The Miracle of Compound Interest

Albert Einstein was once asked what he thought was the most powerful force in the universe. He answered: Compound Interest! Now, I would have thought that Albert Einstein would have considered things other than money. But, when you take another look at it, he may be right. At least, he may have suggested the thing that most of us would like to have.

For the few reading this that have no idea what compound interest is, let me explain briefly. Let's say you deposit a certain amount in a savings account (bad idea) and you leave it there for a while.

On day one you deposit $100 and the bank is paying you 4% compounded daily. On the second day your balance in the account will be $104. On day two your balance will be $108.16. Day 3 will yield $112.48 and so it goes. Until on day 18 your money have doubled to an account balance of $202.58.

Doubling one's money in just 18 days and not having done a thing to accomplish that is an amazing feat if you ask me. In fact I might agree with Mr. Einstein to a degree. I am sure that compound interest might be a force that I want working in my life. It has all the possibility of making one's life that of what we dream.



So, I was thinking to myself what if there was an internet based business that revolved around this principle of compound interest on the internet? That might be one of the easiest ways to earn money. In fact, the easiest. You put money in and it multiplies for you like a bunch of little bunnies. I don't know about you, but, I'd go for that!

When I was young I used to hear of compound interest accounts a great deal more than I do today. I suppose bankers have just become more greedy or the wild fluctuation of interest rates over the last 2 or 3 decades have made it more difficult for banks to pay a rate that keeps up with inflation, recession and all the other financial pressures you can imagine operating in the world today. Although have long been familiar with the concept it just wasn't something I felt I could do.

My mind kept telling me to get involved with such a paying plan one would have to have a great amount to deposit in an account. Then where would I find such a thing?
Having been working on the internet for a couple of years I had yet to come across such a thing. But then, I did.

In plain words there are such things on the internet and I have found some that require only $10 to start an account. What really bothers me about such things is that I have a very difficult time telling folks about it because they don't believe me.

Everyone says, “oh yeah, I know about compound interest." But then, those same people will look at the interest I am being paid and they immediately start telling me I'm being scammed and suckered. Having done my due diligence I have found that the chance of that is fairly small.

So, what if I was being suckered? Is there anything I could do to minimize my position? I wondered. And at once it was apparent to me. I decided to treat my investment as I would a night at the craps table. I would only invest what I was prepared to lose. So, let's say we play it that way. Let's say we have $1,000 to lose without thinking about jumping off a tall building. I could wait for my money to double and then take my original money out leaving only the interest earning interest. And that is how I play it.

One of the programs that I am involved in pays an incredible rate of up to 25% per month compounded daily. Let me show you some calculated results using that initial $1,000.

$1,000 over one year would result in a total balance of $14,551.92. At that time I would withdraw my $1,000 and cast the remaining interest back in to doing what it was doing before.

At the end of the second year my accrued amount would be an incredible $197,206.39 and the third year would put me into the millions. An unbelievable $2,869,730. Wow, like winning the lottery and how much did I risk? Only $1,000. That was my complete exposure to the program. Never mind that some of the programs are run by some of the biggest banks in the world. You hear their names everyday on CNN or FOX.

The miracle of compound interest. It exists out there folks. It works because some entity like a bank is lending that money out at a horrific rate or is investing in futures and doing so by borrowing the money from you and I to do so.

What are they making on our money? Probably 40 to 70%. It is worth it for them to pay us to put the money out there for them to use. The trouble with all this is “US", I mean you and I. Well, maybe not me. Do we fear making a mistake so much that we cannot bear to lose an amount that will not change our life if we do. Because if we choose to take the risk on a small amount we might end up having life-changing results. The only mistake in life is believing our fear of making one.

A.C. Benson said, “One's mind has a way of making itself up in the background, and it suddenly becomes clear what one means to do." This is what anyone that truly wants to succeed to the Nth degree needs to think about. Risk and reward and the miracle of compound interest.
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