Interest Calculator
Calculate simple and compound interest on your savings or investments.
Examples
Savings Account
Investment Growth
Frequently Asked Questions
What is the difference between simple and compound interest?
How does compounding frequency affect earnings?
What is continuous compounding?
Quick Tips
Double check your inputs. Ensure units match (e.g., inches vs cm).
How to Use This Calculator
Enter the principal amount, annual interest rate, time period in years, and select a compounding frequency. Click Calculate to see both simple and compound interest results, along with a comparison table showing how different compounding frequencies affect your returns.
Understanding the Formula
Simple Interest: I = P * r * t | Compound Interest: A = P * (1 + r/n)^(nt) | Continuous: A = P * e^(rt)
Examples
Savings Account
$10,000 at 5% for 5 years compounded monthly yields $12,833.59 in compound interest vs $12,500.00 with simple interest.
Investment Growth
$50,000 at 7% for 10 years compounded quarterly grows to $100,227.51, earning $50,227.51 in interest.
Frequently Asked Questions
What is the difference between simple and compound interest?
Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus any previously earned interest, causing your money to grow faster over time.
How does compounding frequency affect earnings?
More frequent compounding results in slightly higher returns. Monthly compounding earns more than annual, and continuous compounding earns the theoretical maximum.
What is continuous compounding?
Continuous compounding assumes interest is being added at every possible instant, using the mathematical constant e. It represents the upper limit of compound interest growth.