Compound Interest Calculator

Free compound interest calculator with live charts, contribution vs. growth breakdown, scenario comparison, CSV export, and shareable links.

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How compound interest is calculated

This calculator projects how a starting amount plus steady monthly contributions grows over time, when your returns compound — that is, when the money you earn starts earning money of its own. You enter a starting balance, a monthly contribution, an expected annual return, a number of years, and how often interest compounds, and it returns the future value, how much you contributed, and how much of the final balance is pure growth.

The familiar textbook formula for compound interest on a lump sum is:

A = P × (1 + r ÷ n)^(n × t)

A is the final amount, P is the principal, r is the annual rate, n is the number of times it compounds per year, and t is the number of years.

Because most people also add money every month, this tool goes a step further: it converts your annual rate at the chosen compounding frequency into an equivalent monthly growth rate, then steps the balance forward one month at a time, adding your contribution each month. That handles monthly, quarterly, or annual compounding with a single consistent method and reflects how real investing and saving actually work.

Why starting early beats saving more

Emma vs. Liam

Two savers both earn 7%. Emma invests $300 a month from age 25 to 35 — ten years, $36,000 total — then stops forever. Liam waits until 35, then invests $300 a month all the way to 65 — thirty years, $108,000 total. Emma contributed a third of what Liam did and stopped 30 years earlier, yet by 65 she often ends up with a comparable balance, sometimes more. Her early contributions simply had decades longer to compound. Time is the ingredient you can never buy back.

What actually drives the outcome

Time invested is usually the most powerful lever — the growth portion of your balance accelerates the longer you leave it alone.
Contribution amount comes next; consistent monthly investing does most of the heavy lifting.
Rate of return matters, but chasing a slightly higher rate usually means taking on more risk, and it moves the needle less than time and contributions.
Compounding frequency matters least. Going from annual to monthly compounding adds a small bump; monthly to daily is almost imperceptible.

Limitations

This is a clean pre-tax, pre-inflation projection that assumes a steady return every year. Real markets do not deliver a smooth 7% — they rise and fall, sometimes sharply, and a bad sequence of early returns can matter. It also does not model taxes, fees, or inflation unless you enter an inflation-adjusted (real) return. Use it to understand the shape and power of compounding, not as a promise of a specific balance. For a deeper walkthrough, read compound interest and the power of time.

Frequently asked questions

How does compound interest work?

Your money earns a return, and then that return earns its own return. Each period the base grows, so each gain is larger than the last. Over decades this becomes the dominant force in your balance.

Does compounding frequency matter much?

Less than most people expect. Moving from annual to monthly compounding adds a modest boost; monthly to daily adds very little. Contribution amount, rate of return, and years invested matter far more.

Is the 7% default realistic?

It reflects a commonly cited long-run average for a diversified stock portfolio after inflation is excluded. It is an illustration, not a promise — real returns vary widely year to year and are never guaranteed.

Investing involves risk, including possible loss of principal. Projections are illustrative and not a guarantee of future results.