Compound Interest Calculator
Calculate how an investment grows with compound interest, including regular contributions.
Formula
A = P(1 + r/n)^(nt) + PMT · [((1 + r/n)^(nt) − 1) / (r/n)]
Tips
- More frequent compounding increases returns, but the gain from monthly to daily is small — the rate matters far more than the frequency.
- The effective annual rate (APY) is the honest comparison figure between accounts with different compounding schedules.
- Contributions are treated as arriving at the end of each period. Contributing at the start of each period yields slightly more.
Frequently asked questions
What is the difference between simple and compound interest?
Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus all previously accumulated interest, so growth accelerates over time.
Does this account for inflation or tax?
No. The result is a nominal figure. To estimate real purchasing power, subtract your expected inflation rate from the interest rate before calculating.