# Compound Interest

*Borrowing & Credit — Finicade finance glossary*

Interest that earns interest. Leave money invested and each year's gains start generating their own gains — small rates snowball into large sums over decades. It works against you the same way on unpaid debt, which is why credit-card balances grow so viciously.

**Also known as:** compounding, compound growth

**Related terms:** [Simple Interest](https://finicade.com/glossary/simple-interest), [Rule of 72](https://finicade.com/glossary/rule-of-72), [APY (Annual Percentage Yield)](https://finicade.com/glossary/apy), [Time Value of Money](https://finicade.com/glossary/time-value-of-money)

**Taught in:** Charter Climb — Time Value of Money

Source: https://finicade.com/glossary/compound-interest