Einstein once said, “Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.” Understanding the basics of this powerful mathematical tool can ...

Elvis Picardo is a regular contributor to Investopedia and has 25+ years of experience as a portfolio manager with diverse capital markets experience. Suzanne is a content marketer, writer, and ...

The key to taking advantage of compound interest is getting started early! Interest alone is calculated just on that original amount, but compound interest allows your money to grow faster over time.

See how your savings and investment account balances can grow with the magic of compound interest. Many, or all, of the products featured on this page are from our advertising partners who compensate ...

Greg DePersio has 13+ years of professional experience in sales and SEO and 3+ years as a writer and editor. Simple interest is calculated only on the principal balance of the loan each period.