Thursday evening, my son and I went to a local restaurant for supper. After eating, my son asked for some chewing gum - you know, the little round gum that you get for a quarter from one of the machines at the front of the store. He’s three, so he wanted gum for our whole family - Mommy, Daddy, Sister, and himself. I had four quarters, so we loaded up on gum and headed home.
When we got home, I opened up a spreadsheet and began playing around with a few scenarios. What if, instead of spending that dollar on gum, I had saved it? And, what if I saved a dollar, every day, for a year? for a decade? for 50 years? Also, what if I save more than a dollar, say, two dollars, or five dollars or even 10 dollars, per day?
Check out this chart I created -
Note, the following numbers represent the total amounts contributed to savings (w/ no accounting for interest earned).
| 1 Day | 1 Month | 1 Year | 10 Years | 50 Years |
| $1 | $30 | $360 | $3,600 | $18,000 |
| $2 | $60 | $720 | $7,200 | $36,000 |
| $3 | $90 | $1,080 | $10,800 | $54,000 |
| $4 | $120 | $1,440 | $14,400 | $72,000 |
| $5 | $150 | $1,800 | $18,000 | $90,000 |
| $6 | $180 | $2,160 | $21,600 | $108,000 |
| $7 | $210 | $2,520 | $25,200 | $126,000 |
| $8 | $240 | $2,880 | $28,800 | $144,000 |
| $9 | $270 | $3,240 | $32,400 | $162,000 |
| $10 | $300 | $3,600 | $36,000 | $180,000 |
If I save $1 per day, for 50 years, I’ll have $18,000.
If I save $10 a day, for 50 years, I’ll have $180,000.
But, as I mentioned before, this chart represents contributions - and doesn’t calculate interest earned.
So, let’s kick it up a notch and do some calculations, assuming a 5% annual return.
| Yearly | 10 Years | 20 Years | 30 Years | 40 Years | 50 Years |
| $360 | $4,754 | $12,499 | $25,114 | $45,662 | $79,134 |
| $720 | $9,509 | $24,998 | $50,228 | $91,325 | $158,267 |
| $1,080 | $14,263 | $37,497 | $75,342 | $136,987 | $237,401 |
| $1,440 | $19,018 | $49,996 | $100,456 | $182,649 | $316,534 |
| $1,800 | $23,772 | $62,495 | $125,569 | $228,312 | $395,668 |
| $2,160 | $28,527 | $74,994 | $150,683 | $273,974 | $474,801 |
| $2,520 | $33,281 | $87,493 | $175,797 | $319,636 | $553,935 |
| $2,880 | $38,036 | $99,991 | $200,911 | $365,299 | $633,068 |
| $3,240 | $42,790 | $112,490 | $226,025 | $410,961 | $712,202 |
| $3,600 | $47,544 | $124,989 | $251,139 | $456,623 | $791,335 |
If I contribute $1 per day ($360 per year) for 50 years, at 5%, I’ll have more than $79,000!
If I contribute $10 per day ($3600 per year) for 50 years at 5%, I’ll have more than $790,000!
(Please note, I used a very simplified formula to calculate interest, based on annual contributions. In reality, if you made deposits throughout a calendar year, you would earn even more interest!)
Isn’t that cool? I like to look at charts like these. I am motivated by “what if”.
As a side note, my son will only be 4 once, so I’m still going to buy him the chewing gum! But, I’m also going to pocket some additional savings, so that when the time comes, I can buy my grand-kids a warehouse full!
(If you want to get really “pumped” about saving money - checkout what happens if you max our your 401k and Roth IRA contributions.)
41 Responses
Josh
December 10th, 2007 at 11:08 am
1Holy crap!!
Kevin @ Change Your Tree
December 10th, 2007 at 11:19 am
2If you want to really blow your mind, calculate what you would have if you invested that same $10 in a growth stock mutual fund making the market average of 10-12%.
JBL
December 10th, 2007 at 1:51 pm
3Are you me? Mythbusters, Car Talk, sports radio talk, getting out of debt…I think I have a twin!!!
Andrea
December 10th, 2007 at 3:50 pm
4So is your son three or four years old?
JLP
December 10th, 2007 at 4:33 pm
5If you compute the numbers using daily compounding at 5%, your balance would be over $816,000 in 50 years. If you can manage a 10% rate of return, you balance goes to…
$5,382,030!!!!!
