Compound Interest Calculator
Calculate how much your money will grow with compound interest: initial capital, annual interest rate, years, compounding frequency and, if you contribute money periodically, how much that contribution adds to the final result.
How is it calculated?
Without contributions: A = P × (1 + r/n)^(n×t), where P is the initial capital, r the annual interest rate (as a decimal), n the number of times it compounds per year, and t the number of years. With a constant contribution each period, the future value of that annuity is added: if you contribute at the end of each period (the most common approach), the extra term is contribution × ((1 + r/n)^(n×t) − 1) ÷ (r/n); if you contribute at the start of the period, that term is also multiplied by (1 + r/n), because each period's contribution also earns interest that same period. Interest earned is the final capital minus the initial capital minus total contributions.
Examples
1,000 at 5% annual for 10 years, monthly compounding, no contributions
Your money grows to 1,647.01 (647.01 in interest).
5,000 at 3% annual for 5 years, annual compounding, no contributions
Your money grows to 5,796.37 (796.37 in interest).
1,000 initial + 100 a month at 5% annual for 10 years
With 12,000 contributed over 10 years, the final capital is 17,175.24 (4,175.24 in interest).
The effect of compounding frequency
Compounding more often increases the result, but the difference is small compared to the effect of time and the rate. The rule of 72 estimates how many years it takes to double a capital: 72 ÷ annual rate (at 6%, about 12 years).
Doesn't include inflation or taxes.
| Compounding | Final value |
|---|---|
| Annual | 1,628.89 |
| Quarterly | 1,643.62 |
| Monthly | 1,647.01 |
| Daily | 1,648.66 |
Why periodic contributions matter so much to the result
Each new contribution starts earning its own interest from the moment it's added, so contributing earlier (even a small amount) is worth more than contributing later. With an initial capital and a fixed contribution, the final result is the sum of two independent growths: that of the initial capital alone, and that of the annuity formed by the contributions — which is why splitting "total contributions" and "interest earned" in the result helps show how much is money you put in versus how much the investment generated.
If you already know how much you want to accumulate and want to know how much to contribute monthly to get there, use the monthly investment for a goal calculator; if you'd rather fix the contribution and see how long it takes, the time to reach a goal calculator.