Which type of interest to do for a retirement account - compound interest or simple interest? Use in your own words.

Answer: compound interest.

Explanation:

Compound interest paid on the original amount added to the principal or original amount plus previous interest. This means that upon maturity, over a certain agreed period, interest accrued upon an original amount known as principal is not withdrawn but added to the original amount. this new sum over an an agreed period accrues interest which is now referred to as compound interest, being that present interest is paid on a sum made up of original amount and previous interest. This compounding effect continues in a circle until terminated.