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It's Your Paycheck Lesson 5

In this lesson you will calculate compound interest to identify the benefits of saving in interest-bearing accounts. You will learn the "Rule of 72" and apply it to both investments and debt. Finally, you will learn that there is a relationship between the level of risk for an investment and the potential reward or return on that investment.

When you have finished this lesson you should be able to:

  • Explain the difference between a non-interest bearing account and an interest-bearing account.
  • Calculate interest compounded semiannually.
  • Explain and demonstrate the Rule of 72.
  • Describe the risk-reward relationship.