Compound interest calculator: explore how your savings could grow over time

What this calculator can help you understand

• How much a starting amount and regular monthly contributions could grow to over a period you choose.
• How much of the final balance would be money you put in, and how much would be interest.
• How changing the rate, the monthly amount or the number of years changes the outcome.
• What different compounding frequencies (daily, monthly, quarterly, annually or continuously) mean in practice, including the effective annual yield (APY).
• Roughly how long it takes money to double at a given rate.

The result is a projection based on the rate you enter staying the same for the whole period. It shows how the math works, not what any account or investment will actually pay.

When it’s useful

• Before choosing where to keep savings. Comparing a few rates over the same period shows what the difference is worth in dollars.
• When deciding how much to save each month. Trying $100, $200 or $400 a month makes the trade-off between today’s budget and tomorrow’s balance concrete.
• When you’re wondering whether starting now matters. Running the same monthly amount over 10 and 20 years shows how much of the growth comes from time.
• When comparing advertised rates. If one account quotes a rate compounded daily and another compounded monthly, the APY puts them on equal terms.

Who it’s for

• People building savings who want to see how steady deposits add up.
• New investors exploring how long-term growth works, keeping in mind that investment returns are not guaranteed.
• Parents and grandparents thinking about saving for a child over many years.
• Anyone comparing accounts who wants to see the effect of a higher rate.

What to enter

How to use it

1. Enter your starting amount. If you don’t have one yet, enter 0.
2. Enter what you expect to add each month. Leave it at 0 to see growth on a lump sum alone.
3. Enter the annual rate and choose how often it compounds.
4. Enter the number of years.
5. Read the balance first, then how it splits between what you put in and interest. The chart shades the interest portion.
6. Change one input at a time, such as the monthly amount or the years, to see which makes the biggest difference for you. Open the year-by-year table to see how growth speeds up over time.

Understanding your results

• Balance after the period is the projected total if the rate stays the same and every contribution is made. It’s before taxes and fees.
• Total you put in is your starting amount plus all monthly contributions. This part doesn’t depend on the rate.
• Interest earned is the difference: growth from interest, including interest on interest.
• Effective annual yield (APY) shows what the rate earns in a year once compounding is included, so you can compare rates with different compounding.
• Doubling time shows roughly how long a lump sum takes to double at that rate, both exactly and by the Rule of 72.

What it doesn’t show: inflation, which reduces what the balance can buy (see the inflation calculator); taxes on interest; fees; or variation in investment returns.

A worked example

Suppose you have $10,000 saved and can add $200 at the end of each month. You keep the money in an account paying 4.5% compounded monthly (a hypothetical rate) and leave it for 15 years.

• Inputs: starting amount $10,000; monthly contribution $200; rate 4.5%; monthly compounding; 15 years.
• Method: each month the balance grows by 4.5% ÷ 12 = 0.375%, then the $200 is added. Over 180 months, the starting amount grows to $10,000 × 1.00375¹⁸⁰ and the contributions add up as a series.
• Result: a balance of about $70,898. You’d have put in $46,000 ($10,000 plus 180 × $200), and $24,898 would be interest.
• What it means: a little over a third of the final balance would come from interest. The effective annual yield of 4.5% compounded monthly is 4.594%.
• Keep in mind: this assumes the rate never changes, which is rare for savings accounts, and ignores tax on the interest.

For a quick check you can do by hand: $1,000 at 5% compounded monthly for one year grows to $1,000 × (1 + 0.05 ÷ 12)¹² = $1,051.16, earning $51.16.

How the result changes

Changing the monthly contribution, with everything else as in the example:

Changing the rate, with $200 a month:

How often interest compounds, on $10,000 at 5% for 10 years with no contributions:

The gap between the least and most frequent compounding is $198.27 over 10 years. Contributions, the rate and time do the heavy lifting; compounding frequency fine-tunes it.

Common mistakes

• Treating an investment return as guaranteed. Stock and bond returns vary, sometimes sharply. A steady rate is a simplifying assumption, not a forecast.
• Mixing up the rate and the APY. If you enter an APY and also choose monthly compounding, you slightly overstate growth. With an APY, choose annual compounding.
• Forgetting inflation. $70,898 in 15 years won’t buy what $70,898 buys today.
• Ignoring taxes and fees. Interest in a taxable account is generally taxed each year, and fees reduce what compounds.
• Assuming you’ll never miss a contribution. Try a lower monthly amount to see a more cautious outcome.

What to do with your result

• Compare two or three scenarios: a realistic monthly amount, a stretch amount, and a smaller fallback.
• Check the rate you’re actually earning; if it’s low, the high-yield savings calculator shows what a better rate could be worth.
• If you have a specific target, the savings goal calculator works backward from the amount and date.
• Revisit the numbers when your income, the rate or your goal changes.

Limitations to keep in mind

This is a mathematical projection. It assumes a constant rate, contributions at the end of each month, and no withdrawals, taxes or fees. Savings account rates are usually variable, and investment returns are uncertain and can be negative. The result isn’t a quote, a promise of returns, or a recommendation to choose any account or investment.

Frequently asked questions

What’s the difference between compound and simple interest?

Simple interest is paid only on your original amount. Compound interest is also paid on interest you’ve already earned, so the balance grows faster over time. Most savings accounts and investments compound; many loans charge interest on the outstanding balance each month.

Does daily compounding make a big difference?

Less than most people expect. At 5% on $10,000 for 10 years, daily compounding ends at $16,486.65 versus $16,470.09 monthly and $16,288.95 annually. The rate and the time you leave the money invested matter far more.

What rate should I use?

For a savings account or CD, use the APY the bank quotes. For investments, there’s no guaranteed rate: returns vary from year to year and can be negative, so it’s wise to try a few conservative assumptions rather than one optimistic number.

Is the APY the same as the interest rate?

Not quite. The interest rate is the nominal yearly rate before compounding; the APY (annual percentage yield) shows what you earn in a year once compounding is included. US banks must disclose the APY on deposit accounts, which makes it the easiest number to compare.

Does the result include taxes or fees?

No. Interest in a regular savings account is generally taxable as income in the year you earn it, and investment accounts may charge fees. Both would lower the balance shown here.

How accurate is the Rule of 72?

It’s a quick shortcut: divide 72 by the annual rate to estimate the years needed to double your money. At 6% it estimates 12 years; the exact answer is 11.9 years. It’s close for rates between about 2% and 15%.

Related reading

• Why can a good average return still leave you with less than you expected?How ups and downs reduce compound growth, even when the average looks the same.

Related calculators

• Savings goal calculatorHow much to save each month to reach a goal on time, or how long it takes at your pace.
• High-yield savings calculatorThe extra interest you could earn by moving savings to a higher APY.
• Inflation calculatorWhat today’s costs could become, and what your savings could buy after inflation.

Written by the Maxint Content team and reviewed by the Maxint Editor team. How we create our content

This calculator gives estimates for illustration, based on the figures you enter and the assumptions described on this page. It isn’t financial, tax or legal advice, an offer, or a guarantee of any outcome.