Zen Garden > Wealth - When Are You Going To Pick Up the Pace and Start Building Some REAL Wealth For Yourself?

You are not going to live forever. Like they say... there are only two certainties in life - death and taxes. So, let me ask you this - when are you going to start getting serious about building wealth for yourself?

The sooner you start to create wealth for yourself the sooner that magic ingredient called time will act FOR you. The longer you delay, the more time will work AGAINST you. It's a pretty simple choice. Start now and allow time to help you or start later and lose that potential that you have between now and whenever you end up getting around to making a decision on building wealth.

Are you ready for that example? Let's say, for instance that you were able to borrow $200,000. It's not difficult if you know how. Don't worry about the amount or the how or the why. Just play along with me. OK? I want to teach you the principle of time and WHY it is far better to start now than to wait ten years - or even one year for that matter. The SOONER you start, the sooner you benefit.

OK. You have $200,000 - all borrowed. Let's say that you can get a return of 10% on that money. Again, don't worry about how to do that for the moment. It's easy to do when you know how. How much do you now have after one year at 10% return?

$200,000 @ 10% is $220,000. How much did you borrow? $200,000. Let's say that you have to pay 6% interest on that money. That's $12,000. So, simplistically, how much of the $220,000 is yours. Answer? $8,000. ($220,000 - $212,000)

Got the mathematics of this? Good. Now, let's follow this for TEN years.

1. $200,000 + 10% = $220,000 - Interest @ 6% of 200,000 = $12,000. You keep $ 8,000.
2. $220,000 + 10% = $242,000 - Interest @ 6% of 200,000 = $12,000. You keep $ 30,000.
3. $242,000 + 10% = $266,200 - Interest @ 6% of 200,000 = $12,000. You keep $ 54,200.
4. $266,200 + 10% = $292,820 - Interest @ 6% of 200,000 = $12,000. You keep $ 80,820.
5. $292,820 + 10% = $322,102 - Interest @ 6% of 200,000 = $12,000. You keep $110,102.
6. $322,102 + 10% = $354,312 - Interest @ 6% of 200,000 = $12,000. You keep $142,312.
7. $354,312 + 10% = $389,743 - Interest @ 6% of 200,000 = $12,000. You keep $177,743.
8. $389,743 + 10% = $428,717 - Interest @ 6% of 200,000 = $12,000. You keep $216,717.
9. $428,717 + 10% = $471,590 - Interest @ 6% of 200,000 = $12,000. You keep $259,590.
10. $471,590 + 10% = $518,748 - Interest @ 6% of 200,000 = $12,000. You keep $306,748.

In the calculations above, for the sake of simplicity, I have deliberately not reduced the principal of the loan below $200,000. I have therefore assumed that the $200,000 is constant. In actual fact, this amount - the amount that you owe - will reduce every year. So that would make the figures on the right (what you keep) larger than what I have indicated.

But what does this tell us? First, if you paid out the loan in the first year you get to keep $8,000 (less tax, of course). I am going to (conveniently) forget about tax now also. It is the compounding nature of the calculation that I want you to focus on. Let's look at year 4. This is interesting. If you cash out at year 4 you end up with more than TEN times what you had in the first year. See how time has worked FOR you?

Now look at year 8. In year 8 you would walk away with $216,717. That is 27.08 times the amount that you had in year 1 ($216,717/$8,000 = 27.08). How amazing is that? Taking this through to year 10, you get to keep $306,748! That is 38.34 times the amount that you had in year 1 ($306,748/$8,000 = 38.34). Astonishing! Compound interest is working FOR you because time is working FOR you.

Now, if you DON'T invest money now and wait until later, how much money do you lose? Let's say, using the above example, that you decide to wait ten years to implement this plan. Duh! You have LOST $306,748. That is time working AGAINST you!

Can you see why it is far more advantageous to do something NOW? Waiting or delaying or procrastinating is only going to HURT you financially. Get on your bike. Pick up the pace. There is no better time to start building wealth than right now! Actually, I'd like to correct that. Ten years ago would have been much better! Are you going to wait ANOTHER ten years? Five years? One year? If I were you I wouldn't wait another day! Time is PRECIOUS. Don't waste it!

Note: Always consult a qualified INDEPENDENT and UNBIASED financial adviser BEFORE you invest money.

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Gary Simpson is the author of nine books covering a diverse range of subjects such as motivation, self esteem, affirmations, self defense, wealth creation and much more. His many motivation and success articles appear all over the web.

Gary Simpson is a 7th Dan karate master who teaches self defense, motivation, self help and wealth building to students around the world through home study courses. You may reprint this article as you include this author credit and an active link to his web site. Finance - Self Help - Motivation - Self Defense - Personal Growth MotivationSelfEsteem.com