How to use the Compound Interest Calculator
- Enter what you start with and how much you add each month.
- Set an expected annual return and the number of years.
- Pick the compounding frequency your bank or fund uses.
- Watch the chart: the purple part is interest earning interest.
How it works
Compound interest means you earn interest on previous interest. For a single deposit:
A = P × (1 + r/k)k·tWith monthly contributions the calculator simulates every month, converting the annual rate into an equivalent monthly rate
(1 + r/k)k/12 − 1 so any compounding frequency is handled correctly.
Frequently asked questions
What is the rule of 72?
Divide 72 by the annual return to estimate how many years it takes to double your money. At 7%, money doubles roughly every 10 years.
What return should I assume?
Savings accounts pay a few percent; broad stock index funds have historically returned around 7%–10% per year before inflation, but returns are never guaranteed.
Does compounding frequency matter much?
Slightly. Daily or monthly compounding grows a bit faster than annual compounding at the same nominal rate, but the rate and time matter far more.