Ori ToolsHow to use
- Enter the principal and annual rate.
- Enter the years and compounds per year.
- Set the tax on interest and press Calculate.
When to use it
- Comparing savings accounts
- Seeing the effect of compounding
- Estimating interest after tax
Simple vs compound
Simple interest pays only on the principal; compound interest pays on interest already earned. Interest on 10,000 over 3 years:
| Rate | Simple | Compound |
|---|---|---|
| 2% a year | 600.00 | 612.08 |
| 3% a year | 900.00 | 927.27 |
| 4% a year | 1,200.00 | 1,248.64 |
| 5% a year | 1,500.00 | 1,576.25 |
Korea taxes interest at 15.4% by default; change the tax rate for your country.
Frequently asked questions
What does compounds per year mean?
12 means monthly, 1 means yearly.
Why does tax matter?
It reduces the amount you keep.
Is this a bank quote?
No, real products differ.