Hi there,
Hi guys and gals, sorry for my ignorance but I am having trouble getting my head around this for some reason. Here it goes:
Simple Interest
VTB - 200,000
Rate - 5%
Term - 10years
200k x 5% = 10k
10k x 10yr = 100k
So after 10 years we have the VTB paid back for a total of 300000k
Compound Interest
Conventional - 200,000
Rate - 5%
Amortized - 10yr
2166.30 mthly pmt x 120 = 253956.00
So compounded is a savings of 46044.00
The simple interest should be less than the compound? What am I missing here?
Thanks
Wade
Hi guys and gals, sorry for my ignorance but I am having trouble getting my head around this for some reason. Here it goes:
Simple Interest
VTB - 200,000
Rate - 5%
Term - 10years
200k x 5% = 10k
10k x 10yr = 100k
So after 10 years we have the VTB paid back for a total of 300000k
Compound Interest
Conventional - 200,000
Rate - 5%
Amortized - 10yr
2166.30 mthly pmt x 120 = 253956.00
So compounded is a savings of 46044.00
The simple interest should be less than the compound? What am I missing here?
Thanks
Wade