TIME IN (Time in the market/investing), is everything.

 

I wish I knew what I know now, 10 plus years ago. It would of made me a lot wealthier! The good news, I can pass this knowledge onto my kids. I can educate them about money, something that isn’t really taught in school or in some cases throughout their lives at all.

“Compound interest is your best friend. Start investing now, continue investing into the future, and let your money grow.” Warren Buffet.

All the best investors in the world will tell you about the eighth wonder in the world – Compound interest. There’s no better feeling than making money while you sleep.

“Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.” Albert Einstein.

There are many ways to become a millionaire but the easiest in my book is investing a significant amount of money regularly or early. This is why it’s actually not too hard to set your children up for life. Here are some good examples using the forecasting tool that’s found within the Investment tracker workbook.

 

HOW TO MAKE YOUR KID A MILLIONAIRE (50 YEARS)

A ONE TIME INVESTMENT OF $10000

make you kid a millionaire - kid saver

$5000 A YEAR FOR THEIR FIRST 3 YEARS. (TOTAL $15000 BY AGE 3, OR $13.70 A DAY FOR 3 YEARS)

 

make you kid a millionaire - kid saver 2

$2000 DOLLARS STARTING AMOUNT AND $20 A WEEK FROM THEN ON

 

make you kid a millionaire - kid saver 3

 

As you can see, this is easily achievable for just about everyone living in Australia.

It would actually be a much better way for setting up Australians Super funds – The former generation looks after the next.

Imagine how much the Government and Australians would save not having to fork out 9% a week when you can just deposit one small sum at birth.

What am I doing for my kids?

I currently have $6000 invested for my son (6 years), his timeline is looking promising:

 

make you kid a millionaire - kid saver 4

 

Would you look at that, he could be a millionaire at 56 too! That’s if he’s wiser enough to let it grow as I’m planning to let him know about the money on his 21st Birthday.

Inflation will put a bit of a dampener on the buying power of the total but as you can see, if you keep depositing over time you will have a big nest egg. (At the average rate of inflation of 3% for 50 years, 1 million dollars will be worth around $270 000.) Don’t forget though future deposits will also be larger as a result. This is also why parking any money in cash can be a bad idea as it will struggle to keep up with inflation. History is also only a guide for future returns, I’ve used 9% and the stock market has averaged 10% a year.

There are many ways to Invest. Personally, I think the stock market is the best asset class and historically it has massively outperformed all other forms of asset classes averaging 10% a year. Other Investments could be:

  • Property
  • Commodities
  • Bonds
  • Fixed Interest
  • Rare / Vintage items

Platforms like Raiz make investing easy these days, especially for kids. It specializes in micro investing. (Formerly was known as Acorns)

Me, I invest my children’s money in VDHG.

Once you’ve invested in your kids future, why not track it now and then? Investment Trackers forecasting section will let you check actual returns against forecasted returns.

 

make you kid a millionaire - kid saver 5

Good luck!

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This is not investment advice.