A Multiply Money Guide
Have you ever wondered why people often say that time is money? When it comes to saving, time is your best friend. The sooner you start, the better. But most of us put it off for later because we always assume that we must start with large sums of money. The truth is, you can start small and leverage the power of compound interest over time. Here is a simple guide on starting small and finishing big through compounding with Multiply Money.
What is compound interest?
The formal definition
Compounding is the ability of an asset to generate earnings, which are then reinvested or remain invested to generate more earnings-generating earnings from previous earnings.
A simple example:
Piet and Lerato each buy two cows. Piet believes in instant gratification and decides to host a spit braai. A week later, he no longer has any cows.
Lerato, on the other hand, decides to keep her two cows, and a few months later, one of the cows gives birth to another. 5 years later, after leveraging the power of time and compounding, Lerato has an entire herd since her calves had more calves too. She even decides to sell a few to Piet.
Like Piet, many of us tend to host spit braais with our money after payday. We work hard all month long, spend it all, and start the cycle again the next month.
However, if you save as little as R100 per month, you will earn interest over time, and that interest will also start earning interest. Next thing you know, just like Lerato, you have unlocked the power of compounding.
Where and how do I start?
With no minimum deposits, getting started is easy. Set a goal and deposit any amount into your Multiply Money today.