Compound Interest Calculator
Calculate how much a lump-sum investment grows with compound interest. Enter principal, rate, years, and compounding frequency to see the final amount and interest earned.
- Final amount
- 16470.09
- Interest earned
- 6470.09
How to use
- Enter the starting principal.
- Enter the annual interest rate and number of years.
- Choose how often interest compounds, then read the final amount and interest earned.
Examples
- $10,000 at 5% / 10 yr, monthly:
final $16,470.09 - 0% interest:
$1,000 over 5 yr → $1,000
FAQ
- What does compounding frequency mean?
- It is how often interest is calculated and added to the balance each year. Common choices are annually (1), quarterly (4), monthly (12), and daily (365). More frequent compounding earns slightly more because each addition starts earning interest sooner.
- Does more frequent compounding always earn more?
- Yes, for the same annual rate. Daily compounding beats monthly, which beats quarterly, which beats annual. The differences shrink as frequency rises, approaching a limit known as continuous compounding.
- How is the final amount calculated?
- Amount = P·(1 + r/n)^(n·t), where P is the principal, r is the annual rate (as a decimal), n is the compounds per year, and t is the number of years.