Tag Archives: time value of money

Compound Interest Is Not Magic

You know how compound interest works and you’ve learned not to compound to crazy land, so you might enjoy this comic from XKCD:

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A Multitude Of Stock Market Averages

When you hear something like “the average annual return of the stock market since 1926, which is very near 12 percent annually when adjusted for inflation,” just what does that mean?  You may think an average is an average, but … Continue reading

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Compounding to Crazy Land

So you read my post on How Compound Interest Works earlier, and started a little compounding project of your own, right? Right? So, you may have gone to one of those lovely compound interest calculators that festoon the internet, and … Continue reading

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How Compound Interest Works

You may have heard of compound interest before, or compounding.  But how does it work?  Well, this is your lucky day!  I’ll show you how it works. It’s easiest to imagine interest in terms of bank products, like savings accounts … Continue reading

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