Teaching Your Kids about the Power of Compound Interest

Teaching Your Kids about the Power of Compound Interest

Want to give your kid a head start in life? Teaching them about money is a great first step—and one of the best lessons you can share is the power of compound interest.

It sounds fancy, but it’s actually simple: it means your money earns interest, and then that interest earns more interest. Over time, this can grow an investment much faster than you’d expect.

At Blue Pearl Quick Loans, our investors earn 12% annually—that’s 1% per month, compounded. With a minimum investment of $5,000, even a modest gift can become something big over time.

Let’s break it down with the Rule of 72—a quick way to figure out how long it takes money to double. You just divide 72 by the annual interest rate. At 12% annual returns, money doubles in just 6 years. That means a $5,000 investment for your child could grow to $10,000 in 6 years, then $20,000 in another 6!

Source: investright.org

By showing your kids how their money grows month by month, you’re not just helping them save—you’re giving them real-life financial skills. You can even sit down with them and track their investment each month so they can see the results in action.

This kind of early investing can help them save up for big life milestones—like a down payment on a first home—faster than they thought possible.

Plus, there’s a tax benefit: since most kids don’t earn a lot of income, the investment returns stay in a lower tax bracket. That means more money stays in their pocket—not the government’s.

If you're looking for a smart, long-lasting gift that teaches your child about money and helps set them up for the future, this could be the perfect place to start.

Learn more or get started here:
Blue Pearl Quick Loans on FrontFundr

Disclosure Statement:

This document does not constitute an offer or solicitation by anyone in any jurisdiction in which an offer or solicitation cannot be legally made, or to any person to whom it is unlawful to make a solicitation. This document is for informational purposes only and does not provide advice, recommendations, or determinations of suitability in respect of proposed purchases or sales of any securities. Past performance is not indicative of future results, and there are no guarantees of any specific outcomes. Investing in securities involves risks, including the potential loss of principal. Prospective investors should carefully consider their investment objectives and consult with their own financial, legal, and tax advisors before making any investment decisions. This investment opportunity may be suitable only for accredited or qualified investors as defined by applicable securities laws.