The power of compounding and how it applies to a better life

“What if you didn’t define wealth by money, success or satisfaction, but simply by the number of great people in your life?” A question put forth by Peter Attia, M.D. in his podcast “How to live a longer, higher quality life” on the excellent investment blog “The Investor’s field guide” by Patrick O’Shaughnessy. The conversation goes on to link the simple yet powerful investing concept of compounding with living a better quality of life. Read on for the highlights of a wide-ranging conversation. So you want to live a long life? “Never try to solve a complicated problem without explicitly stating your objective, your

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Three questions that could determine your financial future

Try this quick quiz: Question 1: Suppose you had ₹100 in your savings account today and the interest rate is 8% per year. After five years, how much do you think you would have in the account if you left the money untouched? A] More than ₹108                    B] Exactly ₹108                  C] Less than ₹108 Question 2: Imagine that the interest rate on your savings account was 8% per year and inflation was 9% per year. After one year, how much would you be able to buy with the

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Compounding – the most powerful force in investing

At a glance ‘Compounding’ is one of the most under-appreciated concepts in investing Small amounts invested early and regularly with modest returns snowball into significant savings over time Over a 40 year horizon, small amounts invested for the 1st eight years grow bigger than those same amounts invested annually for the next 34 years To harness the magnificent power of compounding, start investing early, regularly and give it time Back when I was a newly minted engineering graduate in my first job as an IT programmer, my idea of money was limited to the salary that went monthly into my

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