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Albert Einstein called compound interest the 8Th wonder of the world. The longer you engage it, the better off you will be. This is why Principal Adviser Stu Varidel wants you to change your habits and start saving 10% if your income, starting right now!

Plus 10 Percent – what is it?

No, I am not talking about Australia’s extra GST on Ebay or online purchases today (although it would make a pretty good topic too).

And no, I am not talking about the accepted social norm of a certain Southeast Asian government in getting things done, either.

I am talking about saving money. And by the end of reading this article, I want you to save 10% of your money religiously.

The world of instant gratification …

Most people ‘feel’ that when they save money, that they ‘lose’ that money. That is, if you save 10% of your income, then you don’t get to enjoy that 10%.

You would probably say “you only live once, so may as well enjoy it”. I think this is the most insane concept ever! If this is your life motto, you are living in the world of instant gratification.

I don’t blame you. With so much credit products offering you “0% interest”, and “same day credit approval”, our society has been inundated with such spirit for some time.

Why you need to save 10%?

Well, firstly you need to save because the bible says so (maybe that is one of the many reasons the church is one of the wealthiest institutions in the world?)

But on a serious note, you must realise, everyone has an expiry date.

During the last world war, our life expectancy was around the mid 60s mark. In Zimbabwe not so long ago, life expectancy was around the 50 mark.

But now it is expected that baby boomers (people in their late 50’s – late 60’s), will live until their mid 80s. And if you are in your 30’s, you can expect to live to 100, thanks to stem cell technology and all sorts

of advances in the medical profession.

Our government seems hopeless in managing our tax dollars, and they understand that demographically we will have more old people to support than the number of taxpayers in the not too distant future. The days of Centrelink benefits may be numbered.

This is why, to me, when you save 10% of your money, it is not a loss, or negative of 10% to you, it is a positive 10%. It is a plus (+) 10 percent to you!

If you still consider that saving 10% is a loss to you, then picture yourself feeding your dog a slice of your pizza.

It is not that much of a loss at all is it? A slice of a pizza is more than 10% of a pizza, by the way.

If you think you won’t have enough to pay your bills, you will have enough. Humans have an amazing ability to adapt to new situations, when they must adapt. Humans have survived through the ice age, hunting & gathering periods, a few world wars, the industrialization age, now the globalisation age, and there will be many more to come.

So, trust me, you can survive a 10% drop in spending.

The Small Picture Stuff

Let’s stop and not get too big on the big picture, like retirement as discussed above (you would say “my

employer is paying into my super” anyway right?).

Let’s not get into cheesy goals like Machu Picchu holidays, buying a new car, or leaving legacies to your kids.

Do you have 3 months’ worth of your monthly expense in your bank account? It’s called “The Rainy Day” fund. It’s the piggy bank that comes in handy if you had lost your job, had an accident and unable to

work, or for helping families in need. If you do not have this Rainy Day fund, then you need to save 10%


For those of you who do have enough for rainy days, congratulations. But still, get into the habit of 10% now anyway. I promise you it will not hurt, at all. If not for anything else, I just want you to get into the

habit of it. Just to get into the habit will make a lot of difference, especially if you understand Einstein’s

concept of “The 8th Wonder of the World” – compound interest!

So, start saving, make your positive 10 percent, today.

Stu Varidel is The Principal Adviser of Heart Financial Advisers, servicing clients throughout Queensland and interstate. Stu is a holistic adviser with 20 years of experience in financial services.

To see the value of compound interest over time, check out the compound interest calculator on our

website. You might just be amazed to see the effect of compound interest in the later years of your

saving and what saving 10% now could do for you!


This information is current as at 11/07/18. This article has been prepared by Heart1Stop, a social media brand owned by Heart Mortgage Services and Heart Financial Advisers. The information contained in this article is an overview or summary only and it should not be considered a comprehensive statement on any matter nor relied upon as such. The views expressed here are not those of Heart1stop, Heart Mortgage Services, Heart Financial Advisers, shareholders, directors or staff and associated contractors and business associates. This article has been prepared without taking into account any person’s objectives, financial situation or needs. Because of this, you should, before acting on any information contained in this article, consider its appropriateness, having regard to your objectives, financial situation or needs. Any taxation information contained in this article is a general statement and should only be used as a guide. It does not constitute taxation advice and is based on current laws and their interpretation. Each individual’s situation may differ, and you should seek independent professional taxation advice on any taxation matters. While the information contained in this article may contain or be based on information obtained from sources believed to be reliable, it may not have been independently verified. Where information contained in this publication contains material provided directly by third parties it is given in good faith and has been derived from sources believed to be accurate at its issue date. It is not the intention of Heart1Stop or Heart Mortgage Services and Heart Financial Advisers that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. To the maximum extent permitted by law: no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up to date or fit for any purpose; and no party of Heart1Stop or associated entities as mentioned is in any way liable to you (including for negligence) in respect of any reliance upon such information. This article may also contain links to websites operated by third parties ("Third Parties") who are not related to Heart1Stop. These links are provided for convenience only and do not represent any endorsement or approval by us.

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