What is the difference between simple and compound interest?

Simple interest is calculated only on the principal amount, while compound interest is calculated on the principal plus previously earned interest. Compound interest grows much faster over time.

Interest Calculator – Simple & Compound Interest

Calculate simple and compound interest on loans and investments. Compare different interest calculation methods.

Interest Calculator – Simple & Compound Interest

Calculate simple and compound interest on loans and investments. Compare different interest calculation methods.

Principal Amount*

Initial amount

Interest Rate (%)*

Annual interest rate

Time Period (years)*

Investment or loan term

Interest Type*

Type of interest calculation

$1,500

Final Amount

$1,000

Principal

$500

Interest

Understanding Interest Calculations

Interest calculations are fundamental to finance, affecting everything from savings accounts to loans. Understanding the difference between simple and compound interest can help you make better financial decisions.