Calculate how your investment grows with periodic compound interest. Enter your Principal (P), Rate per Period (R%), Number of Periods (t), and optional Monthly Contribution to see your Accrued Amount (A), total interest earned, and a full breakdown chart.
Accrued Amount (A)
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Total Interest Earned
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Total Contributions
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Effective Rate per Period
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Solved Value
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The basic periodic compound interest formula is A = P(1 + r)^t, where A is the accrued amount (principal + interest), P is the principal, r is the interest rate per period as a decimal, and t is the number of periods. This formula assumes compounding occurs exactly once per period. For more frequent compounding within a period, the formula expands to A = P(1 + r/n)^(nt), where n is the number of compounding sub-periods.
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest — which only applies to the original principal — compound interest causes your balance to grow exponentially over time. The more frequently interest compounds, the faster your investment grows.
Yes, absolutely. The rate per period and the number of periods must be expressed in the same time unit. For example, if your rate is 1% per month, your number of periods must also be in months. If you have an annual rate but want to calculate over months, convert the annual rate to a monthly rate by dividing by 12 first.
Select 'Principal (P)' in the Solve For dropdown, then enter your target future value, the rate per period, and the number of periods. The calculator rearranges the compound interest formula to P = A / (1 + r)^t and returns the required initial investment.
APR (Annual Percentage Rate) is the stated annual interest rate before compounding is applied. APY (Annual Percentage Yield) reflects the actual return after compounding is accounted for. APY is always equal to or greater than APR — the more frequently interest compounds within the year, the larger the gap between the two.
Adding a regular contribution each period significantly accelerates growth because each new contribution also earns compound interest going forward. The calculator computes the future value of contributions using a future value of annuity formula and adds it to the compounded principal, giving you the total accrued amount.
Use 'Once per Period' for the basic periodic formula where compounding aligns exactly with each period. Select Daily, Monthly, Quarterly, or Semiannually if your financial product specifies a compounding frequency that differs from your rate period — common with savings accounts, CDs, and investment products.
Three key factors drive compound interest growth: a higher principal, a higher interest rate, and a longer time horizon. Starting early has the greatest impact because more periods allow interest to compound more times. Making regular periodic contributions also compounds over time, dramatically increasing the final balance compared to a single lump-sum deposit.