Articles on compound interest, recurring contributions, and how to set and reach savings goals.
Dividing 72 by a rate of return and getting a number of years sounds like a bar trick, but it’s a mathematical approximation with solid reasoning behind it. The rule of 72 lets you estimate in seconds how long it takes for a capital sum to double, without pulling out a financial calculator or resorting…
When you compare two savings options and one promises “simple interest” and the other “compound interest,” the difference seems like a technical detail. It isn’t. After a certain length of time, that difference can double or halve the accumulated capital. Let’s see exactly why, with concrete numbers you can replicate with any amount. What is…
Saving 100 euros a month for 20 years doesn’t produce the same result if that money sits still as if it generates interest that in turn generates more interest. That difference has a name: compound interest. Understanding how compound interest works in savings means understanding why time, more than the amount saved, is the factor…