Compound Interest

Principal, annual rate %, years, and compounding periods per year—future value.

12 = monthly; 1 = annually.

FAQ

What formula is used?

Periodic compounding: each period applies rate/(periods per year) to the running balance. Future value = principal × (1 + r/n)^(n×t) in standard notation.

What does “compounding periods per year” mean?

12 = monthly accrual, 4 = quarterly, 1 = annual. More frequent compounding increases the effective yield slightly at the same nominal APR.

Are taxes, fees, or inflation included?

No. This is a clean math illustration; real accounts may withhold tax, charge fees, or float rates.

Why can my bank’s number differ?

Day-count conventions, promotional tiers, rounding to cents, and variable rates are not modeled here.

Is this investment advice?

No. Educational estimate only.

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Educational estimate only.