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Question: Would you rather have a million dollars now or take a penny now and double the amount for 30 days?
 
As expected, 90% of people chose the million dollars now option. I would have made this choice myself a few years ago. But this would have been the poorer choice, because you would have shortchanged yourself by over $4 Million at month-end. Don’t believe me? Look at penny table calculation on the right. The simple act of doubling your previous day’s investment can rapidly reap huge rewards thanks to the powerful concept known as compounding .

Now a 100% return every day is highly unlikely, but the principle of compounding holds true for even smaller returns (though it will take longer than a month to make your fortune). This is why compounding is a core aspect of good personal finance and the reason why the rich get richer. As outlined in a Kiplinger , when you're young, you have an asset money can't buy: TIME. Start saving now and turn pocket change into riches. Compound interest has been called the eighth wonder of the world. And with good reason. It magically turns a little bit of money, invested wisely, into a whole lot of cash. Even Albert Einstein is said to have called it one of the greatest mathematical concepts of our time. Read More »

The title of this post was based on a question I recently received from a reader - Ben - who was new to equity investing and wanted to get some basic advice on investing in the stock market. He has about $5,000 to kick-start his portfolio and wanted a simple, low-cost way to invest about $250 on a regular basis. He's also a small business owner with a very busy day job meaning he has little time to follow the stock market. Finally he wants to build a low risk portfolio which provides some sort of regular payments (dividends).

Based on his criteria, I told Ben his best approach was to invest via Mutual (managed) or Exchange Traded Funds (ETFs), rather than directly with stocks.

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I recently went to a ball game in my hometown and had a great time watching the local team win. However, one thing I have noticed for the longest time is the rising price of things sold at the ball games and I am sure at many other sporting events. From food to ticket prices to souvenirs, prices are rising much faster than the price of inflation. All this combines to make a family trip to the ball game an expensive proposition indeed.

I understand that you will always pay a premium for things at ball park or sporting stadium, because owners have a limited window (ie during game time/season) to make a profit. They are also able to charge these high prices thanks to a captive audience with few outside choices and a general feeling of "goodness" when at a game. Most people accept that this is just part of the cost of going to a ball game and helping the local team with (paying those exorbitant) player salaries.

This pricing nirvana for club owners has been going on for a long time and I can assure you that despite tough economic times, they take advantage of any price increases they can pass through. However, there are ways that you can save money at ball games or any sporting event with some of the following actions: Read More »