Compound Interest Calculator
Future value and interest with a compounding frequency.
How it works
FV = P × (1 + r ÷ n)^(n × t)
Compound interest earns interest on interest. n is the compounds per year: 1, 2, 4, 12 or 365.
More frequent compounding yields a higher future value; interest = FV − principal.
FAQ
How much more is compound than simple?
The longer the time and the higher the rate, the more compound beats simple, because interest also earns interest.
Worked example
100,000 at 7% compounded annually for 20 years:
FV = 100000 × 1.07²⁰ ≈ 386,968, of which ≈ 286,968 is interest.
At 10 years the value is only ~196,715 — the second decade adds about 190,000, nearly the entire first-decade balance.
Notes and limitations
7% is nominal. With 3% inflation the real return is only ~3.9%. A 1% annual fee can consume roughly a quarter of terminal value over 30 years — fees and taxes are the most underestimated drag on compounding.