Compounded Interests

by Rabbi Mordechai Rhine

The prohibition against charging interest is a fascinating one. In the world of banking, it is normal for a lender to charge interest on a loan. This charge is similar to the charge that a car rental company imposes if you want to us their product. If you want to use someone else’s money, it seems fair that interest should be charged. Yet, the Torah prohibits us from charging interest when we grant another Jew a personal loan. For example, if a person has fallen on hard times and has trouble paying his utility bill, while it is a mitzvah to loan him the money he needs, interest may not be charged.

The Sefer HaChinuch explains the mitzvah in the following way. “G-d wanted the world to be a success. G-d did not want that one person should swallow up another person’s assets without anyone realizing that it is happening. The way of compounded interest is that suddenly the person is left with nothing.”

The Torah recognizes the enormous power of compounded interest. A person may start with a little loan to pay his utility bill. But if he leaves the interest process going unchecked, the amount that he owes can grow exponentially. Day after day the amount owed is recalculated. The Torah prohibits us from unleashing this destructive power against another Jew.

The power of compounded interest is that without realizing it the amount owed keeps getting bigger. Once the system is in place, a person doesn’t realize it, but the numbers are constantly being recalculated.

The question I would like to pose is, after recognizing the enormous power of charging interest, is it possible to channel this power in a meritorious manner?

I believe it is.

Consider this example. In our time it is common for people to subscribe to automatic investment plans. “Pay yourself first,” is the slogan of many investment companies. Indeed, if a person places an automatic investment plan in place, he can come back years later and find that simply by putting a system in place he has managed to accumulate significant wealth. Similarly, I would suggest, if a person gets into a routine of doing a certain mitzvah, then without even realizing it, over time the mitzvos accumulate.

I knew a couple who used to do “hospital rounds” every day after work. They simply scheduled in an extra half hour to visit the ill before they went home from work. Over years they put in thousands of hours of mitzvah time; they spread good cheer to hundreds of patients. Their dedication became so much a part of their life that they didn’t even realize that they were doing anything special. Such is the power of setting up the system of a mitzvah routine. Day after day the mitzvos accumulate without our even realizing the accomplishment.

Let’s try another application. It is well known that Judaism is an action focused religion. We should often be asking ourselves, “What mitzvos have I done today?” But the concept of compounded investments means that you can put a system in place which will allow you to accrue merit daily, even on days that you aren’t involved in a particular mitzvah.

Consider a person who welcomes a person warmly into the synagogue. The newcomer feels at home and decides to attend synagogue more frequently. Soon he becomes an initiator of programs that benefit the Jewish community. All of his accomplishments can be traced to the warm smile of the person who welcomed him warmly on his first day. With time, the merit of that original smile grows exponentially, and becomes a formidable fortune. Such is the power of setting a good thing into motion.

The Torah recognizes the amazing impact of compounded interest. If we can channel that energy in a positive way, then we are capable of multitasking in a way never dreamed possible. Set good projects into motion; give people a kind encouraging word. Each day you will be paid a percentage of merit for the good deeds performed because of your investment.

G-d wants the world to be a success. G-d wants that a person should increase his merits without even realizing what is happening. So go ahead. Set good things into motion. The nature of compounded interest is that suddenly you will find yourself a wealthy person indeed.

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