It's Your Paycheck, Lesson 5: Savvy Savers
In this lesson you will calculate compound interest to identify the benefits of saving in interest-bearing accounts. You will learn the "Rule of 72" and apply it to both investments and debt. Finally, you will learn that there is a relationship between the level of risk for an investment and the potential reward or return on that investment.
When you have finished this lesson you should be able to:
- Explain the difference between a non-interest bearing account and an interest-bearing account.
- Calculate interest compounded semiannually.
- Explain and demonstrate the Rule of 72.
- Describe the risk-reward relationship.