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Enter a starting amount, rate, and time. Contributions are optional.
How compound interest works
Compound interest pays interest on your original principal and on the interest you have already earned. Each compounding period the balance is multiplied by one plus the periodic rate, so the amount of interest added grows as the balance grows. The core formula is A = P (1 + r/n)^(n t), where P is the principal, r is the annual rate as a decimal, n is the number of compounding periods per year, and t is the number of years. When you add regular contributions, each new deposit starts earning interest from the period it is added, which is why steady contributions over many years can make a balance grow dramatically.
Frequently asked questions
What is compound interest?
Compound interest is interest earned on both your original principal and on the interest already added to the balance. Over time this makes a balance grow faster than simple interest, which only pays on the original principal.
How is compound interest calculated?
The formula is A = P (1 + r/n)^(n t), where P is the principal, r is the annual rate as a decimal, n is the number of compounding periods per year, and t is the number of years. Regular contributions are added each period and earn interest from then on.
Does more frequent compounding earn more?
Yes, but only slightly. Daily compounding earns a little more than monthly, and monthly a little more than yearly, at the same annual rate. The gap grows with higher rates and longer time periods.
What is the difference between simple and compound interest?
Simple interest is paid only on the original principal each period. Compound interest is paid on the principal plus all previously earned interest, so the balance grows faster the longer it is left alone.
Is my data saved anywhere?
No. All calculations run entirely in your browser. Nothing you enter is uploaded or saved on a server.
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Disclaimer: Results are estimates for general informational purposes only and do not account for taxes, fees, or changing interest rates. This is not financial advice. Always confirm figures with your financial institution.