Compound Interest Calculator
See how money grows when interest earns interest. Enter a starting amount, a regular monthly contribution, the rate and how often it compounds, and get the future value, the interest earned and a year-by-year growth table.
Calculate compound interest
Compound interest formula
Lump sum
A = P × (1 + r ÷ k)k × tP = starting amount, r = annual rate, k = compounding periods per year, t = years.
With monthly contributions
FV = P × (1 + i)n + C × ((1 + i)n − 1) ÷ ii = effective monthly rate = (1 + r ÷ k)k ÷ 12 − 1, n = months, C = monthly contribution paid at the end of each month.
Worked examples
- Compounded annually: 10,000 × 1.0710 = 19,671.51
- Compounded monthly: 10,000 × (1 + 0.07/12)120 = 20,096.61
- Future value = 54,713.58
- You put in 34,000; interest earned = 20,713.58
Does compounding frequency matter?
A little. More frequent compounding means interest starts earning interest sooner, but the gain shrinks quickly: at 7% over 10 years, moving from annual to monthly compounding adds about 2%, and daily adds almost nothing more. The rate itself and the number of years matter far more.
| Compounding | Effective annual rate at 7% |
|---|---|
| Annually | 7.000% |
| Quarterly | 7.186% |
| Monthly | 7.229% |
| Daily | 7.250% |
The rule of 72
To estimate how long money takes to double, divide 72 by the annual interest rate. At 6% it doubles in about 12 years; at 9% in about 8 years.
Frequently asked questions
What is compound interest?
Interest calculated on the original amount plus all the interest already added, so your balance grows faster each year.
How is compound interest different from simple interest?
Simple interest is paid only on the original amount. 10,000 at 7% simple interest earns 7,000 in 10 years; compounded annually it earns 9,671.51.
Does this include inflation or tax?
No. Real (inflation-adjusted) and after-tax returns will be lower. Use a lower rate to approximate them.
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Results are illustrations assuming a constant rate. Investments can fall as well as rise; this is not financial advice.