Compound Interest Calculator
See how your money grows with the power of compounding, including optional monthly contributions.
How compound interest works
Compound interest is interest earned on both your original principal and the interest already accumulated. The more frequently interest compounds — yearly, quarterly or monthly — the faster your money grows. Adding a regular monthly contribution accelerates growth dramatically over long periods, which is why starting early matters so much.
Compound interest formula
The base formula is A = P(1 + r/n)nt, where P is principal, r is the annual rate, n is the number of times interest compounds per year, and t is the number of years. This calculator extends the formula to also add your recurring monthly contributions.
Frequently Asked Questions
What is the difference between simple and compound interest?
Simple interest is calculated only on the principal. Compound interest is calculated on the principal plus all previously earned interest, so it grows faster.
Does compounding frequency matter?
Yes. More frequent compounding (e.g. monthly vs yearly) produces a slightly higher maturity value for the same rate.
Can I include monthly deposits?
Yes. Enter a monthly contribution to model a recurring deposit or SIP-style savings plan.