How to use the compound Interest Calculator
- Enter the starting amount.
- Enter the monthly contribution.
- Enter the annual interest rate (in %).
- Enter the years.
- Choose the compounding from the list.
- Choose the currency from the list.
- The result updates instantly as you type. There is no button to press.
- Use Copy result to copy the figures, or Copy link to share a link that reopens the compound Interest Calculator with the same inputs.
How it works
Compound interest means you earn interest on your interest. Each time interest is credited, it joins the balance, and the next round of interest is calculated on the larger amount. Over short periods the effect is small. Over decades it dominates: in long-term savings, the interest earned often ends up larger than the money you put in.
This calculator starts with your opening balance, adds your monthly contribution at the end of each month, and grows the balance by the monthly equivalent of your annual rate under the compounding frequency you choose. More frequent compounding gives a slightly higher effective annual rate (APY). For example, 7% compounded monthly is equivalent to about 7.23% a year. The table shows how much of your balance came from contributions and how much from interest, year by year.
Use it for savings accounts, certificates of deposit and long-term investments. For investments such as index funds, the return is not fixed, so try a cautious rate and an optimistic one to see a range. The figures are before tax and inflation. To see the result in today's money, run the answer through the inflation calculator.
Formula
P is the starting amount, r the annual rate, n the compounding periods per year, t the years, PMT the monthly contribution and i the equivalent monthly rate. With no contributions the formula reduces to the classic A = P(1 + r/n)^(nt).
Example
Start with $10,000, add $200 a month, and earn 7% a year compounded monthly for 10 years. You contribute $10,000 + 120 × $200 = $34,000 in total. The balance grows to about $54,713.58, so $20,713.58 is interest. Let it run for 30 years instead and the balance passes $325,000, with interest making up roughly three quarters of it.
Frequently asked questions
What is the rule of 72?
Divide 72 by the annual interest rate to estimate how many years it takes money to double. At 6% that is about 12 years; at 9% about 8 years. It is a quick mental shortcut and is most accurate for rates between about 4% and 12%.
Does compounding frequency matter much?
A little. Moving from yearly to monthly compounding raises the effective rate slightly, for example from 5.00% to 5.12%. Daily compounding adds only a tiny amount more. The rate and the time invested matter far more.
Are contributions made at the start or end of the month?
This calculator adds them at the end of each month, so a contribution starts earning interest the following month. Contributing at the start of each month would give a slightly higher result.
What rate should I use for stock market investments?
Long-run stock market returns have historically averaged around 6–10% a year before inflation, but returns vary widely from year to year and are never guaranteed. Try several rates to see a range of outcomes.
Disclaimer: This calculator gives estimates for general information and education. It is not financial, tax or investment advice. Lenders, banks and tax authorities may round differently, charge fees or apply rules this tool does not model, so confirm figures with a qualified professional or your provider before making decisions.