Can You Spare $50 a Week? Here’s How to Turn That Into $261K in 20 Years

Here’s how you can grow your portfolio with $50 a week.

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It might seem like an impossibility to create a large portfolio when you have nothing on the books. But if that nothing includes no debt, then you’re likely doing far better than many Canadians out there.

With debt out of the way, Canadians can turn their attention to savings. By simply using the same methods of saving to pay down debt to put cash aside, you can create a significant amount of income.

And if you invest it? That can turn to even more.

Where to find that $50

Let’s say you’ve never really had to money manage to pay down debt. You simply stuck to your bill payments, and everything has been fine. Let me quickly go over some ways to find that $50 based on your current spending.

Your current spending should include a budget. If you haven’t created a new budget in the last three months, make a new one. As I’m sure you’re aware, but rising inflation and interest rates haven’t led to a decrease in your budget planning. Figure out how much you’re spending and create a realistic budget.

From there, see what you can again realistically cut. If you’re spending every last penny, then there has to be something you can do to save cash. Maybe it’s biking to work instead of driving. Maybe it’s eating out only for dinners at home rather than every day at lunch. It might be selling items or even something as drastic as getting a cheaper vehicle.

It adds up

You just now have the goal of putting aside $50 each week. That can be achieved fairly easily, and you can treat it as another bill payment that comes out automatically.

By doing this, you can create a large amount of income every year. By putting $50 aside each week, that will add up to $2,400 per year! Over time, sure, that could create, say, $48,000 over 20 years. However, invest it, and you can create an even larger portfolio.

Where to invest

If you’re going to invest in something over and over, make sure it’s going to be around over the next few years. A great option today would be Brookfield Renewable Partners (TSX:BEP.UN). This stock in the renewable energy sector could see massive returns over the years and already has.

Brookfield stock is down 2% in the last year but up 157% in the last decade. It also offers a dividend yield currently at 4.24%. Its share growth has seen a compound annual growth rate (CAGR) of 10.13%, with its dividend at a CAGR of 9.68%. Using that, here’s how you can put that $2,400 to work.

YearShares OwnedAnnual Dividend Per ShareAnnual DividendAfter DRIP ValueAnnual ContributionYear End Shares OwnedYear End Stock PriceNew Balance

As you can see, after 20 years, you could create over $261,000 in your portfolio — all from a start of $50.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has positions in Brookfield Renewable Partners. The Motley Fool recommends Brookfield Renewable Partners. The Motley Fool has a disclosure policy.

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