Compound interest calculator

What is compound interest?

Compound interest is interest which applies to the whole amount earnt or owed.

Compound interest uses the original deposit or borrowed amount as well as any interest previously accumulated to continue earning interest. In comparison simple interest only generates on top of the original deposited or borrowed amount.

Who does this benefit?

Compound interest is a popular tool used for investors as this is a great way to grow your money at a faster rate than just using simple interest. You can start investing and build your portfolio, grow your funds and be financially secure. Having compound interest on any savings will also build up the amount faster and earn you more.

When borrowing money, compound interest works against you and for the lender. Compound interest on any borrowed money will only increase the amount you owe back often leading to unpayable debt.

Compound interest periods

This is the time intervals between interest being added to an account. This can be done annually, monthly, semi-annually, quarterly, daily or continuously.

The higher number of compounding periods the greater the interest which is great for the investor and not great for a borrower.

Use our Compound Interest calculator to work out how much you could generate…