Get Rich

Get Rich
It may be simpler than you think

Does the idea of investing intimidate you? You're not alone. For many people, especially those without a real education in financial matters, investing is frightening. It seems complicated, but according to some experts, complicated is exactly what investing is not. You simply have to admit that getting rich is simple. It's just not easy.

If you've got a paycheck and some time, all you need is discipline and you can be a millionaire, according to some leading financial blogs. Now, depending on your situation, $500 can be a lot of money to save, but if you can discipline yourself and begin setting aside $500 per month, if invested well, in 30 years time you could have $1 million. If that's just too much (and you're certainly not alone if it is), here's a probable scenario if you can afford to invest $100 per month:

Say you start with nothing, invest $100 (of your income) a month (a healthy discipline), and let your money ride (over time) in diversified investments. Long term, the stock market returns at least 10% annually. Assuming a 10% return, you'd have $20,400 after 10 years, $76,000 after 20 years, and $220,000 in 30 years. That's a lot of money - especially considering all it requires of you is $100 per month!

It's not just the money you put away, it's the reinvestment (compounding) of the interest you earn on money you've set aside. For example, if you invest $1,000 and earn 10% interest on it at the end of each year, you'll get in $100 interest at the end of the first year. If you reinvest that interest, the second year you would start with $1,100, and thus would earn $110 interest. If you stay with it, you'd more than double your money every eight years!

"Compounding," Albert Einstein said, "is mankind's greatest invention because it allows for the reliable, systematic accumulation of wealth." But you don't need to be a genius to make this concept work for you!

Now of course there is risk involved - there's always the chance the market will go nowhere for the next 20 or 30 years and you'll end up no better than where you started. And the idea of waiting that long may sound silly anyway. But it beats your odds of winning the lottery.