Finance

Compound Interest Calculator

See how your money grows over time with the power of compound interest.

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Total Interest Earned
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Year Contributions Total Interest End Balance

How Compound Interest Works

Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn't, pays it. When you invest money, you earn interest on your principal. But with compounding, you also earn interest on the interest you've already earned.

A = P(1 + r/n)nt

Formula Breakdown

Frequently Asked Questions

What is a good interest rate?
Historically, the S&P 500 has returned an average of about 7-10% annually over long periods. High-yield savings accounts typically offer between 3-5%, while CDs might offer slightly higher depending on the term.
How does inflation affect my returns?
Inflation reduces the purchasing power of your money over time. If your investment earns 7% but inflation is 3%, your "real" rate of return is roughly 4%. It's important to invest in assets that outpace inflation.