This compound interest calculator has more features than most. You can vary both the deposit intervals and the compounding intervals from daily to annually (and everything in between)...Show Full Instructions $148,032 Future Value Inflation Adjusted If you start with
$25,000 in a savings account earning a 7% interest rate, compounded monthly, and make $500 deposits on a monthly basis, after 15 years your savings account will have grown to $230,629 -- of which $115,000 is the total of your beginning balance plus deposits, and $115,629 is the total interest earnings. Yearly Summary
Comparison
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Compound Interest – ExplainedCompound interest is the most powerful concept in finance. It can either work for you or against you: Compound interest is the foundational concept for both how to build wealth and why it's so important to pay off debt as quickly as possible. The easiest way to take advantage of compound interest is to start saving! See today's highest-paying online savings accounts. Compound interest: Frequently-asked questionsWhat is compound interest?Compound interest is the total amount of interest earned over a period of time, taking into account both the interest on the money you invest (this is called simple interest) and the interest earned or charged on the interest you've previously earned. What is the compound interest formula?The compound interest formula is: A = P (1 + r/n)nt The compound interest formula solves for the future value of your investment (A). The variables are: P – the principal (the amount of money you start with); r – the annual nominal interest rate before compounding; t – time, in years; and n – the number of compounding periods in each year (for example, 365 for daily, 12 for monthly, etc.). What's the difference between compound interest and simple interest?Compound interest takes into account both interest on the principal balance and interest on previously-earned interest. Simple interest refers only to interest earned on the principal balance; interest earned on interest is not taken into account. To see how compound interest differs from simple interest, use our simple interest vs compound interest calculator. How does compound interest work?Compound interest has dramatic positive effects on savings and investments. Compound interest occurs when interest is added to the original deposit – or principal – which results in interest earning interest. Financial institutions often offer compound interest on deposits, compounding on a regular basis – usually monthly or annually. The compounding of interest grows your investment without any further deposits, although you may certainly choose to make more deposits over time – increasing efficacy of compound interest. How can I take advantage of compound interest?
Related: 5 Financial Planning Mistakes That Cost You Big-Time (and what to do instead!) Explained in 5 Free Video Lessons How do compounding intervals affect interest earned?By using the Compound Interest Calculator, you can compare two completely different investments. However, it is important to understand the effects of changing just one variable. Consider, for example, compounding intervals. Compounding intervals can easily be overlooked when making investment decisions. Look at these two investments: Investment A
Investment B
Notice that the only variable difference here is the compounding interval. Investment A wins over Investment B by $2,794.04. Remember, compounding intervals matter. Compound interest terms & definitionsBeginning Account Balance – The money you already have saved that will be applied toward your savings goal. ______ Addition ($) – How much money you're planning on depositing daily, weekly, bi-weekly, half-monthly, monthly, bi-monthly, quarterly, semi-annually, or annually over the number of years to grow. Annual Interest Rate (ROI) – The annual percentage interest rate your money earns if deposited. Choose Your Compounding Interval – How often a particular investment compounds. Number of Years to Grow – The number of years the investment will be held. Future Value – The value of your account, including interest earned, after the number of years to grow. Total Deposits – The total number of deposits made into the investment over the number of years to grow. Interest Earned – How much interest was earned over the number of years to grow. Learn more:Articles
Calculators
How do you find the accumulated value of an investment?Calculate Accrued Amount (Future Value FV) using A = P(1 + r/n)^nt. In this example we start with a principal investment of 10,000 at a rate of 3% compounded quarterly (4 times a year) for 5 years. If you paste this correctly you should see the answer Accrued Amount (FV) = 11,611.84 in cell B1.
What is the formula for accumulated amount?For the special case of an initial principal of 1 unit, we denote the accumulated amount at time t by a(t), which is called the accumulation function. Thus, if the initial principal is A(0) = k, then A(t) = k × a(t).
How do you calculate accumulated future value?How do I calculate future value? You can calculate future value with compound interest using this formula: future value = present value x (1 + interest rate)n. To calculate future value with simple interest, use this formula: future value = present value x [1 + (interest rate x time)].
What is the future value of $1000 after 5 years at 8% per year?What is the future value of $1000 after 5 years at 8% per year? If compounding monthly, $1,489.85 is the total compound interest value after five years.
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Find the accumulated value of an investment calculator
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