Compound interest is when you earn interest on your interest. To demonstrate the power of compounding, suppose you deposit $10,000 (principal amount) in an investment account that pays 10% interest annually;
At the end of:-
1 yr $11,000
2 yr $12,100
3 yr $13,310
4 yr $14,641
5 yr $16,105.10
6 yr $17,715.61
7 yr $19,487.17
8 yr $21,435.89
9 yr $23,579.48
10 yr $25,937.42
After 10 years, your total percentage returns is 159.37%
The Rich understand money and how to use it. Capital is literally a seed; learn how to plant it to produce the best harvest.
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