How Compound Interest Makes Saving For Retirement Possible
What did Albert Einstein say was the 8th wonder of the world???
Most would guess The Theory of Relativity or E=mc² but no that wasn’t it. Einstein was actually talking about finance.
Albert Einstein said, “Compound Interest is the Eighth Wonder of the World.”
He also said that compound interest is the most powerful force in the universe. This was a pretty powerful statement coming from the father of modern physics.
“He who understands it…earns it…He who doesn’t…pays it.” ~Albert Einstein
What is Compound Interest?
Compound interest is the interest you earn from the original amount (called the principal) of an investment plus any interest you’ve made through the investment.
In more simple terms, it is the interest you earn on interest.
“Money makes money” ~Benjamin Franklin
If you are just dipping your toe into the world of finance, I know this can be a bit confusing. All you need to remember is that compound interest is simply the interest you earn on interest.
