Financial calculator
Compound Interest Calculator
Compound interest is interest earned on both your original investment and the interest it has already accumulated. Use this calculator to estimate how your savings could grow over time.
Use the Compound Interest Calculator
Your results
- Final balance
- $0.00
- Total contributions
- $0.00
- Total interest earned
- $0.00
Year-by-Year Projection
How this calculator works
- What it does
- Compound interest is interest earned on both your original investment and the interest it has already accumulated. Use this calculator to estimate how your savings could grow over time.
- Inputs used
- The estimate uses initial principal, monthly contribution, annual interest rate (%), number of years, and compounding frequency.
- Calculation approach
- The calculator applies the relationships defined for the compound interest calculator to those inputs and updates final balance, total contributions, and total interest earned.
- How to read the result
- Treat the result as a scenario based on the values entered. Compare a few reasonable inputs and consider costs, taxes, timing, or risks that the calculator does not include.
How to Use This Calculator
- Enter Initial principal and Monthly contribution using values that match the scenario you want to evaluate.
- Enter Annual interest rate (%) and Number of years using values that match the scenario you want to evaluate.
- Enter Compounding frequency using values that match the scenario you want to evaluate.
- Review the assumptions for the compound interest calculator, especially rates, time periods, and optional amounts.
- Select Calculate to update the results, then adjust one input at a time to compare scenarios.
Understanding the Results
- Final balance
- The estimated value at the end of the selected period after applying the entered contributions, rates, and timing assumptions.
- Total contributions
- The amount added from contributions, separate from investment growth or interest.
- Total interest earned
- The portion of the result attributed to growth rather than money contributed or originally invested.
Common Mistakes
- Treating an assumed return, growth rate, inflation rate, or yield as guaranteed.
- Leaving out taxes, fees, inflation, or timing differences that can affect real-world results.
- Mixing monthly and annual figures or entering percentages in the wrong units.
- Relying on one projection instead of comparing a range of reasonable assumptions.
Worked Example
Example inputs
- Initial principal
- $10,000
- Monthly contribution
- $500
- Annual interest rate (%)
- 7%
- Number of years
- 20
- Compounding frequency
- Monthly
Example results
- Final balance
- $300,850.72
- Total contributions
- $130,000.00
- Total interest earned
- $170,850.72
With these illustrative inputs, the final balance is $300,850.72. The result shows how the example assumptions interact and is not a prediction of future performance.
Frequently asked questions
What is compound interest?
Compound interest is calculated on your starting balance plus any interest previously earned, allowing growth to build on itself.
How often should interest be compounded?
More frequent compounding generally produces a slightly higher balance when the annual rate and all other inputs are the same.
How do monthly contributions affect growth?
Regular contributions increase the amount earning interest. Starting early gives each contribution more time to compound.
Does this calculator account for taxes or fees?
No. The estimate does not include investment fees, taxes, inflation, or changes in the interest rate.
Is the calculated return guaranteed?
No. This calculator provides an estimate based on a fixed annual rate. Actual investment returns can rise or fall over time.
What does the Compound Interest Calculator calculate?
Compound interest is interest earned on both your original investment and the interest it has already accumulated. Use this calculator to estimate how your savings could grow over time. The result is based only on the inputs and assumptions shown on the page.
How should I interpret the final balance from the Compound Interest Calculator?
Use it as an estimate for the scenario entered, not as a guarantee or personal recommendation. Test changes to initial principal, monthly contribution, and annual interest rate (%) to see which assumptions have the greatest effect.