General Finance
Compound Interest Calculator
Project how a starting balance plus monthly contributions grows over time, and see how much of the final balance is your own money versus interest earned.
Calculation inputs
Enter your starting balance, what you add each month, and the return you expect.
Results
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Complete the fields and select Calculate to show results here.
Estimates only. Actual returns vary and are not guaranteed.
About this calculator
This calculator projects how a starting balance grows when regular monthly contributions earn compound interest over time. It's used by savers and investors who want to see how much of a future balance comes from their own deposits versus growth.
How the calculation works
- Monthly compounding: balance = balance × (1 + rate/12) + monthly contribution, repeated each month
- Annual compounding: balance = balance × (1 + rate) + 12 × monthly contribution, repeated each year
- Total contributions = starting principal + monthly contribution × 12 × years
- Total interest earned = final balance − total contributions
Notes and assumptions
Contributions are treated as arriving at the end of each period.
Taxes, fees, and inflation are not deducted from the projected balance.
How it works in plain English
You enter a starting principal, a monthly contribution, an expected annual interest rate, how often interest compounds, and the number of years you plan to keep contributing. The calculator then steps forward one period at a time: each month (or year, if you choose annual compounding), the current balance earns interest and the new contribution is added on top.
With monthly compounding, the balance is multiplied by one plus the monthly rate and then the monthly contribution is added, repeated twelve times per year. With annual compounding, the whole year's contributions are added once and interest is applied once per year instead.
At the end of the period, the calculator reports the final balance, the total amount you personally contributed, and the difference between them, which is the interest earned. It also charts contributions against growth year by year so you can see how the growth portion accelerates the longer money stays invested.
The formula
- Monthly compounding: balance = balance x (1 + rate/12) + monthly contribution, repeated each month
- Annual compounding: balance = balance x (1 + rate) + 12 x monthly contribution, repeated each year
- Total contributions = starting principal + monthly contribution x 12 x years
- Total interest earned = final balance - total contributions
Worked example
Suppose you start with $10,000, add $500 every month, expect a 7% annual return, and compound monthly over 20 years. Each month the balance grows by roughly 0.583% (7% divided by 12) and then $500 is added. Repeating this 240 times produces a final balance of about $291,000.
Of that total, your own contributions add up to $10,000 plus $500 x 240 months, which is $130,000. The remaining $161,000 is interest earned, meaning more than half of the final balance came from growth rather than deposits. If you kept contributing for five more years under the same assumptions, the balance would keep climbing at an accelerating pace, since a larger base is earning interest each month. This illustrates why starting early matters: the earlier contributions have more time compounding, so they end up contributing far more to the final total than dollars added near the end.
Frequently asked questions
Does the calculator account for taxes or fees?
No. The projection shows a gross balance before any taxes on interest, dividends, or capital gains, and before account or fund fees. Real-world returns are usually lower once those costs are subtracted, so treat the result as an upper estimate rather than a guaranteed outcome.
Why does monthly compounding produce a different result than annual compounding?
Monthly compounding applies interest twelve times a year, so earlier contributions start earning interest on interest sooner. Annual compounding waits until year-end to apply growth once. Over long periods this difference adds up, so monthly compounding at the same stated rate produces a slightly higher final balance.
What happens if I set the monthly contribution to zero?
The calculator still works — it simply projects how your starting principal alone grows through compounding, with no new money added. This is useful for seeing how a lump sum, like an inheritance or bonus, could grow if left untouched.
Is the expected return rate realistic?
The rate you enter is an assumption, not a prediction. Historical long-run stock market averages have hovered around 7% to 10% before inflation, but any single year can vary widely, and this calculator does not adjust for inflation or market volatility.
Are contributions assumed to happen at the start or end of each month?
Contributions are added at the end of each period after interest is applied to the existing balance. This is a common convention for these projections, though it slightly understates growth compared with contributing at the very start of each month.
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