Finance

Compound Interest Calculator

See how an investment grows with compound interest over time.

Initial amount ($)

Annual interest rate (%)

Years (years)

Compounds per year

Calculated Output

Final balance ($) 2,009.66

Interest earned ($) 1,009.66

Formula: A = P × (1 + r/n)^(n·t)

Step-by-Step Breakdown

1. Values used:

2. Initial amount = 1,000 $

3. Annual interest rate = 7 %

4. Years = 10 years

5. Compounds per year = 12

7. Final balance = 2,009.66$

8. Interest earned = 1,009.66$

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The math behind it

A = P × (1 + r/n)^(n·t), where P is the principal, r the annual rate, n the compounding frequency per year, and t the number of years.

$1,000 at 7% compounded monthly for 10 years → $2,009.66 ($1,009.66 interest).

Does compounding frequency matter?

Yes — more frequent compounding yields slightly more, approaching the continuous-compounding limit.