Why compound interest is important
25 Nov, 2020
Many of us are building a pension fund, a portfolio of shares or deposits with our bank or building society.
Most of these investment options reward us for our participation by offering income (usually in the form of interest or dividends) or by demonstrating capital growth (share prices increasing).
Accordingly, there are three components to our investments: the capital sum we invest, any growth in the value of the capital sum invested or rewards (interest or dividends) paid by banks or companies in which we hold shares.