Compound interest is a favorable method of compensating lenders and depositors wherein interest is periodically credited to the principal, and subsequent interest is paid on the increasing balance.

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...

Michael Boyle is an experienced financial professional with more than 10 years working with financial planning, derivatives, equities, fixed income, project management, and analytics. Compounding is ...