Savings Calculator
Written by:Abraham A.Finance.ThinkAndDone.com provides you online and windows calculators to calculate earnings from a savings account when interest is compounded continuously.
Savings Calculator
| Initial Deposit | $ |
| Periodic Deposit | $ |
| Interest Rate | % |
| Number of Years | |
| Deposit Frequency | |
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| Ending Balance | |
| Total Amount Invested | |
| Total Interest Earned | |
Instructions
There are different factors that effect the earnings on a savings account, these include the frequency of deposits, the compounding period for interest. Most banks quote an Annual Percentage Rate for savings and loans, this interest rate however is on annual basis. Banks have the option to calculate the interst paid based on compounding periods. For example, a bank might compound the interest on monthly basis. In such a case the interest is paid a rate which equals APR/12 in other terms the annual percentage rate is divided by 12. If the bank were to compound interest on weeekly basis, then the rate of interest equals APR/52. Further if the rate was quoted on Bi-Monthly basis then the interest is paid at APR/24. If it was quoted on fortnightly basis then the interest is paid at APR/26. And if the interest were to be paid on daily basis, the interest rate applied is APR/365. The higher the number of compounding periods the more interest will be earned, thus interest paid on daily rate is more than interest earned on monthly basis. If we were to increase the interest compounding period to an infinite amount in time, this would be called continuous compounding which is common practise at most banks in the US. The calculator on this page allows you to enter an initial deposit amount and a periodic deposit amount. It allows to select the interest rate and number of deposits. Finally showing you the interest earned by your savings at the rate for the duration of the deposit.