A chart that will change the way you manage money?
That’s a bold statement. If it’s so impactful, then it has to be complicated, right?
Not at all, it’s pretty simple and straightforward. However, it does require that you do things a little different than other people you know. Afterall, most Americans are very good at living beyond their means and racking up debt. But struggle when it comes to saving money, investing, and building wealth!
After reviewing this chart, you’ll realize how simple it is to become independently wealthy. While it’s not complicated, it’s not easy either. Ultimately, it takes years of financial discipline to save and invest money every month, so that you can get to a point where you’re no longer reliant on a job for your income!
If you’re like most people, it’s the time during the accumulation phase that are the most difficult. During this stage, your tempted to keep up with the Joneses and may even fall victim to extreme lifestyle creep!
However, as long as you can stay the path of living below your means, then you’ll save and have the opportunity to become financially free!
Without further adieu, here it is: The chart that changed the way I manage money!
Imagine there are two people, Brad Buyer and Sammy Saver and each starts with 1₵. Every day, their wealth doubles for a period of 30 days. Here’s how it begins.
On Day 8, Brad Buyer is feeling good about his progress. So, he decides to reward himself and buys a 99₵ candy bar. At the end of the day, this is how each stands.
How does this play out over the long term? Keep plugging along to see what happens.
At the end of 30 days, Sammy Saver has amassed a fortune that’s $4,152,360.96 greater than Brad Buyers. The only difference between them was a senseless purchase made by Brad Buyer early on in his wealth building journey. Not only was it likely an impulse buy, but it greatly reduced the power that compounding has on his money for all the days that come, too!
I’ll admit, this example is rather extreme. A candy bar isn’t going to prevent you from reaching your financial goals. Yet, to some degree, every purchase you make does have an adverse impact on your financial future!
All too often, I speak with people who are working and building momentum towards their goals. Then suddenly and sometimes without reason, they make one decision that negates all of their progress!
Typically, it’s the choices people make about their housing and transportation expenses that impact them the most. Since these are two of the largest expenses you have, over spending on them makes it much harder to save!
As a tightwad, I realized early on that living below your means is key to building the life of your dreams. The sooner you start, the more savings you’ll have, and the more time it has to compound!
Take Warren Buffet for example. He started saving and investing when he was 10 years old. Now, he’s over 90 and has a net worth in the billions! But, it’s important to realize that he didn’t make the vast majority of his fortune until later in life. According to CNBC, $70 billion of it after he was already in his mid sixties. This is wealth that he created as a result of saving, investing, and compounding decades earlier!
You may not have eight decades, but still there’s good news. Right now, you are the youngest you will ever be. With each passing day, week, and month you’ll grow older. As you do, you have less time to take advantage of the power of compounding!
Now, is the most amount of time you will ever have. Start today by committing to saving and investing each month. In doing so, you’ll secure your financial future and all but guarantee you have success with money!
Take a look at the Investor.gov website. It has a FREE compounding interest calculator for you to try out. Plugin your savings, rate of return, and then watch as your money grows exponentially!
I was in my early 20s when I first saw this chart. It changed the way I thought about spending, saving, and investing money. And I hope that it does the same for you!
Are you ready to ready to build wealth and the life of your dreams? CLICK HERE and let me show you how!
This website uses cookies.