Compound Interest Tools

Simple vs Compound Calculator

Simple vs Compound Interest Calculator

Compare how much extra growth compound interest may produce versus simple interest over the same time period.

Inputs

Your calculation

£
%

AER/APY already includes compounding. The selected compounding frequency applies only to a nominal rate.


£
£
%

% annually
%
%
Calculation assumptions

Calculations use monthly steps. Weekly payments are averaged as 52/12 payments per month; they are not scheduled by calendar date. Annual payments occur at the beginning or end of each year. Daily compounding uses a fixed 365-day convention. Annual payment increases apply every 12 months to both deposits and withdrawals. Tax applies monthly to positive interest; fees are deducted monthly from the balance and capped at available funds. Withdrawals cannot overdraw the account. Simple interest accrues on contributed capital remaining in the account; withdrawals and fees reduce that capital proportionally. Inflation changes purchasing power, not the nominal balance. Full method.

Outputs

Results

Enter your numbers and click calculate.

Final balance
£0.00
Total contributions
£0.00
Withdrawals: £0.00
Gross interest
£0.00
Tax/fees: £0.00

Year-by-year table

A yearly summary of balance, contributions and interest.

YearDepositsWithdrawalsInterestTax / feesEnd balance

What if I allow five more years?

Calculate to see the comparison.

Simple vs compound interest

Calculate to see the comparison.

Excel formula

A matching FV formula is available for constant monthly payments without tax, fees or account exhaustion. Annual and increasing payments require the exported schedule. Inflation adjustment is separate.

=FV(...)

Growth chart

Compare your balance, net cash paid in and net growth or loss after deductions. Negative returns remain visible.

Yearly chart

Month-by-month table

Click a year to expand the monthly breakdown.

Guide

A consistent simple-versus-compound comparison

For £10,000 at 5% for ten years with no payments or deductions, simple interest produces £15,000. Monthly compounding of the same nominal annual rate produces approximately £16,470.09.

The results compare both methods using the same requested cash-flow dates and tax/fee settings. Simple interest earns no return on previously earned interest; new deposits can earn simple interest for the time they remain invested. Withdrawals and fees reduce contributed capital proportionally. If an account runs out of money, actual fulfilled withdrawals can differ. See the simple and compound interest guide.

How this calculator works

Simple interest is calculated only on the original amount. Compound interest adds earned interest back into the balance, so the next period earns interest on a larger amount. The results panel includes a simple versus compound comparison automatically.

You can still change every input: currency, interest rate, years and months, compounding frequency, contribution timing, inflation and tax or fees. Use the share URL button to save a pre-filled version of the result.

FAQ

Simple vs Compound Interest Calculator FAQ

Simple interest uses the original principal only. Compound interest uses the principal plus previously earned interest.

Each compounding period adds interest to the balance, which means future interest is calculated on a larger amount.

Yes. You can include deposits, although the simple comparison is an estimate while the compound result is calculated month by month.