finance calculator
Calculate simple and compound interest scenarios.
Return when comparing rates, compounding frequencies, and different time periods.
Compound total
$12,834
Formula
A = P(1 + r/n)^(nt)Compound interest applies interest to both the original principal and accumulated interest each compounding period.
Step by step
Example
A $10,000 balance at 5% compounded monthly for 5 years grows to about $12,834.
Related guides
Guide
Learn how compound interest works, the formula behind exponential growth, and how starting early, regular contributions, and reinvesting dividends accelerate wealth building.
Guide
Compare simple and compound interest calculations. Understand how compounding frequency affects growth and when each interest model applies to loans and investments.
Summary
Compound total
$12,834
Ending value with compounding.
Compound interest
$2,834
Interest earned with compounding.
Simple interest
$2,500
Interest without compounding.
Effective annual rate
5.12%
12 compounding periods per year.
D3 visualization
Compare simple interest, compound interest, and final totals.
D3 visualization
A sampled projection shows how the compound balance rises over time.
Guide
The interest calculator compares simple interest with compound interest using principal, annual rate, time, and compounding frequency. It shows compound total, compound interest, simple interest, and effective annual rate.
This makes it useful for understanding loans, savings products, CDs, deposits, and any scenario where compounding frequency changes the result.
Enter principal, annual rate, years, and compounds per year. Compare simple interest against compound interest to see the impact of earning interest on prior interest.
Increase compounding frequency to see how the effective annual rate changes. The difference may be small over short periods but larger over time.
Compound interest uses A = P(1 + r/n)^(nt), where P is principal, r is annual rate, n is compounding periods per year, and t is years. Simple interest is P x r x t.
Effective annual rate converts the compounding effect into a single annualized rate.
Simple interest
Interest calculated only on the original principal.
Compound interest
Interest calculated on principal and prior interest.
Effective annual rate
The real annualized effect of compounding.
Simple interest only applies to principal. Compound interest applies to principal plus accumulated interest.
It is how many times interest is applied during a year, such as monthly, quarterly, or daily.
When interest compounds within the year, the annualized effect can be slightly higher than the nominal rate.