Compound Interest Calculator

Compound interest is growth on growth: each period’s interest starts earning interest of its own. This calculator projects a balance with your choice of compounding frequency, and lets you add steady monthly contributions — or withdrawals — to model saving and spending phases with the same tool.

Results

Assumptions: Constant rate for the whole period; contributions and withdrawals are spread evenly across compounding periods.

Formula

Each period the balance grows by the period rate, then contributions land:
Balance → Balance × (1 + r ÷ m) + contribution − withdrawal
repeated for every period. Without contributions this is the classic A = P(1 + r/m)mt.

How to use this calculator

  1. Enter the starting amount, annual rate and years.
  2. Choose how often interest compounds.
  3. Optionally add a monthly contribution or withdrawal, then Calculate.
Compound Interest Calculator — how the calculation works, illustrated
Compound Interest Calculator — how the calculation works, illustrated

Worked example

$10,000 at 5% for 10 years, compounded monthly, no contributions.

  1. Monthly rate: 5% ÷ 12 ≈ 0.4167%; periods: 120.
  2. Final value: 10,000 × (1.004167)¹²⁰ ≈ $16,470.09.

Result: The balance grows to about $16,470 — $6,470 of it is interest.

Frequently asked questions

Why does compounding frequency matter?

More frequent compounding means interest starts earning interest sooner. At 5%, monthly compounding gives an effective 5.12% a year versus exactly 5% for annual — a modest but real difference that grows with the rate.

What is the Rule of 72?

Divide 72 by your annual return to estimate the years needed to double your money: at 6%, about 12 years. It is an approximation of the exact logarithmic answer.

Does this include taxes or inflation?

No. The projection is nominal and pre-tax; real (after-inflation) growth would use a rate reduced by expected inflation.

Related calculators

Finance

APY Calculator

Convert an APR and compounding frequency into the true APY, or project how a savings balance grows at a given APY.

Finance

Present Value Calculator

Discount a future amount back to today’s value at any rate and compounding frequency.

Finance

Coast FIRE Calculator

Find your Coast FIRE number: how much you need invested today so compound growth alone reaches your retirement target.

Finance

Exponential Growth Calculator

Project exponential growth (or decay) for money, populations or anything growing by a fixed percent per period.