How Compound Interest ACTUALLY Works

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Опубликовано:

7 сен 2024

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Комментарии : 30

@Dr.JubairsFinance Месяц назад

Join Trading 212 Invest with my link, and we will both get free shares: www.trading212.com/promocodes/JUBAIR

@noonecaresm8641 Месяц назад

I'm currently almost at 1 year mark, 39 more to go.

@Dr.JubairsFinance Месяц назад

You can do it!

@levibeats2183 Месяц назад

Yes but please tell me where should I put my money in side of trading 212? ISA and where please ?

@Dr.JubairsFinance Месяц назад

I can't tell you what to invest in unfortunately

@deanmartin9358 Месяц назад

well your advice works for me Jubair keep up the good work have a great weekend

@Dr.JubairsFinance Месяц назад

Not advice 😅, but thanks Dean! You too

@stevesmart2545 Месяц назад

Silly question but aren’t savings and investments different things? I understand where compound interest applies to savings but I don’t see it applies to investments I.e. stocks and shares. Or am I missing something?

@Dr.JubairsFinance Месяц назад

Technically stocks don't receive compound interest, but they can benefit from compounding value. So essentially the return on the principal amount can be considered the interest. If a stock grows by 5% each year and it's not withdrawn, then it will behave similarly to a bank account that pays the same amount (minus fees). I hope this helps

@stevesmart2545 Месяц назад

@@Dr.JubairsFinance thanks for answering my question. I thought I was missing something, but you have confirmed my understanding of the term, and and that, in my view, CI doesn’t really apply to shares.

@playingFTSE Месяц назад

@@stevesmart2545it absolutely does apply to shares for the reasons discussed above. CI is just when money made starts making money, which is absolutely the same as receiving interest. Stick it in a calculator it's exactly the same formula. For example you have a stock that grows at 10% per year. You pay £100 for it. At the end of year one it's £110. At the end of year two though it's worth £121, year three £133.10 - it's not £10 per year it's compounding.

@Dr.JubairsFinance Месяц назад

Thanks Steve for the clarification!

@thomaskuttypa6005 Месяц назад

Hai Jubair, I have a doubt regarding the self assessment, If i invest in the portfolio in Trading 212. Do I have to do the self assessment at the end of the financial year.

@Dr.JubairsFinance Месяц назад

Best to consult an accountant, but usually if you make more than £3,000 in capital gains, or £500 in dividends or over £1000 in interest (basic rate), then you have to fill in a self assessment.

@thomaskuttypa6005 Месяц назад

@@Dr.JubairsFinance thanks 😊

@thebill8891 Месяц назад

@@Dr.JubairsFinancewhat if you don’t sell anything at all

@Dr.JubairsFinance Месяц назад

If you don't sell, you can still make money from Dividends though, so it's best to go through an accountant if you exceed your personal allowances

@andrewmuscat9794 Месяц назад

Would dividends also play a part in this? Anything I get is reinvested so surely that will also help with the compounding as it adds to the portfolio value and also the dividend amount increases the more shares are owned in any given stock? I realise of course the yield can decrease as well as increase at any point

@Dr.JubairsFinance Месяц назад

Yes, dividends will further add to the compounding.

@luisluis5306 Месяц назад

I just need to get on with it and open a ISA.

@Dr.JubairsFinance Месяц назад

Only when you're ready!

@luisluis5306 Месяц назад

@@Dr.JubairsFinance I think its time i have 0 debt and im about 20% cash.

@faisalahmed05tm66 20 дней назад

Interest makes the rich richer and the poor more poor - there’s a reason its a sin

@realbartie Месяц назад

Your T212 ISA appears to be all in cash and committed to a trade. Out of interest (pun intended), what is that? You're not trying to time the market are you ;)

@Dr.JubairsFinance Месяц назад

It's actually all invested now. Nice pun. I am human at the end of the day, I get excited with new market highs, I try my best to stay on course. One of the reasons why I made this channel!

@deltaechomusicnh555 Месяц назад

Misleading thumbnail.

@Dr.JubairsFinance Месяц назад

Start with £10k, deposit £500 per month for 30-40 years, 1 million is definitely not out of the question. This was the point of the video. I'm sorry that you were mislead by it.