Compound Interest Calculator

See what savings turn into once interest starts earning interest. Enter a starting amount, a rate and a timescale, add a monthly contribution if you make one, and the final balance plus a year-by-year breakdown appear straight away.

Compound Interest Calculator tool

Final balance
You put in
Interest earned

Year by year

YearContributedInterestBalance

How to use it

  1. Enter your starting amount, the annual rate and how many years.
  2. Choose how often interest compounds and add a monthly contribution if you make one.
  3. Read the final balance and check the year-by-year table.

Worked example

Input: $5,000 at 6% for 10 years, $200/month
Result: About $41,800, of which roughly $12,800 is interest

How compound interest builds

Compound interest pays interest on the interest already earned, which is why savings curve upward instead of climbing in a straight line. The formula for a lump sum is A = P(1 + r/n)^(nt), where P is the starting amount, r the annual rate as a decimal, n the number of compounding periods per year and t the years.

Frequency matters less than people expect. At 6 percent, monthly compounding beats annual compounding by only a fraction of a percent per year. What genuinely changes the outcome is time and regular contributions: $200 a month added to a $5,000 start at 6 percent grows to roughly $41,800 over ten years, and only about $29,000 of that is money you put in.

Rates here are nominal and before tax or inflation. A 6 percent return with 3 percent inflation leaves roughly 3 percent of real growth, so treat the final figure as a gross number rather than spending power.

Common uses

  • Projecting savings and retirement growth
  • Comparing accounts with different rates
  • Seeing the effect of a monthly deposit
  • Understanding how debt compounds against you

Frequently asked questions

For a lump sum it is A = P(1 + r/n)^(nt). P is the principal, r the annual rate as a decimal, n how many times a year interest compounds, and t the number of years. Regular contributions add a further term for each deposit.
Slightly. At 6 percent, monthly compounding yields about 6.17 percent effective annual return against 6 percent compounded once. The gap widens at higher rates but stays small next to the effect of time.
Divide 72 by the interest rate for a close estimate. At 6 percent that is 12 years, at 8 percent about 9 years. This rule of 72 works well for rates between roughly 4 and 12 percent.
No. The result is a nominal, pre-tax figure. Subtract your expected inflation rate from the interest rate if you want an estimate in today's spending power.