The Power of Compound Interest!!

Weeks ago, Shawn was telling me about the Juicy Dividends that Starhub is giving out every yr.. didnt really give it a tot @ tat time, as im super busy due to Xmas last month..

last nite, i read lotsa articles on Dollar Cost Ave. Technique & The power of Compound Interest. after doing some math comparing Starhub with many other cpys.. here's my results!! Starhub way to go!!

25 Yrs Investment plan with Starhub..

Starting out.. $100,000 (This is a reasonable amt of savings for any singaporean who has been working for 10 Yrs). Buy 46 Lots. Est. Dividends for 2010 @ 8%.

Year 2... Balance = $108,000.. On the other hand, by saving $833.30/month from your working salary, you will come up with $10,000 (Buying 4 lots of Starhub @ Market Price of $2.50/share) set aside for Investments. So by the end of 2011, You will have a total of $118,000 in your investment account. Total 50 Lots of Starhub!!

Year 3... Est Dividends = 7%. Balance = $8260 (Dividends for 2011) + $118,000 = $126,260. Continue setting aside $10K for investment from your working salary & buying 4 Lots of Starhub @ est $2.50/share. You will accumulate a total of $136,000 by end of 2011. Total 54 Lots of Starhub!!

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As time goes by

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in Year 2034

you will have accumulated a net worth of $1,170,306.01 from your simple investment account. Now i finally see why some uncles & aunties can relax @ my void deck reading newspapers & feeding cats & pigeons for over 30 yrs, not having to work another day in his or her life!!

Can you imagine if you continue this investment plan.. on the 26 Year, your dividends alone will be $82,621.42. its equivalent to $6885.12/month. this amount will keep on increasing.. increasing & increasing!! This is the POWER OF COMPOUND INTEREST used with Dollar Cost Averaging Technique!!

hope this post can really help everyone reading this :)