How to use the Compound Interest Calculator
- Enter what you're starting with and how much you'll add each month.
- Enter the expected annual interest rate or return.
- Choose the number of years and how often interest compounds.
- Read the final balance and how much of it is interest.
What does this tool do?
With compound interest, each period's interest is added to the balance, so the next period earns interest on a bigger amount. Over long periods this snowball effect does most of the work.
The table shows your total deposits and interest at the end of each year, which makes it easy to see when interest starts to outpace your own contributions.
Why use it?
- Plan savings goals and retirement contributions.
- Compare compounding frequencies.
- See why starting early matters more than the amount.
Example: $10,000 plus $200 a month
Starting with $10,000 and adding $200 a month at 7% compounded monthly for 20 years grows to $144,572.72. You deposit $58,000 of that yourself; the remaining $86,572.72 is interest.
Without any monthly deposits, $10,000 at 5% compounded yearly grows to $16,288.95 after 10 years.
The formula
P = starting amount, r = annual rate, n = compounding periods per year, t = years.
Accuracy and limits
- Assumes a constant rate. Real investment returns vary year to year and can be negative.
- Taxes, inflation and fees aren't included.
Privacy
The calculation happens instantly in your browser. The numbers you enter are not sent to our servers or saved. There's no account to create and nothing to install.
Frequently asked questions
Does compounding frequency matter much?
Less than people think. At 5%, yearly compounding gives 5% a year, monthly gives 5.12%, and daily gives 5.13%. The rate and the time matter far more.
What's the rule of 72?
Divide 72 by the annual rate to estimate how many years it takes to double your money. At 6%, that's about 12 years.
Last reviewed by the M2Toolkit team.