Compound Interest Calculator
See how your money grows with compound interest over time, with a year-by-year balance breakdown.
About the Compound Interest Calculator
Compound interest is often called the most powerful force in personal finance because interest earns interest — every period, growth is calculated on the new, larger balance rather than the original amount. This calculator projects how a lump sum grows at a given rate and compounding frequency, showing the final balance and a year-by-year breakdown of growth.
How It Works
The calculator applies the compound growth formula for your chosen compounding frequency, stepping the balance forward month by month at the equivalent periodic rate. Every year it records the running balance and the interest earned to that point, so you can see how growth accelerates as the balance itself gets larger.
A = P × (1 + r/n)^(n×t), where P is principal, r is the annual rate, n is compounds per year, and t is time in years.
Example
Scenario: $10,000 invested at 7% annual interest, compounded monthly, for 10 years.
Result: Final balance of about $20,097, meaning roughly $10,097 in interest earned on the original $10,000.
Assumptions & Limitations
- Assumes the rate stays constant for the entire period with no withdrawals.
- No additional contributions are included in this basic version — see the Investment Calculator for recurring deposits.
- Does not account for taxes on interest earned or inflation eroding purchasing power.
- Real-world rates fluctuate; this model uses a single fixed rate throughout.