The Power of Compound Interest: Watch Your Savings Grow!
Did you know that ₹10,000 invested at 6.50% p.a. returns doubles in 11 years?Wondering how?It is through compound interest.Let’s decode.
If you invest ₹100 at 5% returns per year, you receive an interest of ₹5. In the 2nd year, the interest is calculated on ₹105, and you will earn ₹5.25.
Every year, the interest gets added back to the deposited amount. As the deposited amount increases, the interest income also increases.
For instance, interest on ₹1,000 at 5% interest compounded annually is ₹50.
When investing, choose avenues that compound the interest more frequently for better returns. Stay invested longer for higher returns.