Simple vs compound interest — what's the difference?

Simple interest is calculated only on the original principal. Compound interest is calculated on principal plus accumulated interest, so the balance grows exponentially over time.

How often should interest compound?

More frequent compounding (daily vs annually) helps slightly. The bigger lever is the rate itself and the time horizon — start early and let years do the work.

Is this calculator free to use?

Yes — every CalculatingWealth calculator is free, runs entirely in your browser, and never requires a signup.

Live calculator

Interest Calculator

Compare simple vs compound interest over any time horizon.

Calculator

Principal

Annual rate

Years

Compounds / year

Compound future value

$16,470.09

Compound interest earned: $6,470.09
Simple future value: $15,000.00
Simple interest earned: $5,000.00
Difference (compound − simple): $1,470.09

What's next?

Refine your numbers, compare options, or explore the next step in your plan.

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Smart insights

Personalized takeaways based on the numbers you entered.

Adding $100/month to your contributions would grow to about $15,528 more by year 10.
Investing the same amount for 30 years instead of 10 could grow to roughly $28,207 more.

AI financial insights

Personalized, plain-English guidance generated from your numbers.

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What this means for your plan

Plain-English trade-offs to help you decide with confidence.

Time matters more than amount
Doubling your contribution helps. Doubling your time horizon helps far more — compounding rewards patience.
Consistency over perfection
A modest, consistent monthly contribution typically outperforms larger, irregular ones. Set it and protect it.

Your planning path

A guided sequence so each tool builds on the last.

0/4 steps

Educational resources

Helpful financial resources

Tools that may support the planning behind your interest calculator — picked for context, not promotion.

High-Yield Savings AccountPartnerAn interest-bearing account for short-term savings.Useful when building an emergency fund or holding cash you'll need within 1–3 years.
Long-Term Investing PlatformPartnerBrokerage focused on low-cost index investing.Educational fit if you're building a long-horizon retirement or wealth portfolio.

Some resources are partner links that may support the platform at no extra cost to you. All recommendations are educational in nature. Learn how we choose them.

Track this over time

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Recommended next steps

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Investment Calculator

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Savings Calculator

Forecast how your savings grow with regular deposits.

Retirement Calculator

See if you're on track to retire comfortably with custom assumptions.

Compare scenarios

See how different terms, rates, or contributions change the outcome — side by side.

Add a scenario to compare it against your current inputs.

How it works

A = P(1 + r/n)^(nt)

The interest calculator uses a standard formula refined for clarity and precision. Results update live as you change any input — try different scenarios to see how sensitive the answer is to each assumption.

Tips for accurate results

Use realistic, current values — don't round aggressively for inputs that matter.
Compare a few scenarios to see how sensitive the result is to your assumptions.
Save your results so you can track changes over time as your situation evolves.