Lesson 13

The compound effect

Interest on interest

If your gains stay invested, they earn gains themselves. €1,000 at 5% a year becomes about €1,629 after 10 years and almost €4,322 after 30. The effect gets stronger over time.

Time beats timing

Starting early needs less money for the same goal. A late start is hard to make up. That is a reason to save small amounts early.