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Reinvesting Meaning: Definition, Examples, and Translations

๐Ÿ’ฐ
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reinvesting

[หŒriหษชnหˆvษ›stษชล‹ ]

Definition

Context #1 | Verb

financial context

Reinvesting refers to the process of putting earnings back into an investment rather than cashing them out. This action can lead to compound growth over time as the reinvested funds generate additional returns. It is a common strategy among investors to maximize their investment portfolios.

Synonyms

plowing back profits, reallocating, reinvesting profits.

Examples of usage

  • She decided to reinvest her dividends in the stock market.
  • Reinvesting profits can significantly increase your wealth over the long term.
  • Many retirees opt to reinvest their retirement funds.
  • The company announced plans for reinvesting profits into new projects.

Translations

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Interesting Facts

Finance

  • Reinvesting dividends is a common strategy where earnings from investments are put back into buying more shares, potentially increasing future earnings.
  • This approach taps into the power of compound interest, where the returns on an investment generate their own returns over time.

Economics

  • Reinvesting plays a critical role in economic growth by allowing businesses to expand operations, improve technology, and create jobs.
  • Governments also reinvest tax revenues into public services, infrastructure, and education to stimulate further economic activity.

Technology

  • In the tech industry, reinvesting profits into research and development is essential for innovation and staying competitive.
  • Companies like Apple and Google are known for reinvesting a significant portion of their profits back into product development and enhanced services.

Psychology

  • Psychologically, the act of reinvesting can be tied to a mindset of growth and long-term thinking, emphasizing patience and the value of building over time.
  • Studies show that individuals who are willing to reinvest in their skills or education often see greater long-term personal and career success.

Origin of 'reinvesting'

Main points about word origin

  • The term combines 're-', a prefix meaning 'again', and 'invest', which comes from Latin 'investire', meaning 'to put on' or 'to clothe'.
  • The modern usage of 'invest' dates back to the late 18th century, initially linked to finance and resources.

The word 'reinvesting' combines the prefix 're-' meaning 'againโ€™ with โ€˜investing,โ€™ which comes from the Latin 'investire' meaning โ€˜to clotheโ€™ or โ€˜to put on.โ€™ Historically, 'invest' originally referred to the act of dressing or putting something on, which evolved to mean allocating resources, especially money, for a profit. The specific term 'reinvesting' likely became prominent in financial literature in the 20th century as economic theories about growth and investment practices developed. The concept has gained traction among investors as a strategic method to improve returns over time, emphasizing the importance of compound interest and wealth accumulation.

Word Frequency Rank

This word's position of #34,152 indicates it's among the more rare English words. While understanding it broadens your vocabulary, focus on more common words first.