Invest To Earn Modest Compound Interest

Invest to Earn Modest Compound Interest: Don't take unnecessary risk

"Cast your bread upon the waters, for you will find it after many days. Give a serving to seven, and also to eight, for you do not know what evil will be on the earth" - Ecclesiastes 11:1-2

It's important to diversify your investment, to protect your money.
Get guarantee or security on your principle.
Guard against Inflation (3.2% long-term)
Stay away from pure GIC; they don't keep pace with inflation

Secure and contractual fix returns are available in Real Estate

Rate can be 9% to 12% annually
Minimum $50,000 required

"And the Lord commended the unjust steward, because he had done wisely: for the children of this world are in their generation wiser than the children of light." - Luke 16:8

When it comes to Money management the people of the world are more shrewd that the children of God, and many times they use the Bible principles that are entrusted to believers.

Michael Lee Chin uses Five Laws of Wealth Creation:

Budgeting
Pay Your-Self First
Earn modest Interest by Owning Companies
Use other people's money
Use other people's knowledge & expertise

Michael says, "History has shown that contrarian attitude has always paid off over time. That being fully invested in the midst of crisis will pay off. That being patient will eventually be rewarding. We are not about to deft history"

The markets took a huge hit in the 2020 - 2022, similar to 2014-2015 & 2007 -2008. The recovery then was spectacular for 3 yrs to 5 yrs giving double and triple digit growth

Investment Principle:

Buy only a few high-quality businesses
Make sure you understand these businesses very well
Ensure they are in strong, long-term growth industries
Ensure these businesses are debt & other peoples money prudently
Hold them for the long run

Rule of 72:

How it works:

Rule of 72 is a simple way to determine how long an investment will take to double given a fixed annual rate of interest. By dividing 72 by the annual rate of return

For example, the rule of 72 states that $1.00 invested at an annual fixed rate of 10% would take 7.2 years

R (Interest Rate) = 10%

T (Years to Double) = 7.2

Therefore, it would take $1.00 - 7.2 years to double ($2.00)

Dollar-Cost Average (DCA):

Key takeaways:

Is a strategy that can make it easier to deal with uncertain markets by making purchases automatic. It also supports an investors effort to invest regularly.

Dollar-cost averaging is the practise of systematically investing equal amount of money at regular intervals, regardless of the prices of a security.
Dollar-cost averaging can reduce the overall impact of price volatility & lower the averaging cost per share.
By buying regularly in up and down markets, investors buy more shares at lower prices & fewer shares at higher prices
Dollar-Cost averaging aims to prevent a poorly timed lump sum investment at a potentially higher price
Beginning & long-term investor can both benefit from dollar-cost averaging.