Compound Interest Calculator

What is compound interest?

Compound interest is interest calculated on both the initial amount and any interest that has already been added. Unlike simple interest, which only applies to the original deposit, compounding means your returns generate their own returns over time.

The more frequently interest compounds, the faster the balance grows. Monthly compounding produces a slightly higher return than annual compounding at the same rate, because interest is reinvested twelve times a year rather than once.

How does this calculator work?

Enter an initial deposit, a regular monthly contribution, an annual interest rate, and a time period. The calculator projects the total balance at the end of the period, broken down into your contributions and the interest earned. The chart shows how both components grow over time.

Key terms

• Initial deposit - the lump sum you start with.
• Monthly contribution - the amount added each month.
• Annual interest rate - the yearly rate of return before compounding is applied.
• Compounding frequency - how often interest is calculated and added to the balance (monthly or annually).

Things to keep in mind

• This calculator assumes a fixed interest rate for the entire period. Real-world savings rates and investment returns fluctuate.
• The results do not account for taxes, inflation, or fees, which can all reduce the effective return.
• Past returns are not a reliable indicator of future performance. This tool is for illustrative purposes only.