If you have RM10,000 to invest, where should we place them 'safely'?
1% : it takes 70 times to double. So, if we put it in an investment at 1% interest, it will takes us 70years to double. Inflation is higher than that. So, it is very unwise. But, if it is 70months, that is we are able to increase it by 1% per month, that is great. 70months is about 6years.
2% : it takes 35 times to double. No one will like to place their money in FD if they are giving us 2% per annum, it will takes us 35 years. Placing it per monthly, 35months is a very fast pace of doubling our capitals, about 3years time.
3% : slightly less than 24 times to double our capital. So, this will be my realistic target per month in trading, it will takes me 2 years to double the capital.
4% : slightly less than 18times. Our FD rate is still below 4%, so placing our money safely here will takes us 18years!!
5% : less than 15 times now. Bonds paying 5%?
6% : slightly less than 12 times. So, we could double our EPF around 12 years?
7% : slightly more than 10 years to double. This is where my 10% of my income goes to ... Saving in ASB.
10% : do the math ...
RM10,000 flip two times becoming RM20,000 and that another round of flipping becoming RM40,000.
2^10 is 1024. That is RM10,000 into RM1.024mil.
Dream on, but compound interest is the 8th wonder of the world.