Opher Ganel
1 min readJul 16, 2022

--

As Jason said, investing does provide good returns over time. The critical point here is "over time."

Yes, investing $20k for one year will get you $2k at 10% return. However, keeping that investment for 30 years at 10% will turn that $20k into $349k. And that's without counting any additional investments from subsequent years.

That's the magic of compounded returns.

However, 10% is more or less the average return from the stock market before counting inflation. Adjusting for the long term average inflation reduces that to about 7%.

At that return, 30 years will turn $20k to $152k. That's why you have to continue investing year after year, decade after decade.

So contrary to the title of this article, investing can build wealth, but it takes many years.

Starting a successful business is another way to long term wealth, as is investing in real estate.

There are multiple ways to do it over a lifetime, but no ways to reliably and predictably become wealthy quickly. Otherwise everyone would be rich (which means nobody would be rich).

--

--

Opher Ganel
Opher Ganel

Written by Opher Ganel

Consultant | systems engineer | physicist | writer | avid reader | amateur photographer. I write about personal finance from an often contrarian point of view.

No responses yet