3 Things Everyone Needs to Know About Compound Interest, Including Kids!

An excerpt from Sammy Rabbit’s Corner:

When it comes to money and financial education, compound interest is the ‘big sexy.’ By that, I mean it is attractive. Experts enjoy talking, teaching, and romanticizing about its mesmerizing and magical mathematical qualities. And, why not? Compound interest is amazing. Mellody Hobson, President of Ariel Investments, ruminates, “If you understand compound interest, just that alone is a game changer.” Warren Buffett states, “My wealth has come from a combination of living in America, some lucky genes, and compound interest.” And, Albert Einstein is widely claimed to have declared, “compound interest is the most powerful force in the universe. Those who understand it, earn it. Those who do not, pay it.”

Their hope is a noble and practical one – that the exponential powers of compound interest will lure and persuade each of us to make better financial choices, consistently. Adding, subtracting, multiplying, dividing, entering and tracking numbers can be off-putting in comparison to compound interest. Never mind they are the skills essential to managing money and being financially competent. They are a turn-off. They do not spin heads or open eyeballs. Arguably the most glamorous thing you can say about budgeting is, you need to do it. On the other hand, compound interest captivates and motivates. It grabs attention. It can make you or anyone rich. Indeed, compound interest is one key to unlocking treasures, if, we choose to turn it on and give it time to do what it does. Here are the three things everyone needs to know about compound interest including kids…READ MORE

This was a guest article written by Sam X Renick for Money Masters TV

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