Compound Interest Calculator
Calculate how your investments grow over time with compound interest and regular monthly contributions.
Results
Example: How compound interest grows your money
If you invest $10,000 initially and contribute $500 per month at an average annual return of 7% for 20 years, your investment could grow to over $300,851.
In this example, your total contributions would be about $130,000, meaning more than half of the final value comes from compound interest rather than deposits.
How compound interest works
Compound interest allows you to earn interest not only on your original investment, but also on interest earned previously. Over time, this creates a powerful snowball effect that accelerates investment growth.
Time is the most important factor in compounding. The longer your money remains invested, the more opportunity it has to grow. Consistent monthly contributions further amplify this effect by increasing the base on which interest is calculated.
Small differences in annual return can lead to very large differences in outcomes over decades. This is why fees, taxes, and investment choices play a critical role in long-term results.
This calculator assumes monthly compounding and does not include inflation or taxes. Results are intended for educational and planning purposes only.
Many people use compound interest as part of a broader financial independence plan. A FIRE number calculator can help estimate how much you need invested to support long-term expenses.
Frequently Asked Questions
What is compound interest?▾
Compound interest is interest calculated on both your original investment and previously earned interest.
Does this calculator include inflation?▾
No. Results are shown in nominal terms and do not account for inflation or taxes.
How accurate is this calculator?▾
It uses regular compounding and contributions, providing a close estimate for planning purposes.
Can I use this for retirement planning?▾
Yes. It is commonly used to estimate long-term investment growth for retirement planning.