Interest earned
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Finance · Saving
Compound interest
Compound interest
calculator
Watch a lump sum grow over time, with optional monthly deposits. It compounds monthly and shows the final balance, the interest earned and how much of that is your own money.
Growth over time
compounded monthly
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$
%
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Total paid in
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How compound interest works
Compound interest is interest earned on your interest. Each period, the return is added to the balance, and the next period's return is calculated on that larger balance. Over years, that feedback loop is what turns steady saving into meaningful growth — the effect Einstein is often, if apocryphally, said to have admired.
The formula (lump sum)
A = P × (1 + r ÷ n)n × t
P is the starting amount, r the annual rate as a decimal, n the number of times it compounds per year, and t the number of years. This calculator compounds monthly (n = 12), which is the common default for savings.
Worked example
$5,000 · 7% · 10 years, no deposits
monthly rate = 0.07 ÷ 12 = 0.005833
months = 120
A = 5000 × (1.005833)120 ≈ $10,048
months = 120
A = 5000 × (1.005833)120 ≈ $10,048
Adding monthly deposits
If you also pay in a fixed amount each month, that stream grows too. Each deposit compounds from the moment it lands, so earlier deposits earn more. The tool adds this automatically — set a monthly deposit and watch both the balance and the interest jump.
The mirror image
Compound interest working for you on savings is the same maths that works against you on debt. The loan calculator shows that side — how interest stacks up on money you borrow.
Common questions
Compound interest FAQ
Use A = P × (1 + r ÷ n)^(n × t): the starting amount times one plus the periodic rate, raised to the number of periods. This tool compounds monthly, so n = 12 and the exponent is years × 12.
Simple interest is paid only on the original amount. Compound interest is paid on the original amount plus all previously earned interest, so the balance grows faster over time.
Each deposit starts compounding from the month it is added, so regular contributions can grow the balance far beyond the starting amount. Earlier deposits earn more because they compound for longer.
Yes, but less than people expect. More frequent compounding earns slightly more for the same annual rate. Monthly is the usual default for savings and is what this calculator uses.
No. It assumes a fixed rate for the whole term. Real rates change, and this is a projection to compare scenarios, not a promise of returns.