Compound Interest Calculator
Calculate how your money grows with compound interest. See future value, total interest earned, and year-by-year growth breakdown with regular contributions.
Starting amount to invest
Expected annual return rate
Investment duration
How often interest compounds
Additional amount added each month (optional)
Complete Analysis
See future value, total contributions, interest earned, and year-by-year growth.
Multiple Frequencies
Calculate with annual, semi-annual, quarterly, monthly, or daily compounding.
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How It Works
Compound Interest Formula
A = P(1 + r/n)^(nt) + PMT × [((1 + r/n)^(nt) - 1) / (r/n)]
Where:
- A = Future value (total amount)
- P = Principal (initial investment)
- r = Annual interest rate (as decimal)
- n = Compounding frequency per year
- t = Time in years
- PMT = Regular payment (monthly contribution)
Example Calculation
If you invest $10,000 at 7% annually for 20 years with $200/month contributions:
- • Initial Principal: $10,000
- • Total Contributions: $10,000 + ($200 × 12 × 20) = $58,000
- • Compound Frequency: Monthly (12/year)
- • Future Value: ~$113,000
- • Total Interest Earned: ~$55,000
Power of Compound Interest
Compound interest is often called the "eighth wonder of the world" because your money grows exponentially. Unlike simple interest, compound interest earns interest on both your principal AND previously earned interest, creating a snowball effect over time.
Frequently Asked Questions
What is compound interest?
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. This creates a compounding effect where your money grows exponentially over time.
How is compound interest calculated?
We use the formula: A = P(1 + r/n)^(nt) + PMT × [((1 + r/n)^(nt) - 1) / (r/n)], where A is future value, P is principal, r is annual rate, n is compounding frequency, t is time in years, and PMT is regular contribution.
What is compounding frequency?
Compounding frequency is how often interest is calculated and added to your balance. Common frequencies are annually (1/year), quarterly (4/year), monthly (12/year), or daily (365/year). More frequent compounding results in slightly higher returns.
Should I include monthly contributions?
Yes! Regular contributions (like monthly deposits) can significantly increase your total returns through the power of compound interest. Even small regular contributions add up substantially over time.
How can I maximize compound interest?
To maximize compound interest: start early to give your money more time to grow, contribute regularly, seek higher interest rates, opt for more frequent compounding when possible, and avoid withdrawing your earnings to let them compound.
Is my data private?
Yes, absolutely! All calculations happen entirely in your browser. Your financial information is never sent to any server, ensuring complete privacy and security.