Compound Interest Calculator
Enter a starting amount, a monthly contribution, and a return. Watch the gap open between the money you put in and what compounding turns it into.
Frequently asked questions
- How does compound interest work?
- Your money earns a return, and next period that return earns a return too. Growth stacks on top of growth, which is why a balance grows slowly at first and then accelerates — the curve gets steeper the longer you stay invested.
- How is the growth calculated here?
- We convert your annual rate to a monthly rate that compounds to exactly the annual figure over 12 months, then add your contribution at the end of each month. So '7% per year' really means 7% per year, regardless of the monthly compounding.
- What return should I use?
- A globally diversified stock portfolio has historically returned around 7% per year before inflation (roughly 5% after). Cash savings earn far less. Use a lower number if you want a conservative projection — the shape of the curve is the lesson either way.
- Why does starting early matter so much?
- Because the earliest money compounds the longest. Delaying the same plan by five years usually costs far more than five years of contributions — you lose the years when compounding is at its steepest, at the end.