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The problem is, you can't get rich with sensible investing. Compound interest is often treated as magic, but like the magic of special and general relatively,
by saalweachter 6y ago
The problem is, you can't get rich with sensible investing.
Compound interest is often treated as magic, but like the magic of special and general relatively, it only really kicks in under conditions that don't really matter to ordinary people.
Money going into an index fund will increase roughly 10x over the course of 30 years or so. This is nice; if you can stop living paycheck-to-paycheck by age 30 and save 10% of your pre-tax income (which is not a given), you can have a comfortable retirement, and the more frugally you live in your youth the more comfortable a retirement you can achieve.
But you won't get rich that way. Best case scenario, if you are absurdly frugal and save nearly all of your money, prudently invested, for forty, fifty, sixty years, you can get one big bang at the end after decades of deprivation.
To get rich you need to win the metaphoric lottery, by founding a unicorn startup, or going all-in on a series of absurdly risky investments, or by just winning an actual lottery.