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Simple & Compound Interest Calculator

Tax & Financial Free Updated 1 Sep 2026
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ⓘ About this tool 🔄 Last updated 1 Sep 2026 ✓ Reviewed by TopToolAI Team

Compare simple interest against compound interest on a principal amount over time, and see exactly how much extra compounding earns you. PKR 100,000 invested for 10 years at 8% grows to PKR 200,000 under simple interest but to roughly PKR 215,900 under annual compounding — the gap widens every year as interest starts earning interest on itself.

How to use Simple & Compound Interest Calculator

Step-by-step guide to the boxes below. Open it only if you need help.

  1. 1
    Principal Number

    The lump sum you are investing at the start.

    Example: 10000

  2. 2
    Annual rate % Number

    The yearly return or interest you expect, for example 8.

    Example: 8

  3. 3
    Years Number

    How long the money will stay invested.

    Example: 5

  4. 4
    Press “Calculate”

    Click the button under the boxes. If something is missing or not valid, a short message tells you which box to fix.

  5. 5
    Read your result

    Simple and compound interest are shown side by side, so you can see what compounding adds. Change any box and try again to compare different numbers.

Simple & Compound Interest Calculator FAQs

Why does compounding matter so much over time?
Because each year's interest is added to the principal and starts earning interest itself, the gap between simple and compound interest grows faster the longer the money is invested.
Does this assume interest compounds annually?
Yes, this version compounds once per year. More frequent compounding (monthly/daily) would produce a slightly higher result.
What is a realistic interest rate to use?
This depends heavily on the investment type — savings accounts, fixed deposits, and stock market averages all differ significantly, so use a rate that matches your actual instrument.
Does adding regular contributions change the calculation?
This calculator projects a single lump sum growing over time. For regular monthly contributions on top, the Retirement Savings calculator is a better fit.

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