Stock Charts

WHY YOU SHOULD START INVESTING AT AN EARLY AGE ?
COMPOUNDED INTEREST !!!!

\$ 100 INVESTED

10%                   15%                20%              25%                  30%
1 yr                    110                  126.50             151.80             189.75              246. 68

\$ 200 invested

10%                      15%              20%              25%                  30%
1yr                   220                      253                 303.6            379.5              493.36

\$300 invested

10%                      15%              20%              25%                  30%
1yr  .                440                        506              607.2               759                  986.72

EXAMPLE:

MARY  DEPOSITED \$1,000 AT 10%  INTEREST RATE FOR 5 YEARS. HOW MUCH MORE MONEY WILL MARY HAVE IN HER ACCOUNT FROM COMPOUND INTEREST THAN FROM SIMPLE INTEREST IF IT IS COMPOUNDED SEMIANNUALLY? (two times a year)

SOLUTION:
SIMPLE INTEREST:
A=P =(P* R*T)
A=1000+(1000*0.1*5 )
A= 1000= (100*5)
A= 1000+500
A= \$1,500

COMPOUND INTEREST:
K*N
A= P(1+R RK)*   2*5
A= 1000(1+0.1/2)
10
A= 1000(1+0.05) 10
A= 1000(1.05)
A= 1000* 1.62889
A= \$1,628.89

\$1628.89 (COMPOUND INTEREST)- \$1500 (SIMPLE INTEREST)=\$128.89

It doesn't seem like a big difference, but if you multiply this over a number of years, you then have a very big difference!

Calculations done by Kseniya Isakova