Travis Scott’s Important Investing Reminder
What do Travis Scott and Charlie Munger have in common? People need reminders. Without them, we repeat our past mistakes.
What do Travis Scott and Charlie Munger have in common? People need reminders. Without them, we repeat our past mistakes.
Those same interest rates pushing would-be homebuyers to the sidelines are also hurting multifamily developers.
“Jesse, your career change…it’s a huge risk, right?” But how do I define risk? How does that definition apply to this question? Is my career change a huge risk? Is it risky at all?
What the heck are annuities? Thatâs what weâll focus on today. Weâll explain annuities in simple terms.
Life is nothing more than learning about the past to infer about the future. If only that worked for investing. But past performance does not predict future returns.
Everyone is naturally interested in finding the investment fund or strategy that consistently produces the best annual returns. But while the performance of funds tends to ebb and flow, often with changes in direction of the financial markets, thereâs a small, elite group of individuals who have enjoyed almost supernatural investment success. Below is my […]
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My name is Zach, and I write at Four Pillar Freedom, where I tend to tackle financial topics through data visualization. While J.D. is on vacation, I offered to explore one of his favorite topics: the effects of saving rate versus investment returns.
Albert Einstein supposedly once said that compound interest is the eighth wonder of the world.But does data actually support this claim?
In this post, I explore the nature of compound interest, how long it takes to become an important factor in wealth accumulation, and whether or not it actually matters much for people who hope to achieve financial independence in a relatively short time.
What matters more: your saving rate or your investment returns?
Suppose your goal is to achieve a net worth of $1 million. If you invest $10,000 every year and earn a 7% annual return on your investments — which is a reasonable assumption for long-term stock market returns — you’ll accumulate $1 million in about 30.7 years.
The chart below shows exactly how long it would take to reach every $100,000 net worth milestone, using the assumptions of a $10,000 annual investment earning a 7% annual return:
Notice how each $100,000 net worth milestone takes less time to reach than the last. In fact, it’s mind-boggling to see that it will take youlongerto go from $0 to $100,000 than it will to go from $600,000 to $1 million:
The first $100,000 takes the longest to save because you don’t receive much help from investment returns early on. The time it takes you to go from $0 to $100,000 is mostly dependent on the gap between your income and your spending.
Risk and reward is the basic relationship in investing. Learn how to apply it to your financial life.
My thoughts on investing have shifted over the years. New ideas consistently challenge me and force me to question my assumptions. The biggest: is there skill in investing?
How does the average investor underperform the market by 4% per year? They’re missing the easy money.