Calculate compound interest
Calculate compound interest with or without monthly contributions. Ideal for long-term saving and investing.
What is compound interest?
Compound interest means you earn interest on your original amount én previously earned interest. This is also known as interest on interest and is a powerful effect when saving and investing for the long term.
With this tool, you can easily calculate how much your wealth grows through compound interest, optionally with a fixed monthly contribution.
How does compound interest work?
The basic formula for compound interest is:
Final amount = initial amount × (1 + interest rate) ^ term
When you also make regular contributions, additional funds are added each period before the interest is calculated again.
When should you use this tool?
- calculating savings
- estimating investment goals
- retirement planning
- simulating wealth growth
- financial education
Who is this tool suitable for?
- individuals
- investors
- students
- financial advisers
- anyone who wants to build wealth
Simple vs. compound interest
Simple
Compound
interest on the initial amount only
interest on interest
linear growth
exponential growth
short term
long term
Frequently asked questions
Are monthly contributions required?
No, you can leave this field blank or enter 0.
Does the tool use annual or monthly interest?
The interest rate is annual, but is converted for a monthly term.
Is this an exact prediction?
No, it is an estimate based on fixed assumptions.