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Image via WikipediaYou all may be much familiar with the 7 Wonders of the World.But did you ever hear about the eighth wonder of the world? Some of you may have heard.Its called the magic of compounding. It magically turns a little bit of money, if invested properly, into a whole lot of cash. Albert Einstein is rightly said to have termed it as one of the greatest mathematical concepts.The magic of compounding,your secret formula to be a millionaire fast.

And to know this concept of compounding,you don’t have to be a rocket scientist. You can easily do this with a basic knowledge on maths.Simply adding your small invested money up with the first year interest you earn on your investment and so on for the rest of your targeted period. Just do the math using this simple calculation and it really creates snowball effect.

It’ll be best for you, if you start up early in your life.It may be twenties or thirties.The quickest you start up,the more you’ll be pacing towards the millionaire goal. A year delay could cost of several thousand dollars.

Lets say you are a 22 years old graduate, and manage to save $300 per month into an high yielding recurring fund earning 10%(being an average annualized stock market return) a year for six years. Now at age of 28,you’ll be cashing in nearly $21,600 of your own money. And if you don’t contribute further and get your accumulated money to stay there, your money would eventually grow into a million dollars by the time you turned 65.If you were started saving $50 a month at the age of 20 years, you’ll become a millionaire having $528,000 in your pocket by the age of 65.

So,you see the power of compounding and getting rich is not so painful, if you start early in your career.But what if you end up earning interest rate at 9% instead of 10%? You can amass only $373,000 by 65