![]() Google finance calculator series#Compound Interest Formula (with regular deposits)Ĭompound interest for principal equation A = P * (1 + r/n) n*tįuture value of a series formula - end of period A = PMT * (((1 + r/n) n*t -1) / (r/n)) To calculate the total compound interest generated we need to subtract the initial principal: I = P * (1 + r/n) n*t - P 2. This is the simple compound interest formula including initial deposit: A = P * (1 + r/n) n*t This example shows the interest accrued on a $10,000 investment that compounds annually at 7% for four different compounding periods over 10 years.Ĭompound Interest Formulas 1. More frequent compounding periods means greater compounding interest, but the frequency has diminishing returns. The following chart demonstrates the difference that the number of compounding periods can make for a $10,000 investment with an annual 7% interest rate over a 10-year period. When calculating compound interest, the number of compounding periods makes a significant difference for future earnings. Interest can be compounded on any given frequency schedule, from continuous to daily, monthly, quarterly to annually. Here we compare the benefits of compound interest versus standard interest and no interest at all. More so if you look at the graph below, the benefits of compound interest outweigh standard interest by $45,122.55. If you invested $10,000 which compounded annually at 7%, it would be worth over $76,122.55 after 30 years, accruing over $66,122.55 in compounded interest. Google finance calculator plus#You can how over the chart bars to see individual metrics for any of the calculated yearly time series.Ĭompound interest (or compounding interest) is interest calculated on the initial principal, which also includes all the accumulated interest of previous periods of a deposit.Ĭompound interest is calculated by multiplying the initial principal amount by one plus the annual interest rate raised to the number of compound periods minus one. Inflation Adjusted - displayed with red line on the chart.Tax - displayed with violet / magenta color bars on the chart.Interest - displayed with blue color bars on the chart.red color bars (in case the withdrawals are greater than the earned interest).yellow color bars (in case of withdrawals).Deposit / Withdrawal - these are represented on the chart using the following colors:.Principal - displayed with gray color bars on the chart.On / Off button allows you to display future gains that are inflation adjusted. ![]() Removing the effects of inflation from the return of an investment allows the investor to see the true earning potential of the security without external economic forces. ![]()
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