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Compound interest calculator

Calculate how your money grows with compound interest: initial principal, periodic contributions, compounding frequency, and a year-by-year table.

The amount you start with. It can be zero if you will only make contributions.

The nominal annual rate, for example 6.

How many years the money will grow. Decimals are accepted, for example 2.5.

How often interest is added to the principal.

Amount added at the end of each compounding period. Leave empty for no contributions.

Fill in the fields to see the result instantly.

Calculation assumptions

  • Contributions are made at the end of each compounding period, at the same frequency.
  • The term is converted to whole compounding periods (rounded to the nearest period); the minimum term is one whole period.
  • Each published figure is rounded to 2 decimal places (half up) independently.

What this calculator does

This calculator projects how your money grows when interest compounds, that is, when it is added to the principal and earns more interest. You can start from an initial principal, add periodic contributions at the end of each period, and choose the compounding frequency: annual, semiannual, quarterly, monthly, or daily.

Besides the final amount, it shows how much you contributed in total, how much is interest, and a year-by-year table so you can see the growth curve.

Who it is for

  • People planning medium- and long-term savings goals who want to see the effect of time.
  • Anyone comparing savings accounts or certificates with different compounding frequencies.
  • People making fixed monthly contributions who want to project their balance in 5, 10, or 20 years.
  • Students who want to understand the real difference between simple and compound interest.

What information you need

  • The initial principal (it can be $0 if you will start with contributions only).
  • The nominal annual interest rate as a percentage.
  • The term in years (decimals accepted, for example 2.5).
  • The compounding frequency.
  • Optional: the contribution you add at the end of each compounding period.

How it is calculated

The annual rate is divided by the number of periods per year (12 for monthly, 365 for daily, and so on) to get the per-period rate. The term is converted to whole periods, rounded to the nearest one: 2.5 years with monthly compounding is exactly 30 periods.

The initial principal grows by the factor (1 + i)^n. Contributions, made at the end of each period, grow with the future value of an ordinary annuity: each contribution starts compounding the period after it is deposited.

The math runs on integer cents: the growth of the principal and of the contributions are rounded to 2 decimal places separately (half up) and then added, so every published line is cent-exact.

If the entered values produce a result beyond the supported range, the calculator shows a notice instead of an imprecise figure.

Formula

Growth of the initial principal
amount = principal × (1 + i)^n, with i = annual rate ÷ periods per year
Future value of contributions (end of each period)
contributions amount = contribution × ((1 + i)^n − 1) ÷ i
Total interest
interest = final amount − principal − total contributed

Worked example

You start with $1,000, contribute $50 at the end of every month, and your account pays 6% per year compounded monthly. How much will you have in 10 years?

  1. Per-period rate: 6% ÷ 12 = 0.5% monthly (i = 0.005).
  2. Periods: 10 years × 12 = 120 months.
  3. Principal: $1,000 × (1.005)^120 = $1,819.40.
  4. Contributions: $50 × ((1.005)^120 − 1) ÷ 0.005 = $8,193.97.
  5. Final amount: $1,819.40 + $8,193.97 = $10,013.37.
  6. Total contributed: $50 × 120 = $6,000. Interest: $10,013.37 − $1,000 − $6,000 = $3,013.37.

In 10 years you would have $10,013.37: $7,000 came out of your pocket and $3,013.37 is compound interest.

How to interpret the result

Compound interest accelerates with time: in the year-by-year table you will see the last years add much more interest than the first ones. Patience is part of the formula.

The higher the compounding frequency, the higher the effective yield at the same nominal rate, although the difference between monthly and daily is usually small.

The result is a constant-rate projection: real rates change, and the calculation does not deduct taxes or fees.

Common mistakes

  • Confusing the nominal annual rate with the effective annual rate: 6% nominal compounded monthly is a 6.17% effective annual rate.
  • Entering a monthly contribution while annual compounding is selected: contributions happen once per compounding period.
  • Ignoring inflation: the final amount is in nominal dollars, not in today’s purchasing power.
  • Assuming that doubling the rate doubles the result: growth is exponential, not linear.

Frequently asked questions

What does the compounding frequency mean?

It is how often interest is added to the principal. With monthly compounding, each month the interest for the period is calculated and becomes part of the principal, so the next month earns interest on a larger base.

When are contributions made?

At the end of each compounding period (ordinary annuity). That is why the first contribution earns no interest in its own period. If your contributions happen at the start of each period, your real result will be slightly higher.

Can I use a term with decimals?

Yes. The term is converted to whole periods rounded to the nearest one: 2.5 years with monthly compounding is exactly 30 periods. With daily compounding, 2.5 years rounds to 913 days. The minimum term is one whole period: for example, with annual compounding the term must be at least 0.5 years.

Why does my bank calculate a different amount?

Banks may use effective instead of nominal rates, different day-count conventions, different cut-off dates, or charge fees and withholdings. Use this projection as a reference and compare against your specific contract.

What is the rule of 72?

A quick approximation: divide 72 by the annual rate to estimate how many years it takes to double your money. At 6%, roughly 72 ÷ 6 = 12 years. The year-by-year table in this calculator gives you the exact figure.

Sources

Last reviewed:
July 20, 2026
Calculation version:
1.0.0

Important notice

The results of these calculators are informative estimates and may differ from official calculations. They do not constitute legal, tax, or financial advice. Always verify with the competent institutions or a professional.

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