Compound interest calculator
Enter a starting balance, a monthly deposit and an annual interest rate to see how your money grows. For example, $10,000 at 4.5% with $200 a month becomes about $45,910 in 10 years.
Future balance
$45,909.54
Total contributions
$34,000.00
Interest earned
$11,909.54
| Year | Contributions | Interest | Balance |
|---|---|---|---|
| 1 | $12,400.00 | $509.52 | $12,909.52 |
| 2 | $14,800.00 | $1,152.71 | $15,952.71 |
| 3 | $17,200.00 | $1,935.70 | $19,135.70 |
| 4 | $19,600.00 | $2,864.91 | $22,464.91 |
| 5 | $22,000.00 | $3,947.07 | $25,947.07 |
| 6 | $24,400.00 | $5,189.20 | $29,589.20 |
| 7 | $26,800.00 | $6,598.64 | $33,398.64 |
| 8 | $29,200.00 | $8,183.09 | $37,383.09 |
| 9 | $31,600.00 | $9,950.59 | $41,550.59 |
| 10 | $34,000.00 | $11,909.54 | $45,909.54 |
How the compound interest calculator works
The formula
Each month the balance grows by the monthly interest rate and then your deposit is added: new balance = old balance × (1 + monthly rate) + monthly deposit. The monthly rate is derived from the annual rate and how often interest compounds, so daily compounding earns slightly more than annual compounding at the same headline rate.
Worked example
$10,000 at 5% compounded monthly grows to about $16,470 in 10 years with no further deposits. Add $200 a month and the balance reaches about $47,527: $34,000 of your own money plus about $13,527 of interest.
What makes the biggest difference
In order of impact, the levers you control are:
- Time: interest earned in later years dwarfs the early years.
- Regular deposits: small monthly amounts add up quickly.
- Rate: a 1% higher rate compounds into a large gap over decades.
- Compounding frequency: helps, but matters least of the four.
The rule of 72
For a quick estimate, divide 72 by the annual interest rate to get the number of years it takes money to double. At 6%, savings double in about 12 years; at 4%, in about 18 years.
Frequently asked questions
What is compound interest?+
Compound interest is interest earned on both your original deposit and on the interest already added to it. Because each period's interest is added to the balance, growth accelerates over time.
How much will $10,000 grow in 10 years at 4.5%?+
With monthly compounding and $200 added every month, $10,000 grows to about $45,910 after 10 years: $34,000 of deposits plus $11,910 of interest.
Does compounding frequency matter?+
Yes, slightly. More frequent compounding (daily vs. annually) earns a little more at the same stated rate, because interest starts earning interest sooner. The rate of return and time invested matter far more.
What is the formula for compound interest?+
For a single deposit, A = P x (1 + r/n)^(n x t), where P is the principal, r the annual rate, n the number of compounding periods per year and t the number of years. This calculator also adds monthly contributions.
Related
Results are estimates for illustration only and are not financial advice. See our terms of use.