Not Financial Advise
So, I did a #financial-education piece last month (in the link, below)
(Simple Financial Education: how to become a millionaire when you retire using only regular savings)
which is essentially the slow method of reaching millionaire status here in the Philippines. Here, I laid out three amounts that one has to save on a daily basis from the time one starts working or doing business at a young age up to retirement. This is the follow up / companion piece to that blog post that shows a different perspective.
I'm a be a Crypto Millionaire when I retire.
Who doesn't want to be a millionaire? In this day and age, we have more opportunities to become one since the world had become more connected. Technology had grown at an incredible pace and we can easily look for opportunities by just browsing and taking note of things that might give us this chance. Since information is at the tip of our fingers, we now have the ability to do rapid research and analysis faster and better than how the previous generation did it. For a quick comparison on traveling the road to becoming a millionaire using financial technology, the tech savvy among our parents' generation would probably invest in stocks and bonds, IPOs, capital accumulation via high paying jobs, acquisition of properties then renting it out, or maybe starting a business with a small capital, right?
Now, all of these options are still available to us, but guess what? We now add cryptocurrency trading / staking, defi, NFTs, play-to-earn, content creation using Web 2.0., etcetera. There is a plethora of choices that we can take to reach financial goals faster.
The power of compounding.
Thinking about this topic from a Hivean perspective, I thought what if I earned 100 HBD from blogging, and just left it in savings for a number of years; only going online to collect the 15% APR on a monthly basis. What do you think the result will be? Take a look below and tell me if this is something that you can't do.
| (A)Amount | (B)No. of Years | (C)15% APR compounded/mo. | (D)Total (A+C) | (E)Total PhP |
|---|---|---|---|---|
| 100 HBD | 5 Years | 110.72 HBD | 210.72 HBD | 11,808.74 Pesos |
| 100 HBD | 10 Years | 344.02 HBD | 444.02 HBD | 24,882.88 Pesos |
| 100 HBD | 20 Years | 1,871.55 HBD | 1,971.55 HBD | 110,505.37 Pesos |
| 100 HBD | 30 Years | 8,654.1 HBD | 8,754.1 HBD | 490,667.30 Pesos |
| 100 HBD | 40 Years | 3,8770.07 HBD | 38,870.07 HBD | 2,178,667.42 Pesos |
*The second column shows the number of years the 100 HBD will be compounded. The third column tells us how much HBD you have earned during this time. The fourth column(D) is the total amount saved, plus the initial 100 HBD, while the last column (E) is the total amount in Philippine pesos, which was around 56.04 pesos per HBD from using the Coingecko HBD/PHP conversion.
Zero premium payment retirement fund
It really blew my mind that the time element had a significant effect on the total amount, especially after the 30 year mark. Remember, this is only from saving 100 HBD and just collecting the interest on a monthly basis. I am now convinced that anybody can become a millionaire here in the Philippines with this simple and very easy method. You won't even have to use your own funds to start this retirement fund given that 100 HBD in blogging rewards is easily earned through the consistent uploading of blog posts. Assuming that you don't withdraw your blogging rewards, this is low-risk, high-reward kind of scenario where you won't even have to use your hard earned cash as capital assuming that you can post original, interesting and useful content here on the chain.
My personal takeaway...
I never really paid much attention to HBD savings because of the "small" interest rate it earns on a monthly basis. Even when it had the 20% APR before, I did not give it much importance. I now have a different take on this matter while writing this piece and will now change my Hive portfolio strategy in the light of this recent discovery. The compounding effect is something that I didn't really give importance to because it seems like a distant time in the future when I will be able to reap the rewards, but the thing about time is that it tends to go by really, really fast, especially if you are busy with work or just enjoying life.
That's it for today. Thanks for dropping by and visiting my blog. I hope that you found something useful and enjoyed reading. All the best and have a great day.
Love and peace.
@juanvegetarian
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malaking pang hihinayang kung nagagastos ang ipon dto lalo na ang HBD, laki ng interest after years. So, I'm starting to save again. Kung wala tlga emergency, I don't want to withdraw my earnings here, coz like you, I want to retire a millionaire with my crypto savings..
Yeah. Rookie mistake ko rin yan. Medyo late na na-realize pero may panahon pa naman. Good luck sa ating lahat. 😎
Kaya nga, good luck . Pro sa panahon ng kagipitan, no choice tlga eh, 🥲
I see your point, but there are a lot of other factors to consider. What if there is further reduction in the percentage APR from 15% to let's say a value as bad as 5% or what if something happens to the value of HBD in the distant future? Nothing is set in stone especially when it comes to accumulating wealth. 20,30,40 years is a long time which can go by really fast, this makes so unpredictable.
I learnt a lot from what you shared, one of the best post I have read today and in a long time. Thanks for sharing
It's true, the APR might change, but will it be soon? If we get another 5 years at 15% APR, then it's already a win for me. I get 0.5 % to 1.5% APR on my regular savings account, which isn't even at par with inflation making this a higher earner for me in terms of passive income. We can always add to our HBD savings if we want to reach our retirement goals faster. 😀