Compound Interest Calculator

Use this compound interest calculator to see how a starting balance and steady monthly contributions can grow over time.

Compound interest means you earn interest not only on the money you put in, but also on the interest it has already earned. Over long periods, that snowball effect can end up larger than your own contributions. Enter your numbers and the chart shows exactly how much of your final balance came from you and how much came from growth.

How to use this calculator

Starting amount. Enter what you have saved or invested today for this goal. Use your current account balance from your latest statement or app. If you’re starting from scratch, enter $0.

Monthly contribution. Enter the amount you plan to add every month. If you contribute through payroll, use your per-paycheck amount converted to a monthly figure. For example, $250 every two weeks is about $542 a month (26 paychecks ÷ 12).

Annual interest rate. Enter the yearly rate or expected return. For a savings account or CD, use the rate your bank shows for the account. For investments, there’s no guaranteed rate, so treat this as an assumption and try a cautious figure as well as a hopeful one. Returns on stocks and funds go up and down from year to year rather than arriving as a steady percentage.

Years to grow. Enter how long you plan to leave the money invested, such as the years until retirement or until you need the money.

Compounding. Choose how often interest is added to your balance: yearly, quarterly, monthly, or daily. Savings accounts often compound daily or monthly; check your account terms. For investments, monthly is a reasonable default, because the choice matters far less than the rate and the time.

How it’s calculated

The calculator simulates your balance month by month. It first converts the annual rate and compounding frequency into an equivalent monthly growth rate, so every option is compared fairly:

Monthly rate = (1 + annual rate ÷ n)^(n ÷ 12) − 1

n = compounding periods per year
    (1 = yearly, 4 = quarterly, 12 = monthly, 365 = daily)

Each month, the balance grows by that rate, and then your contribution is added:

New balance = old balance × (1 + monthly rate) + monthly contribution

After the last month, the calculator reports the final balance, your total contributions (starting amount plus every monthly deposit), and the difference, which is the interest earned.

The results assume:

• The same rate every year, with no losses.
• Contributions made at the end of each month, without missing one.
• No taxes, fees, or withdrawals.
• No adjustment for inflation.

Real accounts rarely behave this neatly. A savings account’s rate can change at any time, and investment returns vary from year to year, sometimes with losses. The calculator’s steady rate is best thought of as an average over the whole period, which is why the results are estimates rather than predictions.

With yearly compounding, the calculator still adds your deposits monthly and grows them at the equivalent monthly rate, so money deposited partway through the year earns its share of growth.

Example

The default inputs are a $10,000 starting amount, $500 a month, a 7% annual rate, 20 years, and monthly compounding. At monthly compounding, 7% works out to about 0.583% per month.

Your $130,000 comes from the $10,000 starting amount plus $500 × 240 months. Interest makes up the rest, and it accelerates over time:

In the first five years, interest adds about $10,000. In the last five, it adds about $84,000, because the growth is working on a much larger balance.

Time is the biggest lever. Change the years to 30, and the balance becomes $691,150 on $190,000 of contributions. Raising the contribution to $600 a month for 20 years gives $352,943 on $154,000 of contributions.

It’s also worth seeing what each piece contributes. The $10,000 starting amount on its own, with no monthly deposits, grows to $40,387 in 20 years. The $500 monthly deposits on their own, starting from $0, grow to $260,463. Together they make the $300,851 total.

The rate you assume has a large effect, which is why it’s wise to test more than one. At 5% instead of 7%, the same plan ends at $232,643. At 0%, you’d have exactly your $130,000 of contributions. Running a cautious and a hopeful scenario gives you a range to plan around instead of a single number.

Compounding frequency matters much less. At the same 7% over 20 years, yearly compounding gives $292,465, quarterly gives $299,252, and daily gives $301,636. Our guide to how compound interest works explains why.

Tips to grow your money faster

1. Start as early as you can. Each extra year gives your money more time to compound, and the final years are where most of the growth happens.
2. Automate your contributions. A scheduled transfer on payday makes saving the default and keeps you from skipping months.
3. Raise your contribution when your income rises. Increasing your monthly amount by even a small step after a raise compounds into a noticeably larger balance.
4. Keep fees low. An annual fee reduces your return every year, so it compounds against you. When comparing funds, look at the expense ratio; our guide to index funds for beginners explains why low costs matter.
5. Use tax-advantaged accounts where it fits. Retirement accounts can let your money grow without yearly taxes slowing it down. See Roth IRA vs. traditional IRA to compare two common options.
6. Leave the money alone. Withdrawals interrupt compounding. Keeping a separate emergency fund helps you avoid dipping into long-term savings.

Related guides

• How Compound Interest Works: A Simple Guide
• Index Funds for Beginners
• Roth IRA vs. Traditional IRA
• High-Yield Savings Accounts, Explained

This content is for educational purposes only and isn't financial advice. Calculator results are estimates based on the numbers you enter. For decisions about your situation, consider talking with a qualified professional. Read our full disclaimer.