Compound Interest Calculator
See how an initial investment can grow over time when interest is compounded at regular intervals.
Calculate Compound Interest
Enter your starting principal, interest rate, investment period and compounding frequency to estimate your future balance.
Investment Details
Your starting amountCompounding
How often interest is addedEstimated Future Value
Based on the assumptions you entered
Compound Interest Insight
Enter your information to see how compounding could affect the estimated future value of your money.
About the Compound Interest Calculator
The Compound Interest Calculator estimates how an initial amount of money could grow when interest is periodically added to the balance and future interest is calculated on the accumulated amount.
The calculator can also include a recurring contribution so you can see how additional deposits may affect the estimated ending balance.
The result is an estimate based on the assumptions entered. It does not represent a guaranteed investment return.
How to Use the Calculator
Enter Principal
Enter the amount you are starting with.
Enter Rate
Enter the assumed annual interest rate.
Choose Time
Enter the number of years the money will remain invested.
How Compound Interest Works
Compound interest allows interest that has already been added to an account to become part of the balance used to calculate future interest.
In this formula, A represents the ending balance, P represents the principal, r represents the annual interest rate, n is the number of compounding periods per year and t is the number of years.
Why Compounding Frequency Matters
Interest can be compounded at different frequencies. Common frequencies include annual, semiannual, quarterly, monthly and daily compounding.
With the same nominal annual rate and other assumptions held constant, increasing the compounding frequency changes the mathematical result because interest is added to the balance more frequently.
If $10,000 earns a 7% annual rate for 20 years, the ending value depends on how frequently the interest compounds. Monthly and annual compounding therefore produce different mathematical results under the same nominal rate.
Compound Interest vs. Simple Interest
Simple interest calculates interest based on the original principal. Compound interest incorporates previously accumulated interest into the balance used for subsequent calculations.
This difference becomes more noticeable over longer periods.
What Can Affect Actual Results?
Actual financial outcomes can differ from a compound interest projection because real accounts and investments can involve changing rates, taxes, fees, inflation and other factors.
- Investment performance
- Account fees
- Taxes
- Inflation
- Changes in interest rates
The Power of Time
Time is one of the most important variables in a compound interest calculation. A longer period gives the accumulated balance more opportunities to compound.
This is why two people contributing similar amounts can arrive at different projected balances when their investment periods are different.
The calculator allows you to change the investment period so you can compare how different time horizons affect the mathematical projection.
Frequently Asked Questions
What is compound interest?
Compound interest is interest calculated on an amount that includes previously accumulated interest.
What does compounding frequency mean?
It describes how often interest is added to the balance. Common examples include monthly, quarterly and annual compounding.
Does this calculator include regular contributions?
Yes. You can enter an additional contribution amount. The calculator treats that contribution as a recurring monthly contribution.
Is the result guaranteed?
No. The result is a mathematical projection based on the assumptions entered and should not be interpreted as a guaranteed return.
Does the calculator include inflation?
No. The displayed result is a nominal future value and does not adjust the result for inflation.
This calculator is provided for educational and informational purposes only. It is not financial or investment advice. Actual results may differ from the estimates shown. The calculator does not account for taxes, fees, inflation or changes in investment performance.