âšī¸ About Compound Interest
Compound interest is the interest calculated on the initial principal
and also on the accumulated interest from previous periods. This
calculator uses the formula: A = P(1 + r/n)^(nt) + PMT Ã [((1 +
r/n)^(nt) - 1) / (r/n)], where A is the final amount, P is principal,
r is annual rate, n is compounding frequency, t is time in years, and
PMT is the regular contribution amount. The "effective annual rate"
shows the actual yearly return including compounding effects.