About

Interest: The amount earned on the principal, usually expressed as a percentage. This can be simple interest, calculated only on the principal, or compound interest, calculated on both the principal and any accumulated interest. Compound Interest: Unlike simple interest, which is calculated only on the principal, compound interest is calculated on the principal plus any previously earned interest. This leads to "interest on interest," which accelerates the growth of the investment. Frequency of Compounding: Interest can be compounded at different intervals (e.g., daily, monthly, quarterly, annually). The more frequently interest is compounded, the greater the amount of interest that will be earned over time. Time: The longer the money is invested, the more time compounding has to work. Even small interest rates can lead to significant growth over long periods.