“My wealth has come from a combination of living in America, some lucky genes, and compound interest.” – Warren Buffet. Here we will show The Benefits of Compounding!
From the man himself Warren Buffet! Warren Buffet is known as one of, if not the best investor of our time. He is one of the richest men in the world and has pledged $50bn to charity, mainly the Melinda and Bill Gates Foundation.
Now we don’t all have the ability to live in America, we have no control over genes, but we can compound.
What is compounding?
Compounding interest is the interest made when you reinvest money earned from Interest. So if you have R100 invested in savings account. You earn R5 interest, you can either take that interest out or reinvest it. Reinvesting that interest will cause you to earn interest on R105, not just R100. Causing you to earn more interest.
Now this seems easy, but the real magic happens over times as shown in the table below, The Benefits of Compounding!:
We can see that you make a low more money using the compounding method, and with little to no effort! When possible always reinvest and let money compound! The Benefits of Compounding!
Be Smart, Be Safe, and only check your finances once a Week!
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