Compound Interest Calculator
See how your investments grow with compound interest over time.
$0.00
Final Amount
$0.00
Total Interest
| Year | Balance | Interest Earned | Cumulative Interest |
|---|
How to Use This Tool
- Enter the required values into the Compound Interest Calculator input fields shown above.
- The Compound Interest Calculator recalculates automatically as soon as all required inputs are filled in.
- Review the breakdown of the result and adjust any input to instantly see how the outcome changes.
Common Use Cases
- Retirement planning: Project how a 401(k) balance grows over 30 years at different return assumptions and contribution rates.
- College savings: Parents estimate how much a 529 plan needs in monthly contributions to hit a tuition target by year 18.
- Loan vs. investment comparison: Decide between paying down a 6% loan or investing in an index fund with 7% expected return.
Frequently Asked Questions
What is the compound interest formula?
A = P(1 + r/n)^(nt). P is principal, r is annual rate (as decimal), n is compounding periods per year, t is years. $10,000 at 7% compounded monthly for 20 years gives A = 10000 * (1 + 0.07/12)^240 鈮?$40,387.
How does compounding frequency affect returns?
More frequent compounding yields slightly more. $10,000 at 8% for 10 years: annual gives $21,589, monthly gives $22,196, daily gives $22,253. Beyond daily, gains are negligible. Continuous compounding (A = Pe^(rt)) is the theoretical upper bound.
What is the "Rule of 72"?
Divide 72 by your annual return to estimate how many years until money doubles. At 8% it's 72/8 = 9 years; at 6% it's 12 years. The rule is accurate within 1% for rates between 6% and 10% and provides a quick mental shortcut.