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<< Invest early - a simple illustration | 61% of US workers are living paycheck to paycheck >>

Invest often - a simple illustration

Monday, September 14, 2009

In my last post, I showed the power of starting to invest for retirement at age 25 versus age 35.  This time, we’ll look at the value of investing “a lot” rather than “a little” over a long period of time.  Specifically, the hypothetical 25 year-old who invests $2k per year until retirement at age 65 will end up with about $518k, assuming an average rate of return of 8%.  On the other hand, the investor who puts away $10k per year over the same time period will have almost $2.6m.

2k-vs-10k-compounding-illustration

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General Personal Finance | Retirement Planning

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