What is Compound Interest?

Compound interest is interest calculated on the initial principal, which also includes all of the accumulated interest of previous periods. Essentially, it's "interest on interest."

The Rule of 72

A simple way to determine how long an investment will take to double given a fixed annual rate of interest.

Formula: 72 / Interest Rate = Years to Double

Example: If you have an interest rate of 8%, your money will double in approximately 9 years (72 / 8 = 9).

Start Early

The biggest factor in compound interest is time. Starting to save early, even with smaller amounts, can lead to significantly larger returns than starting later with larger amounts.