Compound Interest Calculator
Last updated: 2026-06-25
Compound future value = principal × (1 + annual rate ÷ periods)^(periods × years); because interest earns interest, it grows larger than simple interest over time.
This calculator lets you choose monthly or annual compounding and shows the future value and the difference versus simple interest.
Enter compounding inputs
Compound future value (pre-tax)
0 KRW
| Item | Amount |
|---|---|
| Principal | |
| Compound future value | |
| Compound interest | |
| Simple future value | |
| Simple interest | |
| Compounding effect (compound − simple) |
A pre-tax estimate. Deposit and savings interest is subject to 15.4% interest income tax, so check the after-tax amount with the Savings Interest Calculator.
How to use
- Enter principal and rate — Enter your investment principal and the annual rate (%).
- Select term and frequency — Select the term (years) and the compounding frequency (monthly/annual).
- View the result — The compound future value, interest and the difference vs simple interest are shown in a table.
How compounding works vs simple interest
Compounding means interest earns more interest. The future value formula is FV = principal × (1 + r/n)^(n×t), where r is the annual rate, n is the number of compounding periods per year (12 for monthly, 1 for annual), and t is the term in years. By contrast, simple interest applies only to the principal: FV = principal × (1 + r×t).
| Term | Simple future value | Compound future value |
|---|---|---|
| 5 years | 12,500,000 KRW | approx. 12,834,000 KRW |
| 10 years | 15,000,000 KRW | approx. 16,470,000 KRW |
| 20 years | 20,000,000 KRW | approx. 27,126,000 KRW |
As the table shows, the gap between compound and simple widens quickly with time. This is why compounding matters in long-term investing. For the maturity amount of a regular monthly deposit, use the Savings Interest Calculator, and for loan interest, the Loan Interest Calculator.
Frequently asked questions (FAQ)
How is the compound future value calculated?
Compound future value = principal x (1 + annual rate / periods)^(periods x years). Monthly compounding uses 12 periods, annual compounding uses 1.
How do compound and simple interest differ?
Simple interest applies only to the principal, while compound interest also applies to prior interest. Simple future value = principal x (1 + annual rate x years), and the longer the term, the larger compound grows over simple.
Is monthly compounding better than annual?
For the same annual rate, more compounding periods give a larger future value, so monthly compounding is slightly better than annual. The gap widens with a higher rate and a longer term.
Is interest income tax reflected?
This calculator shows the pre-tax future value. Actual deposit and savings interest is subject to 15.4% interest income tax, so check the after-tax amount with the Savings Interest Calculator.
Related calculators & guides
Savings Interest Calculator
Compute the after-tax maturity amount of monthly savings.
Loan Interest Calculator
Compare monthly payments and total interest by method.
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Repayment method guide
Equal payment vs equal principal compared.
Last updated: 2026-06-25