Compound interest: what it is and how it affects you
4 min read
With compound interest, each period's interest is added to the balance and starts earning interest too. That is the snowball effect.
On debt
A credit card balance at a high rate can double surprisingly fast if you only pay the minimum. That is why it should be paid off first.
On savings
The same effect works for you when you invest: the earlier you start, the bigger the result, even with small amounts.
Loan payment calculator
Estimate the fixed monthly payment of an amortizing loan.
Monthly payment
279.56
Total paid
6,709.54
Total interest
1,709.54
Illustrative estimate. Actual rates depend on the lender and your profile.