MyWebUtils: Free Online Dev Tools

What is Compound Interest?

Often called the "eighth wonder of the world," compound interest is the interest you earn on both your initial principal and the accumulated interest from previous periods. In simple terms, it's "interest on interest," and it's what makes investments grow exponentially over time.

How This Calculator Helps You See the Future

Understanding compounding is key to smart financial planning. This tool makes it easy to visualize that growth.

• Investment Projections: See how a one-time investment (like a fixed deposit or a stock purchase) can grow over several years.
• The Impact of Frequency: Experiment with different compounding frequencies (annually, monthly, etc.) to see how often your interest is calculated and added to the principal, which can significantly affect your total returns.
• Visual Breakdown: The pie chart provides a powerful visual representation of your final amount, showing how much is your initial investment versus how much is pure profit from interest.

Key Takeaway

The longer your money is invested, the more powerful compounding becomes. This calculator is a great first step in understanding and planning for long-term financial goals like retirement, education funds, or wealth creation.