Compound interest calculator
Enter your starting balance, interest rate, and time frame — add monthly contributions if you like — and see the final balance, total interest earned, and growth year by year.
How compound interest works
With compound interest, the interest you earn is added to your balance and starts earning interest of its own: the basic formula is A = P × (1 + r/n)n×t, where P is the principal, r the annual rate, n the number of compounding periods per year, and t the number of years. The more often interest compounds (monthly instead of annually), the faster the balance grows, because your interest starts "working" sooner. With annual compounding, contributions made during the year begin earning interest from the first year-end credit.
Why monthly contributions make such a difference
Even a small but steady contribution transforms the outcome over the long run: $100 a month for 20 years is $24,000 out of pocket, yet at 5% with monthly compounding it grows to more than $41,000. That's the principle behind dollar-cost-averaging investment plans: time matters more than the amount, because every extra year adds interest on top of the interest from all the years before. Use the year-by-year table to spot the point where your interest starts growing faster than your contributions.
This tool provides estimates for informational purposes only: it does not account for taxes, inflation, or fees, and is not financial advice. Consult a financial advisor for decisions about your money.