Compound interest
Etymology
"Compound" is from Latin "componere" (to put together) — com "together" + ponere "to place". The interest is literally put together with the principal, so it too begins earning. This folding-in is what makes the growth curve bend upward rather than climb in a straight line.
noun phrase · /KOM-pownd IN-truhst/
Interest calculated not only on the original amount but also on the interest already accumulated.
What it names
The engine behind both long-term wealth and runaway debt — the reason starting early matters far more than saving more later.
Example
Thanks to compound interest, the money he invested at twenty-two outgrew the larger sum his friend started saving at thirty-five.
Related idea
Contrast simple interest, which is charged only on the original principal and grows in a straight line — the difference between the two widens dramatically over long stretches of time.