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Compound Interest Calculator

Calculate how your money grows with compound interest over time. See the power of compounding with detailed projections and charts.

Compound Interest Calculator

See how your money grows over time with the power of compound interest.

$
$
%
10 years

Future Value

$107,143.85

Total Contributions$70,000.00
Total Interest Earned$37,143.85
Initial Deposit$10,000.00
Total Contributions$70,000.00
Total Interest$37,143.85
Future Value$107,143.85
Contributions (65.3%)Interest (34.7%)

How Compound Interest Works

Compound interest is the interest you earn on both your original deposit and on the interest that has already been added to your account. Unlike simple interest, which is calculated only on the principal, compound interest accelerates the growth of your savings over time. The more frequently interest is compounded, the faster your money grows.

The Compound Interest Formula

The basic compound interest formula is A = P(1 + r/n)^(nt), where A is the future value, P is the principal, r is the annual interest rate, n is the number of times interest is compounded per year, and t is the number of years. When regular contributions are included, the future value of the annuity portion is added separately.

Tips to Maximize Compound Interest

  • Start saving as early as possible — time is the most powerful factor
  • Choose accounts with more frequent compounding (daily or monthly)
  • Make regular monthly contributions, even if small
  • Reinvest all interest and dividends rather than withdrawing them
  • Look for higher interest rates through high-yield savings accounts or CDs

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How to Use

  1. 1Enter your initial investment amount and any regular monthly contributions.
  2. 2Set the annual interest rate and the number of years for your investment.
  3. 3View the projected growth including total contributions, interest earned, and final balance.

Frequently Asked Questions

What is compound interest?
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest, your earnings generate their own earnings over time.
What is the compound interest formula?
The formula is A = P(1 + r/n)^(nt), where A is the final amount, P is the principal, r is the annual rate, n is compounding frequency per year, and t is the number of years.
How often should interest be compounded?
More frequent compounding yields higher returns. Daily compounding earns slightly more than monthly, which earns more than annual. However, the difference decreases as frequency increases.
What is the Rule of 72?
The Rule of 72 is a quick way to estimate how long it takes to double your money. Divide 72 by the annual interest rate to get the approximate number of years needed to double your investment.
How does compound interest differ from simple interest?
Simple interest is calculated only on the original principal, while compound interest is calculated on the principal plus all previously earned interest. Over time, compound interest grows exponentially while simple interest grows linearly.

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