KICK YOUR JOB AFTER 40

ADVT: HOME PROJECTOR IN AMAZON

How human population or bacteria population grows? Two may become four. Four may become eight and so on. Here the offspring gives rise to more offsprings.

How the nuclear bomb explodes? One nuclear fission becomes two due to ejected neutrons. Two becomes four fissions and so on. This chain reaction is left uncontrolled then it results in a huge explosion. Here fission causes fission. How the plant and tree grow? From seed, stem shoot out. Then it branches out. Next, it clads with leaves. More leaves, more photosynthesis. Then it yields flowers, fruits, etc. Here, we observe the rapid growth of plant cells.

Why do not we learn from nature? Why do not we use the money to make money? Why do not we use the interest to get more interest? That is compound interest, the magic. In compound interest, money grows rapidly towards the end.

"Compound interest is the addition of interest to the principal sum or in other words, interest on interest".

If you follow the following saving methods, you may kick your job at the age of 45 or even you may retire.
1. Open a suitable account like a national pension scheme, recurring deposit, mutual fund, etc. Assume your age is 30. The account should be live for 15 years.
2. Deposit 20000 every month in the first year. Let us assume that the interest is compounded every three months.
3. In the second year deposit 22k every month. In the third year -24k go on up to 15 years.
4. At the end of the 15th year. You are likely to get around one crore. You will be earning more than 35 lakhs as interest.

At the age of 45, you can boldly venture into (passion) business with one crore as the capital or you can deposit the one crore in the bank and live off using the monthly interest.

Here the interest is taken as 6%. This amount should not be touched at any cost. Self-discipline is the most important.

THE FORMULA
A= P(1+r/n)^nt
A= amount
P= principle
r= rate of interest
n- number of times interest is compounded per year.
t- the number of years.
Also
P=A/(1+r/n)^nt
t= ln(A/P)/n(ln(1+r/n)

With these formulae, you can design your savings plan. I have given only guidelines. But the sky is the limit. Use online calculators.

Footnote; Einstein said "compound interest is the eighth wonder"
2. Nature's compound interest formula.
A=P*e^(r*t) can be applied to any natural growth and decay.
e = constant 2.71.....

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