ECONOMICS
BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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a person can stop saving at age 40.
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of the effect of compounding on growth.
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income is greater when a person is young.
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a person will not need insurance.
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Detailed explanation-1: -The more you invest and the earlier you start means your retirement savings will have that much more time and potential to grow. By investing early and staying invested, you may be able to take advantage of compound earnings. “Make money on your money” is the concept behind compounding.
Detailed explanation-2: -Why investing matters. Investing is an effective way to put your money to work and potentially build wealth. Smart investing may allow your money to outpace inflation and increase in value. The greater growth potential of investing is primarily due to the power of compounding and the risk-return tradeoff.
Detailed explanation-3: -Why is compound interest important? Compound interest causes your wealth to grow faster. It makes a sum of money grow at a faster rate than simple interest because you will earn returns on the money you invest, as well as on returns at the end of every compounding period.