Compound Interest Calculator
See exactly how your savings or investments grow over time. Enter your principal, interest rate, and time period to calculate compound interest with a detailed year-by-year breakdown.
Future Value
$20,096.61
Total Interest
$10,096.61
Principal
$10,000.00
Year-by-Year Growth
How to use
Enter your initial investment (principal), the annual interest rate as a percentage, the number of years you plan to invest, and how many times the interest compounds per year. Common compounding frequencies are annually (1), semi-annually (2), quarterly (4), monthly (12), or daily (365). Click calculate to see your future value and a year-by-year growth breakdown.
Formula
Where A is the future value, P is the principal, r is the annual interest rate (decimal), n is the number of times interest compounds per year, and t is the number of years. For example, $10,000 at 7% compounded monthly for 10 years gives you $10,000 × (1 + 0.07/12)^(12×10) = $20,096.61.
When this calculator helps
Compound interest can look boring until you put real numbers into it. A small rate change, a few extra years, or a monthly contribution can move the final balance more than most people expect. Use this calculator to test those scenarios before you decide how much to save, how long to leave the money alone, or how expensive it is to wait.
Examples
Example 1: Early Retirement Saver
A 25-year-old invests $5,000 at 8% compounded annually for 40 years. Without adding another dollar, that $5,000 grows to $108,623. If they waited until age 35, the same $5,000 would reach $50,313. Those 10 years matter.
Example 2: High-Yield Savings Account
Depositing $20,000 in a high-yield savings account at 4.5% APY compounded daily for 5 years. The balance grows to $24,960, earning $4,960 in interest with zero risk. Compounding daily instead of annually adds an extra $45 over five years at this rate.
Example 3: The Cost of Debt
Compound interest also works against you on debt. A $10,000 credit card balance at 22% APR can become painfully expensive if you only make minimum payments. Running the numbers makes the tradeoff harder to ignore.
Things to watch
- •Starting earlier usually matters more than starting perfectly. Even modest amounts get more room to grow.
- •The difference between 6% and 8% returns seems small, but over 30 years it can mean double the final amount. Even small rate improvements matter.
- •Inflation erodes the real value of your returns. A 7% nominal return with 3% inflation gives you roughly 4% real growth in purchasing power.
- •Tax-advantaged accounts such as a 401(k), IRA, or Roth IRA can reduce the drag from taxes, depending on your situation.
- •Compounding needs reinvestment. If you keep pulling out the interest or dividends, the curve flattens quickly.
Sources and methodology
Last reviewed: April 25, 2026. We review formulas, default assumptions, and examples against public references when a formal source applies.
Method: This calculator uses the formula explained on this page, then checks default assumptions and examples against the references listed below.
- •Compound Interest Calculator, Investor.gov
- •What is compound interest?, Investor.gov
Found something off? Send a correction with the page URL, inputs, result, and expected result.
Common questions
- What is compound interest?
- Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest, which only earns interest on the original amount, compound interest allows your money to grow exponentially over time.
- How often should interest compound?
- More frequent compounding means faster growth. Daily compounding earns slightly more than monthly, which earns more than annually. However, the difference between daily and monthly compounding is usually small, the biggest jump is from annual to monthly.
- What is the difference between APR and APY?
- APR (Annual Percentage Rate) is the stated interest rate without compounding. APY (Annual Percentage Yield) includes the effect of compounding. A 5% APR compounded monthly produces a 5.12% APY. Always compare APYs when evaluating savings accounts or investments.
- How does the Rule of 72 relate to compound interest?
- The Rule of 72 is a quick way to estimate how long it takes to double your money. Divide 72 by your annual interest rate: at 6%, your money doubles in roughly 12 years (72/6=12). At 8%, it doubles in about 9 years. This rule works best for rates between 4% and 12%.
- What happens if I add regular contributions?
- Regular monthly or annual contributions dramatically accelerate growth. For example, $10,000 at 7% for 20 years grows to about $38,700 alone. But adding just $200/month turns that into over $142,000. The earlier and more consistently you contribute, the more compound interest works in your favor.