Compound Interest Calculator
Calculate compound interest on your investments. Enter principal, interest rate, investment period, and optional monthly contributions to see how your money grows.
Year-by-Year Growth Chart
| Year | Start Balance | Annual Contribution | Annual Interest | End Balance |
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What is Compound Interest?
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Over time, this creates exponential growth as your interest earns interest.
The Compound Interest Formula
A = P(1 + r/n)^(nt)
A = Final amount, P = Principal, r = Annual interest rate, n = Compounding frequency, t = Time in years
Effect of Compounding Frequency
The more frequently interest is compounded (monthly > quarterly > annually), the more interest you earn. However, the difference becomes more noticeable with higher interest rates.
What is a Compound Interest Calculator?
A compound interest calculator is a financial planning tool that shows how your money grows over time through the power of compounding. Enter your principal, interest rate, investment period, and optional monthly contributions to see the projected final balance, total interest earned, and overall return. Whether you are planning a savings account, retirement fund, or long-term investment, this tool helps you visualize the exponential growth that compounding can deliver.
How It Operates
The compound calculator uses A = P(1 + r/n)^(nt). P is principal, r is annual rate, n is compounding frequency, t is time in years. For example, $10,000 at 5% compounded annually for 10 years: A = $10,000 × (1.05)^10 = $16,288.95. Unlike simple interest (P × r × t), compound interest earns interest on interest, growing exponentially over time.
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