Free Online Compound Interest Calculator
Project how savings or investments grow with compound interest over time
Future Value
$16,470.09
Effective annual rate: 5.12%
Investment Growth Over Time
Year-by-Year Breakdown
For informational purposes only. Not financial advice. Past performance does not guarantee future results. Consult a financial professional before making investment decisions.
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Watching those projections grow is satisfying, but the real magic happens when you actually put money to work. We point people to Betterment because they handle the portfolio building and rebalancing for you, so compounding does its thing while you go about your life. (We may earn a commission, at no cost to you. We are not licensed financial advisors.)
Why use Compound Interest Calculator
- Models any real-world account: daily, monthly, quarterly, semi-annual, or annual compounding.
- Monthly contribution field shows the dramatic impact of regular deposits -- not just a static lump sum.
- Growth chart splits your balance into contributions vs. interest earned, making the snowball effect visible.
- Simple interest comparison built in, so you can see exactly what compounding adds over time.
- Year-by-year table lets you set milestone targets (e.g., when do I cross $100K?) without guessing.
- Effective annual rate (EAR) is shown alongside the nominal rate, revealing the true yield after compounding.
How it works
The core formula is A = P(1 + r/n)^(nt), where P is the initial principal, r is the annual interest rate as a decimal, n is the number of compounding periods per year, and t is the number of years. When monthly contributions (C) are included, the future value of the annuity is added: FV_contributions = C * [((1 + r/n)^(nt) - 1) / (r/n)]. The calculator evaluates this at each year to build the growth table. Simple interest is computed separately as A = P(1 + rt) for comparison. The effective annual rate (EAR) is derived as (1 + r/n)^n - 1, which reveals the true yearly yield after compounding.
About this tool
How much will $10,000 be worth in 20 years at 7%? What if you add $200 a month? Enter your starting amount, interest rate, time horizon, and compounding frequency to see the future value, total interest earned, and a year-by-year table. The formula is A = P(1 + r/n)^(nt), where P is the principal, r is the annual rate as a decimal, n is compounding periods per year, and t is years. Monthly contributions are layered on top using the annuity future-value formula, so each deposit starts compounding from its deposit date. A growth chart splits your balance into contributions vs. interest earned, which makes the snowball effect tangible -- especially over 20- or 30-year horizons where interest can outpace what you put in. The calculator also shows simple interest (I = P x r x t) for comparison, so you can see exactly how much compounding adds. Supports daily, monthly, quarterly, semi-annual, and annual compounding.
How to use Compound Interest Calculator
- Enter your starting amount. Type the principal you already have or plan to invest as a lump sum.
- Set rate and time horizon. Enter the annual interest rate and number of years.
- Pick compounding frequency. Choose daily, monthly, quarterly, semi-annual, or annual.
- Add monthly contributions (optional). Enter a recurring deposit amount to see how regular investing accelerates growth.
- Read the growth chart. The chart and year-by-year table show contributions vs. interest earned at every point.
Use cases
- Opening a Roth IRA at 28 and curious what $6,000/year at 7% looks like by retirement -- the calculator shows over $1.1M and makes the case for starting now.
- Setting up a 529 for a newborn and adjusting the monthly contribution until the future value crosses $100,000 in 18 years at 6%.
- Teaching a personal finance class? Show students that $5,000 invested at 22 at 8% compounded monthly reaches $150,000 by 65 -- waiting until 32 cuts that in half.
- Comparing two high-yield savings accounts: 4.85% daily vs. 4.90% monthly. On a $50,000 balance the annual difference is under $25, which settles the debate fast.
- Running retirement scenarios at different contribution levels to find the minimum monthly deposit needed to hit a seven-figure target by age 60.
Frequently Asked Questions
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest which only earns on the principal, compound interest creates a snowball effect where your earnings generate their own earnings. The formula is A = P(1 + r/n)^(nt), where P is principal, r is the annual rate, n is compounding frequency, and t is time in years.
The Rule of 72 is a quick way to estimate how long it takes for an investment to double. Divide 72 by the annual interest rate. For example, at 6% interest, your money doubles in approximately 72 / 6 = 12 years. This rule works best for rates between 6% and 10%.
More frequent compounding produces slightly higher returns because interest is calculated and added to the principal more often. Daily compounding earns more than monthly, which earns more than annually. However, the difference between daily and monthly compounding is usually small for typical interest rates.
Simple interest is calculated only on the original principal: I = P × r × t. Compound interest is calculated on the principal plus accumulated interest. Over long periods, compound interest earns significantly more. For example, $10,000 at 5% for 20 years earns $10,000 with simple interest but $16,533 with annual compounding.
The true annual yield after accounting for compounding frequency. A 5% rate compounded monthly has an EAR of about 5.12%.
Regular contributions dramatically increase your final balance because each deposit starts earning compound interest immediately. For example, $10,000 at 7% for 30 years grows to about $76,123 alone, but adding just $200/month turns it into over $300,000.
Work backward using this calculator: enter your target future value scenario, adjust the monthly contribution until you reach your goal. As a general guideline, financial advisors recommend saving 15-20% of your income for retirement.
This calculator shows nominal returns before taxes and inflation. To estimate real returns, subtract the expected inflation rate (typically 2-3%) from your interest rate. For after-tax returns, the impact depends on your tax bracket and account type (taxable vs. tax-advantaged like 401k or IRA).
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