Compound interest calculator

With compound interest you earn interest on your interest. Each time interest is credited, it is added to the balance, and the next period's interest is calculated on the bigger amount. Over long periods this snowball effect matters more than almost anything else, which is why starting early pays off.

The calculator shows your future value, how much of it you contributed, how much is interest, an optional after-tax figure and a year-by-year table. It runs entirely in your browser; nothing is uploaded. The results are estimates for planning and are not financial advice.

For a single deposit:

A = P × (1 + r/n)^(n × t)

• A = final amount
• P = initial deposit
• r = annual interest rate as a decimal
• n = compounding periods per year (1, 4, 12 or 365)
• t = years

Example: $10,000 at 5% compounded monthly for 10 years: A = 10,000 × (1 + 0.05/12)^120 ≈ $16,470.09, so $6,470.09 is interest.

Add $200 a month (deposited at the end of each month) and the balance after 10 years is about $47,527: $34,000 in contributions and about $13,527 in interest.

More frequent compounding helps, but less than most people expect. $10,000 at 5% for 10 years:

Compounding	Final balance
Annually	$16,288.95
Quarterly	$16,436.19
Monthly	$16,470.09
Daily	$16,486.65

The rate and the time you leave the money invested matter far more. That is why banks quote the APY (annual percentage yield), which already includes compounding, so you can compare accounts on equal terms. Use the interest calculator to convert an APR to an APY.

A quick mental shortcut: divide 72 by the annual rate to estimate how many years it takes money to double. At 6%, about 12 years; at 9%, about 8 years. The calculator shows the exact doubling time for annual compounding, for example 14.2 years at 5% (the rule of 72 gives 14.4).

The same rule works in reverse for inflation: at 3% inflation, prices double in about 24 years.

Interest in a regular savings account, CD or taxable brokerage account is generally taxable. Enter your tax rate in the optional field to see interest after tax. Money in tax-advantaged accounts such as a 401(k), IRA or Roth IRA follows different rules.

Remember that a fixed rate is an assumption. Savings account rates change, and stock market returns vary from year to year; a long-term average is not a guarantee. To see what your future balance is worth in today's dollars, use the investment calculator, which can subtract expected inflation, or check past price changes with the inflation calculator.

Time is the ingredient you cannot make up later. Compare two savers who both earn 7% a year, compounded monthly:

• Saver A invests $200 a month from age 25 to 35, then stops: $24,000 in total.
• Saver B starts at 35 and invests $200 a month until 65: $72,000 in total.

At 65, Saver A's ten years of deposits have had 40 years to compound, and at 65 Saver A ends up with about $281,000 versus Saver B's $244,000, despite putting in a third as much. Run both scenarios in the calculator by changing the years and contributions, and the effect is easy to see. Small, regular amounts started early often beat larger amounts started late.