What is compound interest?

Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. This allows investments to grow faster over time.

How does compound interest work?

Compound interest works by reinvesting earned interest back into the principal, so future interest is calculated on a larger amount.

What is the compound interest formula?

The basic compound interest formula is: Final Value = Principal × (1 + interest rate)^number of periods.

Is compound interest better than simple interest?

Yes. Compound interest grows faster than simple interest because interest is calculated on both the principal and previously earned interest.

Can this calculator handle monthly contributions?

Yes. This calculator supports recurring contributions such as monthly investments, making it suitable for long-term savings and investment planning.

Does this tool run entirely in the browser?

Yes. All calculations are performed locally in your browser. No financial data is sent to or stored on any server.

What is the difference between CAGR and compound interest?

CAGR shows the average annual growth rate of an investment, while compound interest calculates the actual accumulated value over time based on compounding.

Is compound interest suitable for long-term investing?

Yes. Compound interest is most powerful over long time horizons, making it ideal for retirement planning, savings goals, and long-term investments.

Can this calculator handle monthly contributions?

Yes. This calculator supports a simplified monthly contribution model where the same amount is invested every month. The monthly contribution amount is assumed to be equal to the initial input value.

Why can the result be different from real investment apps?

This calculator uses a fixed return assumption to simulate investment growth. Real investment platforms may show different results due to market fluctuations, fees, taxes, and daily price changes.

Where can I learn more about compound interest?

You can read more about compound interest at: - [Investopedia](https://www.investopedia.com/terms/c/compoundinterest.asp) - [Khan Academy](https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial)

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Compound Interest Calculator

Calculate compound interest easily and see how your investments grow over time. Supports recurring contributions, multiple compounding periods, and long-term projections.

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Compound Interest Calculator