An annuity is a system of accumulating a lot of money through several ways of equal and regular form of payment. Interest is regarded as the cost incurred after one borrows money from either an individual or a bank and the interest is always paid by the person who borrows money. Thus, for one to be in a good position to understand full concept of interest and its rates, he or she should be well equipped with the knowledge about simple and compound interest and on how both are calculated (Lipschutz 19).
Money is always considered as natural thing in our lives. Just like oxygen that we breathe, it is part and parcel of our daily activities that we always carry out in our lives. The word of God through the bible gives us several ways of using money in a very wise manner. This implies that the bible teaches us several lessons about money and gives lessons on the attitude we should have towards money and ways of using and not using money. The book of proverb in particular deals mainly with matters related to our daily life.
In proverbs 20:18 it is written that we should always make our plans by seeking advice; this will serve to avoid unnecessary borrowing of money every time. Naturally, borrowing and lending of money in the society has been an issue which has been passed on from generation to generation and it has been regarded as a way of life. People borrow money and pay back with a lot of interest though these issues are perceived differently in the bible. Money borrowing and lending is considered negative way of getting money and it is referred to as unwise. Proverbs 22:7 says “The rich rule over the poor, and the borrower is a servant of the lender” when one borrows he or she have to pay back large sums of money therefore they become slaves of the lender (American Bible Society).