mean? Well, if your money was to double every 5 years, then again after 5 more years, and again after another 5 years, well, you can see the power of compounding interest. Every penny you blow away today can equal so much more if you let it grow using the power of compounding interest rather than putting it on plastic and paying that out. If you are looking for a way to safely and consistently grow your money by 5% or much more a year guaranteed, I can share with you what your bank can not. This is so important that you understand the rule of 72 and the power of compounding interest and if you don’t, please let me know as I want to make sure it’s very clear to everyone consuming this lesson. If you are interested in leveraging my knowledge as a licensed financial professional then reach out and let me see what my team and I can set up for you. Feel free to comment below or send me a message from the healthwealthandrealestate.com website on the “Get in Touch” link at the top of the page and please like and subscribe to the channel so that you don’t miss any future educational videos. Thanks for watching and make every day great!