Compound Interest Calculator

Calculate the growth of your investments over time with compound interest

Input Parameters
Growth Visualization
Yearly Breakdown
Year Starting Balance Interest Earned Ending Balance
Understanding Compound Interest
What is Compound Interest?

Compound interest is the addition of interest to the principal sum of a loan or deposit, or in other words, interest on interest. It is the result of reinvesting interest, rather than paying it out, so that interest in the next period is earned on the principal sum plus previously accumulated interest.

The Formula

A = P(1 + r/n)nt

  • A = Final amount
  • P = Principal (initial investment)
  • r = Annual interest rate (decimal)
  • n = Compounding frequency per year
  • t = Time in years
Benefits of Compound Interest
  • Exponential Growth: Your money grows at an increasing rate over time
  • Time Advantage: The longer you invest, the more powerful the compounding effect
  • Frequency Impact: More frequent compounding periods can increase your returns
Tips for Maximizing Compound Interest
  1. Start investing as early as possible
  2. Reinvest dividends and interest payments
  3. Make regular contributions to your investment
  4. Choose investments with higher returns (considering risk tolerance)
  5. Be patient and maintain a long-term perspective