For an existing savings account, log into online banking, check your latest account statement, or contact your bank to determine the current amount in your account.

Deposit accounts, like certificates of deposits (CDs), use another term, annual percentage yield (APY), to refer to the annual rate. [2] X Research source Make sure you are using the annual rate (the amount of interest paid each year) and not the periodic rate (the amount of interest paid each time the interest compounds each year). For example, an account with interest that compounds quarterly (four times per year) might have a periodic interest rate of 0. 3 percent, but an annual rate of 1. 2 percent. Remember to use the annual rate in your calculations. For the purpose of calculating compound interest, your rate must be in decimal form. Convert it by dividing your started interest rate by 100. [3] X Research source For example, 1 percent would be 1/100, or 0. 01.

For annual compounding, use 1 (once per year). For semiannual, use 2 (twice per year). For quarterly, use 4. For monthly, use 12. For weekly, use 52. For daily, use 365. [5] X Research source

If you are calculating interest for an account to which you will be making regular contributions, use the part of this article titled “Calculating Compound Interest with Regular Contributions. "

A is the final value of the account after interest is calculated. P is the principal in the account. r is the annual interest rate. n is the compounding frequency. t is the time period in years.

For example, imagine you start a new savings account with a $2,000 (P=$2,000) deposit. The account will earn 1. 2 percent interest (r=0. 012) compounded quarterly (n=4). You decide to leave the money in the account for ten years (t=10). Using the example savings account, your completed equation would look like this: A=$2,000(1+0. 0124)4∗10{\displaystyle A=$2,000(1+{\frac {0. 012}{4}})^{4*10}}

Next, solve the addition in parentheses. For the example, this would give: A=$2,000(1. 003)40{\displaystyle A=$2,000(1. 003)^{40}}. Then, calculate the exponent. The number above the others, on the far right, is the exponent. Calculate this by inputting the lower value ((1. 003) in the example), pressing the exponent button xy{\displaystyle x^{y}} on your calculator, and then entering the exponent (40) and pressing enter. For the example, this would give: A=$2,000(1. 12729){\displaystyle A=$2,000(1. 12729)}. This result, 1. 12729, was rounded to five decimal places. For a more accurate answer, keep more decimal places in your calculation. Finally, multiply the two remaining numbers to get your future account balance, A. In the example, this would be $2,254. 58. Your $2,000 deposit will be worth $2,254. 58 in ten years if you put it into an account earning 1. 2 percent annual interest compounded quarterly.

This formula is for regular contributions made at the end of the period in question (end of the month, end of the quarter, etc. ). To calculate interest when payments are made at the beginning, add the figure, multiply the PMT part of the equation by 1+rn{\displaystyle 1+{\frac {r}{n}}}. This formula only works if the payment frequency and compounding frequency are the same. For example, if you make monthly contributions, the interest compounds quarterly, this calculation will not be accurate. [6] X Research source

Your completed equation would be: A=$2,000(1+0. 01212)12∗10+$100((1+0. 01212)12∗10−1)0. 01212{\displaystyle A=$2,000(1+{\frac {0. 012}{12}})^{1210}+{\frac {$100((1+{\frac {0. 012}{12}})^{1210}-1)}{\frac {0. 012}{12}}}}.

Using the example equation, this would leave you with: A=$2,000(1+0. 001)120+$100((1+0. 001)120−1)0. 001{\displaystyle A=$2,000(1+0. 001)^{120}+{\frac {$100((1+0. 001)^{120}-1)}{0. 001}}} Your next step is to add the numbers in parentheses (1+0. 001 in the example), this gives you: A=$2,000(1. 001)120+$100((1. 001)120−1)0. 001{\displaystyle A=$2,000(1. 001)^{120}+{\frac {$100((1. 001)^{120}-1)}{0. 001}}} After that, solve the exponents by raising the lower number (1.

  1. to the power of the higher number (120). This yields: A=$2,000(1. 12743)+$100(1. 12743−1)0. 001{\displaystyle A=$2,000(1. 12743)+{\frac {$100(1. 12743-1)}{0. 001}}} Subtract the 1 in parentheses. The example equation is now: A=$2,000(1. 12743)+$100(0. 12743)0. 001{\displaystyle A=$2,000(1. 12743)+{\frac {$100(0. 12743)}{0. 001}}} Multiply and divide the two parts separately. Multiply the principal and payments by the decimal figures in parentheses and then divide the payments side by the decimal underneath it. This results in: A=$2,254. 86+$12,743{\displaystyle A=$2,254. 86+$12,743} Add the final two numbers. Your result is the value of the account after your chosen time period. In the example, this is $14,997. 86. Your 1. 2 percent annual interest-earning account that compounds monthly will be worth $14,997. 86 in ten years if you start with $2,000 in principal and add $100 each month.

The interest earned is then $14,997. 86 (the final account value) minus $14,000 (your paid-in amount), or $997. 86. Your account will earn $997. 86 in interest over the ten-year period.