Part 6/9:
While compound interest is a boon for investments, it can work against you when it comes to debt, especially credit card bills. Unpaid balances accrue interest on the outstanding amount, and if not paid in full promptly, this interest compounds, making debt grow rapidly.
Advice for Fresh Graduates:
Prioritize paying off high-interest debts quickly. Once debt is cleared, the money saved from interest costs can instead be invested to harness compound growth.
Practical Tips for Young Adults
Pay off debts promptly: To prevent interest from working against you, clear credit card balances in full and on time.
Maximize retirement contributions: Consider topping up CPF special accounts or personal savings that accrue compound interest.