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Compounding - Definition
Below, you'll find a definition of this investing term...

Definition: This is the concept that you earn interest on the interest you have already earned.  At first, your money grows slowly, but as time passes, your money grows more rapidly.  This is often considered the "eighth wonder of the world."

TeenAnalyst Advice: We're serious when we say that compounding can make you rich.  In order to gain the full benefits of compounding, you need to keep your money invested for a prolonged period of time.

 

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