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
Examples are automatically compiled from online sources to show current usage. Read More Opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Send us feedback.
But your late teens and early 20s is arguably the best time for young people to develop healthy financial habits: Starting to invest now, even a little bit, will yield ample benefits via decades of compound interest, experts said. Greg Iacurci, CNBC, 7 June 2025 One of the most powerful tools at your disposal is the ability to harness time and compound interest to your advantage. Jamie Bosse, Kansas City Star, 21 May 2025 The government matches the contribution and, according to the plan, after 35 years of compound interest, each dollar turns into $10. Erik Sherman, Forbes.com, 16 May 2025 While compound interest often steals the spotlight, combining it with tax deferral can create extraordinary financial growth. Bob Chitrathorn, Forbes.com, 30 Apr. 2025 See All Example Sentences for compound interest

Word History

First Known Use

1660, in the meaning defined above

Time Traveler
The first known use of compound interest was in 1660

Cite this Entry

“Compound interest.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/compound%20interest. Accessed 12 Jun. 2025.

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

Last Updated: - Updated example sentences
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