Friday, March 31, 2006
That's a lot of money! Amazing how compounding works. Earlier today, I ran some numbers supposing I dedicated this money to my son and invested it in an IRA in his name. He's age 5 now and would have 55 years to compound the investment in mutual funds. I am assuming an 8% return and adding our current years "finds" and Dividends (at least $120 per year.) as an annual contribution to the fund for the next 55 years until he could start withdrawing the money. Ajay would have $162,340.63 in his account at age 60! And he would never have had to work a day in his life until then to build his retirement account. Ah, the magic of compound interest! Most likely it will be more with a few big "finds."