Interest Calculator
Calculate simple and compound interest on your savings or investments.
Ally Bank
High-yield savings with competitive interest rates
Important Legal Disclaimer
For Educational and Informational Purposes Only: This calculator provides estimates and approximations based on the information you provide. Results are not exact and should not be relied upon for any official, legal, financial, medical, or professional purposes.
No Professional Advice: The calculations and information provided do not constitute financial advice, legal advice, tax advice, medical advice, or any other form of professional consultation. Always consult with qualified professionals (financial advisors, attorneys, tax professionals, healthcare providers, etc.) before making important decisions.
No Liability: By using this calculator, you acknowledge that the results are estimates only. We make no warranties or guarantees about the accuracy, completeness, or reliability of the calculations. Use of this tool is at your own risk.
This disclaimer complies with applicable U.S. federal and state laws regarding the provision of informational tools and the limitation of liability for educational resources.
Abbreviations Explained
Simple Interest: Interest calculated only on the principal amount, not on accumulated interest.
Compound Interest: Interest calculated on both the principal and previously earned interest.
Principal: The initial amount of money invested or borrowed.
APY (Annual Percentage Yield): The effective annual rate of return taking into account compound interest.
Compounding Frequency: How often interest is calculated and added to the principal (daily, monthly, quarterly, annually).
How the Calculation Works
Two different formulas are used:
Simple Interest Formula:
Where: I = Interest, P = Principal, r = Rate, t = Time
Compound Interest Formula:
Where: A = Final amount, n = Compounding frequency per year
Example: $10,000 at 5% for 10 years:
• Simple Interest: $10,000 + ($10,000 × 0.05 × 10) = $15,000
• Compound Interest (annual): $10,000 × (1.05)^10 = $16,289
• Difference: $1,289 more with compound interest
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