Compound Interest Calculator

Every number on this page is read off one month-by-month schedule

Compound interest is interest earned on both your original principal and the interest already added to the balance. Because each period earns on a larger base, the balance grows faster the longer it runs — the effect usually called interest-on-interest. This calculator does not evaluate one closed-form equation and show you the answer. It builds a schedule, one row per month, and the headline figures, the charts, the year table, the scenario comparison and the goal solver are all read off that same schedule, which is why they agree to the cent instead of drifting apart.

Each month the engine adds any contribution due, applies growth, subtracts fees, applies tax if you asked for it, and records the new balance. Your stated annual rate and compounding frequency are first converted into an effective monthly rate, so choosing annual, quarterly, monthly, daily or continuous compounding reproduces the exact effective annual rate of that frequency rather than approximating it. Contributions land at the start or the end of each period depending on your timing choice, and beginning-of-period money therefore earns one extra period of growth. An annual contribution increase, a contribution stop year and a one-time deposit are applied on the schedule in the month they actually occur.

The closed-form formulas still hold, and the schedule reproduces them. For a single lump sum, A = P(1 + r/n)^(n x t), where P is the starting principal, r the annual rate as a decimal, n the number of compounding periods per year and t the number of years, so n x t is the total number of periods. For a stream of equal deposits, FV = C x [((1 + i)^m - 1) / i], where C is the contribution, i the rate per period and m the number of periods. Continuous compounding is A = P x e^(r x t); simple interest is A = P(1 + r x t); the effective annual rate is EAR = (1 + r/n)^n - 1. What the schedule adds is everything a single textbook formula cannot hold at once — increases, a stop year, a lump-sum top-up, fees, tax and inflation, all interacting month by month.

• P — the starting amount you already have saved or invested. It can be zero if you are beginning from scratch.
• r — the annual interest rate or assumed return, entered as a percentage and used as a decimal.
• n — how often interest compounds per year: annual, quarterly, monthly, daily or continuous.
• t — the time horizon in years. The total number of compounding periods is m = n x t.
• i — the periodic rate, r / n, which the engine restates as its effective monthly equivalent before running the schedule.
• C or PMT — the recurring contribution, plus any annual increase, contribution stop year or one-time deposit layered on top of it.

A 7% quoted rate and a 7.23% earned rate describe the same account

A nominal rate is the headline number an account advertises, and the one shown as APR on borrowing. It says nothing about how often interest is credited back to the balance. The effective annual rate does say that, and for savings products it is published as APY. The conversion is EAR = (1 + r/n)^n - 1, and in the base case on this page a 7% nominal rate compounded monthly works out at roughly 7.23% APY. Nothing about the account changed; only the frequency with which interest started earning interest.

Those 0.23 of a percentage point are why two accounts quoting an identical headline rate can pay different amounts over a year, and why the only fair comparison between accounts is APY against APY rather than nominal against nominal. Set the compounding frequency to annual, quarterly, monthly, daily or continuous and the calculator recomputes the effective monthly rate behind the schedule, so the summary, the reported APY and the year-by-year table all move together rather than one of them lagging the others.

The honest caveat is that frequency is the weakest of the three levers you have. Holding the rate and the horizon fixed and varying only how often interest is credited produces a real difference, but a small one next to a change in the assumed rate or in the number of years the money runs. If you are choosing between two savings accounts, compare their APYs. If you are trying to change the outcome of a plan, the rate assumption and the horizon are where the leverage actually is.

Where the $36,639 of growth in the base case actually comes from

The base case used throughout this page is a $10,000 starting balance, $500 added every month, a 7% annual return compounded monthly, a ten-year horizon and 3% inflation. It finishes at an estimated $106,639. You supplied $70,000 of that — the $10,000 you started with plus $60,000 of monthly deposits — which leaves $36,639, a little over a third of the ending balance, as growth.

The two halves of that growth are not equal, and the split is the part worth seeing. The $10,000 starting balance left entirely alone at 7% compounded monthly for ten years reaches about $20,097, so it contributed $10,097 of the growth by itself. The remaining $86,542 of the ending balance comes from the deposit stream: $60,000 of your own money plus $26,542 of growth earned on it. Add the two growth figures, $10,097 and $26,542, and you are back at the $36,639 the summary reports.

