Compound Interest Calculator

Understanding Compound Interest: The Eighth Wonder of the World

Compound interest is the interest you earn on your initial investment plus the interest that has accumulated over previous periods. Unlike simple interest, which is calculated only on the principal amount, compounding allows your wealth to grow exponentially over time.

Why Use Our Compound Interest Calculator?

• Project Your Wealth: See how your savings or crypto investments could grow over 5, 10, or 30 years.
• Smart Financial Planning: Compare different interest rates to see the impact of even a 1% difference in returns.
• Easy to Use: Designed for quick calculations with professional accuracy.

The Formula Behind the Magic:

The calculator uses the standard compounding formula:

$$A = P(1 + r)^t$$

Where:

• A = the future value of the investment
• P = the principal investment amount
• r = the annual interest rate (decimal)
• t = the number of years the money is invested

Pro Tip for Investors:

The earlier you start, the more powerful compounding becomes. Even small monthly contributions can lead to significant wealth over a long-term horizon due to the exponential nature of growth.