Introduction to Compounding

In this episode of Finding The Need, Financial Advice Founded in Faith, let’s talk about compounding. Some of the wealthiest, brightest, most successful financial minds have one mantra and it’s the word compounding. Why is compounding so important? Because compounding is where you take a dollar and then it earns interest and then that dollar’s interest is compounded every single day.

Example of How Compounding Works

So if you put in X number of dollars in one day and then a year later, you take a look at where your account is, if that account has been invested with a financial company that does compounding, then you are going to be very pleased with how your money has grown over the course of that time. If you are disciplined enough, through your advisor, to put money away throughout the months, throughout the quarter of that year, then your compounding is going to have compounding on top of compounding. And you’re going to be very pleased with how that money ends up at the end of the year.


So whether you’re a millennial, Gen-Xer, a Baby Boomer, compounding is one of those things you need to be taking advantage of and there are certain institutions that just believe in compounding and you need to make sure that your advisor gets you with those companies that do compounding. And if you’re compounding, you’re going to love how it’s going to end up. If you’re not compounding, you’re not going to be as happy as those guys that are compounding. Talk to your advisor.

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Watch This Series from the Beginning

Check out the first video in this series, "Introduction: Finding the Need" with host Bob Abbate. In this introduction, Bob will guide viewers on how to protect one's family, assets, investments, and also one's business. He will do this in a Catholic-centric way and in a way that is centered around the three Fs: faith, family, and finances.