Quickly and Safely Double Money
How quickly do you think you could double money? Let’s say you had a quarter. Could you turn that into $0.50 within a couple of days? If so, could you turn that $0.50 in to $1?
If it is that easy to double money, why can’t you double $100 into $200 just as easily, or $5,000 into $10,000? You actually can, but to do it safely with little risk it may take a little time. One way this is possible is for a growing business owner to take their profits and reinvest it into things that help them grow their business, such as advertising. But there’s another way for the non-business owner to double their own money.
It’s an investing formula known as the rule of 72, which allows you to figure out how long it will take to double your invested money. Here’s how the double money formula works:
The bottom line is that if you put your money into the stock market, which historically returns about 10% over time, you will double your money in just about 7 years.
So, if you are 23 years old and have $5,000, you can expect to have $10,000 when you are 30. If you keep reinvesting those profits, you’ll have $20,000 when you are 37 years old . . . then $40,000 by age 44. That’s the power of compound interest at work for you.
Note that this example only takes your initial investment into consideration. If you invest in a 401k, you are regularly making additional contributions, which will accelerate your wealth creation.
As you can see, when you are a long-term investor and you re-invest your earnings, it is very easy to become a millionaire without much effort. All you need is a long term perspective with a slow and steady approach.
Millionaire Money Habit: You can control the two variables that allow you to double money. By simply being a long-term investor that earns just average stock market returns, you will build wealth with very little effort. This is the safest and surest way to become a millionaire.