Free Investment Calculator
Compound Interest Calculator
Estimate how your money could grow over time with compound interest. Add an initial investment, recurring monthly contributions, expected annual return, and investment period.
Enter your investment details
Estimate how your money may grow over time with compound interest and recurring monthly contributions.
Growth Results
Enter your investment details
Your estimated future value and compound interest results will appear here.
How compound interest works
Compound interest means that returns can be earned not only on your original investment, but also on previously accumulated returns. Over longer periods, this compounding effect can make a significant difference in the estimated value of an investment.
Regular contributions can further increase the amount available to compound. This calculator lets you combine an initial investment with optional monthly contributions to estimate future growth.
Initial Investment
The amount of money you start with before additional contributions or investment growth.
Contributions
Additional money contributed regularly during the investment period.
Interest Earned
The estimated growth generated above the amount you personally contributed.
Compound interest formula
A = P(1 + r/n)ⁿᵗ
A = future value
P = initial principal
r = annual interest rate
n = number of compounding periods per year
t = number of years
Recurring contributions require additional calculations because each contribution has a different amount of time to compound.
Why time matters with compound interest
The longer money remains invested, the more opportunities it has to compound. This is why investment duration can have a large impact on estimated future value.
For example, an investment earning the same annual return for 20 years will generally have substantially more time to compound than the same investment held for only 5 or 10 years.
Compounding does not guarantee investment returns
Real investments do not normally earn the exact same return every year. Market values can rise or fall, and fees, taxes, inflation, and investment losses can affect actual results.
Monthly vs. quarterly vs. annual compounding
Compounding frequency describes how often earned interest is added to the balance. When all other assumptions are equal, more frequent compounding can result in a slightly higher future value because interest begins earning additional interest sooner.
Monthly
12 times per year
Quarterly
4 times per year
Annually
1 time per year
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What is compound interest?
Compound interest is interest calculated on both the original principal and previously accumulated interest. This can allow money to grow at an increasing rate over time.
How do I calculate compound interest?
A common compound interest formula is A = P(1 + r/n)ⁿᵗ, where P is the initial principal, r is the annual interest rate, n is the number of compounding periods per year, and t is the number of years.
What is the difference between simple and compound interest?
Simple interest is generally calculated only on the original principal. Compound interest can also generate returns on previously earned interest.
How does a monthly contribution affect compound growth?
Regular contributions increase the amount of money available to potentially earn returns. Contributions made earlier generally have more time to compound than contributions made later.
Is monthly compounding better than annual compounding?
When the stated annual rate and other assumptions are the same, more frequent compounding can produce a slightly higher future value. The difference depends on the rate and investment period.
Does this calculator predict actual investment returns?
No. The calculator provides hypothetical estimates using the rate you enter. Actual investment returns fluctuate and may be higher, lower, or negative.
This compound interest calculator is provided for general informational and educational purposes only. Results are hypothetical estimates and do not represent guaranteed investment performance. Taxes, fees, inflation, market volatility, and other factors may materially affect actual results.