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
Year by year
| Year | Contributed | Interest | Balance |
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How to use it
- Enter your starting amount, the annual rate and how many years.
- Choose how often interest compounds and add a monthly contribution if you make one.
- Read the final balance and check the year-by-year table.
Worked example
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