The original amount of money invested or saved.
Fixed Interest Rate
The rate will not change for the lifetime of the investment.
The uncertainty of the outcome of an investment.
The steady rise in the general level of prices.
Earning interest on interest.
Interest earned on the principal investment.
What an amount invested today at a particular interest rate will be worth in the future.
The amount of money today that would be needed, with a certain interest rate, to make a certain future amount of money
The number of times interest is earned.
Time Value of Money
Money received in the future is not equivalent to money received today.
Percentage rate paid on the money invested or saved.
The portion of current income not spent on consumption.
A savings plan that recommends that 70% of your money is spent, 20% should be saved and 10% should be invested.
Pay Yourself First
Taking out a portion of a paycheck for saving or investing BEFORE using any of the check for spending.