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Interest
Personal
WHAT IS IT?
Interest is the amount charged for borrowing money or paid on certain savings and investments.
IN PLAIN ENGLISH
It is the cost of borrowing or the return paid for allowing money to be used.
SIMPLE EXAMPLE
Borrow £1,000 at an interest rate and you may repay more than £1,000. Save money in an interest-bearing account and the provider may pay you interest.
WHY DOES IT MATTER
The rate, balance and length of time can all affect how much interest is paid or received.
THE ROCKET TEST
Interest is either the cost of borrowing or the return paid on certain savings.
SEE IT IN ACTION
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