Compound Interest Calculator
See how a lump sum grows with compound interest, choosing yearly, monthly or daily compounding, with the interest earned shown separately from your principal.
How to use the Compound Interest Calculator
- Enter the starting principal.
- Enter the annual interest rate and the number of years.
- Choose the compounding frequency and read the final balance and total interest.
About the Compound Interest Calculator
Compounding frequency matters more than most people expect: the same nominal rate produces a noticeably higher balance when interest is added monthly rather than annually, because each addition starts earning immediately. Comparing the two here makes the effective rate visible, which is the number to use when comparing savings accounts or fixed deposits that quote different compounding terms.
Please note: this is an educational estimator. It does not account for processing fees, insurance bundling, prepayment penalties, floating-rate resets or local tax rules, so the figure on a real agreement will differ. Use it to compare options, then confirm with your lender or a licensed financial adviser. Full disclaimer.
Frequently asked questions
What is the compound interest formula?
A = P(1 + r/n)^(nt), where P is principal, r the annual rate, n the compounding periods per year and t the number of years.
Does compounding frequency really matter?
Yes. Daily or monthly compounding produces a higher final balance than annual compounding at the same nominal rate.
What is the difference from simple interest?
Simple interest is earned only on the original principal; compound interest is earned on principal plus all interest already added.
Why does the growth accelerate later on?
Because each period's interest is added to the balance and then earns interest itself. Early on the growth looks almost linear; the curve steepens once the interest already earned becomes a large share of the balance, which is why time in the market matters more than the rate.
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