The deposits earn less per dollar because they have had less time. The $500 you add in month 120 earns nothing at all before the horizon ends, while the $500 added in month one has had the full ten years. That is also why the balance curve steepens instead of rising in a straight line: early on your contributions dominate and growth is a thin slice on top, but as the balance builds, a single year of growth eventually exceeds a whole year of deposits.

The results panel is organised around the same split. It separates the money you put in from the interest and growth it earned, then reports the effective annual rate, the inflation-adjusted real value, total fees and estimated taxes, and how the result compares with a plain simple-interest track. The charts and the year-by-year schedule show the build-up over time, and the Excel workbook keeps your inputs, a results summary, a yearly schedule, a full period-by-period schedule, a scenario comparison and plain-English formula notes in one file you can keep or hand to an adviser.

The $8,814 gap against the simple-interest track is the entire case for compounding

Simple interest is calculated only on the original principal, so it pays the same amount every period and grows in a straight line: A = P(1 + r x t). Compound interest is calculated on the principal plus every dollar of interest already credited, so the line bends upward instead. This calculator runs both tracks from the same starting balance and the same contributions, which means the distance between them is attributable to compounding and to nothing else.

In the base case the simple-interest track reaches about $97,825 while the compound track reaches $106,639. The $8,814 between them is value created purely by interest earning interest, and it is roughly a quarter of the $36,639 of total growth. Over one or two years that gap is almost invisible, which is why short-horizon comparisons make compounding look like a rounding error; over decades it becomes most of the result. If your situation genuinely is interest on a fixed principal with nothing reinvested, the simple interest calculator is the correct tool and this one will overstate what you should expect.

The Rule of 72 is the quick sanity check on the same idea: divide 72 by the annual return percentage to estimate the years to double. At 6% that is about 12 years, at 8% about 9 years, and at 9% about 8 years. It is an approximation that behaves well for rates between roughly 5% and 12%, and it ignores contributions entirely, so treat it as intuition and read the actual doubling point off the year-by-year schedule when the answer matters.

A $106,639 balance that buys $79,349 of today’s goods

A balance in the future does not buy what the same number buys now, because prices rise in the meantime. The calculator discounts the projection back to present purchasing power with Real FV = Nominal FV / (1 + inflation)^t. At the 3% inflation rate in the base case, the $106,639 nominal ending balance is worth about $79,349 in today’s money — roughly $27,290, or a quarter of the headline figure, is erosion rather than a shortfall in the plan.

The mistake this figure exists to prevent is holding a nominal projection up against today’s prices. If the goal you are saving for costs $100,000 at current prices, a projected $106,639 does not clear it; the $79,349 real value is the number to compare against a present-day price tag. And the longer the horizon, the more misleading the nominal figure becomes — at 3% inflation, money loses roughly half its real value over about 24 years, so a projection running two or three decades needs the real column far more than a five-year one does.

There is one comparison to avoid making in the other direction: setting the $79,349 real value against the $70,000 of nominal dollars you deposited. Those deposits were made in dollars of ten different years, so pairing them with a single inflation-adjusted endpoint mixes units and does not mean what it looks like it means. Compare nominal with nominal, or real with real. The calculator reports both figures side by side, and plots them against one another, precisely so you can keep the two frames apart rather than quietly blending them.

A 1% fee does not cost 1% — it costs 1% compounded for the whole horizon

A fee is not only the money that leaves the account; it is every dollar of growth that money would have gone on to earn for the rest of the horizon. That compounding-against-you effect is why an annual charge that sounds trivial in a single year can remove a visible share of a long projection. Enter an annual fee percentage, a fixed annual fee, or both, and the engine applies them proportionally each month against the running balance rather than deducting them once at the end, which is closer to how they are actually charged.

