How to Calculate Monthly Compound Interest?
Here’s how to calculate monthly compound interest using our compound interest formula. Monthly compound interest means that our interest is compounded 12 times per year:
- Divide your annual interest rate (decimal) by 12 and then add one to it.
- Raise the resulting figure to the power of the number of years multiplied by 12.
- Multiply your step 2 result by your principal balance (P).
- Deduct the principal balance from your step 3 result if you want just the interest.
As a formula, it looks like this:
A = P(1 + r/12)^12t
Compound Interest Calculator
Our Online Compound Interest Calculator tool can help you calculate the future value of your investment considering compound interest.