Compound Interest

Compound interest is interest calculated not just on the original amount of money put in, but on all the interest that's already accumulated on top of it, which means growth accelerates over time rather than staying flat. A small amount invested consistently over decades can grow into a genuinely large sum almost entirely because of this snowball effect, which is why financial advice about retirement savings so often comes back to one central point: starting early matters more than almost anything else, because compounding needs time to do its work.