Compound Interest Calculator
Project investment growth over time with regular contributions and custom compounding frequency.
About the Compound Interest Calculator
Compound interest is interest earned on interest: each period, the account grows by its rate, and the next period's growth is calculated on that larger balance rather than just the original principal. With no contributions, this follows the closed-form formula A = P × (1 + r/n)^(n×t), where P is principal, r is the annual rate as a decimal, n is compounds per year, and t is years. This calculator adds a monthly contribution on top, so instead of the closed form it simulates month by month: each month it grows the current balance by the equivalent monthly rate, then adds your contribution, and repeats for the full term.
To use it: enter a starting principal, an optional monthly contribution, an annual rate, how many years to project, and how often interest compounds (more frequent compounding — daily versus annually — produces slightly more growth at the same nominal rate). For example, $10,000 invested at 7% annually for 20 years with monthly compounding and no contributions grows to roughly $40,400 — over $30,000 in interest on $10,000 of principal, purely from compounding. Add a $200 monthly contribution and the same 20 years instead ends around $144,500, since each contribution also gets years to compound before the term ends. Use the year-by-year table and CSV export to see exactly how the balance, contributions, and interest build up over time.
How is compound interest calculated here?+−
We convert your annual rate and compounding frequency into an equivalent monthly rate, then simulate month by month, adding your monthly contribution after each period grows.
What compounding frequency should I pick?+−
Most savings accounts compound daily or monthly; most bonds compound semi-annually or annually. A higher compounding frequency yields slightly more growth at the same nominal rate.
Does this account for inflation or taxes?+−
No — the projection shows nominal growth only. Real purchasing power will be lower after inflation, and taxable accounts will owe tax on realized gains or interest depending on your account type and jurisdiction.
What is the Rule of 72 and how does it relate to this calculator?+−
The Rule of 72 is a mental shortcut: divide 72 by your annual rate to estimate years to double your money (e.g. at 8%, about 9 years). This calculator gives you the exact figure instead of the approximation, including the effect of ongoing contributions.
Why does a monthly contribution matter so much over 20+ years?+−
Each contribution starts compounding from the moment it's added, so early contributions have far more time to grow than later ones. Small, consistent monthly amounts often outgrow a single larger lump sum added later.
What is the difference between total interest and future value?+−
Future value is your entire ending balance. Total interest is just the growth portion — future value minus every dollar you personally put in (principal plus all contributions).
Can I model a decreasing balance, like a loan payoff, with this tool?+−
No — this calculator only models growth from contributions and compounding, not a declining balance with payments against principal. For loan amortization, use the Mortgage Calculator instead.