Required interest rate calculator
If you have a sum today and a target in the future, this gives the rate you need to get there.
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Processing and privacy: The result is calculated inside your browser and your data is not sent to any server.
How to use it
- Enter present amount, target amount, term and compounding frequency.
- The result appears straight away and updates as you edit.
- Copy the result, or copy a link that keeps the same values to share it.
How it is calculated
Nominal rate = n × ((FV/PV)^(1/(n × t)) − 1). Effective rate = (FV/PV)^(1/t) − 1.
Example
Inputs: Present amount = 10,000 your currency, Target amount = 15,000 your currency, Term = 5 years, Compounding frequency = Annually. Result: Nominal annual rate: 8.4472%; Effective annual rate: 8.4472%; Total growth: 50%.
Limits and caveats
- Covers a single sum with no extra deposits.
- If the target is below the present amount, the rate is negative, meaning a loss.
Questions about this tool
Why do the nominal and effective rates differ?
With monthly compounding, a slightly lower nominal rate gives the same growth because interest is added more than once a year.
Is this the same as CAGR?
The effective rate here equals the CAGR between two values for a single sum.
Is the rate realistic?
Compare it with deposit and bond yields you can get. If it is far higher, you may need more time or a larger start.