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Compound Interest Calculator: Grow Your Wealth

Understand the power of compound interest and learn how to calculate it for savings, investments, and loans.

2025-01-065 min

What is Compound Interest?

Compound interest is interest calculated on the initial principal and the accumulated interest from previous periods. It's often called "interest on interest."

The Compound Interest Formula

A = P(1 + r/n)^(nt)

Where:

  • A = Final amount
  • P = Principal (initial investment)
  • r = Annual interest rate (decimal)
  • n = Compounding frequency per year
  • t = Time in years

    • Compounding Frequencies

  • Annual: Once per year
  • Semi-annual: Twice per year
  • Quarterly: Four times per year
  • Monthly: 12 times per year
  • Daily: 365 times per year

    • More frequent compounding = slightly higher returns

    The Power of Time

    Example with $10,000 at 7% annual rate:

  • 10 years: $19,672
  • 20 years: $38,697
  • 30 years: $76,123

    • The earlier you start investing, the more compound interest works for you.

    Rule of 72

    Quick way to estimate doubling time:

    Years to double = 72 / Interest Rate

    At 8% interest, money doubles in ~9 years.

    Applications

    Savings Accounts

    Calculate growth of emergency funds and savings.

    Investments

    Project retirement account growth.

    Loans

    Understand true cost of debt.

    Our Compound Interest Calculator

  • Multiple compounding frequencies
  • Monthly contribution option
  • Visual growth chart
  • Year-by-year breakdown
  • Inflation adjustment option