Compound Interest Calculator
See how savings or investments grow with monthly contributions and compound interest. Free and instant.
What is compound interest?
Compound interest means you earn interest on your interest. Each month the growth is added to the balance, and the next month's growth is calculated on the larger amount. Over long periods this snowball effect is the main reason that starting early matters.
How this calculator works
It adds your monthly contribution at the end of each month and applies one-twelfth of the annual rate every month. Returns are not guaranteed. Real investments rise and fall, so treat the result as an estimate, not a promise.
Worked example
Last reviewed November 2026. Formulas are standard and shown in the sections above; results are estimates.
Tips and common mistakes
- Time in the market matters more than the exact return.
- Extra contributions early have the biggest effect.
- Watch out for fees, 1% a year can cost tens of thousands over decades.
Learn more
Frequently asked questions
What return should I enter?
Savings accounts pay far less than stock-market funds. Many people use 4–7% for a long-term diversified portfolio, but past results do not guarantee future returns.
Does it account for inflation or tax?
No. Subtract your expected inflation from the rate to see growth in today's money.
Why does the interest earned grow so fast late on?
Because the balance is larger, so each month's interest is larger too. That is compounding.
Money guides for this topic
All guides →Compound Interest Explained (and Why Starting Early Wins)
How compound interest works, the rule of 72, and a simple example showing why time matters most.
Read guide →Investing for Beginners: A Simple Plan with the Numbers
A plain-English starter plan for investing: low-cost index funds, regular contributions and why fees matter.
Read guide →Lump Sum vs Dollar-Cost Averaging
Should you invest a windfall all at once or spread it out? What the history and simulations show, and how to choose.
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Open calculator →Results are estimates and not financial advice.