Compound Interest Calculator
Project a balance from principal, rate, time, and compounding frequency
- Future value
- $16,288,946
- Total contributions
- $10,000,000
- Total interest
- $6,288,946
- Effective annual rate
- 5.00%
Year-by-year balance
| Year | Balance | Interest earned |
|---|---|---|
| 1 | $10,500,000 | $500,000 |
| 2 | $11,025,000 | $525,000 |
| 3 | $11,576,250 | $551,250 |
| 4 | $12,155,063 | $578,813 |
| 5 | $12,762,816 | $607,753 |
| 6 | $13,400,956 | $638,141 |
| 7 | $14,071,004 | $670,048 |
| 8 | $14,774,554 | $703,550 |
| 9 | $15,513,282 | $738,728 |
| 10 | $16,288,946 | $775,664 |
About this tool
Enter principal, annual rate, compounding frequency, and time horizon to project future value and total interest earned. Optional monthly contributions are supported, and a year-by-year schedule shows how the balance compounds. All calculations are run locally and are pre-tax, nominal figures.
How to use
- Enter principal, annual rate, and number of years.
- Pick a compounding frequency that matches the product (savings accounts: monthly; bonds: often semi-annually).
- Add a monthly contribution to simulate periodic deposits.
- Scan the year-by-year table to see how the balance and yearly interest grow.
FAQ
How much does compounding frequency really matter?
Less than people think over short horizons, but it adds up. A nominal 5% rate becomes ~5.116% APY when compounded monthly and ~5.127% when compounded daily. The gap widens with longer horizons.
How are monthly contributions handled?
As an ordinary annuity: contributions are added at the end of each compounding period, matching how most automated savings plans behave.
Are taxes or inflation included?
No. Numbers are pre-tax and nominal. To approximate after-tax or real returns, subtract the relevant rate (e.g., 15.4% interest tax in Korea, or expected inflation) from the annual rate and recalculate.
Why does the effective annual rate differ from the rate I entered?
The rate you enter is the nominal annual rate. The effective annual rate (APY) reflects how much you actually earn in a year once compounding is applied — so it's slightly higher when compounded more often than yearly.