Financial Perspective

 Financial Perspective

If a person works 40 hours per week instead of 37 between the ages of
17 and 30, and takes the saved money, assuming they don’t squander it,
and invests it at 12%, by which it will double every 6 years because of
the Rule of 72, at age 66 they will have:

3hrsx$12 per hourx52weeks per yearx13 years= $24,336 on their 30th birthday,

$48,000 on their 36th birthday

$96,000 on their 42nd birthday

$200,000 (about) on their 48th birthday

$400,000 on their 54th birthday

$800,000 on their 60th birthday

$1.6 million on their 66th birthday

The same exercise holds if they work 43 hours instead of 40.

If they work 50 hours instead of 40 hours the result is 3.3 times as great, or $1.6×3.3= $5.28 million

If a young couple marries at 22 and instead of spending $20,000 on
their wedding, they spent $5,000, and they put the difference into a
12% investment, they would have the following assets at the named ages:

28    $30M

34    $60M

40    $120M

46    $240M

52    $480M

58    $960M

64    $1.92mil

“Twenty eight percent of Americans 65 and older had incomes of less than $10,000 per year.” (Congressional Research Service)

People do poorly because they don’t work enough and they spend the
money they do make without caution. And they borrow money for frivolous
reasons, pure consumption. Then interest expense drags them down.

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