Saving is something that is hopefully at the top of everyone’s New Year’s resolution list. The magic of financial growth seems to be in compound interest, and its impact in the wealth creation process.
Albert Einstein called it the eighth wonder of the world, and it has received high praise from financial gurus like Warren Buffet. Compound interest seems to be the forgotten gem in the world of finances.
Gauteng Regional head of Overberg Asset Management Werner Erasmus joins Africa in studio to chat about compound interest as a forgotten secret to success.
Compound interest is a really powerful tool but because it takes a bit of time to really kick in. People sometimes forget about it or are reluctant to keep their money invested for a long time.— Werner Erasmus, Gauteng Regional head of Overberg Asset Management
Erasmus says that compound interest is like a snowball, if you leave your money invested, and reinvest the returns you receive every year the results are exponential. He adds that the longer you reinvest the returns you receive on an annual basis, the quicker your snowball will grow.
Click on the audio below for more info…
This article first appeared on CapeTalk : [LISTEN] Compound interest: a forgotten secret