Work out how much your savings or investment can grow with compound interest. Enter your starting amount, a monthly contribution, the yearly rate and the time, and see the final balance, the interest you earned and a year-by-year table.
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What Is Compound Interest?
Compound interest is interest that earns interest. Each time interest is added to your balance, the next round of interest is worked out on the bigger amount. Over a few years the difference from simple interest looks small. Over decades it becomes very large, which is why starting early matters more than most other choices.
How to Use the Compound Interest Calculator
- Type your starting amount. Use 0 if you are starting from nothing.
- Type how much you will add every month. Use 0 if you will not add anything.
- Type the yearly interest rate in percent.
- Type the number of years you will leave the money to grow.
- Choose how often the interest is added: yearly, twice a year, quarterly, monthly or daily, then press Calculate.
The Formula
With no extra deposits, the final balance is the starting amount times (1 + rate / n) raised to the power of n times the number of years, where n is the number of times interest is added each year. With monthly deposits the calculator adds each deposit at the end of the month and carries on from there, so you do not need to work it out by hand.
Good to Know
- The more often interest is added, the more you earn, but the gap between monthly and daily is small.
- A higher rate or more years has a much bigger effect than a slightly larger deposit.
- The result does not include taxes, fees or inflation, so the real value of your money in the future will be lower.
- Real savings accounts and funds may change their rate over time. Use a few different rates to see a range.
Frequently Asked Questions
Is this calculator free?
Yes. It is free to use, with no sign-up. Everything is worked out in your browser.
What is the difference between simple and compound interest?
Simple interest is worked out only on the starting amount. Compound interest is worked out on the starting amount plus the interest already earned.
Does it work for loans too?
The same math applies to debt that grows with interest, but for repayments use the Loan Calculator, which shows the monthly payment.
Which compounding option should I choose?
Choose the one your bank or fund uses. If you do not know, monthly is a common choice for savings accounts.
Can I use a different currency?
Yes. The calculator only works with numbers, so the result is in whatever currency you typed.
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