Compound interest is a powerful financial concept that can significantly boost your savings over time, especially when you start early. Here's how it works and why starting early is so advantageous:
Compound interest is the interest you earn on both the initial amount of money you save or invest (the principal) and on any interest that has already been earned. This means that over time, your money can grow exponentially, with the interest compounding on itself.
Starting to save or invest early allows you to take full advantage of this compounding effect. Even small amounts saved or invested early on can grow into substantial sums over time due to the long-term effects of compounding.
Start Early
"Compound interest is the eighth wonder of the world.
He who understands it, earns it … he who doesn't … pays it.”
― Albert Einstein