Compound Interest Calculator
See exactly how your money grows over time with the power of compounding. Enter your initial deposit, monthly contributions, and expected return rate.
How much you'll add each month
Final balance
$167,072
Total contributed
$58,000
Interest earned
$109,072
188% return on contributions
Green = total balance · Gray = amount contributed
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How compound interest works
Compound interest is the process of earning interest on both your original deposit and the interest you've already earned. Albert Einstein reportedly called it the "eighth wonder of the world" — and with good reason.
The formula is: A = P(1 + r/n)^(nt) where P is your initial investment, r is the annual interest rate, n is the number of times interest compounds per year, and t is time in years. Monthly contributions are calculated separately and added to the total.
The key insight: starting early matters far more than the amount you invest. $10,000 invested at 25 grows to nearly twice what the same amount invested at 35 becomes, even with no additional contributions. Time is the multiplier.
Compounding frequency
More frequent compounding means slightly higher returns. Monthly compounding (12x/year) is the most common for savings accounts and investment accounts. Daily compounding offers marginally more but the difference is smaller than most people expect.
What rate should I use?
The S&P 500 has historically returned around 7–10% annually after inflation. For conservative estimates, use 6–7%. For high-yield savings accounts, use the current APY from your bank. For CDs, use the rate offered at the time of purchase.