Daily compound interest calculator

The Compound Interest Calculator below can be used to compare or convert the interest rates of different compounding periods. Please use our Interest Calculator to do actual calculations on compound interest.

What is compound interest?

Interest is the cost of using borrowed money, or more specifically, the amount a lender receives for advancing money to a borrower.

When paying interest, the borrower will mostly pay a percentage of the principal (the borrowed amount). The concept of interest can be categorized into simple interest or compound interest.

Simple interest refers to interest earned only on the principal, usually denoted as a specified percentage of the principal.

To determine an interest payment, simply multiply principal by the interest rate and the number of periods for which the loan remains active. For example, if one person borrowed $100 from a bank at a simple interest rate of 10% per year for two years, at the end of the two years, the interest would come out to:

$100 × 10% × 2 years = $20

Simple interest is

how does a compound interest calculator work

compound interest calculator with explanation