Our guide to the benefits of compounding
How compounding works and why it can be your most powerful wealth-building tool.
It is said that the world-famous physicist, Albert Einstein, proclaimed that compound interest is “the eighth wonder of the world.” It is described as such because it has the potential to multiply your money exponentially, provided you give it time to work its magic.
The compounding effect – essentially growth on growth that snowballs over time – can have an enormous impact on your finances and can significantly increase the size of your savings and investments in the long term.
So, if you’re looking to grow your savings or investments over time, it’s important to understand how compound interest works.
Our latest guide seeks to explain the basics and demonstrates how it works. Please click on the link below to read or download it.
Our guide also points out that it isn’t just savings accounts that benefit from compounding. Investments like your Stocks and Shares ISA and pensions can take advantage of it too.
And we finish by providing a few tips on how you can make the most of compounding, to make your money work better for you.
If you would like to benefit from compound growth in your savings and investments, in order to help you achieve your investment goals, contact us now to find out how we can help you.
Please note
This guide is for general information only and does not constitute advice. The information is aimed at retail clients only.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
The Financial Conduct Authority does not regulate cashflow planning.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028).
The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.
The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.
Download the Kellands guide to compounding