Compound Clash
Two savers, one question: who ends up with more? Work out whether time, rate or amount wins, then see the real figures.
Frequently asked questions
Why does starting early matter so much?
Money saved early has the most time to earn returns on its returns. A few early years can rival many later ones, though which side wins depends on the rate and the gap.
Which matters more, the rate or the time?
Both, and neither always wins. A lower rate over many more years can beat a higher rate over fewer, so multiply it out for your own numbers.
What is the difference between simple and compound interest?
Simple interest is paid on the original amount only, so it grows in a straight line. Compound interest is paid on the growing balance, so it curves upward and overtakes simple interest as time passes.
Should I raise my savings each year?
A yearly step-up can overtake a bigger flat amount, if the step is large enough and you keep it up. It suits people whose income grows.
Is a higher return a reliable way to catch up?
No. Returns are not guaranteed and usually come with more risk. The amount you save is the part you control.
Is this financial advice?
No. It is an illustrative learning game with simplified assumptions and fixed returns.