For the calculations beneath, I assume a CONSERVATIVE compound rate of interest of 25% and a SEMI-CONSERVATIVE compound curiosity of 37.5%.
Let’s begin off with planning for retirement for an individual who has 0.01 bitcoin and desires to retire in 15 or 30 years. Listed here are my CONSERVATIVE and SEMI-CONSERVATIVE calculations for a way a lot you possibly can have in retirement:
State of affairs #1 (CONSERVATIVE):
Present worth of 1 bitcoin = $68,000
Individual has 0.01 bitcoin
Individual saves $100/week ($5200/yr) for 30 years
Estimated compound rate of interest of bitcoin in 30 years = 25%
State of affairs #2 (CONSERVATIVE): Let’s redo situation #1 besides over a 15-year time-frame:
As you’ll be able to see, the facility of compound curiosity is magnified in a 30-year interval versus a 15-year interval. That is why it is necessary for individuals to start out retirement planning as early as potential.
Now let’s do the identical calculations above however let’s be SEMI-CONSERVATIVE and use an rate of interest of 37.5%:
State of affairs #3 (SEMI-CONSERVATIVE):
Present worth of 1 bitcoin = $68,000
Individual has 0.01 bitcoin
Individual saves $100/week ($5200/yr) for 30 years
Estimated compound rate of interest of bitcoin in 30 years = 37.5%
State of affairs #4 (SEMI-CONSERVATIVE): Let’s do situation #3 besides over a 15-year interval:
Now let’s plan for an individual who has 0.001 bitcoin and desires to retire in 30 years:
State of affairs #5 (CONSERVATIVE):
Present worth of 1 bitcoin = $68,000
Individual has 0.001 bitcoin
Individual saves $100/week ($5200/yr) for 30 years
Estimated compound rate of interest of bitcoin in 30 years = 25%
State of affairs #6 (CONSERVATIVE):
Identical as State of affairs #5 however over a 15-year time-frame:
State of affairs #7 (SEMI-CONSERVATIVE):
State of affairs #8 (SEMI-CONSERVATIVE):
Identical as State of affairs #7 however over a 15-year time-frame:
As you’ll be able to see, whether or not you’ve got $680 value of bitcoin (0.01 of a bitcoin) or $68 value of bitcoin (0.001 of a bitcoin), please do not low cost what you personal as being not important. The calculations above show that it is advisable to deal with your Bitcoin with utmost care and respect. Please deal with any Satoshi that you just personal as “items of your most valuable TIME.”
If you wish to run some numbers over a 5-year time-frame, for my part, compound rates of interest of 100% to 200% could be thought of sustainable and simply achievable. Listed here are a pair extra eventualities which can be very achievable for individuals to succeed in EARLY RETIREMENT.
State of affairs #9 (CONSERVATIVE):
0.01 bitcoin
Individual saves $100/week ($5200/yr)
State of affairs #10 (SEMI-CONSERVATIVE):
0.01 bitcoin
Individual saves $100/week ($5200/yr)
State of affairs #11 (SEMI-CONSERVATIVE):
0.001 bitcoin
Individual saves $100/week ($5200/yr)
State of affairs #12 (SEMI-CONSERVATIVE):
0.001 Bbitcoin
Individual saves $100/week ($5200/yr)
For eventualities 9-12, I describe them as conservative and semi-conservative eventualities in comparison with historic 100% and 200% interest rates . This could make a standard retirement planner roll their eyes and scoff, however bitcoin will not be a typical funding and conventional buyers do not perceive bitcoin’s world-altering implications that justify these “conservative” and “semi-conservative” retirement calculations.
As you’ll be able to see, in 5 years, with a mere 0.001 bitcoin and saving $100/week, you’ll be able to feasibly and justifiably attain early retirement. Do not take frivolously any satoshi you personal as a result of any irresponsible actions in not defending your valuable satoshis may actually price you TIME. Bitcoin is an asset that affords you to save lots of and leverage your hard-earned time. As Archimedes says, “Give me a lever lengthy sufficient and a fulcrum on which to position it, and I shall transfer the world.” Bitcoin is the lever and your TIME is the fulcrum.
In conclusion, many individuals don’t understand how their bitcoin can maintain perpetual and generational wealth for a whole lot of years. Right here is one final calculation to exhibit this notion, if in case you have simply 0.1 bitcoin ($6800 value of bitcoin). After 50 years of 25% compound curiosity and also you saving $100/week, an individual may change into a billionaire.
Many individuals snigger at me once I present them these calculations however little do they understand that these calculations are VERY CONSERVATIVE. For the needs of this text, I needed to be very conservative to exhibit how life-changing bitcoin may very well be from a generational wealth standpoint.
Please mess around with the compound curiosity calculator situated here and plug in what you suppose are real looking compound rates of interest based mostly in your opinion.
Completely happy retirement and generational wealth planning!!
It is a visitor publish by Jeremy Garcia. Opinions expressed are solely their very own and don’t essentially mirror these of BTC Inc. or Bitcoin Journal.
