In this post we estimate returns on investments (ROIs) you need to become a millionaire from investing an initial capital S and reinvesting it for N years with the same ROI.
To accomplish this task we go to this URL https://dynpass.online/tools/1m/1ms.html, enter input data and click on the “Calculate ROI!” button.
As a result of such calculations we have the following table. Results for ROIs are shown in percents.
If you are 20 years old, with initial capital $1000 then you need reinvest your capital at lest with 18.9% ROI to have a million, when you will be 60 years old.
These results do not take into account that you can each year contribute to your investments. To find required ROIs in this case, we go to this URL https://dynpass.online/tools/1m/1mc.html, enter input data and click on the “Calculate ROI!” button.
Let us assume that you can contribute each year the same amount as the initial capital. As a result of such calculations we have the following table. Results for ROIs are shown in percents.
If you are 20 years old, with initial capital $1000 and contribute each year the same amount to your investments then you need reinvest your capital at lest with 12.2% ROI to have a million, when you will be 60 years old.
Young people can afford to invest all their savings in risky assets, because they have time to recover loses in the case if they lose their risky investments.
Older persons do not have such option, therefore they should keep a part of their investments in non risky assets. In the part 2, we consider such cases.
