💫 Compound Interest Calculator
Compound interest means earning interest on your interest — the snowball effect Einstein allegedly called the most powerful force in the universe. The more often interest compounds, the faster the snowball rolls.
Add a monthly contribution to see the habit that matters most: regular deposits combined with compounding beat a bigger starting sum left untouched.
How to use this calculator
Enter your starting principal, annual rate, number of years, compounding frequency and optional monthly contribution to see how your savings snowball.
- Enter the Initial principal and the Annual interest rate.
- Set the number of Years and pick a Compounding frequency from annually to daily.
- Add a Monthly contribution if you will keep depositing.
- Press Calculate, then change the frequency to see how often compounding changes the result.
Frequently asked questions
What is compound interest?
It is interest calculated on both the original principal and the interest already earned, so growth accelerates over time. More frequent compounding means the snowball rolls a little faster.
How does the calculator do the maths?
The principal grows with the standard compound formula using your chosen frequency. Monthly contributions are treated as a separate stream compounding monthly, then added to the grown principal.
Give me a concrete example.
With $10,000 at 6% compounded monthly for 10 years plus $100 a month, the future value is about $34,582. You would have put in $22,000, so roughly $12,582 is compound interest earned.
Why does frequency matter?
Because interest starts earning its own interest sooner. Daily compounding beats annual compounding on the same rate, though the difference is small compared with the effect of starting early and contributing regularly.