What a difference 5% makes!
Llama Money
December 10th, 2007 at 5:43 pm
6I second the mutual fund idea. Compound interest is an amazing thing.
Also, not to rain on anyone’s parade, but just remember that a quarter million in 50 years isn’t worth the same as a quarter million today - it’s worth *substantially* less due to inflation.
NCN
December 10th, 2007 at 7:04 pm
7Andrea,

My son turns 4 in January - and the new baby is due in April…
I’ve spent so much time telling folks, “he’ll be 4 when the baby gets here” that sometimes I call him 4, sometimes I call him 3…
NCN
DreadlocCowgirl
December 10th, 2007 at 7:29 pm
8I don’t have any money. Compound interest of 0 is still 0! I’m still motivated and will try $1/day
Wish me Luck!
SavingDiva
December 11th, 2007 at 12:11 pm
9Great post! It really makes you stop and think do I need to purchase this candy bar…
Want an Extra $750,000? « Friendzy
December 11th, 2007 at 12:19 pm
10[...] pay off huge in the long run. The No Credit Needed blog has given us a nice little example of how $10 a day can add up to over 3/4 of a million dollars just in time for retirement and that’s with only a 5% return on investment. I think we can [...]
Keith
December 11th, 2007 at 12:21 pm
11Sometimes it’s hard to think that far into the future. Hard, but necessary!
TNT
December 12th, 2007 at 4:01 pm
12What about inflation? How much would you end up in 50 years really.
NCN
December 12th, 2007 at 4:53 pm
13For those asking about inflation -
The purpose of this post was to show how quickly things “add” up, if you keep at it -
In the “real world” - one would have to contribute the equivalent of 1 per day - if you wanted to keep up with inflation…
NCN
Change Your Tree » Blog Archive » Friday Friends #3
December 14th, 2007 at 8:46 am
14[...] The power of compound interest should not be underestimated. No Credit Needed has a fun post that shows you how $10 a Day Equals 3/4 of a Million Dollars. [...]
Friday Finance Findings for December 14th : Generation X Finance
December 14th, 2007 at 10:29 am
15[...] $10 a Day Equals 3/4 of a Million Dollars - The power of compounding and regular saving can work wonders, and NCN has a nice post that explains it. When you think about it, at $10/day, that comes out to less than the max you can contribute to an IRA each year. [...]
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December 15th, 2007 at 3:58 am
16[...] No Credit Needed posts an example of the magic of compounding. [...]
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December 15th, 2007 at 7:19 pm
17[...] $10 A Day Equals 3/4 Of A Million Dollars [...]
money news blog » Weekly Roundup, Still Shopping Edition
December 15th, 2007 at 8:07 pm
18[...] $10 A Day Equals 3/4 Of A Million Dollars [...]
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December 15th, 2007 at 11:00 pm
19[...] some charts to show the expected rate of return for specific small investments. He discovered that if you save $10 a day for 50 years (and can get a 5% return on your investment), you’ll have $791,335. It’s always fun to [...]
John
December 16th, 2007 at 5:39 am
20You should keep this in mind with the 3 (going to be 4) year old and the newborn. Just think about the $10 per day, in 18 years plus 5% interest is just above $100,000. For what? For COLLEGE, what else? You can use this as a quick and simple (theoretically) method of saving for college.
bobzimmy
December 16th, 2007 at 6:50 am
21Wow, so $10 a day for a year is $3,600 not $3,650. When did the length of a year get shortened by 5 days? I bet banks did this just to save money on interest.
PipholicDotCom
December 16th, 2007 at 7:16 am
22well, though a bit unrealistic, considering the fact that in most case it is hard to keep away from your saving account and let them untouch for 50 years,your post is worth to read. At least it give more consideration before we investing somewhere
NCN
December 16th, 2007 at 7:56 am
23@bobimmy - I simply used 360 for the sake of simplification…
@pipholic - it’s not really that unrealistic…
my wife and I plan to do this for our newborn…
NCN
Sunday Morning Link Love ~ Sick Kid Edition | I've Paid For This Twice Already...
December 16th, 2007 at 9:53 am
24[...] No Credit Needed: $10 a Day equals 3/4 of a Million Dollars. [...]
