Simple interest works in your favor when you borrow money, while compound interest is better for you as an investor.

Simple interest calculates earnings or payments based solely on the initial principal, while compound interest grows by calculating interest on both the principal and the accumulated interest over ...

In the world of finance and mathematics, compounding is a fundamental concept that can seem deceptively simple yet holds ...

Understanding the difference between simple and compound interest can add up to huge savings.

In other words, as a saver or investor, you’re earning interest on the interest, or ‘compounding’ your returns. An example illustrates the difference between simple and compound interest.

If the same account offered compound interest with daily compounding, you’d have $14,917.92 after 10 years. Note that credit unions usually refer to both simple and compound interest as dividends.

How does compound interest work with CDs? There are two kinds of interest you can earn on a deposit account: simple and compound interest.

The difference between APY and interest rate is compound interest. A given APY depends on both the interest rate and the compound frequency.

When you earn interest on your interest, your savings can grow much faster than if you were just earning simple interest. View high-yield savings accounts here and earn more interest on your money.