compound interest

noun

: interest computed on the sum of an original principal and accrued interest

Examples of compound interest in a Sentence

Recent Examples on the Web

Build Financial Literacy Skills Through Practice Traditional financial education often focuses on theory—budgeting worksheets and compound interest calculations. —Sarah Hernholm, Forbes.com, 2 Sep. 2025

Putting off saving for retirement altogether would mean missing out on that valuable compound interest. —Kamaron McNair, CNBC, 29 Aug. 2025

First of all, young people should learn the importance of compound interest before using a credit card as their only means of a financial parachute or taking out a student loan. —Elisabeth Sherman, Parents, 27 Aug. 2025

Indeed, power in Chinese politics tends to accrue like compound interest rather than depreciate, and the potential for opposition to Xi has dissipated rather than coalesced over time. —Jonathan A. Czin, Foreign Affairs, 18 Aug. 2025

Word History

First Known Use

1660, in the meaning defined above

Rhymes for compound interest

• noninterest

Kids Definition

compound interest

noun

: interest paid or to be paid both on the principal and on accumulated unpaid interest

Legal Definition

compound interest

see interest sense 5