Compound Interest Calculator
See how your investments grow over time with the power of compounding
Future Value
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Frequently Asked Questions
What is compound interest?
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest, it grows exponentially — your earnings generate their own earnings over time.
How often should interest compound?
More frequent compounding means more growth. Monthly compounding yields slightly more than quarterly or annually. Most savings accounts compound monthly or daily. The difference between monthly and daily compounding is usually small.
What is the Rule of 72?
Divide 72 by your annual interest rate to estimate years to double your money. At 7% annual return, your investment doubles in roughly 72 ÷ 7 = 10.3 years.
How do monthly contributions affect growth?
Regular monthly contributions dramatically accelerate wealth. Adding $200/month to a $10,000 investment at 7% over 30 years grows to ~$354k vs. ~$76k without contributions — nearly 5× more wealth from consistent saving.
What is a realistic investment return?
The S&P 500 has historically returned ~10% annually before inflation, or ~7% after. For conservative planning, use 5–7%; for stock-heavy long-horizon portfolios, 7–10% is reasonable.
How Compound Interest Works
Compound interest earns on both your principal and accumulated past interest. Each period, interest is added to your balance, and future interest calculations include that amount — creating exponential growth.
Compounding Frequency: $10k at 7% for 10 Years
| Frequency | Future Value | vs Annual |
|---|---|---|
| Annual | $19,672 | — |
| Quarterly | $19,799 | +$127 |
| Monthly | $20,097 | +$425 |
| Daily | $20,136 | +$464 |