See how your money grows with the power of compounding over time.
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest, it makes your money grow exponentially — often called the "eighth wonder of the world" by financial experts.
A = P(1 + r/n)^(nt)
Where: A = future value, P = principal, r = annual interest rate, n = compounding periods per year, t = time in years.
Divide 72 by your annual return rate to estimate how many years it takes to double your money. At 7%, your investment doubles in roughly 72 ÷ 7 = 10.3 years.
Investing $10,000 at age 25 vs age 35 at 7% annual return: at 65, the age-25 investor has ~$149,745 while the age-35 investor has ~$76,123 — nearly twice as much from the same initial investment, just starting 10 years earlier.