Understand Compounding Frequency
When comparing different financial products, the compounding frequency can make a surprisingly large difference. A 5% rate compounded daily will yield a higher return than a 5.1% rate compounded annually. Use this calculator to compare different frequencies.
Exponential Growth Visualized
In the first few years, compound interest looks like a straight line. But over decades, the curve goes exponential as your interest starts earning its own interest. Use our tool to calculate your future wealth.
Frequently Asked Questions
Compound interest is the interest calculated on the initial principal AND the accumulated interest from previous periods. It is 'interest on interest'.
It is how often the interest is calculated and added to the balance. The more frequent the compounding (e.g., daily vs annually), the higher the final total will be.
A = P(1 + r/n)^(nt), where A is the final amount, P is the principal, r is the annual rate, n is the compounding frequency, and t is time in years.