Simple vs. Compound Interest Calculator
Open toolCompare how a principal grows under simple and compound interest over time.
See side by side how a sum of money grows under simple interest and under compound interest over the same period, and how big the difference is. A clear way to understand why compounding matters.
How it works
Simple interest is earned only on the original amount: Total = P × (1 + r × t). Compound interest is also earned on the interest already added: Total = P × (1 + r ÷ n)^(n × t). In both, P is the principal, r is the annual rate as a decimal (5% = 0.05), t is the time in years, and n is how many times a year interest is compounded.
The totals include your original principal — they show what the money is worth at the end, not just the interest. Difference is Compound total − Simple total.
Amounts are labelled with the site-wide currency from Settings; nothing is converted.
How to use it
- Enter the Principal — the amount you start with.
- Enter the Annual interest rate as a percentage.
- Enter the Time period in years.
- Choose how often interest compounds.
- Compare the Simple, Compound and Difference figures, and click Copy if you want them as text.
Options & controls
Inputs
- Principal
- The starting amount. Must be greater than 0. Default: 10,000.
- Annual interest rate (%)
- The yearly rate, for example
5, in steps of 0.01. Must be greater than 0. Default: 5. - Time period (years)
- How long the money is invested or borrowed, in steps of 0.5; decimals such as 2.5 are fine. Must be greater than 0. Default: 10.
- Compounding frequency
- How often interest is added to the balance: Annually (1 time a year), Semi-annually (2), Quarterly (4) or Monthly (12). It only affects the compound result. Default: Monthly.
- Reset
- In the title row. Restores the four sample values.
Reading the results
Results
- Simple interest total
- The principal plus simple interest at the end of the period.
- Compound interest total
- The principal plus compound interest at the end of the period.
- Difference
- How much more (or the same) you end up with under compounding. It is 0 at the start and grows faster the longer the period and the higher the rate.
- Copy
- Copies all three figures as one line of text.
Tips & guidelines
- Compounding matters most over long periods. Increase the Time period from 10 to 30 years and watch the Difference grow much faster than the totals.
- More frequent compounding gives a slightly higher total, but the jump from annual to monthly is far smaller than the effect of time or rate.
- The same maths works against you for debt that compounds, such as an unpaid credit card balance.
- For regular monthly savings or a step-by-step projection, use the Investment Projector.
Limits
- One lump sum and a constant rate: there are no regular deposits or withdrawals, and no rate changes.
- Taxes, fees and inflation are ignored, so real-world returns will be lower.
- The rate is treated as a nominal annual rate. Products that quote an effective annual rate (APY) need converting first.
Saved in your browser
Nothing. Values return to the defaults when you refresh.