Tax behaves the same way but varies far more between accounts. Growth can be taxed each year as it is earned, taxed only when the money is withdrawn, or sheltered entirely inside a tax-advantaged account, and those three treatments produce different after-tax results from identical returns. The optional tax setting lets you apply your rate either to interest annually or to total growth at the end, so you can see both shapes against the same schedule instead of guessing which one your account resembles.

Be clear about what that tax model is not. It is a single flat rate applied one of two ways, and it is a simplified estimate rather than a tax return. It does not model brackets, account types, contribution limits, capital-gains rules or any jurisdiction-specific treatment, and the fee model likewise assumes your fee stays constant. For your own account type and jurisdiction, confirm the treatment with a qualified professional before planning around the after-tax figure this page reports.

Two points of assumed return move this plan more than two years of deposits

Hold the $10,000 start, the $500 monthly deposit and the ten-year horizon fixed and change only the assumed return. At 5% the plan finishes near $94,100, at 7% it finishes at $106,639, and at 9% it finishes near $121,300. Moving from 7% to 9% adds about $14,661 — more than the $12,000 you would deposit across two additional years. Moving from 7% down to 5% costs about $12,539. The upside is slightly larger than the downside because growth compounds on growth, and that asymmetry is exactly why an optimistic rate assumption is the easiest way to build a plan that quietly cannot work.

Returns are not guaranteed, and this model does not pretend otherwise. It applies one constant rate, the one you chose. Real portfolios deliver a sequence of good and bad years, some of them negative, and the order in which those years arrive changes the outcome in ways a single average rate cannot capture. The same constancy assumption applies to your contributions, the inflation rate, fees and taxes: every one of them is held flat unless you change it, while real markets and real accounts vary year to year.

The practical habit is to model a base case and a deliberately conservative case side by side and to plan against the conservative one, so the plan does not depend on everything going right at once. This is an educational projection, not financial, investment or tax advice, and no figure it produces is a promise about what any account or investment will actually earn.

Withdrawals, employer matches and account rules sit outside this model

This tool models a balance that grows: a starting amount, deposits, a rate and time. It does not model money coming back out. There is no scheduled-withdrawal mode, so a drawdown plan belongs in the retirement withdrawal calculator rather than here. Loan repayment is a different shape again — a balance that falls on a fixed schedule while interest accrues against it — and belongs in the loan or amortization calculators listed below.

Other situations it deliberately does not attempt: employer matching, vesting and withdrawal restrictions inside a workplace retirement plan; country-specific contribution limits, account types and capital-gains rules; guaranteed deposit products with penalties or stepped rates; portfolios that change asset allocation or rebalance over time; and short-horizon or daily trading returns, which a constant-rate model has no business predicting. Each of those needs a purpose-built calculator or professional input rather than a more optimistic input here.

What the model does travel across is currency. Switch the currency selector to INR, GBP, CAD, AUD, SGD or AED and every figure — including the year-by-year schedule and the Excel export — displays in that currency. The underlying future-value, APY and inflation-adjusted math is identical whichever one you pick, because the arithmetic does not care what the units are called.

The compounding and future-value logic on this page is cross-checked against the U.S. Securities and Exchange Commission’s Investor.gov compound interest calculator, and the APY figure follows the Consumer Financial Protection Bureau’s Regulation DD methodology for annual percentage yield. The sources listed below are the primary references behind those choices. If a figure here looks wrong to you, the contact page reaches a person who will check it and correct it.

Sources & References

Figures on this page are checked against primary, authoritative sources. Links open in a new tab.

• Compound Interest CalculatorU.S. SEC — Investor.gov · verified 2026-06-07
• Compound interest (investing glossary)U.S. SEC — Investor.gov · verified 2026-06-07
• How does compound interest work?Consumer Financial Protection Bureau (CFPB) · verified 2026-06-07
• Appendix A to Part 1030 — Annual Percentage Yield Calculation (Regulation DD)Consumer Financial Protection Bureau (CFPB) · verified 2026-06-07
• Consumer Price Index (CPI)U.S. Bureau of Labor Statistics (BLS) · verified 2026-06-07

Related Calculators

More in Finance, or browse all calculators.

Read the guide

For the full picture, see How Compound Interest Works With Regular Contributions.