Compounding

Front

A key difference between saving and investing is

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Saving is for emergencies & goals, investing is for long-term wealth

Front

Why is compound interest more advantageous than simple interest?

Back

In compound interest, you earn interest on not only your principal, but also on the interest you’ve already made.

Front

How often does semiannual compounding occur?

Back

Twice a year

Front

When an account compounds quarterly, how often does interest get applied?

Back

Every 3 months

Front

Making choices between saving and investing depends on these two factors: Your time horizon and when you will need access to the money

Back

Your time horizon and when you will need access to the money

Front

Why is it important to start investing as soon as possible?

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You have more time for your money to compound

Front

The Rule of 72 is used to find how long it will take for

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investments to double

Front

Rule of 72: How many years to double my money if I get a 9% return on investment?

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8 years

Front

Which of the statements below, regarding inflation, is accurate?
You want the inflation rate to be higher than the interest you’re earning on your investments.
You want the inflation rate to be lower than the interest you’re earning on your investments.
If you invest your money, you don’t need to worry about inflation.
Historically, investment returns have always outpaced inflation.

Back

You want the inflation rate to be lower than the interest you’re earning on your investments.

Front

A series of equal payments, made or received, at regular intervals is called:

Back

An annuity