Compound Interest Calculator
Estimate how recurring monthly contributions and an assumed annual return could affect a balance over time.
Run your estimate
Change the assumptions to see how the result moves.
Visual projection
Updates as you change the assumptions.
Year-by-year breakdown
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Results are estimates for education. They are not financial, tax, legal, or investment advice.
How this calculator works
The estimate assumes monthly compounding, a constant annual return, and contributions made at the end of each month. Investment returns can be negative and are never guaranteed.
Compound interest explained for beginners
Compound interest means that growth is calculated on both the money you put in and any growth already added. In simple terms, your money can begin earning growth on earlier growth. This calculator shows how that effect may build over time when you start with a balance and continue adding money every month.
The information you enter
Starting balance is the amount you have today. Monthly contribution is the amount you plan to add each month. Annual return is the percentage of growth assumed for one year; it is an estimate, not a promise. Years is how long the money is allowed to grow. A longer period creates more opportunities for compounding, but it also makes the projection more uncertain.
What the results mean
Projected balance is the estimated total at the end. Total contributed is your starting balance plus all monthly deposits. Estimated growth is the difference between those two figures. Growth is not the same as guaranteed profit: real investments rise and fall, and fees, taxes and inflation can reduce what the money is worth.
Formula and assumptions
A = P(1 + r/12)12t + C × [((1 + r/12)12t − 1) / (r/12)]
A is the projected balance, P the starting balance, C the monthly contribution, r the annual return written as a decimal, and t the number of years. The calculator divides the annual rate by 12, assumes monthly compounding and treats each deposit as arriving at the end of the month. If the return is 0%, the balance grows only through your deposits.
How to read the chart and yearly breakdown
The projected-balance line includes deposits and assumed growth. The contributed-amount line shows only money added by you. The space between the lines represents estimated growth. The yearly table provides the same comparison at the end of each year, making it easier to see why compounding may look slow at first and become more noticeable later.
Worked example
With $1,000 to start, $100 per month, a 6% annual assumption and 10 years, you personally contribute $13,000. The projection is about $18,207 before fees, taxes, inflation and market losses. Roughly $5,207 is estimated growth under these assumptions.
Compound interest calculator FAQs
Is the annual return the same as an interest rate?
It plays a similar role in the calculation, but the real meaning depends on the product. A savings account may quote an interest rate, while an investment has an uncertain return that can be positive or negative.
Is the projected return guaranteed?
No. A constant rate makes the maths understandable, but actual returns change over time and losses are possible.
Why does time make such a large difference?
More time means more monthly deposits and more periods in which earlier growth can itself generate growth.
Does this include inflation, tax or fees?
No. Inflation reduces purchasing power, while fees and taxes may reduce the amount you keep. These vary by country and product.
How should I choose a return assumption?
Try several scenarios, including a low or zero return. A range is more useful than treating one optimistic number as certain.
Continue learning: What is investing for beginners?
