A Reason to Invest

from www.investopedia.com

What Is the Rule of 72? 

The Rule of 72 is a simple way to determine how long an investment will take to double given a fixed annual rate of interest. By dividing 72 by the annual rate of return, investors obtain a rough estimate of how many years it will take for the initial investment to duplicate itself.           Jun 20, 2019

from www.thebalance.com

If you're looking into investing in mutual funds, you'll want a sense of the average return before making any moves. In 2019, mutual funds in seven broad categories have averaged a return of roughly 13%, more than double the average annual return over the past 15 years.        Oct 21, 2019

SO WHAT DOES THE ABOVE INFOMATION TELL YOU?

Well...

the first thing we must do is divide 13 into 72.

the answer is 5.5 

In other words,

whatever money you have in a MUTUAL FUND will double in value every 51/2 years...

 

Is this important information to have access to?

Well...

let's run the numbers

Year 0               $5,000

Year 51/2          $10,000

Year 11             $20,000

Year 161/2       $40,000

Year 22            $80,000

Year 271/2       $160,000

Year 33            $320,000

Year 381/2       $640,000

Year 44            $1,280,000

So, if you put $5,000 into a Mutual Fund at the age of 25 and kept it in that Mutual Fund with no withdrawals for 44 years or age 69...  you will have over ONE MILLION DOLLARS...  This age is only 2 years over the government required FULL RETIREMENT AGE...

A General Rule of Thumb is that you will receive $400/month for every $100,000 invested...  so, you would have 12 - $100,000 invested or you would be receiving $4,800 each month and you would never be drawing down on the over ONE MILLION DOLLARS...

PRETTY COOL SHIT RIGHT?