“Money Makes Money”—But How?
Ever heard someone say, “Just let your money grow with compound interest”?
It sounds like finance jargon. But don’t worry—Vizzve is here to break it down in plain, simple language, so you can actually use it to your advantage.
🔄 What Is Compound Interest?
🧮 In One Line:
Compound interest is interest earned on both your original money AND the interest it already made.
That’s right—your interest starts earning more interest.
📊 Simple Interest vs Compound Interest
Let’s compare:
| Year | Simple Interest (on ₹10,000 @10%) | Compound Interest |
|---|---|---|
| 1 | ₹1,000 | ₹1,000 |
| 2 | ₹1,000 | ₹1,100 |
| 3 | ₹1,000 | ₹1,210 |
| Total | ₹3,000 | ₹3,310 |
The difference keeps growing every year!
💡 The Formula (Optional, but Good to Know)
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Compound Interest = P(1 + r/n)^(nt) - P
Where:
P = Principal (initial money)
r = Interest rate
n = Number of times interest is applied per year
t = Time in years
But don’t worry—Vizzve calculates all of this for you automatically.
🚀 Why It’s Called “The 8th Wonder of the World”
Albert Einstein (allegedly) said:
“Compound interest is the 8th wonder of the world. He who understands it, earns it… he who doesn’t, pays it.”
That means:
💰 Savers = earn interest on interest
💳 Borrowers = pay interest on interest if they delay payments
🧠 Real-Life Example
Rhea invested ₹5,000/month at 12% interest for 20 years.
Her total investment = ₹12 lakhs
Total corpus with compounding = ₹49.95 lakhs
She earned nearly ₹38 lakhs in interest!
That's the power of compounding. Start early. Stay consistent.
💸 Where Does Compound Interest Work?
✅ You Earn It From:
Fixed Deposits (FDs)
Recurring Deposits (RDs)
Mutual Funds (reinvested)
PPF, NPS, EPF
Vizzve's compounding micro-investment plans
❌ You Pay It On:
Credit card debt
Missed loan EMIs
Payday or personal loans if delayed
🧠 How Vizzve Finance Helps You Use It Smartly
📈 Auto-calculate compound growth with savings/investment tools
🔔 Reminders to invest early and regularly
⚠️ Alerts on compound debt risks (like credit card interest)
💰 Build wealth with small steps, big impact
🧠 FAQs
Q1: How often does compounding happen?
It depends—annually, quarterly, monthly, or even daily. The more frequent, the faster your money grows.
Q2: Can I earn compound interest monthly?
Yes—especially in mutual funds, RDs, and some digital savings tools like Vizzve’s smart plans.
Q3: What if I delay investing by 5 years?
You lose a huge chunk of future earnings. Compounding needs time to work magic—start now.
🏁 Final Thought
Compound interest is your financial best friend—if you start early and stay consistent.
Whether you’re saving ₹500 or ₹5,000/month, Vizzve Finance helps you turn those small amounts into big milestones.
Published on : 8th July
Published by : SMITA
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RBI-Registered Loan Partner | 10 Lakh+ Customers | ₹600 Cr+ Disbursed.