Interest Calculator
Calculate interest earned or paid on any amount β supports both simple and compound interest with flexible compounding options.
Total Interest (Compound)
$2,834
Total Amount
$12,834
Effective Rate
5.116%
How to Calculate Interest
This calculator supports both simple interest (I = P Γ r Γ t) and compound interest (A = P Γ (1 + r/n)nt).
Types of Interest
- Simple β charged on principal only
- Compound β charged on principal + accumulated interest
How Banks Calculate Interest
US banks use the daily balance method: interest calculated daily, summed at month-end.
Interest Rate Environment
The Federal Reserve's funds rate influences all consumer rates. Higher Fed rates = better savings APYs but costlier loans.