Compound Interest Calculator
See how your savings grow over time with compound interest and regular monthly contributions.
How the compound interest calculator works
Compound interest means you earn interest on your interest. Each period, the calculator grows your balance by the periodic rate implied by your annual rate and compounding frequency, then adds your monthly contribution at the end of the month. Next period, the slightly larger balance earns slightly more — and that feedback loop is what bends the growth curve upward.
Compounding frequency matters at the margins: the same nominal rate compounds to a little more when applied daily than annually. The calculator converts whatever frequency you pick into an equivalent monthly rate so contributions are handled consistently.
The stacked chart separates your starting amount, your cumulative contributions, and the interest earned — making it easy to see the point where growth starts doing more work than your deposits.
How to use this calculator
- Enter your starting amount (it can be zero).
- Set the monthly contribution you plan to make.
- Enter the expected annual interest or return rate.
- Choose how many years to grow and how often interest compounds.
- Press Calculate to see the future value and the growth breakdown.
Key terms
- Compound interest
- Interest calculated on both the original principal and previously earned interest.
- Compounding frequency
- How often interest is credited — annually, quarterly, monthly, or daily. More frequent compounding yields slightly more at the same nominal rate.
- Future value
- What your balance is projected to be at the end of the growth period.
Tips
- Time in the market beats timing: starting ten years earlier usually matters more than a slightly higher rate.
- Automate the monthly contribution — consistency is what the compounding math rewards.
- For long horizons, run the calculation with a conservative and an optimistic rate to bracket the outcome.
Frequently asked questions
When are contributions added in the calculation?
At the end of each month, after that month’s interest is applied. This is the standard "ordinary annuity" convention and slightly understates growth compared with contributing at the start of the month.
What rate should I use for stock market investments?
There is no guaranteed rate, but long-run diversified stock returns have historically averaged around 7% after inflation. Use a range of rates to see best- and worst-case projections rather than relying on a single number.
Why does daily compounding barely beat monthly?
The gain from more frequent compounding shrinks as frequency rises. Moving from annual to monthly is noticeable; from monthly to daily adds only a few hundredths of a percent in effective yield.
Planning further? Try the apy calculator, the savings goal calculator or the simple interest calculator.
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APY Calculator
Convert a nominal interest rate to its effective annual yield (APY) and see what a deposit earns.
Savings Goal Calculator
Plan how long it will take to reach a savings goal and how much to save each month to get there on time.
Simple Interest Calculator
Calculate interest earned on a principal balance at a fixed rate without compounding.
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