I decided to dedicate an entire heading with a drop down list to money matters and investing. I have already written four “Money/Investment Tips” where you can find here, here, here, and here.

Since money, investing, and business have always been lifelong interests of mine, I realized that my experiences in the financial world might be valuable to others—particularly young people who are just starting out and seeking guidance on managing their financial lives.

I’m not claiming to be a financial wizard or a success story. In fact, I’ve faced my share of financial struggles, especially in my early years, when I could easily be described as someone with very little to their name.

While I’ve always been intrigued by money, business, and investing, I wouldn’t describe myself as a “lover of money.” Throughout my life, making money was never my top priority. I appreciated the benefits money could bring, but I was never consumed by it like many people today who seem to live and breathe money, making it the central focus of their lives.

One key reason I wasn’t overly obsessed with making money was my deep involvement in my former evangelical Christian faith. That phase of my life is a long, complex story—one that could fill several books. I’ve moved far beyond that chapter, and in discussing money and investing, I’ll focus on the lessons and experiences that have led to the modest financial success I’ve been fortunate to achieve.

As we begin this series on money and investing, I’d like to offer a piece of advice to younger readers: adopt a long-term perspective on life and plan accordingly. This approach can serve as a guiding principle—a “North Star”—on your journey toward financial independence.

As I mentioned in part four of my “Money/Investing Tips,” my mom and dad were not savvy or sophisticated financial people. We never had money discussions around the dinner table nor did my mom and dad share with us children any tips or secrets of how to become financially independent. It was not something that was prioritized and this was one of the many tragedies of my highly dysfunctional and abusive family.

Due to my unstable childhood and teenage years, the future was something I rarely considered or looked forward to. Simply getting through each day was enough to occupy my mind; planning for the future wasn’t even on my radar. I lived in the moment, and just surviving each day was challenge and priority enough.

I never imagined I would live as long as I have. At 64, soon to be 65, reaching this age feels extraordinary—something I truly didn’t believe I would achieve.

This is why I advise young people to adopt a long-term perspective on life and plan accordingly. Statistically speaking, you’re likely to live well into your seventies. The average life expectancy for men is 74.8 years (meaning I potentially have less than ten years left—far more than I ever expected), and 80.2 years for women.

“Money makes money, and the money money makes, makes more money.”

Attributed to Ben Franklin

A truly wise young person begins planning for retirement early, recognizing that youth, beauty, strength, and good times won’t last forever. The old saying, “Make hay while the sun shines,” fits perfectly here. As we age, our energy, ambition, and drive to make a mark on the world naturally diminish. Therefore, the best time to pursue financial independence is while you’re young, before the wear and tear of life—illness, aging, and inevitable setbacks—take their toll.

Another crucial reason to start early on the path to financial freedom is the power of compound interest. Simply put, compound interest is the interest you earn not only on your initial investment (the principal) but also on the accumulated interest from previous periods. It’s essentially earning interest on interest, which helps your money grow much faster than with simple interest, which only earns on the original amount.

Albert Einstein reportedly called compound interest “the eighth wonder of the world. He who understands it, earns it. He who doesn’t, pays it.” Another insightful quote, often attributed to Ben Franklin, states, “Money makes money, and the money money makes makes more money.”

Breaking it down: “Money makes money (interest), and the interest interest makes, makes even more money.” In essence, your initial investment generates interest, and that interest, in turn, earns additional interest.

This idea ties into a powerful statement by legendary investor Warren Buffett: “If you don’t find a way to make money while you sleep, you will work until you die.” It’s a sobering reminder of the importance of generating passive income. While there are exceptions—such as those who inherit wealth, win the lottery, or live off welfare—the general principle holds: to achieve financial security, you must find a way to earn a living.

Oftentimes, when we view things from the inverse or opposite perspective, we can gain knowledge we might not have otherwise gained by looking at things the way they normally are. For instance, most people agree that you have to work to earn your daily bread, but we also know that people who are fully retired don’t work at all—their savings and investments are working for them.

“If you don’t find a way to make money while you sleep, you will work until you die.”

Warren Buffet

Let’s change Buffet’s statement to the inverse: “If you find a way to make money while you sleep, you won’t have to work until you die.”

I recently shared this quote from Buffet with a friend of mine. He has always been a hard worker and has had his own business for decades as a painting contractor. We have worked on countless projects together over the decades. When he heard this, he said he didn’t like this quote because, I imagine, he can’t ever visualize a period in his life where this gem of wisdom could become a reality in his life.

This friend admits he is not financially savvy. In fact, looking back on our decades of friendship and working together, I don’t think we have had too many conversations which have revolved around money and investing.

Compound interest is indeed a fascinating subject; it is also somewhat miraculous in its ability to exponentially grow if given enough time to do so. To help explain this remarkable quality, I will provide the link to the familiar story of the “doubling penny.” As an added bonus to this story, the linked article also gives the fable of “The Grain of Rice,” a story I had never heard until I did a google search for the doubling penny. Both of these stories provide fascinating insights into the phenomena of compounding.

“I’d argue that taking advantage of compound interest is the single most powerful action that an individual investor can leverage to build wealth.” Mark Catanzaro

My hope is this post will create an interest in my readers who may not have heard about compounding interest to explore this wealth building strategy further. Learning about financial principles is the first step toward financial independence, but your learning must not begin and end on a merely theoretical basis: you must put these principles into action, and the sooner you do this, the better off you will be as you near your retirement years.

Compounding is one of the most reliable and effortless paths to achieving financial independence. The primary drawback, however, is the time required before you begin to see significant returns on your investment. This strategy demands patience and discipline, as it’s a long-term financial goal that may take many years to bear fruit.

Think of compounding like planting an oak tree. You start with an acorn, a small seed that easily fits in the palm of your hand and could disappear if you close your fingers around it.

You dig a hole, add mulch and fertilizer, plant the acorn, cover it with soil, water it, and wait. Ideally, you’ve chosen the right time of year for the best chance of germination, selected a spot with optimal sunlight, and followed all the guidelines for soil preparation.

Now comes the waiting. You need patience, watering the spot regularly, and keeping faith in the process. Eventually, if all goes well, a tiny sprout will emerge.

It will take years for this sprout to grow into a tree that provides ample shade and a stunning canopy. Such growth doesn’t happen overnight. After two decades, you’ll have a majestic oak, bringing beauty and shade, and filling you with a sense of awe.

As the years go by, this tree will continue to grow taller and fuller. It will become a haven for birds, offering them a place to nest and raise their young. In time, the tree will also produce acorns of its own.

Compounding is similar to this oak tree in one key way and different in another. Like the oak, compounding grows steadily over time, increasing in size and impact with each passing decade. The difference is that while an oak tree requires ongoing care—planting, watering, pruning, and maintenance—compounding requires much less hands-on effort. Once you’ve invested and set your strategy in motion, it largely takes care of itself.

Aside from occasional portfolio rebalancing if you invest in the stock market (which does require some attention), investing through compounding or dividend reinvestment is relatively simple and self-sustaining. Unlike the nurturing of a tree, your investments grow with minimal intervention, steadily building toward financial growth and stability.