Compound Interest Calculator
See how an investment grows with compounding and regular deposits, or switch to Loan to work out repayments and total interest.
See how an investment grows with compounding and regular deposits, or switch to Loan to work out repayments and total interest.
Every formula used by these calculators. They match the FNSACC323 Perform financial calculations unit.
Markup calculates profit as a percentage of the cost price. Profit Margin calculates profit as a percentage of the selling price.
Fixed Costs stay the same no matter how much you sell (e.g. rent, insurance). Variable Cost is what it costs to make or deliver one single unit (materials, packaging, per-item shipping) — it goes up and down with sales, unlike fixed costs. Selling Price is what you charge per unit.
FV is the future value, PV is the amount you start with, i is the annual rate as a decimal, n is the number of compounding periods per year and t is the number of years.
Example. $10,000 at 5% a year, compounded monthly for 10 years.
FV = $10,000 × (1 + 0.05 ÷ 12)^(120) = $16,470.09. Simple interest over the same period would give $15,000.
The more often interest is added, the sooner it starts earning interest itself. At 5% over 10 years, $10,000 grows to $16,288.95 with annual compounding and $16,470.09 with monthly compounding.
In Loan mode the calculator uses the standard amortisation formula:
Here r is the interest rate per repayment period and N is the total number of repayments. Early repayments are mostly interest; later ones are mostly principal.
Interest calculated on the original amount plus any interest already added. Each period, the balance that earns interest is a little larger.
Simple interest is charged only on the original principal. Compound interest is charged on principal plus accumulated interest, so it grows faster.
It helps, but the effect is modest. Moving from annual to monthly compounding at 5% lifts the effective annual rate to about 5.12%.