Use this free compound interest calculator to estimate how an initial investment and regular monthly contributions could grow over time.
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Estimated results
| Year | Contributions | Interest earned | Ending balance |
|---|
Estimates assume monthly compounding and contributions made at the end of each month. Results exclude taxes, fees and inflation.
How compound interest works
Compound interest means earning returns on both your original money and the returns already added to it. Over a long period, this creates a snowball effect: early growth becomes part of the balance that may generate future growth.
The calculator uses monthly compounding. Each month, it applies one-twelfth of the annual return to the current balance and then adds the monthly contribution. Real investments do not grow at a fixed rate, so the result is an illustration rather than a prediction.
Compound interest formula
For a one-time investment, the standard formula is A = P(1 + r/n)nt, where P is the starting principal, r is the annual rate, n is the number of compounding periods per year and t is the number of years. Regular monthly deposits require an additional future-value calculation, which this tool performs automatically.
New to the concept? Read our beginner guide explaining what compound interest is and how it works before comparing scenarios.
How to use this calculator
- Enter the amount you already have invested.
- Add the amount you expect to contribute each month.
- Choose a reasonable estimated annual return.
- Enter the number of years you plan to invest.
- Select Calculate growth to see the projected balance and annual breakdown.
Why time and consistency matter
Time gives returns more opportunities to compound, while regular contributions keep building the amount that can potentially grow. Starting with a small amount can still be meaningful when the habit continues for years. Compare different scenarios to see how an earlier start, a longer timeline or a higher monthly contribution changes the estimate.
If you are preparing to invest, read our guides on how to start investing, how much money you need to start and investing with a small amount.
What return rate should you use?
No single rate is appropriate for every investment. Cash, bonds and stocks have different risk and return characteristics, and market returns vary from year to year. Test a conservative, middle and optimistic scenario instead of relying on one number. Also remember that investment fees, taxes and inflation reduce the value you ultimately keep.
A higher expected return normally comes with higher risk. Review our guide to investment risk for beginners and the comparison of ETFs versus index funds before choosing investments.
Frequently asked questions
Does this calculator guarantee future returns?
No. It assumes a constant return for illustration. Actual investments fluctuate and may lose value.
Are monthly contributions added at the beginning or end of the month?
This calculator assumes deposits are made at the end of each month. Depositing at the beginning would produce a slightly higher estimate.
Does the result include inflation, fees or taxes?
No. The displayed total is a nominal estimate before investment fees, taxes and inflation.
Can compound interest work with small investments?
Yes. The starting amount affects the result, but time and consistent contributions can also have a major effect. Use the calculator to compare several affordable monthly amounts.
This calculator and its content are for educational purposes only and do not provide personalized financial, investment, tax or legal advice. Estimates are not guarantees, and investment values can decline.