Balance over time
Remaining balanceYear-by-year schedule
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This compound interest calculator shows how your money grows over time when your returns earn returns. Enter a starting amount, how much you add each period, an annual rate, and the number of years — see your future balance and exactly how much is interest versus your own contributions.
How compound interest works
Compound interest means you earn interest on both your original money and the interest it has already earned. The future value formula is FV = P(1+r)n + PMT × [((1+r)n − 1) ÷ r], where P is your starting balance, PMT is each contribution, r is the periodic rate, and n is the number of periods. The more often it compounds and the longer you stay invested, the more dramatic the growth.
Why time matters so much
Because growth compounds, the early years build the base that later years multiply. Investing $200/month for 30 years at 7% grows to roughly $243,000 — of which more than $170,000 is pure interest, not your own money.
Related
Compound Interest Calculator FAQ
How do you calculate compound interest?
Use FV = P(1+r)ⁿ for a lump sum, where P is the principal, r is the rate per period, and n is the number of periods. If you add money regularly, add the annuity term PMT × [((1+r)ⁿ − 1) ÷ r]. The calculator above does both automatically.
What is the difference between simple and compound interest?
Simple interest is earned only on your original principal. Compound interest is earned on your principal plus all previously earned interest, so it grows faster — and the gap widens dramatically over long periods.
How much will $10,000 grow in 20 years?
At a 7% annual return compounded monthly, $10,000 grows to about $40,400 in 20 years with no extra contributions. Add regular deposits and it grows much more — try your own numbers above.
Does compounding frequency matter?
Yes, but less than people think. Daily vs monthly vs annual compounding changes the result only slightly at the same rate. What matters far more is the rate itself and how many years you stay invested.
What interest rate should I use?
For long-term stock-market investing, many planners model 6%–7% after inflation. For a high-yield savings account, use its current APY. Be realistic — overestimating the rate overstates your results.
Written by Nicolas William, Lead Financial Editor at Finances News. Figures are estimates for planning only. Last updated 2026.