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Annuities are how smart people save!  This is where you invest a set amount each month...

A little at a time is the way to go!

Here's how it works:

Let's invest $100 each month at 12% compounded monthly...

Beginning of January:  You put in $100.

On the last day of January:

They compute your interest...

(Remember that, if we make 12% for the whole year,
we'll make 1% each month.)

100 + .01( 100 ) = $101

On February 1st:  You put in another $100.

$101 + $100 = $201

On the last day of February:

They compute your interest...

201 + .01( 201 ) = $203.01

On March 1st:  You put in another $100.

$203.01 + $100 = $303.01

On the last day of March:

They compute your interest...

303.01 + .01( 303.01 ) = $306.0401

On April 1st:  You put in another $100.

$306.0401 + $100 = $406.0401

On the last day of April:

They compute your interest...

406.0401 + .01( 406.0401 ) = $410.100501

On May 1st:  You put in another $100.

$410.100501 + $100 = $510.100501

On the last day of May:

They compute your interest...

510.100501 + .01( 501.100501 ) = $515.201506

On June 1st:  You put in another $100.

$515.201506 + $100 = $615.201506

On the last day of June:

They compute your interest...

615.201506 + .01( 615.201506 ) = $621.3535211