Starting amount, Monthly contribution, Annual interest rate, Years, Compounding
Compound Interest Calculator
Project how an investment grows when interest is earned on interest.
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How this calculator works
With compound interest, each period's interest is added to the balance and earns interest itself. The effect is small at first and large over decades. This calculator handles a starting balance plus a fixed contribution at the end of each month, and lets you choose how often interest compounds.
Formula
- Future value of the starting amount = P × (1 + r/n)^(n × t)
- Effective monthly rate i = (1 + r/n)^(n/12) − 1
- Future value of contributions = C × ((1 + i)^(12 × t) − 1) / i
- P = starting amount, C = monthly contribution, r = annual rate, n = compounding periods per year, t = years
Worked example
10,000 plus 200 a month at 7% for 20 years
- Starting amount
- 10,000
- Monthly contribution
- 200
- Annual interest rate
- 7%
- Years
- 20 years
- Compounding
- Monthly
Result144,572.72
Balance after 20 years at 7.00%.
Things to keep in mind
- Real returns vary from year to year. A fixed rate is a simplification.
- Inflation and taxes reduce the real value of the result.
- Figures are estimates for planning. They are not financial advice, and they ignore taxes and fees unless stated.
Frequently asked questions
What is compound interest?
Interest calculated on both the original principal and the interest already earned. Simple interest, by contrast, is calculated on the principal only.
How often should interest compound?
More frequent compounding earns slightly more. The jump from annual to monthly matters more than from monthly to daily.
What is the Rule of 72?
A shortcut for doubling time: divide 72 by the annual interest rate. At 6% money doubles in about 12 years.
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Results are estimates based on the values you enter and the published method shown above. They do not replace professional medical, financial or legal advice. Method reviewed October 7, 2026. About this site