Einstein described compounding interest as the 8th wonder of the world and very few people understand how powerful it can be. In 10 Minute Shares it forms a basis for regular investing which when dividends are reinvested makes it possible to generate incredible wealth within a 10 – 15 year time span.
2 charts are included in the book which show an initial investment of £2000 followed by £100 monthly investments with the compounding effect taking 15 years to become a millionaire. In the second chart an initial investment of £3000 is used again investing £100 per month. This time the investment gets to £1 million only 6 months sooner.
Starting with an investment of just £100 per month and every month thereafter will take just 8 months longer than the first chart to become a millionaire.
The benefit of the compounding effect shows that it is consistent investing which produces the best results.