Compound Interest Calculator
What is Compound Interest?
Compound interest is the process of earning interest not only on your initial investment, but also on the interest you have already accumulated. This creates a snowball effect: the longer your money is invested, the faster it grows.
The formula is simple: A = P × (1 + r/n)^(n×t) — where P is the principal, r is the annual interest rate, n is the number of compounding periods per year, and t is the time in years.
Why Monthly Deposits Matter
Adding a fixed monthly deposit dramatically accelerates wealth growth. Even a small contribution of $100 per month at 5% annual interest over 20 years results in over $41,000 in total interest earned — on top of your deposits. This is the core principle behind retirement savings plans, ETF savings plans, and pension funds worldwide.
How to Use This Calculator
Enter your starting capital, your planned monthly deposit, the expected annual interest rate, and the number of years. Click Calculate to instantly see your projected final balance, an interactive growth chart, and a year-by-year breakdown. You can also download the full data as a CSV file for further analysis.
Realistic Interest Rate Benchmarks
A savings account typically yields 0.5–2% per year. A diversified ETF portfolio (e.g. S&P 500) has historically returned around 7–10% annually before inflation. Use conservative estimates (4–6%) for long-term planning to account for market fluctuations and fees.
Disclaimer
These financial tools are provided for educational and informational purposes only. The results do not constitute professional financial, investment, or legal advice. Users should verify all information and consult with a qualified professional before making any financial decisions.