ToolBox FreeFINANCE TOOL
Compound Interest Calculator
See how an amount grows over time when interest is added to the balance and earns interest itself.
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How to use the Compound Interest Calculator
Enter your starting amount, the yearly interest rate, how long it will grow and how often interest is added. If you plan to add money regularly, enter the amount per compounding period. Choose Calculate for the final balance, how much you put in and how much came from interest.
The formula
Without contributions: balance = P × (1 + r ÷ n)n × t, where P is the starting amount, r the annual rate as a decimal, n the number of compounding periods per year and t the years. Contributions are added at the end of each period and also earn interest.
Examples and uses
10,000 at 5% for 10 years grows to about 16,470.09 when compounded monthly, and about 16,288.95 when compounded annually. More frequent compounding gives a slightly higher result.
Limitations and good to know
This is a simple projection that assumes a fixed rate, no fees, no taxes and no inflation. Real investments fluctuate and past results do not guarantee future returns. If the time is not a whole number of compounding periods, only complete periods count for contributions. This is not financial advice.
Frequently asked questions
What is the difference between simple and compound interest?
Simple interest is calculated on the starting amount only. Compound interest is calculated on the starting amount plus the interest already earned.
Why does compounding frequency matter?
The more often interest is added, the sooner it starts earning interest of its own, so the final balance is slightly higher.
Are contributions made at the start or end of a period?
At the end of each compounding period.
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