Compound Interest Calculator
Project how a starting amount plus regular contributions grows over time.
Short answer: See how money grows with compound interest: enter your starting amount, monthly contribution, annual interest rate, compounding frequency, and time horizon. The calculator projects your future balance and total interest earned instantly — all computed privately in your browser.
Last updated: October 13, 2026
How it works
Compound interest means you earn interest on your interest. Each compounding period, the balance grows by the periodic rate, your contribution is added, and the next period starts from the larger amount — so growth accelerates over time.
Enter a starting amount, a monthly contribution, an expected annual rate, and a time horizon, then pick how often interest compounds. The three results update as you type: the projected future value, how much of it came out of your pocket, and how much compounding added.
A worked example
The values loaded in the tool — $10,000 starting amount, $250 a month, 7% annual rate, 10 years, monthly compounding — produce:
More than a third of the ending balance is interest the contributions never had to cover. Extend the same inputs to 20 years and the interest share grows past the contributed share — that crossover is the whole point of starting early.
Frequently asked questions
How is compound interest calculated?
Each period the balance is multiplied by (1 + rate ÷ periods per year) and the period contribution is added. Repeating that for every period is exactly what this calculator does, period by period.
Does compounding frequency make a big difference?
A modest one. Daily compounding edges out monthly, which edges out annual, because interest starts earning its own interest sooner. Contributions and time matter far more.
Is this a prediction of my investments?
No. It assumes a steady rate and regular contributions, which real markets never provide. Treat the result as a planning estimate, not financial advice.
What rate should I use?
For long-term diversified investing, people often model 5–8% before inflation. For a savings account, use the rate your bank actually pays. Try a few rates to see a range rather than a single number.
Why does time matter more than the rate?
Because compounding is exponential in time: doubling the years roughly squares the growth factor on your earliest money, while a slightly higher rate only nudges it. The example above shows interest overtaking contributions given enough years.
What is the difference between APR and APY?
APR is the nominal annual rate before compounding is considered; APY folds the compounding frequency in. 5% compounded monthly is a 5.116% APY — the number that reflects what you actually earn.
Does compounding frequency really change the result?
Yes, but with diminishing returns. On $1,000 at 5% for 10 years: $1,628.89 annually, $1,647.01 monthly, $1,648.66 daily. The jump from annual to monthly matters; monthly to daily barely does.
What is the rule of 72?
A mental shortcut: divide 72 by the interest rate to estimate the years needed to double your money. At 6%, about 12 years; at 8%, about 9. Use it to sanity-check calculator results.
Does the calculator account for inflation or taxes?
No. Results are nominal growth of the balance itself. Inflation, taxes, and fees all reduce real returns, so treat the figure as a starting point, not a promise.
How compounding actually works
Compound interest means you earn interest on your interest. The formula is A = P(1 + r/n)^(nt), where P is the starting amount, r is the annual rate as a decimal, n is how many times per year interest is applied, and t is the number of years. Each compounding period, the balance grows by the fraction r/n — and the next period applies to the new, larger balance.
Worked through: $1,000 at 5% compounded monthly for 10 years. The monthly rate is 0.05 ÷ 12 ≈ 0.004167, applied 120 times: $1,000 × (1.004167)120 ≈ $1,647.01, of which $647.01 is interest. Simple interest at the same rate would have paid only $500 — compounding more than doubles the return here because the time horizon is long.
Why compounding frequency matters
The same $1,000 at 5% for 10 years grows to $1,628.89 compounded annually, $1,647.01 compounded monthly, and $1,648.66 compounded daily. More frequent compounding always wins, but the gains shrink fast — the jump from annual to monthly is worth $18.12, while monthly to daily adds just $1.65. Banks quote this as APY (annual percentage yield), which rolls the frequency in: 5% compounded monthly is a 5.116% APY.
The rule of 72
For a quick mental check, divide 72 by the interest rate to estimate the years needed to double your money: at 6%, about 12 years; at 8%, about 9. It is an approximation, but it is accurate enough to sanity-check any calculator result — if the tool says your money doubles in 4 years at 5%, something is wrong with the inputs.
One caveat: these are nominal figures. The calculator does not subtract inflation, taxes, or fees, which all eat into real returns. Treat the result as the growth of the balance itself, then discount mentally for what that money will actually buy.
What is the difference between compound and simple interest?
Simple interest pays only on your original principal: $1,000 at 5% earns $50 every year, forever. Compound interest pays on the principal plus all previously earned interest, so that same $1,000 at 5% compounded annually becomes about $1,628 after ten years instead of $1,500.
The gap widens with time and rate — which is why starting early beats chasing higher returns later. Try 10 vs. 30 years here with the same inputs and watch the curves diverge.
How does compounding frequency change my returns?
Interest can compound yearly, monthly, or daily. More frequent compounding means each interest payment starts earning its own interest sooner, so daily compounding beats monthly at the same nominal rate — though the difference is modest (on $10,000 at 5% for 10 years, roughly $30).
What moves the needle far more is the rate itself and the time horizon. Use the frequency dropdown here to see the exact difference for your numbers rather than guessing.