Getting a rate of return is vital to wealth building. This is something that long time investors take as standard but to new people, it is something that is overlooked.
In this video I go through some examples of how a strong APR over time can amount to a lot of money.
▶️ 3Speak
That's actually finally explained in a way that I can understand it, thank you!
I have seen the APR vs APY many times, but never really understood the difference. You explained it very clear.. I won't forget this now, so this is great..
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BEER.APR is quite important but downside is probably more or less unpredictable. So I suggest people just DCA on average but if your good with charts, you can buy based on TA.
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Becoming debt free is one of main factor of wealth building .And we do build wealth by make our money on the buy. We all should have budget. Long-term wealth we can build by investing as well.Cash is a king in wealth building so it's necessary that we should save 15or 20 percent of every dollar we earn. If we not use our debt on some type of creative business expansions might it will kill our wealth.
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Even though Hive has "only" about 10% APY for curation and inflation put together my plan is to keep compounding the shit out of it until I grow old :P
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Summary:
Task discussed the concept of APR (Annual Percentage Rate) and the rate of return in investing. He explained how compounding plays a crucial role in wealth building and used a simple example of a 10% annual return to illustrate its power over time. Task emphasized the importance of reinvesting profits to accelerate growth and highlighted the impact of market volatility on returns. He cited Warren Buffett as an example of compounding wealth through consistent and disciplined investing.
Detailed Article:
In this video, Task delved into the fundamental concepts of APR and rate of return in financial education, particularly focused on investing. He started by stressing the significance of understanding these concepts for individuals new to investing and wealth building. Task emphasized the compounding nature of investment returns, describing it as putting one's money to work to generate more money over time.
To illustrate the power of compounding, Task presented a simple example using a 10% annual return scenario. He walked through a hypothetical situation where an initial investment of $100 grows each year with a 10% return. Task meticulously demonstrated how the investment would grow to $110 in the first year, $121 in the second year, and $133.10 in the third year. This progression highlighted how the returns increase over time due to both the rate of return and the element of time.
Furthermore, Task underlined the role of reinvesting dividends and profits in accelerating wealth growth. By reinvesting the returns instead of cashing them out, investors can compound their gains and achieve a higher effective return. He emphasized that this strategy can lead to significant wealth accumulation over an extended period.
Task also cautioned about market volatility and the impact of losses on investment returns. He illustrated a scenario where a 20% loss in the third year eroded the gains from the previous years, underscoring the importance of minimizing losses in investing. Task referred to Warren Buffett's principles of investing: "Rule number one, don't lose money. Rule number two, never forget rule number one." This highlighted the need for investors to prioritize protecting their capital to sustain long-term growth.
In conclusion, Task encouraged viewers to consider the power of compounding in their investment strategies and to remain vigilant against market volatility. By comprehending the concepts of APR and rate of return, individuals can make informed decisions to optimize their wealth-building journey. Through insightful examples and practical advice, Task provided a valuable lesson in financial education for his audience, empowering them to navigate the complexities of investing with clarity and confidence.