Compound Interest: The Basics

WHAT IS COMPOUND INTEREST?

Simply put, it’s interest from interest. The snowball effect.

In the first few compounding periods, the interest is minimal – but over time, interest from interest is a game changer!

How interest compounds depends on three variables:

Interest Rate: The rate earned from savings or an investment
Time: The length of time money is left to compound
Taxes: The timing of taxation can make a big difference

Check out the infographic below to learn more.