Compound Interest Calculator
Estimate how an initial amount and regular contributions may grow over time with compound interest. Adjust the annual rate, time period, compounding frequency and contribution timing to compare scenarios.
Calculate compound growth
Use a lump sum only, or add recurring monthly or yearly contributions.
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| Year | Total contributed | Interest / growth | Estimated balance |
|---|
What is compound interest?
Compound interest means earning interest on your original principal and on interest that has already been added to the balance. This is often described as interest on interest. Over longer periods, compounding can create a widening gap between the amount you contributed and the ending balance.
Compound-growth projections are useful for savings accounts, fixed-return illustrations and long-term planning. For investments such as stocks or funds, the rate entered should be treated as an assumption rather than a guaranteed return.
How to use the Compound Interest Calculator
- Select the display currency.
- Enter an initial investment, or leave it at zero if you want to model only recurring contributions.
- Enter a recurring contribution and choose monthly or yearly frequency.
- Enter the assumed annual rate and number of years.
- Select how often interest compounds and whether contributions are made at the beginning or end of each contribution period.
- Select Calculate growth to view the final balance, total contributions, estimated growth and year-by-year projection.
Compound interest formula
For a single lump sum, the standard formula is A = P(1 + r/n)nt, where A is the future value, P is the starting principal, r is the annual rate as a decimal, n is the number of compounding periods per year and t is time in years.
Recurring contributions require an additional future-value calculation because each contribution is invested for a different length of time. This calculator projects each recurring contribution from its contribution date to the selected end date using the same rate and compounding assumption.
Compound interest example
| Input | Example | Why it matters |
|---|---|---|
| Initial investment | ₹1,00,000 | Starting amount that compounds for the full period |
| Monthly contribution | ₹5,000 | Adds fresh principal throughout the period |
| Annual rate | 8% | Growth assumption used in the projection |
| Time | 10 years | Longer time gives earlier deposits more time to compound |
| Compounding | Monthly | Interest is assumed to compound 12 times per year |
What affects compound growth?
Time
More time allows previously earned interest to remain in the balance and potentially earn additional interest.
Rate of return
A higher assumed rate increases projected growth, but real investment returns can vary and higher expected returns may involve higher risk.
Regular contributions
Consistent contributions can have a major effect because they continuously add new principal to the compounding base.
Monthly, daily and annual compounding
Compounding frequency describes how often interest is added to the balance. With the same nominal annual rate, more frequent compounding generally produces a slightly higher effective return because interest is credited more often.
- Daily: 365 compounding periods per year.
- Monthly: 12 periods per year.
- Quarterly: 4 periods per year.
- Semiannual: 2 periods per year.
- Annual: 1 period per year.
Beginning vs end-of-period contributions
A contribution made at the beginning of a period has slightly more time to compound than the same contribution made at the end of the period. This difference becomes more visible over long time horizons or at higher assumed rates.
Compound interest vs simple interest
Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus previously accumulated interest. Because of this, the difference between the two methods generally becomes larger as time increases.
Inflation, fees, taxes and investment risk
The calculator shows a mathematical projection based on the inputs you provide. It does not automatically reduce the result for inflation, taxes, account fees or investment losses. If you are modelling a real investment, those factors can materially change the amount you eventually keep.
Common compound-interest mistakes
- Using 8 instead of 0.08 in a manual formula: percentage rates must be converted to decimals.
- Ignoring contribution timing: earlier contributions generally compound for longer.
- Confusing nominal rate and APY/effective return: compounding frequency changes the effective annual result.
- Assuming a constant investment return: real market returns fluctuate.
- Ignoring inflation, taxes and fees: future purchasing power can be lower than the nominal balance.
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Frequently Asked Questions
What is compound interest?
Compound interest is interest earned on the principal plus interest that has already accumulated.
What is the compound interest formula?
For a lump sum, A = P(1 + r/n)^(nt), where P is principal, r is the annual rate, n is compounding frequency and t is time in years.
Do regular contributions compound too?
Yes. Once a contribution is added to the balance, it can participate in future growth according to the assumed rate and compounding schedule.
Is monthly compounding better than annual compounding?
With the same nominal annual rate, more frequent compounding generally results in a slightly higher effective return.
Is this an investment-return guarantee?
No. It is a mathematical projection using the rate you enter. Real investment returns may be higher or lower and can be negative.
Are my inputs stored?
The calculation runs in your browser. The entered values do not need to be sent to a server to produce the result.
Last updated: October 18, 2026. This calculator provides illustrative projections and does not constitute investment advice or a guaranteed return.