Compound Interest Calculator
Watch your money grow: Calculate compound interest for savings and investments
Track Growth
See how your investment grows over time
Flexible Inputs
Customize principal, rate, and frequency
Instant Calculation
Real-time results as you adjust values
Plan Ahead
Set goals and plan your financial future
Principal
$0.00
Interest Earned
$0.00
Final Amount
$0.00
How Compound Interest Works
The Formula
A = P(1 + r/n)^(nt)
- A = Final amount
- P = Principal (starting amount)
- r = Annual rate (as decimal)
- n = Compounds per year
- t = Time in years
Why It Matters
- Exponential Growth: Your money grows faster over time
- Interest on Interest: You earn returns on your returns
- Frequency Effect: Daily compounding > monthly > annually
- Time Effect: Longer periods = dramatically more growth
- Power of Compound: Albert Einstein called it the 8th wonder
Compounding Frequency Comparison
| Frequency | Description | Common In |
|---|---|---|
| Annually | Interest added once per year | Some bonds, treasury bills |
| Semi-annually | Interest added twice per year | Some bonds, corporate bonds |
| Quarterly | Interest added 4 times per year | CDs, some savings accounts |
| Monthly | Interest added 12 times per year | Most savings accounts |
| Daily | Interest added 365 times per year | High-yield savings, money market |
Practical Scenarios
Savings Goals
Plan how much to save to reach targets
Retirement Planning
Estimate retirement account growth
Investment Returns
Compare investment vehicle returns
Loan Payoff
Understand loan interest accumulation
Financial Planning Tips
- Start Early: Time is your biggest advantage
- Invest Regularly: Dollar-cost averaging reduces risk
- Higher Rate: Even 1% difference compounds significantly
- More Frequent: Daily compounds better than annual
- Realistic Rates: Use conservative estimates for planning
- Account Fees: High fees reduce effective interest earned
- Tax Impact: Taxes reduce actual growth on interest
- Verify Numbers: Cross-check with financial institutions