Albert Einstein is famous for saying “Compound interest is the eighth wonder of the world. He who understands it, earns it… he who doesn’t, pays it.
To reach any level of wealth, you have to be in the market for compounding growth to occur.
An investment property purchased for $450,000 with a conservative 4% annual growth rate would be worth $666,110 ten years later. In 20 years time, the property would be worth $986,005.
Many of our investor clients are experiencing 6% annual growth rates. The same $450,000 property with a 6% annual growth rate would be worth $805,881 in 10 years and $1.443m in 20 years.
This is the benefit of compounding growth – growth on growth over a long period of time.
| 1984 | 2020 | |
| Median house price in Brisbane | $60,500.00 | $596,316 |
| Median house price in Sydney | $85,900.00 | $1,154,406 |
| Median house price in Melbourne | $69,300.00 | $875,980 |
| Richest person in Australia | Kerry Packer $200 million | Gina Rinehart $28.89 billion |
| Gold price per ounce | US $343.75 | US $1,773.73 |
| Richest person in the world | Gordon Getty US $4.1 billion | Jeff Bezos $113 billion |
| ASX All Ordinaries Index | 739.1 | 6,943.30 |
By becoming a property investor and investing in appreciating assets your net worth will increase substantially over time if you continue to hold the assets.
Holding assets for the long term is key. By utilising the rental income and tax depreciation, we can show you how you can hold your assets without spending any of your own personal income to pay the debt.
Wealthy people don’t become rich by investing their money in the bank, they get rich by investing their money in appreciating assets. Fill your asset column!
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