How to Earn an Extra Million in Your Lifetime the Lazy Way
June 26, 2008 by Vagabond Investors · 12 Comments
How much is €1 worth?
Most people would think that it’s a trick question. It’s not. Not for the new rich, anyway. A dollar is a dollar is a dollar? Guess again. Herein lays the secret to insane wealth. If you follow this advice, you will soon have the cash flow and time to live the life you desire.
First of all, that €1 is a seed. Put it on work and let it grow. How much it is ultimately worth depends on how long you let it grow and what growth rate you get. Let’s suppose you take that single euro and deposit it into a special account that gives you 5% interest. It will take 100 years for it to grow into €1 million. What? Not planning on living 100 years? Relax. We’re not done with this yet. We’ve got to supercharge it. Rather than just planting one seed, you can plant them more often. A euro a day becomes a €1 million in the span of a normal life time, in 34 years.
What makes this happen is the power of compound interest. It means that you re-invest the returns you get on your initial investment. For example, let’s suppose you invest €100 and get a 10% return. You now have €100 plus that 10%, which is €10, for a grand total of €110. You now invest the whole €110. If you get a 10% return again, you re-invest that €121 as well.
This way €1 a day becomes €1 million in 34 years if you get a consistent 20% return on it. In fact, €1 a day becomes €1 billion in 66 years with that 20% interest. Einstein himself said, “The most powerful invention of man is compound interest.”
This is a lazy way to get €1,000,000. You don’t have to become a good investor if you don’t want to. The price, though, is not measured in money. It’s measured in time.
In my opinion, 34 years is a gross price. There is a way to do it much, much faster. You don’t have to wait 20-40 years to reach a questionable pot of gold at the end of your life. There is a way, and we’ll show it to you. From building business that requires no more than 6 hours a week to maintain to buying real estate and paper assets in order to finance your lifestyle, you can reach financial independence in a relatively short period of time.
This is not to say that compounded growth is not important. It is the key to huge financial reserves with little effort. Let’s say you want to reach that goal in 5-10 years and live and exciting life while you’re getting rich. What then?
You have to increase your financial IQ. It’s not difficult. It’s just a matter of learning and the prize is well worth it: 20-40 years of exciting life.
Keep on reading this section and you’ll soon learn the new rich way to do this.
Jaakko
