Compound Interest Calculator
See how money grows when returns compound on top of returns. Combine a starting balance with regular monthly contributions to project a future balance — and watch how much of that total comes from growth rather than from what you put in.
How this calculator works
The projection combines two pieces, both compounded monthly. The starting amount P grows as:
P · (1 + r)ⁿ
and a stream of monthly contributions PMT grows as an ordinary annuity:
PMT · ((1 + r)ⁿ − 1) / r
Here r is the monthly rate (annual return ÷ 12) and nis the number of months. “Interest earned” is the final balance minus everything you contributed.
About the return assumption
Real-world returns are not a smooth fixed rate — markets rise and fall. This model assumes a constant average return and does not account for taxes, fees, inflation, or sequence-of-returns risk. It illustrates the power of compounding, not a guaranteed outcome.
Learn more
- The Time Value of Money: Why Starting Early Beats Saving More — Compounding rewards time more than effort. See why a head start can outweigh much larger contributions made later — and what that means for you.
- Investing Basics: How to Start Growing Your Money — A jargon-free primer on why investing beats saving alone, what compound growth really does, and the simple, low-cost way most people get started.
- What Is FIRE? A Beginner's Guide to Financial Independence — Financial Independence, Retire Early explained — the savings-rate math, the 25× rule, the variations, and the honest trade-offs behind the movement.
Frequently asked questions
- What return rate should I use?
- That's a personal assumption. A broad stock index has historically averaged roughly 7% per year after inflation over long periods, but any given decade can be much higher or lower. Try a range to see how sensitive the result is.
- Why does starting early matter so much?
- Because compounding rewards time. Money invested earlier has more years to grow on itself, so even small early contributions can outweigh larger ones made later. Lower the 'years to grow' field to see how much the ending balance shrinks.
- Does this account for inflation or taxes?
- No. The result is a nominal, pre-tax projection. To think in today's dollars, use a return rate net of inflation, and remember that taxes on gains depend on the account type.