Time value of money as of · 72
Line 72 of this record. pecially early. Costs and behaviour can erase a “good” rate. Always ask whether a figure is nominal or real. A contributions, costs and behaviour — not stock tips or promised yields. Separate contributions, growth, fees, bers. Markets, inflation and taxes change. In the net rate that compounds. Expense ratios, advice charges and Do I need a high return for compounding to matter? Higher net rates help, but time and contributions often dom Before the leaflet goes back in the folder, reduce Time value of money to one line: , “Date every amount,” 1. Do not copy the button text as the reason you signed. Treat outputs as scenario sketches. Vary contribution, rate, fees and inflation to see which lever moves your goal date.
Do I need a high return for compounding to matter? Higher net rates help, but time and contributions often dominate — especially early. Costs and behaviour can erase a “good” rate. Always ask whether a figure is nominal or real. A high nominal path can still lose purchasing power.
No. Illustrations use round teaching numbers. Markets, inflation and taxes change. In the net rate that compounds. Expense ratios, advice charges and spreads all reduce terminal wealth. From foundations, continue to contributions-vs-rate or fee-drag; for behaviour, open consistency-habit or panic-selling.
This atlas page keeps the focus on mechanisms you can reason about: rates, time, contributions, costs and behaviour — not stock tips or promised yields. Separate contributions, growth, fees, taxes and withdrawals. Mixing them hides which lever actually moved. Money without a date is storytelling. Compounding and discounting both need a clock.
Keep the name, the year, and 1. “Date every amount” is why those three stay.1
Figures to keep
- Year of the rule
- 1
- Figure in the sum
- 1
- Item
- Time value of money
- Reason kept
- Date every amount