Compound interest
Free compound interest calculator for investors and savers. Enter a starting amount, monthly contribution, expected annual return, and time horizon — see the final balance, total interest, and a year-by-year growth table.
Year-by-year growth
| Year | Contributions | Interest | Balance |
|---|---|---|---|
| 1 | $6,000.00 | $955.34 | $16,955.34 |
| 2 | $6,000.00 | $1,458.14 | $24,413.48 |
| 3 | $6,000.00 | $1,997.29 | $32,410.77 |
| 4 | $6,000.00 | $2,575.41 | $40,986.18 |
| 5 | $6,000.00 | $3,195.33 | $50,181.52 |
| 6 | $6,000.00 | $3,860.06 | $60,041.58 |
| 7 | $6,000.00 | $4,572.85 | $70,614.43 |
| 8 | $6,000.00 | $5,337.16 | $81,951.59 |
| 9 | $6,000.00 | $6,156.72 | $94,108.31 |
| 10 | $6,000.00 | $7,035.54 | $107,143.85 |
| 11 | $6,000.00 | $7,977.88 | $121,121.72 |
| 12 | $6,000.00 | $8,988.34 | $136,110.06 |
| 13 | $6,000.00 | $10,071.84 | $152,181.91 |
| 14 | $6,000.00 | $11,233.68 | $169,415.59 |
| 15 | $6,000.00 | $12,479.50 | $187,895.09 |
| 16 | $6,000.00 | $13,815.39 | $207,710.48 |
| 17 | $6,000.00 | $15,247.84 | $228,958.32 |
| 18 | $6,000.00 | $16,783.85 | $251,742.18 |
| 19 | $6,000.00 | $18,430.90 | $276,173.08 |
| 20 | $6,000.00 | $20,197.01 | $302,370.09 |
How to use compound interest
- 01Enter your starting balance
Current investment or savings account balance. Use zero if you're starting fresh.
- 02Add monthly contributions
How much you plan to deposit every month. Dollar-cost averaging is built in — contributions are added at the start of each period.
- 03Set the expected return
Use a realistic long-term average. Historical S&P 500 total return is roughly 7% after inflation.
- 04Pick the time horizon
Years until the goal — retirement, a down payment, college. Longer horizons compound harder.
- 05Switch compounding frequency
Monthly, quarterly, or yearly. Match whatever your account uses — the effect is small but matters for precision.
Examples
Formula
Future value = P × (1 + r/n)^(n·t) + C × ((1 + r/n)^(n·t) − 1) / (r/n). P is the starting amount, r is the annual rate, n is compounding periods per year, t is years, and C is the contribution per compounding period.
FV = P(1 + r/n)^(nt) + C · ((1 + r/n)^(nt) − 1) / (r/n)Frequently asked questions
What's a realistic rate of return?
For a diversified stock portfolio, a long-term real return (after inflation) of roughly 6–7% is a reasonable planning assumption. Bonds historically return 2–4% real. Run your projection with both optimistic and pessimistic rates to bracket outcomes.
How often should interest compound?
Many brokerage accounts compound daily (effectively), banks typically monthly, some bonds semi-annually. The difference between monthly and yearly compounding at typical rates is small — a fraction of a percent over decades — but match your account for accuracy.
Does this calculator account for taxes and inflation?
No. The result is a nominal, pre-tax future value. To account for inflation, plug in your expected real return (nominal minus inflation). For taxes, subtract your expected effective rate from the return before entering it.
What's the difference between simple and compound interest?
Simple interest pays a fixed percentage of the original principal every period. Compound interest pays interest on the accumulated balance, which grows exponentially over time — the effect most people want when they say 'interest.'
Can I model irregular contributions?
Not directly — contributions are a fixed monthly amount. For lump sums, add them to the starting balance. For varying monthly amounts, use your average.
Last updated . Built by Tooligan.