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Interest Calculator

Input a negative value for withdrawing.


%
years

Leave it as zero if you want to calculate before tax interest only.

%

Only used for calcualting inflation adjusted end balance.

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Calculated Results
Total Interest11,517
Total Contribution30,000
End Balance61,517
Infaltion Adjusted End Balance53,065
End Principal50,000
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Balance and Interest

Year Begin Principal Begin Balance Interest End Principal End Balance
1 20,000 20,000 1,365 26,000 27,365
Month120,00020,00010020,50020,600
Month220,50020,60010221,00021,202
Month321,00021,20210521,50021,808
Month421,50021,80810822,00022,415
Month522,00022,41511022,50023,025
Month622,50023,02511223,00023,638
Month723,00023,63811523,50024,252
Month823,50024,25211824,00024,870
Month924,00024,87012024,50025,490
Month1024,50025,49012225,00026,112
Month1125,00026,11212525,50026,738
Month1225,50026,73812826,00027,365
2 26,000 27,365 1,807 32,000 35,172
Month1326,00027,36513726,50028,002
Month1426,50028,00213927,00028,641
Month1527,00028,64114227,50029,283
Month1627,50029,28314428,00029,927
Month1728,00029,92714728,50030,574
Month1828,50030,57414929,00031,223
Month1929,00031,22315229,50031,875
Month2029,50031,87515430,00032,530
Month2130,00032,53015730,50033,186
Month2230,50033,18615931,00033,846
Month2331,00033,84616231,50034,508
Month2431,50034,50816432,00035,172
3 32,000 35,172 2,275 38,000 43,447
Month2532,00035,17217632,50035,848
Month2632,50035,84817833,00036,526
Month2733,00036,52618133,50037,207
Month2833,50037,20718334,00037,890
Month2934,00037,89018634,50038,576
Month3034,50038,57618835,00039,265
Month3135,00039,26519135,50039,955
Month3235,50039,95519336,00040,649
Month3336,00040,64919636,50041,345
Month3436,50041,34519837,00042,043
Month3537,00042,04320137,50042,744
Month3637,50042,74420338,00043,447
4 38,000 43,447 2,772 44,000 52,219
Month3738,00043,44721738,50044,164
Month3838,50044,16422039,00044,884
Month3939,00044,88422239,50045,606
Month4039,50045,60622540,00046,331
Month4140,00046,33122740,50047,058
Month4240,50047,05823041,00047,788
Month4341,00047,78823241,50048,520
Month4441,50048,52023542,00049,255
Month4542,00049,25523742,50049,992
Month4642,50049,99224043,00050,732
Month4743,00050,73224243,50051,474
Month4843,50051,47424544,00052,219
5 44,000 52,219 3,298 50,000 61,517
Month4944,00052,21926144,50052,980
Month5044,50052,98026445,00053,744
Month5145,00053,74426645,50054,510
Month5245,50054,51026946,00055,278
Month5346,00055,27827146,50056,050
Month5446,50056,05027447,00056,823
Month5547,00056,82327647,50057,599
Month5647,50057,59927948,00058,378
Month5748,00058,37828148,50059,159
Month5848,50059,15928449,00059,942
Month5949,00059,94228649,50060,729
Month6049,50060,72928950,00061,517

How to calculate interest earned

An investment on a bond, CD or bank saving account will have an annual coupon rate, for example 6%. For simple interest, the interest earned is calculated based on: \[ Interest = Principal \times Periods \times Rate \] Where Periods is number of periods for the calculated duration, Rate is the periodic rate. For example, for monthly interest earned, the monthly rate for a coupon of 6% is \( 0.06\div 12 = 0.005 \) Take the 6% coupon example, for a principal of 10,000, the monthly interest is \( 10000 \times 0.005 = 50 \).

If the interest is compounding, based on the compounding frequency, interest from current compounding period will be added into the principal for the next period and will earn interest on that interest. The compounding frequency determine when to move the interest into principal. For example, if the compounding frequency is monthly, then at each month end, the interest earned at that month will be added into principal and the interest earned on the next month will be based on the increased principal. You can think of compounding like an interest income reinvestment process. The interest earned during a compound period instead of paid to the investor, it is kept into the principal as a new investment and thus will increase the principal amount.

Interest earned if not got paid is normally compounding. For example, if you save on an bank saving account, the interest calculated daily and then added into your bank accounting balance. That is equal to interest compounding daily.

Tax is a big component in the investment. Most of the interest earned from investment such as CD and bonds will subject to income tax. Therefore, the calculator here will deduct the interest earned by the amount of tax you will need to pay. There are some investments earn tax free interest, such as certain municipal bond. However, those investment will normally have a lower interest rate.

The inflation adjusted value tells you the real value of the money. The tax and inflation adding together will each up the majority of your investment so that it is hard for you to earn real money through a lower interest rate investment.