THE POWER OF INTEREST

DAVE RAMSEY'S INVESTMENT CALCULATOR

WHAT ARE SOME ITEMS YOU MAY LOAN TO A FRIEND?

The owner does not get to use the item for a period of time.

A saver is paid when they allow a borrower to use their money for a period of time.

Interest is paid by a borrower and received by a lender or a saver.

“HE WHO HAS THE GOLD---RULES!”

“I do not believe Dave

Ramsey’s claim.”

SIMPLE INTERESTPaid on the amount of the original investment and does not change over time.

A1 Type the word SimpleA2 Type in 100A3 = A2 + 5Drag

COMPOUND INTEREST

Paid on the amount of the original Paid on the amount of the original investment investment and all accrued interestand all accrued interest..

C1 Type CompoundC1 Type CompoundC2 Type 100C2 Type 100C3 = C2 * 1.05C3 = C2 * 1.05

ADD $2,000 STARTING WITH A $100 INVESTMENT

E1 Title Add $2,000 per year

E2 Type 100E3 = (E2 * 1.05) + 2000

RULE OF 72 HOW MANY YEARS TO DOUBLE YOUR MONEY?

Divide 72 by the Interest RateInterest rate is 4 72/4 = 18 years.Interest rate is 18 72/18 = 4 years