{"id":13168,"date":"2022-09-05T23:56:00","date_gmt":"2022-09-05T15:56:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=13168"},"modified":"2024-10-14T08:58:46","modified_gmt":"2024-10-14T00:58:46","slug":"compound-interest","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/05\/compound-interest\/","title":{"rendered":"Simple and compound interest calculator"},"content":{"rendered":"\n<p>Simple and <a href=\"https:\/\/en.wikipedia.org\/wiki\/Compound_interest#:~:text=Compound%20interest%20is%20the%20addition,interest%20on%20principal%20plus%20interest.\" target=\"_blank\" rel=\"noreferrer noopener\">compound interest<\/a> calculation is the first step to wealth management. You can use simple and compound interest calculators, a free online tool I developed, to quickly calculate and compare the differences.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/05\/compound-interest\/#Simple_and_compound_interest\" >Simple and compound interest<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/05\/compound-interest\/#Why_develop_simple_and_compound_interest_calculator\" >Why develop simple and compound interest calculator?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/05\/compound-interest\/#How_to_use_this_calculator\" >How to use this calculator?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/05\/compound-interest\/#IRR_Calculator\" >IRR Calculator<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/05\/compound-interest\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Simple_and_compound_interest\"><\/span>Simple and compound interest<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>I have introduced simple interest and compound interest in my book &#8220;The Rules of Super Growth Stocks Investing&#8221;. The difference between simple interest and compound interest is the first step in financial management.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Why_develop_simple_and_compound_interest_calculator\"><\/span>Why develop simple and compound interest calculator?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>For the average person, it is easy to calculate the interest rate for one or two years, but it is difficult to see it at a glance or through mental arithmetic for a long period of time. Most people will use Excel or Google, or to search for calculation formulas on the internet.<\/p>\n\n\n\n<p>Like the annualized rate of return on investment (aka IRR), the calculation of simple interest and compound interest is really a fundamental work for wealth management. I decided to write an interest rate calculator, calculate the results of using simple interest and compound interest respectively.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_to_use_this_calculator\"><\/span>How to use this calculator?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Readers can click <a href=\"https:\/\/www.granitefirm.com\/us\/tools\/compoundinterest\/\" target=\"_blank\" rel=\"noreferrer noopener\">this link<\/a> to connect to the simple interest and compound interest calculators I designed, and you can see the following screen:<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"556\" height=\"434\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/08\/ci_e.jpg\" alt=\"Simple and compound interest calculator screenshot\" class=\"wp-image-13180\" srcset=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/08\/ci_e.jpg 556w, https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/08\/ci_e-300x234.jpg 300w\" sizes=\"auto, (max-width: 556px) 85vw, 556px\" \/><\/figure>\n\n\n\n<p><\/p>\n\n\n\n<p>The user only needs to enter the following three fields on the screen:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Principal: For example, in the example in the screen, we enter 100<\/li>\n\n\n\n<li>Interest Rate: For example, in the example in the screen, we enter 6<\/li>\n\n\n\n<li>Number Of Year Invested: For example, in the example in the screen, we enter 10<\/li>\n<\/ul>\n\n\n\n<p>After the input, click the &#8220;Calculate&#8221; button on the screen, you can see the result of the simple interest calculation in the &#8220;Simple interest calculation result&#8221; area below, and the compound interest in the &#8220;Compound interest calculation result&#8221; area. You can then compare the differences.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"260\" height=\"180\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/08\/compound-interest-vs-simple-interest-1600x1200-1.jpg\" alt=\"Simple and compound interest calculator\" class=\"wp-image-13188\"\/><figcaption class=\"wp-element-caption\">Credit: investmentu.com<\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"IRR_Calculator\"><\/span>IRR Calculator<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>I also previously post an article &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/08\/30\/irr-calculator\/\" target=\"_blank\" rel=\"noreferrer noopener\">IRR Calculator<\/a>&#8221; describing an IRR calculator that I put on my website. Readers can click on <a href=\"https:\/\/www.granitefirm.com\/us\/tools\/irr\/\" target=\"_blank\" rel=\"noreferrer noopener\">this link<\/a> to connect to the IRR calculator I designed.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"block-d8a344e9-4edc-4dc1-b981-40aa61d258b5\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/11\/20\/the-compound-effect\/\" target=\"_blank\" rel=\"noreferrer noopener\">The Compound Effect<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/04\/22\/deferred-gratification\/\" target=\"_blank\" rel=\"noreferrer noopener\">People who are good at deferred&nbsp;gratification&nbsp;is more likely to succeed<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/01\/18\/exponential-growth\/\" target=\"_blank\" rel=\"noreferrer noopener\">Exponential growth can produce excess returns<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/09\/24\/compound-interest-2\/\" target=\"_blank\" rel=\"noreferrer noopener\">The power of compound interest<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/09\/05\/compound-interest\/\" target=\"_blank\" rel=\"noreferrer noopener\">Simple and compound interest calculator<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/21\/why-long-term-investment\/\">Why long-term investment is better?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/08\/30\/irr-calculator\/\" target=\"_blank\" rel=\"noreferrer noopener\">IRR Calculator<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/07\/25\/stock-worth-holding-forever\/\" target=\"_blank\" rel=\"noreferrer noopener\">Investors should care annualized rate of return (IRR), How to calculate?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/04\/young-people-investing\/\" target=\"_blank\" rel=\"noreferrer noopener\">The great enviable advantages of young people investing in stock<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/09\/18\/time-discipline-and-patience-are-the-three-elements-of-successful-investment\/\">Time, discipline and patience are the three elements of successful investment<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/05\/16\/patience-to-invest-success\/\" target=\"_blank\" rel=\"noreferrer noopener\">Patience, an indispensable element of investment success<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em><strong>Disclaimer<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>You can use simple and compound interest calculators, a free online tool I developed, to quickly calculate and compare the differences.<\/p>\n","protected":false},"author":1,"featured_media":13188,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34,1151,407,675],"tags":[],"class_list":["post-13168","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-wealth-management","category-compound-interest","category-interest-rate","category-site-announcement"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/13168","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=13168"}],"version-history":[{"count":19,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/13168\/revisions"}],"predecessor-version":[{"id":31170,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/13168\/revisions\/31170"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/13188"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=13168"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=13168"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=13168"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}