Looking at the table below the good news if you are starting on your investing journey with only modest sums to invest, compound interest takes a while to be noticeable.

If you are investing modest amounts, it’s human nature to want to start out on your journey but initially accrue in a savings account to save charges eating into your invested capital. Charges have been reduced over the years, so it’s not such a problem as before.

Buy one less Starbucks a week, other expensive coffees are available.

The first part of the SNOWBALL’s plan was to earn 1k of income a month from a seed capital of 100k without adding any more funds to the portfolio.

The SNOWBALL should meet its target of 1k a month and consolidate next year and then the SNOWBALL will start to really increase.

Understanding the Snowball Effect

The snowball effect describes how Warren Buffett built his wealth through the power of compounding over time.


Understanding the Snowball Effect
The snowball effect is a metaphor for compounding, where small, consistent actions accumulate into significant results over time. Just as a snowball rolling down a hill gathers more snow and grows larger, investments can grow exponentially when earnings are reinvested and allowed to compound. In Buffett’s case, this principle applied to his investments in high-quality companies, where profits were reinvested to generate even greater returns over decades.

The big problem to re-investing dividends is you may find you are wishing your life away as you wait for your dividends to arrive but always remember the goal is to have a happy and secure retirement. To leave your capital to your nearest and dearest and if you could leave a small legacy to your nearest cat and dog home you would leave the world a better place than when you arrived.

GL Enjoy your journey.