Usually, for most people, the words interest rate, loan, or investment don't come up within the first 5 minutes of a first date. If they do, you could be in for a bit of a boring evening (unless of course, you're on a date with Warren Buffet).
We thought it would be nice to start this post off with some good news. Slowly but surely we’re seeing more and more banks telling us how important it is for them to invest our savings responsibly. And not just the usual suspects like Triodos. Large banks like ABN AMRO, ING and Rabobank feel urged to work on their corporate image.
At Lendahand, people can invest in our local partners (banks and non-banking financial institutions) or directly to entrepreneurs through crowdfunding. These investments have interest rates of approximately 2.5 to 8 percent annually. As you can see, this is quite a difference. The higher the interest, the higher the price that needs to be paid. But the price of what, exactly?
Recently I asked the following question in the office: assume you are really strong, you tear a phonebook in half and stack the two halves on top of each other. You tear the stack and put the new parts on top of each other again. Once more, you tear and stack. You get the idea. Now the question was: how many times should you repeat this process in order to be able to jump off the stack onto the moon? My colleague’s answers ranged from 5,000 to 1,000,000 times. Before reading on, how many times do you think you would need to tear and stack the phonebook?