This article explains compound interest and its benefits. Compound interest is defined as a system where interest is earned on both the principal and any accumulated interest. This leads to exponential growth over time.
The article provides an example of investing $1,000 with a 5% annual interest rate, compounded annually. After the first year, the investment grows to $1,050. In the second year, the 5% interest is calculated on the new principal of $1,050, resulting in $52.50 in interest. This cycle continues, with the interest earned each year increasing due to the growing principal.
The article highlights several advantages of compound interest:
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by Saifal Khan о medium.com 11-12-2024
https://medium.com/@saifalkhan_31932/the-power-of-compound-interest-unlocking-wealth-creation-6c604dfee479Глибші Запити