Compound Interest Calculator

This compound interest calculator projects the future value of a lump sum plus optional monthly contributions. Compound interest is why starting early beats saving more later. This calculator projects a starting amount plus optional monthly contributions forward at a steady annual rate, compounding as often as you like, and shows the future value alongside how much of it is growth rather than deposits.

The maths

A lump sum grows by

FV = P × (1 + r/n)^(n·t)

with r the annual rate, n the compounding periods per year and t the years. Monthly contributions are added as an ordinary annuity, compounded monthly, and summed with the grown lump.

Why time dominates

Because the exponent is time, an extra decade at 7% roughly doubles the outcome, while an extra percent adds far less. The growth-multiple figure makes this tangible: it shows how many times over your contributions the final balance is.

Worked example

Start with 10,000, add 200 a month, at 7% a year compounded monthly, for 20 years:

lump sum:       10,000 × (1 + 0.07/12)^240 ≈ 10,000 × 4.0387 = 40,387
contributions:  200 × ((4.0387 − 1) ÷ 0.0058333) ≈ 200 × 520.93 = 104,186
future value ≈ 144,573

You put in 58,000 of your own money and finish with about 144,573, so growth accounts for 86,573 of it — a multiple of 2.49×. Compound the same lump sum annually instead of monthly and it grows to 38,697 rather than 40,387: more frequent compounding helps, but the twenty years sitting in the exponent is doing far more work than the twelve periods.

Why the years matter more than the rate

Because time is in the exponent its effect is not linear. At 7% money roughly doubles every decade — the rule of 72 puts it at 72 ÷ 7 ≈ 10.3 years, close enough for planning. Doubling the rate to 14% halves that to about five years, but a rate you cannot actually earn is worth nothing, whereas an extra decade of patience is entirely within your control.

The growth multiple makes the shape visible: in the early years almost the whole balance is money you deposited, and the curve only bends upward once accumulated interest starts earning interest of its own. That bend usually arrives past the halfway point of a long horizon, which is precisely why stopping early is so expensive.

Inputs, and the caveats that come with them

• Starting amount — the lump sum today. Zero is a valid and common entry.
• Monthly contribution — added at the end of each month, which is an ordinary annuity. Contributing at the start of each month would earn marginally more.
• Annual rate — the nominal rate; enter 7 for 7%.
• Compounding frequency — how often interest is credited. Monthly is typical for savings, quarterly for some bonds, annually for many fixed deposits.

The output is a projection at a constant rate, not a forecast. Markets do not return 7% every year; they return something that averages out over decades with losses along the way, and inflation takes a further slice from the real value. Read the figure as the shape of compounding rather than a promise, and compare scenarios by changing one input at a time. Simple Interest Calculator shows what the same money does without the exponent.

Private and precise

Every figure is worked out in your browser with standard financial formulas. Nothing you type is uploaded, stored or sent anywhere.