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Compound Interest Calculator

See how money grows when interest compounds, enter principal, rate, time, and frequency to project the future value.

Future value

$20,096.61

After 10 years, compounded monthly.

Total interest earned$10,096.61
Total contributions$10,000.00
Learn the finance behind the cases →

The compound interest formula

A = P(1 + r/n)^(nt). P is principal, r the annual rate, n the compounding periods per year, and t the number of years. The more often interest compounds, the faster the balance grows.

Simple vs. compound interest

Simple interest is earned only on the principal; compound interest is earned on the principal plus all prior interest. Over long horizons, compounding dominates, the heart of the time value of money.

Why it matters for business

Compounding underlies discounting, NPV, and growth math. Internalizing it makes finance cases far more intuitive.

Frequently asked questions

What is the compound interest formula?
A = P(1 + r/n)^(nt), where P is principal, r is the annual rate, n is compounding periods per year, and t is years. The more frequently interest compounds, the faster the balance grows.
How is compound interest different from simple interest?
Simple interest is earned only on the principal; compound interest is earned on the principal plus all previously accrued interest. Over long horizons compounding dominates, the core idea behind the time value of money.
Is this compound interest calculator free?
Yes, completely free and client-side.