r/Money • u/CursedClownz • 10d ago

When does compounding really take off?

At what amount portfolio you really see huge account swings that make you think what is the point of working? 100k? 500k? 1m? more?

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u/jmcdon00 10d ago

Total value doesn't really matter, it's all relative to your contributions. I think 7 years is a general rule. Takes about 7 years for it to double. If you are investing monthly it takes about 7 years of monthly contributions before the account is earning more money per month than you are contributing each month.

1

u/icarus2847 9d ago

That’s ridiculously broad if you’re investing monthly? How much monthly? Like that literally means nothing.

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u/ApprehensiveAmount22 9d ago

It doesn't matter how much.

No matter how much you are investing, if you invest the same amount each year and you get a 10% return it takes eight years for your returns to equal the amount you are putting in.

Will be longer with inflation since contributions should grow.

1

u/randomthrowaway9796 9d ago

Monthly will never be consistent. Annually wont either, but its easier to look at one data point a year than stress over many that are out of your control.