The Most Important Retirement Table You’ll Ever See. Smart Change: Personal Finance

(Selena Maranjian)

When I consider my personal investment history, there is clearly one “Most Important Retirement Table” that I remember. I was in my 20s at a new job, and as part of a retirement benefits presentation, we were presented with a table showing how money grows.

At the time, I hadn’t had much financial education in my life and hadn’t gone to business school yet, so the information was new to me—and it was a massive wake-up call. I quickly saw that it would be better to invest in stocks for a longer period of time than to deposit the extra income in a bank account.

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The Most Important Retirement Table You’ll Ever See

I don’t have that specific table to reference now, but the table below does just as well to demonstrate the power of simple but regular investing.

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Growing at the rate of 8%:

$5,000 annual investment

$10,000 invested annually

$15,000 invested annually

5 years




10 years




15 years




20 years




25 years




30 years




35 years




40 years




What the Most Important Retirement Table Tells Us

There are several takeaways from the table above. For example:

  • Accumulating great wealth usually requires a combination of time, worthwhile regular investments, and a respectable growth rate.
  • The more time you have, the more you can accumulate — and you’ll see the biggest jump in your net worth in subsequent years. Compound money starts small and can scale up over time.
  • You can become a millionaire by investing just $5,000 a year – although larger sums can get you there more quickly and help you collect even more. See what happens if you can withdraw $10,000 or $15,000 each year.
  • It’s important to start this process as soon as possible, because every year you delay (even if you’re only in your 20s now) represents a later year in which your money won’t be able to grow for you. In other words, look at different results when you invest for 20 years instead of 25.

Also note, that while I’m using the 8% average annual growth rate in the table, your own average growth rate may be good or low. over several decades, The stock market averages the growth rate about 10% per year — as measured by S&P 500,

how to invest in stock market

How should you invest in the stock market over the long term? well, you can certainly take the time to read and Learn a lot about investing and then invest in some carefully chosen growth stocks or other stocks (dividend paying stocks are always well worth considering).

But most investors will be served simple, broad-market index fundsWhich easily and quickly deploys your hard earned money across multiple companies, providing returns close to the return of the overall market. best index funds Very few charge annual fees, which will take very little of your profit.

However you invest, make sure you learn enough to be comfortable with what you are doing so that you don’t panic whenever the market moves south, as will happen now and then. Remember that every recession then there’s a raise,

And keep that table showing how money grows in mind — it can keep you on track and your eye on rewards. You may be able to retire into a millionaire or even a multi-millionaire if you are diligent and smart about saving and investing.

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