How to use this calculator
- Enter your initial deposit (starting balance).
- Enter the nominal annual interest rate and how long the money stays invested—choose years or months.
- Pick compound frequency: daily, monthly, quarterly, semiannual, or annual. High-yield savings often compound daily; many loans compound monthly (see also amortization schedule).
- Under regular contributions, choose deposit or withdrawal, amount, weekly/biweekly/monthly/yearly frequency, beginning or end of period, and an optional annual increase (%).
- Optionally enter annual inflation and tax on interest to see purchasing power and after-tax results.
- Review ending balance, APY, time to double, and interest split; compare simple vs compound; switch the schedule by year or month; copy a share link or download CSV.
Example: $10,000 for 10 years
The defaults are $10,000, a 5% annual rate, 10 years, monthly compounding, and no regular contributions.
After year 1 the balance is $10,511.62 ($511.62 of that is interest). After 10 years the ending balance is $16,470.09, so interest earned is $6,470.09. The effective annual rate is 5.12%.
Add $100 per month under regular contributions to model a savings plan (or open the savings goal calculator to solve for the deposit needed to hit a target), or switch to withdrawal for regular payouts. Toggle the schedule to by month, set 3% inflation to see today’s dollars, or use Copy link to share the scenario.
What is compound interest?
Simple interest is charged or paid only on the original principal. Compound interest is charged or paid on the principal plus interest that has already been added. The balance becomes the new base for the next period, so growth accelerates.
A $1,000 balance at 6% simple interest for two years earns $120. The same rate compounded annually earns $123.60, because the second year is calculated on $1,060. Banks, savings accounts, and most loans use compounding.
Compound interest when you borrow
On the borrowing side, interest still compounds on the remaining balance each period—you pay interest first, then principal, and the schedule is the mirror of saving. Use the loan calculator for payment, total interest, and payoff from loan amount and rate; the amortization schedule shows each period’s split. For home price, down payment, and optional taxes and insurance, use the mortgage calculator. Nominal rate vs APY matters for comparing savings products; loan APR is quoted differently—use each tool for its scenario.
Compound interest formula
When you make no extra deposits, the future value is:
A = P(1 + r/n)nt
A is the ending amount, P the starting principal, r the annual rate as a decimal, n the compounds per year, and t the time in years. Example: $5,000 at 5% compounded monthly for one year is 5000 × (1 + 0.05/12)^12 = $5,255.81. With weekly deposits, partial-year terms, inflation, or tax, use the calculator above—it simulates each period instead of this closed form.
Rule of 72
To estimate how long a lump sum takes to double at a fixed annual rate, divide 72 by the rate in percent. At 8%, 72 ÷ 8 ≈ 9 years. It is a shortcut, not a substitute for the calculator results. Extra deposits shorten the time to double.
Frequently asked questions
What is compound interest?
It is interest calculated on both the original deposit and the interest already earned. Each compounding period the balance grows, and the next period uses that larger balance.
How do I calculate compound interest?
Use A = P(1 + r/n)^(n t) when you do not add money later. With regular contributions, choose beginning or end of period. End adds after interest for that month; beginning adds before interest so each deposit earns one extra period.
What is the difference between APY and interest rate?
The interest rate you type is nominal. APY (effective annual rate) includes compounding: (1 + r/n)^n − 1. A 5% rate compounded monthly is about 5.12% APY. Convert between nominal and APY on our APY calculator.
How does this relate to loan or mortgage calculators?
This page models growing a balance with compounding and optional deposits. Loan tools model paying down debt with the same math on each remaining balance—start with the loan calculator, amortization schedule, or mortgage calculator.
Does daily compounding earn much more than monthly?
More frequent compounding earns slightly more, but the gap shrinks at typical savings rates. The difference is larger at high rates or over long terms.
Why is my bank a few dollars off?
Banks may use a 360-day year, actual calendar days, different contribution timing, rounding to the cent each period, or fees. Treat this page as a planning estimate.
What is the difference between simple and compound interest here?
Compound interest reinvests each period’s interest so your balance grows faster. Simple interest accrues on your balance but is not added to it. Open “Simple vs compound interest” in the results to compare ending balances on the same inputs, or use our simple interest calculator for a full schedule and formula walkthrough.
What do the inflation and tax fields do?
Inflation shows an approximate ending amount in today’s dollars by discounting the nominal result. Tax on interest applies a flat rate to total interest earned and shows an after-tax ending balance. They are optional planning assumptions, not bank rules.
Can I share my scenario or export the schedule?
Yes. Copy link saves your inputs in the page URL. Download CSV exports the year or month schedule you are viewing. Print opens a printer-friendly view of results and the table.