Interest Calculator
Calculate simple or compound interest and see how your money grows over time
Optional: add regular monthly deposits
// Growth Over Time
Year-by-Year Breakdown
| Year | Interest | Total Interest | Balance |
|---|---|---|---|
| 📈 Calculate above to see yearly growth | |||
Simple vs Compound Interest
This calculator supports both simple and compound interest. Use the toggle above to switch between modes. Compound interest is the more powerful of the two — your interest earns interest, leading to exponential growth over time.
Simple Interest Formula
Simple interest is calculated only on the original principal. It is commonly used for short-term loans and some savings accounts.
Compound Interest Formula
Compound interest calculates interest on both the principal and the accumulated interest from previous periods. The more frequently interest compounds, the faster your money grows.
The Power of Compounding
Compounding frequency makes a significant difference over long periods. Daily compounding produces slightly more growth than annual compounding at the same rate. Over decades, even a small difference in compounding frequency can result in thousands of pounds, euros or dollars more.
Monthly Contributions
In compound mode, you can add a monthly contribution to simulate regular saving or investing. This dramatically increases your final balance over time and is the basis of most retirement and investment planning.
// Rule of 72
Divide 72 by your interest rate to estimate how many years it takes to double your money. At 6% that's 12 years.
// Start Early
Thanks to compounding, starting 10 years earlier can double your final balance even with the same contributions.
// Frequency
Daily compounding earns slightly more than annual. The difference grows larger over longer time periods.
// Real Returns
Subtract the inflation rate from your interest rate to see your real return. 5% interest with 3% inflation equals roughly 2% real growth.