interés compuesto
/inteɾes kompwesto/from spelling rules
Compounding interest in Spanish is interés compuesto.
This phrase refers to interest calculated on both the initial principal and the accumulated interest from previous periods.
Which one should you use?
The standard term is interés compuesto, but you may also encounter the informal phrase intereses sobre intereses.
Is it said differently in some regions?
In Mexico, it is common to hear the phrase rendimiento compuesto used to refer to compounding interest.
Did you know?
- In historical Spanish law, the process of adding interest to the principal to calculate new interest was known as anatocismo. This practice was often strictly prohibited to prevent debtors from falling into inescapable financial spirals.
- The word interés shares a common ancestor with the English word 'interest', both tracing back to the Latin 'interesse' which literally means 'to be between' or 'to make a difference'.
- In banking across many Spanish-speaking countries, the word rendimiento is preferred over interés when discussing investments. This shifts the meaning from a cost of borrowing to a 'yield' or 'performance' of an asset.
Examples in context
- El interés compuesto es una herramienta financiera muy poderosa.Compounding interest is a very powerful financial tool.
- Cuanto más tiempo inviertas tu dinero, más se beneficiará del interés compuesto.The more time you invest your money, the more it will benefit from compounding interest.
- El interés compuesto es clave para ahorrar.Compound interest is key to saving.
- Necesito entender cómo funciona el interés compuesto.I need to understand how compound interest works.
- Esta cuenta ofrece un buen interés compuesto.This account offers good compound interest.
Example conversation
María and Mateo are discussing their long-term savings plan.
- MaríaMateo, ¿sabes qué es el interés compuesto?Mateo, do you know what compound interest is?
- MateoSí, es cuando los intereses generan más intereses.Yes, it is when interest generates more interest.
- MaríaExacto, por eso es tan útil para nosotros.Exactly, that's why it is so useful for us.
- MateoTienes razón, María, debemos aprovecharlo.You are right, María, we should take advantage of it.
Sources
- IPA marked “from spelling rules” is derived from standard Spanish spelling, where Wiktionary gives none.
- Word origins: Wiktionary entries compuesto, interés, CC BY-SA 4.0.
