Compound Interest Calculator
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See how your money grows with compound interest. Enter a starting amount, monthly contributions, interest rate, and time period for an instant projection.
Enter your values below and click Calculate for instant results.
Compound interest means you earn interest not just on your original deposit but on the interest that has already accumulated. Over time, this creates a snowball effect where your money grows faster and faster — a mathematical reality that makes starting early one of the most powerful financial decisions anyone can make.
💡 The Rule of 72: divide 72 by your annual interest rate to estimate how many years it takes to double your money. At 7%, money doubles roughly every 10.3 years. At 10%, every 7.2 years.
When interest is compounded monthly, the formula adds that month's interest to your balance before calculating next month's interest. This means your effective annual return is slightly higher than the stated annual rate. A 7% annual rate compounded monthly is actually equivalent to about 7.23% in simple interest terms — a difference that compounds significantly over decades.
Adding even a modest monthly contribution transforms the calculation dramatically. Someone who starts with $5,000 and adds $300 per month at 7% for 30 years ends up with roughly $366,000. Without the monthly contributions, that same starting amount grows to about $38,000. The regular contributions are responsible for the vast majority of the wealth built.
The more frequently interest compounds, the faster your balance grows. Daily compounding produces slightly more than monthly, which produces more than quarterly or annual. In practice, the difference between monthly and daily compounding is small for most people — what matters far more is the rate and how long the money stays invested.
Simple interest calculates interest only on the original principal. If you deposit $10,000 at 5% simple interest for 10 years, you earn exactly $500 per year — $5,000 total. With compound interest at 5% annually for the same period, you end up with $16,289 — $1,289 more. The gap grows dramatically over longer periods and higher rates.