**Interest rate** denotes the rate that an interest is paid by a debtor for the use of the money that they’ve borrowed from the lender.

Particularly, an **interest rate** is a percentage of principal paid a specific number of times per period (normally quoted per year). As an illustration, a small business may borrow capital from a bank to purchase the new assets for its operation. In return, the bank receives the interest at the approved interest rate for the use of capital in the certain time frame. In most situations, the interest rates reflect the percentage of the principal for a certain period of 1 year.

In case of **compound interest**, it is informed that this kind of interest is added to the principal of a loan so that the added value can even earn interest afterwards. The addition of interest added into the principal is known as compounding. For instance, an account within $1,000 principal and 20% interest/year will have a balance of $1200 at the end of the 1st year. How about the 2nd and the 3rd years? It turns to be $1440 at the end of the 2nd year and $1728 at the end of the 3rd year. Of course, the balance value will grow due to the predetermined percentage as time passes. As you see, compound interest brings lots of remarkable interests. So, how to **calculate compound interest**? Get to know **Compound Interest Formula Calculator** from now on!

### Work Out the Compound Interest with Formula

When searching for the **Compound Interest Formula**, the seekers find lots of formulas for calculating the annual compound interest that are generated as below:

*Future value or amount = Principal investment x (1 + interest rate / frequency of compounding every year) ^ (years x frequency of compounding every year)*

By taking the 4 ingredients into account including the principal amount (initial investment), annual interest rate, number of times the interest compounded per year, and number of years that the money is borrowed, we can mathematically calculate the future value of the compound interest rate over time. After viewing the formula, get the numerical data applied and work it out with electronic calculators. Find the required numbers and take out a pen, paper, and calculator at any time you’re in quest of the future amount of compound interest rate! To work out the exact value, rest assured that you use a calculator that can calculate the exponents!

### Use Online Compound Interest Calculator

The math can be quickly and accurately done if taking advantage of the online **compound interest calculator**!

The program can be easily found on the Internet. By understanding the exact interest, ones can make the best of their situations. By submitting the details of currency kind, base amount (principal), annual interest rate, calculation period, and compound interval, you get the instant calculated result for the quick reference. Whatever the result, bear in mind a rule that the *debt with compound interest* reflects the total sum being higher than the original loan amount a lot!

Therefore, the **Compound Interest** can either hinder your progress or work to your benefits due to the role of yours: saving or investment accounts. Through mastering the effect of interest if being compounded via the Interest Calculation FREE, you come closer to the financial targets when it comes to loan, investment, and many other financial transactions. How will the future value of the transaction with compound interest be? Calculate the far-off value with the Online Program right now! Otherwise, practice calculating the interest of compounding via the formula. Anyway, you’re always encouraged to check the result by consulting the Internet Calculators for the solid reference.

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