Compounding Interest – The Magic and Power

Here is the proof:
 

The reason this works is because within a few days you are no longer doubling pennies, but dollars, then doubling thousands of dollars. Every day you are doubling a bigger and bigger number (doubling your money is called making 100%).

How much you earn because of compounding depends on the percent you make and the amount of time the money grows. Of the two (percent and time), time is the more powerful.

If you bought stock in a company at $20 per share and it went up in value starting at only 28 cents a week (1.4% per week), with compounding you would be making 100% on your investment each year and the stock price each year would be doubling. Then in 31 years, every penny that you had invested in this stock would turn into $10,737,418. Every dollar invested would turn into $1,073,741,824. Yes, really!

Other "Why Invest Money?" Topics:

1. Investing Introduction for Adults
   
2. Special Investing Introduction for Children & Young Adults
   
3. Introduction to the Investing Concept of the Golden Piggy Bank
   
4. Compounding Interest - The Magic and Power
   
5. Basic Investing Words You Need to Know
   

				Did you find the information you were looking for?
				After reading the above article, what is still your biggest question? Get Weekly Investing Advice Receive free practical investment advice and tips delivered weekly to your email box with contributions from financial planners, investors, and financing and loan professionals.   I want to ask a question and receive investment tips.   I only want to ask a question and don't want helpful advice. E-Mail Address:   Your Name:

To find more investing and stock related websites input the phrase "investing advice" directly into the search box below or simply type in your own search phrase to see over 1 million other investing, stocks and online trading websites.