# Compound Interest Calculator

## Formula to calculate compound interest

The formula to calculate the final balance with compound interest (interest on interest):

B = P(1+i/n)^{nt}

- B = Final Balance
- P = Principal investment (initial balance)
- i = interest rate
- n = number of times interest is compounded per period
- t = number of periods invested

## Formula to calculate effective annual interest rate

The formula to calculate APY or effective annual interest rate:

APY = (1+(APR/n))^{n}-1

- APY = Annual Percentage Yield (effective annual interest rate)
- APR = Annual Percentage Rate (nominal annual interest rate)
- n = number of times interest is compounded per year