compound interest
Interest on interest
Compound interest is interest calculated on both the original principal and any previously accumulated interest.
Unlike simple interest, which applies only to the principal, compound interest grows exponentially over time: The magic of compound interest turned her modest savings into a substantial nest egg.
The frequency of compounding—daily, monthly, yearly—affects how quickly the amount grows.
Chief school administrator
- reinvestmentReturning gains to capital
- frequencyRate of recurrence
- capitalizationUsing big letters properly
- accrualIncremental addition over time
accumulation · snowballing · quarterly · monthly · daily · future value · present value · exponential growth
Raising to a power
- formulaFixed method or notation
- geometric growthIncrease by fixed proportion
- logarithmicBased on exponents
- exponentialIncreasing by constant ratio
multiplication · power · rate · calculation · financial calculator · sequence · calculus · percentage
Interest-bearing bank holding
- depositPlace for safekeeping
- nest eggSaved money for later
- emergency fundReserve for unexpected expenses
- certificate of depositTime-locked bank savings
high-yield savings · money market · time deposit · saver · thrift · piggy bank · passbook · maturity date
Collected works or assets
- dividendsProfits paid to shareholders
- securitiesTradeable financial assets
- stocksOwnership stakes or inventory
- bondsTies that unite
mutual funds · retirement accounts · IRA · 401(k) · annuities · capital gains · equity · brokerage
Borrowed-funds payment tool
- loanBorrowed money repaid later
- mortgageSecured home loan
- APRYearly borrowing cost
- amortizationGradual debt reduction schedule
principal balance · minimum payment · debt spiral · refinance · liability · creditor · payoff
principal
Chief school administrator
- reinvestmentReturning gains to capital
- frequencyRate of recurrence
- capitalizationUsing big letters properly
accrual · accumulation · snowballing · quarterly · monthly · daily · future value · present value · exponential growth · doubling time
exponentiation
Raising to a power
- formulaFixed method or notation
- geometric growthIncrease by fixed proportion
- logarithmicBased on exponents
exponential · multiplication · power · rate · calculation · financial calculator · sequence · calculus · percentage · decimal
savings account
Interest-bearing bank holding
- depositPlace for safekeeping
- nest eggSaved money for later
- emergency fundReserve for unexpected expenses
certificate of deposit · high-yield savings · money market · time deposit · saver · thrift · piggy bank · passbook · maturity date
portfolio
Collected works or assets
- dividendsProfits paid to shareholders
- securitiesTradeable financial assets
- stocksOwnership stakes or inventory
bonds · mutual funds · retirement accounts · IRA · 401(k) · annuities · capital gains · equity · brokerage · diversification
credit card
Borrowed-funds payment tool
amortization · principal balance · minimum payment · debt spiral · refinance · liability · creditor · payoff
- savingssavings account, piggy bank, online savings, savings bonds, savings plan
- investing topicsstock tips, mutual funds, index funds, value investing, growth investing
- interestcuriosity, fascination, attention, concern, stake
- mathaddition, subtraction, multiplication, division, algebra
- bankingbank, banks, ATM, ATMs, account
- financebank, CFO, banks, controller, finance
compound interestsimple interest
Interest on principal alone
linear growth · fixed interest · depreciation · zero interest · stagnation
interest, compound, interesting, uninteresting, interests, disinterest, compounds, compounded, compounding