Periodic Compound Interest
Flexible tool to analyze your savings or loans. Unlike simple interest, this calculator accounts for compounding over time, allowing you to find exactly what you need to meet your financial targets.
What is compound interest?
Compound interest is the interest on a loan or deposit calculated based on both the initial principal and the accumulated interest from previous periods. It is essentially "interest on interest."
How does compounding frequency affect my returns?
The more frequently interest is compounded, the higher the total return will be. For example, interest compounded monthly will result in a higher future value than interest compounded annually, assuming the same nominal annual rate.
What is the "Rule of 72"?
The Rule of 72 is a quick way to estimate how long it will take for an investment to double at a given annual interest rate. Simply divide 72 by the annual rate (e.g., at 6% interest, your money doubles in about 12 years).
Can I calculate the required rate to reach a goal?
Yes! Select "Solve for: Interest Rate" in the calculator. Enter your starting amount, your goal amount, and the time period to see what annual return you need to achieve.