{"id":556,"date":"2023-09-08T10:33:44","date_gmt":"2023-09-08T01:03:44","guid":{"rendered":"https:\/\/freedomtochoose.com.au\/?p=556"},"modified":"2024-05-07T23:04:52","modified_gmt":"2024-05-07T13:34:52","slug":"create-half-a-million-with-5-a-day","status":"publish","type":"post","link":"https:\/\/freedomtochoose.com.au\/?p=556","title":{"rendered":"Create Half a Million Dollars With $5 a Day"},"content":{"rendered":"\n

Literally everyone can build wealth the tried and true way.<\/strong><\/p>\n\n\n\n

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Got $5?<\/span>\u00a0I bet you do. And I bet you can figure out how to find $5 a day (or more) if you strive toward a big damn payday.\u00a0<\/span>If you\u2019re looking for a get rich scheme, keep searching<\/span>\u200a\u2014\u200athis isn\u2019t it. But\u00a0<\/span>the reality is, if you have patience, you can make a fortune<\/span>.<\/span>

Here are the simple\u00a0facts<\/h2>

The S&P500 Index, one of many indicator of stock market performance (by tracking big US businesses),\u00a0averaged 9.5% annual returns from 1928 to 2015<\/span>\u00a0(see here<\/a>).<\/p>

Now let\u2019s take our $5 a day, which adds up to to $1,825 a year, and put it into an S&P500 or total stock market index or mutual fund\u200a\u2014\u200awhich just means it should have similar performance,\u00a0over the long term<\/span>, as the S&P500\u2019s 9.5% annual returns. We contribute this $5 a day in weekly or monthly chunks (this is important<\/span>).<\/p>

Now what happens?\u00a0Compound interest is a beautiful thing:<\/span><\/p><\/p>\n\n\n\n

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You start to accrue both the money you contributed, that $5 a day, and the 9.5% a year returns. Then those contributions and the returns, plus the second year\u2019s contributions, earn another 9.5%. And so on and so fourth. This won\u2019t be the exact case for the year 1 and year 2, because the stock market is SUPER unpredictable in the short term. But\u00a0in the long term, you can expect decent returns.<\/strong><\/p>\n\n\n\n

KEEP 100% OF YOUR COMMISSIONS. CLICK HERE TO FIND OUT HOW!<\/a><\/strong><\/p>\n\n\n\n

After 25 years, we can reach over a quarter of a million dollars:<\/h2>\n<\/div><\/div>\n\n\n\n
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And guess what? Your contributions of $5 a day, only make up 1\/4 of that total sum. 75% of that is JUST EARNINGS<\/strong>. See how the graph just takes off as time goes on? That is interest, doing its thang!<\/p>\n\n\n\n

After 35 years, we can reach half a million dollars:<\/h2>\n\n\n\n
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Damn. Half a million dollars. And all it cost you was a fancy coffee or half a burrito a day. Can you spare $5 a day for a $500,000 payday? 87% of that is purely earnings!<\/p>\n\n\n\n

You only had to pay $64,000 for a half million payday.<\/h2>\n\n\n\n

This demonstrates the importance of investing over time. Now remember, for the volatile stock market, this works best over the long run, where you are continually purchasing investments (called \u201cdollar cost averaging<\/a>\u201d). If you have less than 25 or 35 years, you could do a number of things. A great option would be to use a less volatile index or mutual fund, like a balanced fund. These have less year to year risk\u200a\u2014\u200aand less return, but FAR more returns than you\u2019d get from a savings account or spending the money instead!<\/p>\n\n\n\n

Guess what? We are never taught about the importance of investing. But you don\u2019t even need a degree to understand it. It can be simplified. Scroll to the bottom for some more resources!<\/em><\/p>\n\n\n\n

To summarize<\/h3>\n\n\n\n