Compound Interest Calculator

A compound interest calculator estimates how money can grow when investment returns are reinvested instead of withdrawn. This model blends two growth engines: your own contributions and earnings generated by prior earnings. Over longer periods, reinvestment is often the largest factor behind portfolio growth.

This calculator is structured for real-world saving behavior. It supports a one-time starting amount, recurring monthly contributions, and multiple compounding frequencies. That lets you compare conservative and aggressive assumptions while keeping your inputs transparent and easy to adjust.

Use it as a planning tool for retirement contributions, education funds, or long-horizon wealth targets. It does not predict market performance. It simply shows how different assumptions can change outcomes, so you can stress-test your savings plan with consistent math.

The calculator first converts your annual rate into an effective monthly growth rate. That allows monthly contribution modeling even when interest compounds daily, quarterly, or yearly. Each month, the balance earns interest, then your monthly contribution is added to the account.

The result panel updates live as you type. You get final balance, total contributions, and total interest earned. A chart visualizes growth across time, and a yearly table breaks down how much of your ending balance came from contributions versus compounded gains.

For very long horizons, charting every month can add noise. When the selected period exceeds 30 years, the chart switches to yearly points for readability while preserving accurate calculations under the hood.

General compound growth can be represented as A = P(1 + r/n)^(nt), where P is principal, r is nominal annual rate, n is compounding periods per year, and t is years. With recurring deposits, there is an additional contribution-growth term based on payment timing and compounding assumptions.

Because this tool accepts monthly deposits with multiple compounding frequencies, it uses iterative period-by-period simulation. That avoids confusion around formula variants and makes edge-case behavior explicit. Each period includes contribution updates and interest accrual based on the current balance.

Total interest earned is ending balance minus total contributed capital. Total contributed capital includes the initial principal and all recurring deposits. This distinction helps separate return-driven growth from savings-driven growth.

Suppose you start with $10,000, contribute $500 each month, earn 7% annually, and stay invested for 20 years. Total contributed capital would be $130,000 ($10,000 + $500 x 240 months). Your ending balance is typically much higher due to compounding over time.

In this scenario, the first few years are contribution-heavy. Later years often become interest-heavy because the base balance is larger. That transition is a key insight for long-term planning: consistency early may matter more than trying to perfectly time returns.

You can also run sensitivity checks by changing one variable at a time. Increasing monthly contribution, extending the timeline, or improving expected return each affects the final balance differently. Side-by-side comparisons make these tradeoffs easier to understand.