Interest Calculator
Calculate simple and compound interest on savings, loans, and investments. See exactly how your money grows over time.
How to Use the Interest Calculator
1. Enter the principal — the starting amount you save, invest, or borrow.
2. Set the annual rate — for savings use the APY; for loans use the APR.
3. Choose the time and compounding frequency — more frequent compounding means faster growth.
4. Compare simple vs compound — switch the type to see how compounding magnifies returns over long periods.
The Interest Formulas
Compound: A = P × (1 + r/n)n×t
A = final amount, P = principal, r = annual rate (decimal), n = compounding periods per year, t = years. Interest earned = A − P.
Frequently Asked Questions
What is the difference between simple and compound interest?
Simple interest is calculated only on the original principal: I = P × r × t. Compound interest is calculated on the principal plus previously earned interest, so your money grows faster: A = P × (1 + r/n)^(nt). Compound interest is why saving early matters — the "interest on interest" effect accelerates over time.
How is compound interest calculated?
Use A = P × (1 + r/n)^(nt), where A is the final amount, P is the principal, r is the annual interest rate as a decimal, n is the number of compounding periods per year, and t is the number of years. The more frequently interest compounds, the more you earn.
What is the Rule of 72?
The Rule of 72 estimates how long it takes an investment to double: divide 72 by the annual interest rate. At 6%, money doubles in about 12 years (72 ÷ 6). It is an approximation, but a useful mental shortcut for comparing rates.
What is a good savings interest rate?
High-yield savings account rates in the US have ranged from about 3% to 5% in recent years, while traditional accounts pay far less. Rates follow central-bank policy, so they change over time. Compare annual percentage yield (APY) — which already accounts for compounding — across banks.