When you compound money, you are making an initial amount of cash grow into an even larger amount. It doesn’t matter if you start with $20, $50, or $1000, you can make your cash grow and grow for as long as you want.
Now, here is how you are going to do that:
You are going to make an investment that will bring you a profit. This can be an investment in the stock market or even an investment in a business. When you make your profit you are not going to spend it. In fact, you are going to take that profit and reinvest it. That way, you have even more money to grow on. This is a cycle that continues over and over. Before long, you will notice that your profits will grow and grow.
Just keep in mind that the most you invest, the more you will get back. That is why you don’t want to spend your cash as you get it. If you do, then your return will be the same every single time. It loses its potential to grow.
Now if you are compounding your money to make an income, that is okay. Just make sure you don’t use all of your profits as an income so that you can reinvest some of it. That way you can keep your money growing even more.
And what’s better is, depending on your investment, you can watch your money grow fast. This is a great thing to do when you are making fast cycle investments. Keep investing your return and you’ll be in great shape. You may find that full-time investing is your thing.