In the one-horse town where I grew up, on the main intersection – the only intersection in town with a traffic light – was Mr. Kline’s shoe store. He was very wise and he knew about compounding money.
The shoe store was in a large, tan brick building, with those long, large, and classic window displays on both sides as one walked into the store. It felt like I walked halfway through the store before I actually entered. And when I opened the door, the bell attached to the back of it would ring.
Upon entering, there were so many wonderful smells that entered my nose – fresh shoe leather, crisp and new sneaker smell, and the musty aroma of an old time store.
Mr. Kline would always greet me with a handshake and ask how I was doing.
He was very successful and had run his business very well for a particularly long time. He was also really kind, knowledgeable, and willing to dispense advice to all those who asked.
One day after purchasing sneakers, well, full disclosure here, my Mom purchased the sneakers because I was an unemployed 7 year old. I asked Mr. Kline how he was so successful in running his business.
He smiled widely and said, “Worry about the pennies and the dollars will add up.” The concept that he described is compounding. The smallest amount of savings will add up to much larger sums over time. It’s the same idea as when a video “goes viral.”
The next day, I went to the bank, opposite Mr. Kline’s store, and opened a bank account with the help of my Mom. The few dollars that I earned from shoveling snow in the winter, and cutting grass in the summer, went into my bank account.
At the end of every month, I would look at my statement to see how much my account increased from the interest that the bank paid. It was very exciting to see the increase in value each time.
Even better, my money was making me money. I didn’t have to freeze in the winter or sweat in the summer doing manual labor to earn money.
This was a great lesson to learn at a young age.
How Are You Compounding Your Money?
How do you apply compounding to your life? Not only with finances, but with other aspects – your relationships, your time, and your talents. It’s a wonderful concept that can improve your life in so many ways.
Interested in chatting more about compounding your money? We can chat!