Comments on: What is Interest?

By: Francois Viljoen

Francois Viljoen — Wed, 28 Apr 2010 10:45:40 +0000

@Vicky

I’m not exactly sure what you’re asking, but you should always try to make investments that will generate an above inflation return.

If your investment growth is less than inflation, then you are actually loosing money.

E.g. if you’re earning 5% return on your investment, but the inflation rate is 6%, then even though your invested amount increases, you will be able to buy less with that money, than you would have been able to buy a year earlier.

By: Vicky

Vicky — Sun, 25 Apr 2010 09:31:29 +0000

Hi there,

Can anyone please explain to me the need for compound investment growth in relation to inflationary aspects of the South African economy? Please

By: Francois Viljoen

Francois Viljoen — Thu, 08 Oct 2009 09:26:03 +0000

@Esme

You’ve lost me here. Which calculations are you talking about?

By: Esme Knox

Esme Knox — Wed, 07 Oct 2009 13:33:09 +0000

Presume all calculations done before VAT, as VAT is state money? We are having a bit of a debate in the office.

Thanks

Esme

By: Francois Viljoen

Francois Viljoen — Thu, 04 Jun 2009 08:32:21 +0000

@Duncan

Thanks for pointing out the mistakes.

By: Duncan

Duncan — Thu, 04 Jun 2009 08:22:54 +0000

Great article – certainly cleared some things up that I have been struggling with! Just two bugbears I noticed though – both in the definition of Compound Interest – firstly, a common mistake: you never lend anything FROM anyone, you borrow it (“For example, if you lend (should be BORROW) R1000 from someone, at an interest rate of 10% per year…”)

Secondly (not so essential, but still a bugbear of mine) – “Einstein called it the EIGHTH (not eight) wonder…”

Sorry for being anal, but I didn’t want your fascinating explanation to go tarnished by some basic language errors.

Thanks!