Due to the power of compounding interests, if you are 20 years old and were to save the $4 you were going to spend on a latte and, instead, invested it into a TOTAL MARKET INDEX FUND with an average growth rate of 8-12% per year, at the age of 55, those $4 would be worth ~$100 (does not take into account purchasing power of a dollar today vs a dollar 35 years later)
Point is, SAVE. If you use this rule of thumb everything becomes more expensive. My $55 dinner this weekend would be worth $1000 for 55-year old me. I think I can forego a dinner so old me can have more money.
Just something to think about.
October 07, 2019 at 08:05PM
