Tools
Compound Interest Calculator
Explore how your savings grow over time with interest and regular contributions. Adjust the inputs to match your plan.
Compound Interest Calculator
Adjust the values and see how your money grows over time.
≈ 7.23% effective annual rate
Compound: interest earns interest too, on the schedule set by Capitalization below.
Every contribution is the same amount.
Ordinary: each contribution lands at the end of its period, so it only starts earning interest the next one.
How often you make a contribution.
How often interest compounds — more frequent capitalization compounds faster.
Compounding advantage over simple interest: 24,364.07
Growth over time
Year-by-year breakdown
| Year | Balance | Contributed this year | Total contributed | Total interest |
|---|---|---|---|---|
| 1 | 3,550.81 | 2,400.00 | 3,400.00 | 150.81 |
| 2 | 6,286.01 | 2,400.00 | 5,800.00 | 486.01 |
| 3 | 9,218.95 | 2,400.00 | 8,200.00 | 1,018.95 |
| 4 | 12,363.90 | 2,400.00 | 10,600.00 | 1,763.90 |
| 5 | 15,736.21 | 2,400.00 | 13,000.00 | 2,736.21 |
| 6 | 19,352.29 | 2,400.00 | 15,400.00 | 3,952.29 |
| 7 | 23,229.79 | 2,400.00 | 17,800.00 | 5,429.79 |
| 8 | 27,387.59 | 2,400.00 | 20,200.00 | 7,187.59 |
| 9 | 31,845.96 | 2,400.00 | 22,600.00 | 9,245.96 |
| 10 | 36,626.62 | 2,400.00 | 25,000.00 | 11,626.62 |
| 11 | 41,752.88 | 2,400.00 | 27,400.00 | 14,352.88 |
| 12 | 47,249.72 | 2,400.00 | 29,800.00 | 17,449.72 |
| 13 | 53,143.92 | 2,400.00 | 32,200.00 | 20,943.92 |
| 14 | 59,464.22 | 2,400.00 | 34,600.00 | 24,864.22 |
| 15 | 66,241.41 | 2,400.00 | 37,000.00 | 29,241.41 |
| 16 | 73,508.52 | 2,400.00 | 39,400.00 | 34,108.52 |
| 17 | 81,300.97 | 2,400.00 | 41,800.00 | 39,500.97 |
| 18 | 89,656.74 | 2,400.00 | 44,200.00 | 45,456.74 |
| 19 | 98,616.56 | 2,400.00 | 46,600.00 | 52,016.56 |
| 20 | 108,224.07 | 2,400.00 | 49,000.00 | 59,224.07 |
The formulas behind it
With i the rate per period and n the
number of periods, a lump sum P left to compound grows
to:
FV = P × (1 + i)n
A level contribution C made every period is an
annuity. Paid at the end of each period it is an
ordinary annuity; paid at the start it is an
annuity due, which earns one extra period of
interest on every payment:
FVordinary = C × [((1 + i)n − 1) ÷ i]
FVdue = FVordinary × (1 + i)
When the contribution itself grows by a fixed percentage
g each period — a geometric or growing
annuity, the closest match to contributions that rise with a salary
— the closed form is:
FV = C × [((1 + i)n − (1 + g)n) ÷ (i − g)], for i ≠ g
Finally, a nominal annual rate j compounded
m times a year is not what you actually earn. The
effective annual rate, shown live next to the rate field, is:
EAR = (1 + j ÷ m)m − 1
So 12% nominal compounded monthly is an effective 12.68% a year, which is why the capitalization setting changes the result even when the quoted rate does not.
Related resources
- Financial Mathematics course — syllabus, notes, and teaching materials for the course taught at Universidad Francisco Marroquín.
- Compound interest exercises — practice problems on compound interest, with solutions.
- Annuities exercises — practice problems on annuities, including growing contributions.
- Loan amortization calculator — the same mathematics from the borrower's side: French, Italian and American amortization methods with a full schedule.
- Inflation calculator — check what a projected balance is actually worth in today's money.
Frequently asked questions
What's the difference between compound and simple interest? ▾
With simple interest, you only ever earn interest on the amount you've contributed — the interest itself never earns more interest. With compound interest, interest is periodically added to your balance and starts earning interest too. Over long horizons this compounding effect is the main driver of growth, which is why this calculator lets you toggle between the two and see the gap directly.
What's the difference between an ordinary annuity and an annuity due? ▾
It's about when each contribution lands relative to its period. In an ordinary annuity, a contribution is added at the end of the period, so it doesn't start earning interest until the next one. In an annuity due, the contribution is added at the start of the period and begins earning interest immediately. Annuity due always produces a slightly higher balance for the same contributions and rate.
What does capitalization frequency mean? ▾
It's how often the interest earned is added into the principal so it starts compounding on itself — for example monthly, quarterly, semi-annually, or annually. A nominal rate compounded more often produces a higher effective annual rate (APY), which this calculator shows next to the Annual rate field.
What are arithmetic and geometric growing contributions? ▾
These are annuities where each contribution grows instead of staying flat. With arithmetic growth, each contribution increases by a fixed amount over the last one. With geometric growth, each contribution increases by a fixed percentage instead — closer to how contributions might grow alongside a salary. Both are available as a growth mode in this calculator's Advanced options.
What is the effective annual rate (APY) and how does it differ from the nominal rate? ▾
The nominal annual rate is the rate before accounting for how often it compounds. The effective annual rate (APY) is what you actually earn over a year once compounding is factored in — it's always equal to or higher than the nominal rate, and grows with capitalization frequency. This calculator computes it live from your Annual rate and Capitalization settings.