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Starving For Yield? Where To Find Income Sustenance
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Published Tue, 13 Mar 2012 11:52:31 -0400 on Seeking Alpha
Welcome to our new reality. The table below shows low and declining yields across the yield curve for three developed countries. With ten-year risk-free rates hovering about 2%, it will take approximately 36 years to double your money applying the rule of 72. In financial circles, the rule of 72 is a method for estimating an investment's doubling time. The rule number 72 is divided by the interest percentage per annum to obtain the approximate number of years required for doubling when only a basic calculator is available. In this case, if you were to invest $10,000 with compounding interest at a rate of 2% per annum, the rule of 72 gives 72/2 = 36 years required for the investment to be worth $20,000. A scientific/financial calculator would give a more accurate reading of about 35 years. At a paltry 2% yield, even retirees with a liquid nest egg of... Read more


