A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- Time Value of MoneyThe idea that a dollar today is worth more than a dollar later, because money you have now can be invested to grow.
- Present ValueWhat a future sum of money is worth today, once you account for the return it could earn between now and then.
- Compound InterestInterest that earns interest — the engine behind long-term growth.
- Savings RateThe share of your income you set aside rather than spend, usually shown as a percentage of your take-home pay.
- AppreciationAn increase in an asset's value over time, such as a home or stock becoming worth more than you paid.
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Plain-English education — not personalized legal, tax, or investment advice.