Compound Interest Calculator
Enter your details to see the final amount and interest earned.
Work out how much your money grows with compound interest. Enter the principal, the annual interest rate, the number of years, and how often interest compounds (yearly, half-yearly, quarterly, monthly, or daily). The calculator shows the final amount and the interest earned, updating as you type. It is currency agnostic, so it works with any currency you have in mind.
How to use
- Enter the principal, the starting amount you are investing or saving.
- Enter the annual interest rate as a percent, for example 8 for 8 percent.
- Enter the time in years.
- Choose how often interest compounds: yearly, half-yearly, quarterly, monthly, or daily.
- Read the total amount and the interest earned in the results panel.
Examples
- Principal 10000 at 8 percent for 5 years compounded quarterly grows to 14859.47, so the interest earned is 4859.47.
- Principal 10000 at 6 percent for 10 years compounded monthly grows to 18193.97, so the interest earned is 8193.97.
- Principal 5000 at 5 percent for 3 years compounded yearly grows to 5788.13, so the interest earned is 788.13.
FAQs
- What formula does this calculator use?
- It uses the standard compound interest formula A = P times (1 + r divided by (100 times k)) raised to the power of (k times t), where P is the principal, r is the annual rate in percent, t is the time in years, and k is the number of compounding periods per year.
- What is the difference between compound and simple interest?
- Simple interest is charged only on the original principal. Compound interest is charged on the principal plus any interest already added, so it grows faster over time. The more often interest compounds, the larger the final amount.
- How does compounding frequency change the result?
- More frequent compounding produces a slightly higher final amount because interest is added back more often and starts earning interest sooner. Daily compounding gives a little more than monthly, which gives more than yearly, for the same rate and term.
- Which currency does this calculator use?
- None in particular. It works on the numbers you enter and adds thousands separators for readability, so you can read the result in whatever currency you have in mind.
- Can I enter a rate of zero?
- Yes. A rate of zero is valid and returns an interest of zero, so the total amount equals the principal. Negative rates and a principal of zero or below are not allowed.
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