Free Compound Interest Calculator
See how an amount grows over time with compound interest, including optional regular contributions. The result separates your deposits from the interest earned.
- Initial amount
- 1,000.00
- Total added
- 0.00
- Interest earned
- 647.01
Enter all amounts in a single currency. Estimate only — excludes fees, taxes, and inflation.
Estimate only. This calculator provides estimates based on the values you enter and the formula shown. It is not financial advice and may not reflect every fee, tax, or lender requirement. Check figures with a qualified professional before making financial decisions.
Quick answer
Compound interest is interest calculated on both your original principal and the interest already added. The future value is A = P(1 + r/n)^(n·t), where P is the principal, r is the annual rate as a decimal, n is how many times per year it compounds, and t is the number of years.
Formula & method
Compound interest (lump sum)
A = P × (1 + r/n)^(n·t)
- A — final amount (principal + interest)
- P — initial principal
- r — annual interest rate as a decimal (5% = 0.05)
- n — compounding periods per year
- t — time in years
With a regular contribution each period
A = P(1 + i)^N + C × [((1 + i)^N − 1) ÷ i]
- i — rate per period = r/n
- N — total periods = n·t
- C — amount added each compounding period
If the rate is 0, the balance is simply the principal plus all contributions.
Examples
- Input
- P = 1000, r = 0.05, n = 1, t = 10
- Result
- $1,628.89
- Why
- 1000 × (1 + 0.05)^10 = 1000 × 1.62889 = 1,628.89.
- Input
- P = 5000, r = 0.04, n = 12, t = 5
- Result
- ≈ $6,104.98
- Why
- 5000 × (1 + 0.04/12)^60 ≈ 5000 × 1.22100.
- Input
- P = 0, C = 200, r = 0.06, n = 12, t = 20
- Result
- ≈ $92,408
- Why
- Only the monthly deposits earn interest here; about $48,000 is deposited and the rest is interest.
When to use this tool
- Estimating how a savings balance or investment could grow over time.
- Comparing the long-run effect of different interest rates or contribution amounts.
- Understanding why starting early matters more than starting big.
Common mistakes
- Entering the rate as a whole number. Use 5 for 5% in the tool — but in the formula r is the decimal 0.05.
- Mixing up compounding frequency and contribution frequency. More frequent compounding raises the result, but only slightly at typical rates.
- Treating the output as guaranteed. Real returns vary, and this model ignores fees, taxes, and inflation.
Frequently asked questions
＋ － What is compound interest?
It’s interest earned on both your original deposit and the interest that has already been added. Over time this compounding makes balances grow faster than simple interest.
＋ － How is compound interest different from simple interest?
Simple interest is calculated only on the original principal, so it grows in a straight line. Compound interest is calculated on the growing balance, so it accelerates.
＋ － Does compounding more often make a big difference?
It helps, but less than people expect. At 5%, daily compounding beats annual compounding by only a fraction of a percent of the balance per year.
＋ － What is APY, and how does it relate to this?
APY (annual percentage yield) is the effective yearly rate after compounding is taken into account. It lets you compare accounts that compound at different frequencies.
＋ － Are taxes, fees, and inflation included?
No. This is a simplified estimate of nominal growth. Real outcomes depend on fees, taxes, and inflation, which this tool does not model.
＋ － Is this financial advice?
No. It’s an educational estimate based on the numbers you enter. Speak with a qualified financial professional before making decisions.
Disclaimer
This calculator provides estimates based on the values you enter and the formula shown. It is not financial advice and may not reflect every fee, tax, or lender requirement. Check figures with a qualified professional before making financial decisions.
- ✓ Free to use
- ✓ No sign-up required
- ✓ Runs entirely in your browser — nothing is uploaded.
- ✓ Formula and method shown above
Provided “as is” for general information only — results may be inaccurate, so verify before you rely on them. No warranty; use at your own risk.
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