How to Calculate Compound Interest When Buying Del Mar Homes

Compound interest means interest is being accrued not only on the principal amount but you are also accruing interest on the already accrued interests.  Essentially, you are making interest on the money you've already made. 

If you are considering investing in Del Mar homes, it's valuable to understand and know how to calculate compound interest. 

I've chosen a simple principal amount of $1,000,000 and an interest rate of 6%, compounded over three years.

* Year 1

$1,000,000 X .06 for one year is $60,000 interest.

* Year 2

Now we have $1,060,000 X .06 for the second year is $63,600 interest.

* Year 3

Starting with $1,123,600 accumulated X .06 = $67,420 interest.

At the end of the third year we have a total compounded interest amount of $1,191,020.

Calculating your compound interest versus interest alone shows how beneficial compound interest really can be to investing in Del Mar Homes.