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December 16th, 2007 at 10:50 am
25[...] does some math and shows us how saving just a little bit can end up being a [...]
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December 16th, 2007 at 11:01 am
26[...] No Credit Needed tells us all how $10 A Day Equals 3/4 Of A Million Dollars. [...]
Weekend Linkage - December 16, 2007 | The Sun’s Financial Diary | A Personal Finance Blog on Saving and Investing
December 16th, 2007 at 11:10 am
27[...] at No Credit Needed calculated what saving $10 everyday could mean to one 50 years [...]
Borrowing Against Home Equity, Paying Off A Car Loan @ My Roundup
December 16th, 2007 at 12:45 pm
28[...] Credit Needed shows us how $10 a day can turn into three quarters of a million dollars in 50 years via some chart [...]
debtdieter
December 16th, 2007 at 4:08 pm
29That’s amazing!
I’m glad I’m not the only one out there running ‘what if’s on a regular basis.
Personal Finance Review - Do It Yourself Edition » Money Smart Life
December 16th, 2007 at 4:35 pm
30[...] -$10 A Day Equals 3/4 Of A Million Dollars @ No Credit Needed [...]
money news blog » Roundup for week of 9 December 2007: Imminent ice edition
December 16th, 2007 at 9:10 pm
31[...] No Credit Needed posts an example of the magic of compounding. [...]
Steven Burda, MBA
December 16th, 2007 at 11:36 pm
32Great example for your son!
Thanks!!
- Steven Burda
http://www.linkedin.com/in/burda
Shay
December 17th, 2007 at 3:56 pm
33My husband thinks I am mad saving $10 a week I know it isn’t a lot but I am the only one working in the house and I only work 25 hours a week. I find that $10.00 per week add’s up at the end of the year with my interest that is paid from a saving’s account. I put in extra where i can and I get maintaince for my son which is just under $40 per month so in effect I save $80 approximatley per month. what am I going to do with the money is my most asked question…my response is just leave it there you never know when you may need it!
Carnival of Personal Finance:Naughty or Nice Edition
December 17th, 2007 at 9:31 pm
34[...] Credit Needed: $10 a day equals three-quarters of a million dollars — “If I contribute $10 per day ($3600 per year) for 50 years at 5%, I’ll have more than [...]
Harsh Patel
December 20th, 2007 at 11:15 am
35Intersting. I did the same calculations… but with 10,000 dollars a year being added and I was comparing percentages. I wanted to see the difference of 1% interest rate. The difference between 4% and 5% is over 610,000. The difference between 6% and 5% is ver 879,000.
So saving isn’t the only difference. If you bank somewhere simply for conveniece, this is something to look at.
aardvark
January 8th, 2008 at 1:21 am
36OOOOooo that is sooo neat. How much will you have at 100 years? Hello, when you’re ass is 80 years old, you won’t give a shit if you have $80 or $8,000,000
Free Credit Repair
January 9th, 2008 at 7:41 pm
37Compounding interest and saving money are beautiful things.
I Have Been A Debt-Free Blogger For Two Years
February 8th, 2008 at 6:06 pm
38[...] $10 A Day Equals 3/4 Of A Million Dollars [...]
Dana
February 20th, 2008 at 2:18 am
39Aard-dude, the only way you will not care how much money you have at 80 is if you have Alzheimer’s. You don’t stop being a human being who needs money at eighty. My grandmother is almost eighty, and it sure would not hurt her feelings to have $80k in the bank considering all the meds she has to be on and the property taxes she has to pay.
brandon atoch
April 15th, 2008 at 3:42 pm
40where can i find a free download to figure out
what the balance would be if i had 100,000 dollars
to put into a safe fund for 40years,as if i did not
waste my time&money going to college and just put
the same amount in a fund that earned interest
then go to work at a fastfood resturent and not
have worry about my retirement,thank,s
dee
June 3rd, 2008 at 8:45 pm
41I just want to add a comment what will happen to that same $1 a day if I put it under my mattress and do not allow the gov to tax me on my savings? If you haven’t noticed the quote green backs are not going to be tangible some day all of our money will just be on paper we are almost there now the only people who have real cash are the poor and drug dealers even our casinos are cards no more clink clink clink when we win
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