Compounding Possibilities

By Chris Compton

Small, seemingly insignificant acts can have an impact beyond anything imagined. For example, a kind word, simple gesture, or thoughtful deed can brighten another’s day or even change his or her outlook on life. Drinking more water, taking a short walk each day, and cutting back on sugar can lead to increased energy, better sleep, and improved physical health.

Breaking down big goals into smaller, manageable steps can help us achieve success over time. Small actions and changes may seem insignificant on their own, but when combined with others and repeated consistently over time, they can have a profound impact on our lives and the lives of those around us.

The Bible is full of stories where small things made a big impact. Consider David’s faith, courage, and the smooth, small stone in his defeat of Goliath—how it inspired the Israelite army to victory. Or the widow who gave two small coins in the Temple treasury and received Jesus’ praise for her faith and generosity. Recall when Jesus fed five thousand with only five loaves of bread and two fish, demonstrating the abundance that can result from small acts of generosity and faith.

It is also true small things can have a big impact in life and in ministry. The Lord gifts all believers with time, talents, and resources to be used for the furthering of His Kingdom. No matter how small or insignificant we think our gifts are, God can multiply them by His strength to produce a great impact in our lives and on the world around us.

This principle is not only true in life and ministry but in savings as well. When it comes to retirement savings, time and compounding interest are your friends! You probably have heard the term compound interest, but what does it mean? Compound interest works by allowing your savings to earn interest not only on the principal invested, but also on the interest earned over time. As your savings grow, the amount of interest earned also increases, accelerating your savings growth.

Consider a 25-year-old who puts aside $3,000 per year toward retirement for a decade. That is basically $58 dollars a week for ten years. Or $30,000 for those of you doing the math. After 10 years, at age 35, the individual stops making contributions completely. By age 65, the $30,000 investment will have accumulated $472,000 (assuming 8% annual return).

Now consider a 35-year-old who starts putting away $3,000 per year for 30 years, or $90,000. At age 65 the investor will have accumulated $367,000 assuming the same 8% annual return, a difference of $105,000. Plus, this person had to contribute $60,000 more money for less return.

As you can see from this example, time is the key ingredient for compound interest. The more time compound interest can work, the more powerful it becomes. The earlier you begin saving for retirement, the more time your money has to grow. It is best to start saving as early as possible, even if it’s a small amount. The power of compound interest can turn your small savings into a substantial nest egg over time.

Don’t wait! God can use us and our money in a compounding way for ministry, both now and in the future.

About the Author: Chris Compton is accounting administrator for the Board of Retirement. He graduated in 2007 with an M.A. in Bible exposition from Columbia International University. A 1998 graduate of East Tennessee State University, he has over 18 years of administrative/financial experience in varied fields and seven years in pastoral ministry.