Calculate your interest
Reverse: principal needed for a target
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Simple vs compound — the difference
On $10,000 at 5% for 10 years:
| Interest earned | Total | |
|---|---|---|
| Simple (5% × 10) | $5,000.00 | $15,000.00 |
| Compound (monthly) | $6,470.09 | $16,470.09 |
Compounding earns $1,470 more on the same deposit — that's interest earning its own interest, and it's why starting early beats starting big.
Questions, answered straight
What's the compound interest formula?
A = P(1 + r/n)^(nt) — principal times one plus the rate divided by compounding periods, raised to periods times years. The calculator above does it instantly.
How do Indians commonly use this?
Mostly for fixed deposit (FD) estimates — enter your bank's FD rate and tenure. Note Indian banks typically compound quarterly; select "Quarterly" for the closest FD estimate. This is an estimate, not a bank quote.
Does compounding frequency matter much?
Somewhat. On $10,000 at 5% for 10 years: annual compounding gives $16,288.95, monthly gives $16,470.09 — about $181 difference. More frequent is always slightly better for the saver.
Simple interest — where is it still used?
Some personal loans, auto loans, and short-term lending. Most savings products and investments compound.
Is this financial advice?
No — it's math. Rates, taxes, and inflation all affect real returns. Talk to a qualified advisor before investing.
General information only, not financial advice. Calculations are estimates; actual products vary by institution and terms.