Simple & Compound Interest Calculator

Calculate investment returns, compound growth, maturity value, and interest earnings instantly.

How to use the Interest Calculator?

1. Enter Principal Amount

Input the initial sum of money you are investing or borrowing.

2. Adjust Rate & Period

Use the interactive sliders to set the annual interest rate and time period.

3. Select Compounding

Choose the frequency (annually, monthly, quarterly) to compound interest earnings.

4. Add Advanced Variables

Enable advanced mode to factor in inflation, taxes, monthly contribution, and goal limits.

Understanding Interest Formulas

1. Simple Interest (SI) Formula

Accrues interest purely on the principal amount over time.

SI = (Principal × Rate × Time) / 100
Maturity Amount = Principal + SI

2. Compound Interest (CI) Formula

Accrues interest on both the principal and previous periods interest.

Maturity Amount (A) = Principal × (1 + Rate / (n × 100))^(n × Time)
Interest Earned = A - Principal
*(where n is compounding frequency per year)

Frequently Asked Questions (FAQ)

What is Simple Interest?

Simple Interest is calculated only on the initial principal sum, meaning interest returns remain flat every year.

What is Compound Interest?

Compound Interest is interest computed on the initial principal plus all of the accumulated interest of past periods, creating exponential growth.

Which is better SI or CI?

Compound Interest is far better for growing savings and investments, while Simple Interest is better for borrowers looking to pay less total interest.

How does compounding frequency affect returns?

Compounding more frequently (e.g. monthly instead of annually) yields higher returns because interest accumulates and compounds on itself sooner.