Exponential growth is everywhere, and we see it every day. But how can it be applied to you? First things first, let’s talk about what exponential growth actually is. Exponential growth is a growth rate that becomes more and more rapid in proportion to the growing total number or size. A good example of this can be seen in a folded piece of paper. Three folds in a piece of paper becomes as wide as a fingernail, ten folds jumps to the width of a hand, and fifty folds is as wide as the distance from the sun to the Earth. Of course, we can’t really fold a single sheet of paper that much in reality, but the property still stands.
Now, for a more practical application, exponential growth works for money too. Imagine this: it’s the first day of the month and you save one penny with the plans to double that penny every day for the rest of the month. Seems easy right? By day fifteen you would have $327, by day twenty-five you would have $335,544, and finally by the end of the month you would be a millionaire with over ten million dollars, just from doubling a penny.
Take a look at this infographic for more on exponential growth and what it could mean for your retirement. Let us know what you think in the comments and don’t forget to share it with your friends!