What The Heck is Compounded Interest?

Have you ever seen this story about the power of compound interest?

Like an example they use is the guy who saves $10,000 in his twenties and then allows it to accrue interest over 20 years or 30 years without ever adding more versus the guy who starts late.

He doesn’t start saving until his thirties or forties, or I can’t remember the exact details, but the gist of it is that if you save early and hit a certain threshold and allow that money to compound over time, you don’t have to keep making investments into it.

It just grows by itself.

Off of the principle.

Now I know right now the stock market doesn’t seem like it’s growing anywhere,

Which isn’t quite true because I follow some stocks individually.

And even though the market as a whole is down, some stocks are making moves.

It’s not much.

Unless you count 10%, sometimes 5% as much.

I think those are the actions that day traders and trading bots are making with micro purchases and sales just to keep the tickers moving.

But from our perspective right now, stocks are at a huge discount.