Investing 101: The Concept Of Compounding |Investopedia: Are you
looking for more information on currency trading? Try our Forex
Walkthrough, it goes from beginner to advanced.| Albert Einstein
called compound interest "the greatest mathematical discovery of
all time". We think this is true partly because, unlike the
trigonometry or calculus you studied back in high school,
compounding can be applied to everyday life. The wonder of
compounding (sometimes called "compound interest") transforms
your working money into a state-of-the-art, highly powerful
income-generating tool. Compounding is the process of generating
earnings on an asset's reinvested earnings. To work, it requires
two things: the re-investment of earnings and time. The more
time you give your investments, the more you are able to
accelerate the income potential of your original investment,
which takes the pressure off of you. To demonstrate, let's look
at an example: If you invest $10,000 today at 6%, you will have
$10,600 in one year ($10,000