Authors of speculative fiction (science fiction, fantasy, alternate history, etc.) often need to describe people, places, and things outside the normal realm of experience. There are three basic ways to do this:
1.) Use a combination of standard English words. For example, if your characters use bodies of water to travel between different dimensions, you can call them 'waterwalkers' or 'water-walkers.'
Pros: It's easy for your reader to know what you're talking about.
Cons: Limits creativity. Also, these terms don't necessarily call attention to themselves, and can be lost in the rest of your prose.
2.) Make a word up from scratch. In this case, you might call the water-walking characters 'lisorbb.'
Pros: Absolute creative control.
Cons: Many readers abhor the made-up word. Used too frequently, they can turn all but the most dedicated reader away, as I talked about in my post on different types of fantasy novels.
3.) Use the basic building blocks of the English language to invent a word more or less within the accepted boundaries of word formation. In order to do this, you can parse a word into morphemes, a.k.a. basic units of English taken from the ancient languages (usually Latin and Greek) that originated English. Say you wanted to create a new word to mean 'waterwalker.' Water has a Latin morpheme of 'hydr' (as in 'hydropower') and walk has a Greek morpheme of 'ambl' (as in 'amble'). So we could call the waterwalkers 'hydramblers,' if we'd like.
Pros: High level of creative control. Works best if you use easily recognizable morphemes.
Cons: Still might throw some readers off.
And no, I'm not fluent in either Greek or Latin. I use an excellent book that I bought as a textbook for a class on the origin of the English language. The book is English Vocabulary Elements by Keith Denning and William R. Leben. (William Leben actually taught the class I took.) I mostly use the list of Greek and Latin morphemes at the back of the book as a reference guide. And yeah, I know I'm not following the 'rules' for word formation, but that's my creative license at work!
The book is also handy if you're interested in learning why certain words are the way they are. Did you know that the 'hyster' in 'hysterical' actually comes from the Greek morpheme for 'womb?' Because back in the day, 'hysterics' was an actual disease women were diagnosed with. Grrr.
I think that inventing words has the potential to add another dimension to speculative fiction. We do it all the time in real life: how long has 'vloggers' been around? So why not use it in our writing?