Compound Interest: Your Secret Weapon to Building Wealth

Building wealth is easier when you have time on your side. Time allows you to leverage compound interest.

Listen in as Xavier Angel, CFP® and Erik Garcia, CFP® introduce you to your secret weapon to wealth building.

Episode Highlights:

  • Erik talks about the current state of the stock market and mentions that it is common for a market to lose 10% of its value per year. (3:46)
  • Erik differentiates between two types of interest: simple interest and compound interest. (7:46)
  • Erik and Xavier discuss the rule of 72 and how it helps you understand how long it will take to get a return on your investment. (14:58)
  • Erik mentions compound interest as a powerful tool for building wealth. (17:42)
  • Erik explains why people should begin investing now. (18:12)
  • Erik explains that investing on a regular basis, putting money into an account that earns interest on a constant basis, is a great way to get started. (19:26)
  • Erik mentions that investing gives you the ability to capitalize on opportunities when they arise. (20:18)
  • Xavier shares that he is advising his children to start investing now. (22:39)
  • Erik and Xavier emphasize the importance of patience because compounding takes time. (24:11)

Key Quotes:

  • “Compounding is a function of time and return. And time is a diminishing resource, you’ll never get it back. So the sooner you start, the better off you’re going to be.” – Erik Garcia, CFP®
  • “You don’t have to start with a lump sum of money. But if you’re investing regularly, putting money into an account that’s earning interest on a consistent basis, that’s a really good way to get started.” – Erik Garcia, CFP®
  • “If you put off investing for a later date, you’re not going to have what you could if you begin today. So rethink your strategy and begin saving now. Start today.” – Xavier Angel, CFP®

Resources Mentioned:

About Erik Garcia

Hi there, I'm Erik. How you manage your money and other resources impacts practically every aspect of your life. I help individuals and families invest plan for a more secure and predictable financial future. Thanks for taking time on my site!

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