Compound Interest
See how your principal grows with compound interest over time.
About Compound Interest
Compound interest pays interest on previously earned interest, so the balance grows faster than linear each year. More frequent compounding, like monthly rather than yearly, slightly increases the final amount. Compounding is the engine of long-term wealth, so small rate differences compound into very large differences over decades.
Formula
Compound Interest
A = P x (1 + r/n)^(n x t)
- P
- principal
- r
- annual rate
- n
- compounds per year
- t
- years
Worked example
With the default values below, Compound Interest returns Final Amount of $9,096.98. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Principal
- 5,000
- Annual interest rateaccepts 0–100 %
- 6 %
- Compounds per yearminimum 1
- 12
- Yearsminimum 0
- 10
Results
- Final Amount
- $9,096.98
- Interest Earned
- $4,096.98
- Growth Factor
- 1.819
Step by step
- 1Values used
- 2Compound Interest
- 3Final Amount= 9,096.98
- 4Interest Earned= 4,096.98
- 5Growth Factor= 1.819
Assumptions and limits
- The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation, tax or fees or charges into account.
- Figures are rounded for display to 3 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
- This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Frequently Asked Questions
How is Compound Interest calculated?
A = P x (1 + r/n)^(n x t) Compound interest pays interest on previously earned interest, so the balance grows faster than linear each year. More frequent compounding, like monthly rather than yearly, slightly increases the final amount.
Why does Compound Interest matter?
Compounding is the engine of long-term wealth, so small rate differences compound into very large differences over decades.
What values do I need to enter?
This calculator takes 4 inputs: Principal, Annual interest rate, Compounds per year, Years. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.