Compound Interest Calculator

What your savings grow to

Enter a starting amount, a rate, a term and whatever you add along the way. The tool shows the final balance split into two parts: what you put in, and what it earned.

That split is the whole point. A single big number at the end is impressive and tells you nothing; seeing the moment your interest overtakes your deposits is what makes compounding concrete.

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Simple against compound

Simple interest pays only on your original money. Compound interest pays on the interest too, so each year starts from a bigger balance.

$10,000 at 7%:

After 10 years — $17,000 simple, $20,097 compounded monthly.
After 20 years — $24,000 simple, $40,387.
After 30 years — $31,000 simple, $81,165.
After 40 years — $38,000 simple, $163,114.

Simple interest adds $700 a year forever. Compound interest adds $700 in year one and over $10,000 in year forty — the same rate, on a balance that has been growing the whole time.

Notice the shape: the gap is modest for the first decade and then runs away. That is why compounding is described as slow and then sudden, and why the single most valuable input on this page is time.

Starting early beats saving more

The clearest demonstration of that, and it surprises almost everyone.

Two people, both earning 7%, both stopping at 65.

Ana saves $200 a month from 25 to 35 — ten years — and then never adds another penny. She pays in $24,000.

Ben starts at 35 and saves $200 a month for thirty years, right up to 65. He pays in $72,000 — three times as much.

At 65, Ana has about $280,968. Ben has about $243,994.

Ana wins by roughly $37,000, having contributed a third of what Ben did. Her advantage is entirely that her money had ten more years to compound. There is no way for Ben to catch up except by saving considerably more.

Compounding frequency matters far less than you would think

Accounts advertise daily compounding as if it were a meaningful edge. It is not.

$10,000 at 10% for 10 years:

Compounded yearly — $25,937.
Compounded monthly — $27,070.
Compounded daily — $27,179.

Yearly to monthly is worth about 4%. Monthly to daily is worth about 0.4% — a tenth as much. Beyond daily there is essentially nothing left; the limit as compounding becomes continuous is only a few dollars further on.

So of the four inputs, rank them: time and rate dominate, the amount matters, and frequency is noise. Never choose an account on compounding frequency; choose it on the rate it actually pays.

Deposits at the start or the end

The option changes when each deposit is assumed to land. Money in at the start of a period earns for one extra period, which is the difference between what finance calls an ordinary annuity and an annuity due.

It is a genuine difference and a modest one — one period’s interest on the contribution part of the balance, so under 1% a year. Worth ticking to match how your account actually works, not worth reorganizing your finances over.

The rate is an assumption, not a forecast

This is the part to be careful with, because the tool will happily project any number you type across forty years and produce a very confident-looking total.

For a savings account, the rate is whatever the bank currently pays, and it can change tomorrow.

For investments there is no rate, only a distribution. People commonly assume 6–7% a year for stocks after inflation, based on very long-run averages. Any individual decade can be far above or far below that, and the order matters too: a bad run early in a long horizon does much less damage than one just before you need the money.

Treat the output as “what this rate would produce, if it held” — which is useful for comparing scenarios, and is not a prediction of your balance.

Two things this does not model

Inflation. The final figure is in future money. At 3% inflation, money loses half its purchasing power in about 23 years — so a projected $500,000 in 2050 buys roughly what $250,000 buys today. To think in today’s money, subtract your inflation assumption from the return and use that real rate instead. A 7% return with 3% inflation is 4% real.

Tax and fees. Depending on the account and the country, growth may be taxed each year, on withdrawal, or not at all — and a tax-sheltered account can be worth more than a percentage point of return. Fees work the same way in reverse: a 1% annual fee does not cost you 1%, it costs you 1% compounded, which over forty years is a substantial share of the final balance.

Neither appears above. Both are large enough to change a decision, which is why they belong in this article rather than only in a disclaimer.

Frequently asked questions

What is compound interest?

Interest paid on interest already earned. With simple interest the balance grows by the same amount every year; with compounding, each year's interest joins the balance and earns in its turn, so the growth accelerates. Over long periods the difference is enormous.

How much does compounding frequency matter?

Much less than people think. Going from yearly to monthly compounding at 10% over 10 years adds about 4%. Going from monthly to daily adds about 0.4%. It is the least important of the four inputs — rate and time dominate — and it is nowhere near worth switching accounts for.

What does "deposit at the start of each period" change?

Each deposit earns for one extra period, so the contribution part of the balance grows by one period's interest. It is the difference between an ordinary annuity and an annuity due. Over decades it is a real but modest amount — a few hundred on a six-figure balance.

What rate should I assume?

Whatever you assume, treat it as an assumption. A savings account pays whatever it currently pays. For a stock market projection, people commonly use 6–7% as a long-run average after inflation, but any single decade can be far above or below that, and past averages are not a promise.

Does this account for inflation?

No. The final figure is in future money, which will buy less than the same amount does now — at 3% inflation, money halves in purchasing power roughly every 24 years. To think in today's money, use a real rate: your assumed return minus inflation.

Does it account for tax?

No. Depending on the account and the country, growth may be taxed annually, on withdrawal, or not at all. A tax-sheltered account can be worth more than a percentage point of return, which over a long period is a large difference.

Is this financial advice?

No. It is a projection from an assumed rate, not a forecast, and it models none of the things that make real investing complicated — fees, sequence of returns, or the fact that you might need the money early.