In 2020 David inherited a property and has spent the past few years renovating it. In 2024 David sold the property and made £100,000 profit. David now has total savings of £125,000 in his savings account.
David’s bank will give him 3.75% compound interest for the next 2 years.
If David keeps the £125,000 in his savings account how much will it be worth in 2026.
Answer:
You must multiply the saving account’s worth by the percentage multiplier of 1.0375 for each year
£125,000 x 1.0375² =£134,550.78