"Don't judge each day by the harvest you reap, but by the seeds you plant."- Robert Louis Stevenson

I read with interest an article recently that seek to encourage the legalizing of “the numbers game.” 

While the writer made his case these lines will make another case “I am beginning to think, however, that this number is never going to fall, but whenever it does, rest assured that I shall recoup some of what I have already invested in it”

Not withstanding the excitement of the game or the fact that persons especially the number house operators have benefited.  The truth is you have a better chance of drowning in your own bathtub or being struck by lightening than ever getting the money back that you have spent on playing numbers.

Playing the numbers game goes against the tenants of my view on investing and financial planning, that is “the key to making money is not to lose it!” 

Whenever an investment loses money then it is not a good investment. 

So the question you must always ask yourself when considering what investments to include in your financial planning is “what are the ways that I can lose money with this investment?”  You are not ready to invest until you are able to answer this question.

Your financial planning should only focus on investments that guarantee the return of your money first.  Once your money is secure then you should consider the returns on your investment.

You may not know but there is a much better numbers game that you can use to dramatically increase your financial planning results.  It is far less visible, but far more powerful than the numbers game you may be accustom to. 

It is compounding. 

Albert Einstein described compounding as “the eight wonder of the world” and you can easily put this force to work for you.

The writer of the article indicated that he has been playing numbers daily for more than thirty years.  So let’s say he had invested $25 a week for the last forty years, earning seven percent on his money, how much do you think his investment would have grown to?

Believe or not, today he would have over $286,640.00.  If he had doubled his investments to $50 a week he would now have more than half a million dollars.  Sadly he has invested much more than this on numbers but has very little to show for it. 

He is still wishing that his number soon fall!

He is not alone as this scene is played out across our country everyday.  Each day scores of persons are lining up to play the numbers, kissing their hard earned money goodbye, all because they are blinded by the lure of quick gain.

Not realizing that they could actually be doubling or even tripling their money over time by using a little patience and the magic of compounding.

As you consider your own situation, I trust you will see the benefits of changing the “numbers game” you are playing to one that really put the odds in your favor.

Here is a rule that can help you do just that.  The “Rule of 72” helps you determine how long it takes for your money to double at various rates of growth.

• Let’s say that your money is earning 5% a year in interest. Then you divide 72 by 5 to get 14.4.  This means that it will take about 14 and ½ years for you to double your money. 
  
• If your money is earning 10% a year, you divide 72 by 10 giving you 7.2 years to double your money.

• Let’s say that you would like to double your money in 6 years.  Simply divide 72 by 6 and you’ll see that you will need an average growth of around 12 percent to double your money.