The Miracle of Compound Interest

I've been exploring quite a variety of internet "forums" or "newsgroups" lately, partly because I intend to set up one for the buyer's of an E-Book I'm writing. Still haven't got the title, but tentatively, it's something like "More Fun with Digital Photography".

There's thousands of forums, all manner of special interests, and amazing conversations that go on. Gotta be careful, they can be voracious Time Leaches.

One that I posted on today is the forum for Investment U.
www.InvestmentU.com
It's a free educational service, with weekly email newsletter, and other services including a new forum, which I just entered today.

One person had asked for help--said he'd considered starting investing when he was about 20, but had been too afraid. But now he's newly married and has a daughter to help support, and wonders if it's too late to start.

Another forum member replied with good advice:

"1) Set a goal.
2) Write down your goal.
3) Create a plan. (Those who fail to plan, plan to fail).
4) Seek out a mentor or teacher/coach you can learn from.
5) Based on what you learn, revise your plan so that it has a greater chance of success.
6) Keep visualizing your success.

(Michael Masterson) estimates you will need 1000 hours to become competent in a field, 5000 hours to become a master, and that time can be cut by 25% or so with a good teacher/coach.
So if you devote 10 hours per week to learn investing, you will need up to 100 weeks to become competent (2 years) or 500 weeks (10 years) to become a master.
In other words, what you want won't happen overnight.
Persistence is going to be the key. "

My contribution:

That was excellent advice.
And as far as investing is concerned, a few years of steady experience is about right to become competent (provided you learn steadily from your experience).
I'd caution you not to try to jump into being too aggressive too quickly.

But do get started.
No matter how small.
If your investable funds are going to be very modest for a while, you might buy individual stocks via DRIP programs. There's a local writer Scott Burns here in Dallas who recommends various varieties of Couch Potato Portfolios, based on stock and bond indexes.
(Be sure to maximize your tax savings via IRA/401K's, etc.)
There are lots of sane ways to get started.
Doesn't matter so much which one you pick.
Just get started.
Do a plan.
Then work to gradually improve your results.
As you gradually become more competent as an investor,
and gradually accumulate more capital,
you can gradually ratchet up the level of aggressiveness in your investments.
But always focus as much or more on NOT LOSING MONEY as you do on your rate of return.

One VISUALIZATION TOOL that helped me get started:
Find one of those compound rate of return calculators, where you can plug in an initial amount of investment, and a periodic contribution (like $100 month or whatever), which will extrapolate out what you'll accumulate after so many years. Look at what that does in 20 years or so, and you'll be mighty motivated. It's fun to plug in different contribution rates, and different rates of return, to see what that does over the long run.
Just for instance, according to a calculator @ http://www.dinkytown.net/java/InvestmentReturn.html
If you start with nothing, but invest $200 month @ 20%, after 24 yrs you'll have well over a million dollars ($1,130,355). That's assuming no taxes (use IRA) and without considering inflation.

I'm not so sure that Einstein really said that compound interest was the most powerful force in the universe, but anyway, it's plenty powerful!