Compound Interest Calculator

The compound interest formula is A = P × (1 + r/n)^(n × t). P is the starting amount, r is the annual rate as a decimal, n is how many times interest compounds per year, and t is the number of years. For example, 5,000 at 5% compounded yearly for 10 years grows to about 8,144.47.

Simple interest is paid only on the original amount, while compound interest is also paid on interest already earned. With 1,000 at 10% for 2 years, simple interest gives 1,200, but yearly compound interest gives 1,210. Over long periods, the difference becomes very large.

More frequent compounding gives slightly more interest, but the effect is usually small compared with the rate and the time invested. For 10,000 at 7% over 10 years, yearly compounding gives about 19,671.51, while monthly gives about 20,096.61. You can compare options in the Compounding Frequency menu.

Regular deposits add money that also earns compound interest, so your total can grow much faster. Adding 200 per month to 10,000 at 7% for 10 years raises the result from about 20,097 to about 54,714. The calculator assumes deposits are made at the end of each period.

No. The calculator assumes a fixed interest rate for the whole term, with no taxes, fees, or inflation. Real investment returns change over time and can be negative. Use the results for planning and learning only; this is not financial advice, so check with a qualified advisor before making investment decisions.