Compound Interest Explained (and Why It’s So Powerful)
By Allen Krewzz
The Core Idea
Simple Interest vs Compound Interest
Why Compounding Frequency Matters
The Power of Time
A simple estimation shortcut is the "Rule of 72": divide 72 by your annual interest rate to get a rough estimate of how many years it would take your money to double, assuming that rate holds steady.
When Compounding Works Against You
Carrying a balance on high-interest debt allows compounding to work against you in the same way it works for you in savings — the longer interest goes unpaid, the faster the total owed accelerates.