GLOSSARY · FIRE & EARLY RETIREMENT
Compound growth
Growth on both what you put in and the growth already earned, so a balance grows faster the longer it is left alone. Time invested matters as much as the rate.
Also called: compound interest, compounding
FORMULA
Future value = present value × (1 + r)^n, plus the growth on each later contribution
COMPUTE IT WITH YOUR NUMBERS
LEARN IT PROPERLY
CHAPTER · BUDGETING METHODS & FUNDAMENTALS · FOUNDATIONSWhy Budgets Fail and How to Build One That LastsCHAPTER · BUDGETING METHODS & FUNDAMENTALS · FOUNDATIONSBuilding the Structure: Take-Home Pay, Order and AccountsRELATED TERMS
SOURCES
- The Theory of Interest. Irving Fisher, 1930.