What Is Compound Interest?
Compound interest is interest calculated on the original amount as well as the interest accumulated during previous periods. This allows your investment to grow over time.
How to Use the Compound Interest Calculator
Enter your initial investment, annual interest rate and investment period. Select how often the interest is compounded and click the Calculate Interest button.
Compound Interest Formula
The standard compound interest formula is:
A = P × (1 + r/n)ⁿᵗ
In this formula, P represents the principal amount, r represents the annual interest rate, n represents the number of times interest is compounded per year and t represents the number of years.
Example
If you invest ₹1,00,000 at an annual interest rate of 8% for 5 years with monthly compounding, the calculator can estimate the final amount and total interest earned.
Compound Interest vs Simple Interest
Simple interest is generally calculated only on the original principal amount, while compound interest also considers previously accumulated interest.
Frequently Asked Questions
Is this compound interest calculator free?
Yes. Toolveta's compound interest calculator is free to use.
Can I use this calculator on mobile?
Yes. The calculator works on mobile phones, tablets and desktop computers.
What does the calculator show?
It shows the final amount, total interest earned and original investment amount.
Can I change the compounding frequency?
Yes. You can select annual, half-yearly, quarterly, monthly or daily compounding.