New Delhi. It is good to save but it is not right to save only. Money is saved from savings, but you are not able to strengthen you financially for the future. At the same time, when money is made by money, then your economic future also gets safe. Therefore, it is important that money should be put in a place from where you will get a good amount every year as a return. But money is not made only by returns, another big factor works in it. That factor is compounding.
Due to this compounding, a person from Delhi suddenly came to Rs 130 crore. However, so much money suddenly came to them, it would be an exaggeration to speak, but they were suddenly known about it. This is the story of Ravi of Delhi. Ravi’s grandfather was paralyzed since 2006, but by taking care of Ravi, he was cured to a great extent by 2016. He gave Ravi a gift. This gift was some receipts of the stock given by Grandpa. He wanted to know what to do with him now. To get the answer to this question, Ravi made a call in a pre-market show of Zee Business. What happened after that became a very exciting story.
Also read- Why does the bank ask for a canceled check? Know the real reason behind this, very few know
20,000 shares
Ravi’s grandfather bought 20,000 shares of a company in 1990. But these shares were on paper and the world is now digital. That is, now stocks come in demat account. Ravi called the show and asked how he can sell these shares. When the conversation went ahead, Ravi told the name of the company. The company was Madras Rubber Factory or MRF.
130 crore rupees shares
There was a few moments of silence in the studio. Then the experts told Ravi that if he wants, these old paper shares can still be converted into demat. But the real shocking thing came to light when the anchor said that today’s price of these 20,000 shares is ₹ 130 crore! First the anchors were shocked and Ravi became silent after knowing the amount. Ravi was also made a millionaire by compounding.
Compounding is the name of this magic
Compounding means compound interest-the power that keeps your capital gradually but continuously increases. Think, if you keep ₹ 10,000 in the bank, on which you get 10% annual interest, then in the first year you will get ₹ 1,000 interest – total ₹ 11,000. The second year you will get 10% at this entire ₹ 11,000 i.e. ₹ 1,100. Now total ₹ 12,100. The real game begins from here. Every year interest is also made on old interest and gradually the same amount starts growing like a big mountain.
Give time
The real magic occurs when you mix time with compounding. This is the combination that can give ₹ 130 crore to someone. Due to this compounding, Warren Buffet, the world’s largest investor, reached there where he is today. Let us tell you that Warren Buffet also deposited his property in the same way. Buffet’s 96 percent of wealth came after the age of 65 years. Compounding is slow, but its effect is explosive – provided you be patient and let the time go along.
