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Compound Interest Calculator

See how principal grows with compound interest. Choose compounding frequency and optional contributions each period to model savings or investments.

Understanding compound interest

Compound interest grows a balance on principal plus accumulated interest. Small rate and time differences become large over long horizons — which is why the formula is central to savings and debt literacy.

Good for

  • Exploring savings growth scenarios
  • Comparing compounding frequencies at a high level
  • Teaching compound versus simple interest

Try the calculator

Compound Interest Calculator

Project growth with compound interest and optional regular contributions

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%
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Compounding frequency

Contribution is applied once per compounding period (e.g. monthly when compounding monthly).

Result

$31,998.32

Interest earned $9,998.32 · Contributed $22,000.00

FV = P(1+r/n)^(nt) + PMT × [((1+r/n)^(nt)−1) ÷ (r/n)]

Final balance

$31,998.32

Total contributed

$22,000.00

Interest earned

$9,998.32

120 compounding periods

See how principal grows with compound interest. Choose compounding frequency and optional contributions each period to model savings or investments. Read related guides.

Core idea

Unlike simple interest (paid only on original principal), compounding credits interest to the balance so later periods earn more. Frequency (annual, monthly, daily) changes the effective outcome for the same nominal annual rate.

A common model is A = P(1 + r/n)^(n t), with optional contribution terms when you add money each period. Results here are educational estimates, not personalized investment advice.

Reading the outputs

Compare ending balance with and without contributions to see how much habit matters. Watch whether your rate is nominal annual and how often compounding occurs — banks and products disclose this differently.

Loans are related but different

Borrowing often amortizes with a fixed payment that blends interest and principal. For payment schedules, use the loan / EMI calculator. Use compound interest when modeling growth of a deposit-like balance.

Worked examples

Example calculations for Compound Interest
QuestionAnswer
$10,000 at 5% for 10 years (monthly)About $16,470 without contributions
$10,000 + $100 per period at 5%Higher balance from contributions + interest
$5,000 at 7% for 20 years annuallyAbout $19,348

Formula reference

GoalFormula
Future value (no PMT)P(1 + r/n)^(nt)
With contributionsP(1+r/n)^(nt) + PMT × [((1+r/n)^(nt) − 1) ÷ (r/n)]

FAQ — Compound Interest

What is compound interest?
Interest is calculated on principal plus previously earned interest. Over time this creates exponential growth compared with simple interest.
How often should interest compound?
More frequent compounding (e.g. monthly vs annually) slightly increases effective yield for the same nominal annual rate.

Educational tool only — not tax, legal, or financial advice. Contact us with corrections.

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