Compound Interest Calculator
See how your money grows over time with the power of compounding. Choose daily, monthly, quarterly, or annual compounding and add regular contributions to model your real savings plan.
Understanding the Compound Interest Calculator
A compound interest calculator projects how savings or investments grow over time when returns are reinvested and earn returns of their own. Enter a starting amount, an interest or growth rate, the compounding frequency, the time horizon, and optional regular contributions to see the future value, total contributions, and interest earned. It is for savers, investors, and students learning the power of compounding. Figures are estimates and not guaranteed returns; all math runs locally in your browser.
How it works
Compounding means each period's interest is added to the balance, so the next period earns interest on a larger base; growth accelerates over time. The tool applies the standard future-value formula using your rate per period and the number of periods, set by the compounding frequency (annual, monthly, daily, etc.). If you add regular contributions, it also sums a future-value-of-an-annuity term so each deposit compounds from the date it is made. The results separate what you put in from what compounding added, making the effect of time and frequency easy to see. Longer horizons and more frequent compounding both raise the final figure.
Worked example
Invest 10,000 at 7% compounded monthly for 20 years, adding 200/month. Here r = 0.07, n = 12, t = 20, so nt = 240 and r/n = 0.005833. Lump sum grows to 10000 x (1.005833)^240 = about 40,275. Contributions of 200/month add roughly 104,200. Future value is around 144,500, of which you contributed 58,000 (10,000 + 48,000) and compounding added about 86,500. Starting earlier or raising the rate widens that gap dramatically.
Tips & common mistakes
- Time matters most; starting a few years earlier can outweigh a higher contribution later.
- More frequent compounding helps, but the difference between monthly and daily is typically only 0.1–0.2% of total interest. Note that compounding rules vary by region: Canada legally requires daily interest accrual on savings accounts, while US and UK institutions vary, so check how your bank compounds.
- Use a real (inflation-adjusted) rate if you want today's purchasing power.
- Regular contributions often drive more of the final balance than the initial lump sum.
- Projected returns are not guaranteed; markets vary, so treat any single rate as an estimate.
Sources & methodology
- • U.S. Securities and Exchange Commission — Compound interest calculator and explainer (https://www.investor.gov)
- • Investopedia — Compound Interest (https://www.investopedia.com/terms/c/compoundinterest.asp)
Related tools
Reviewed by the TopOpenTools editorial team · Last updated June 2026. These tools provide general estimates for educational purposes only and are not financial, tax, insurance, investment, or medical advice. Verify important decisions with a qualified professional.
How to Use This Calculator
- 1Enter your initial principal — the amount you invest today.
- 2Enter the annual interest rate and time period in years.
- 3Choose the compounding frequency. Monthly is typical for savings accounts.
- 4Optionally add a monthly contribution to model ongoing savings.
Frequently Asked Questions
What is compound interest?
Compound interest is interest earned on both your original principal and on the interest already accumulated. Over time, this "interest on interest" effect causes your balance to grow exponentially rather than linearly.
What is the compound interest formula?
A = P(1 + r/n)^(nt), where A is the final amount, P is the principal, r is the annual interest rate (as a decimal), n is the number of compounding periods per year, and t is the time in years.
How does compounding frequency affect returns?
More frequent compounding produces higher returns, though the difference narrows at higher frequencies. Daily compounding yields slightly more than monthly, which yields more than annual — but the gap is modest compared to the rate and time variables.
What is the Rule of 72?
The Rule of 72 is a mental shortcut: divide 72 by the annual interest rate to estimate how many years it takes to double your money. At 7% annual return, your investment doubles in roughly 72 ÷ 7 ≈ 10 years.
Can I include monthly contributions?
Yes — enter an amount in the "Monthly Contribution" field to see how regular savings boost your final balance alongside the compounding effect.