What is compound interest actually doing?
Why do people say starting at 25 beats starting at 35 — even with less money?
The simple version
Compound interest means your growth earns growth. Year one, you earn on what you put in. Year ten, you're earning on ten years of earnings too.
Coral = growth you didn't pay in yourself.
4
8
12
16
20
24
28
30
You put in
£36,000
Growth
£61,451
Illustration only. Investments can go down as well as up.
✓
Key takeaway
Time does more of the heavy lifting than the amount. Starting small, early, beats starting big, late.
Nice work — that's one more thing you understand.
Create a free account to track what you've learned.
Save my progress