Compound Interest Calculator
Calculate compound interest with contributions and visualize growth over time.
About Compound Interest Calculator
Calculate how your investments grow over time with compound interest. Enter your initial investment, monthly contributions, interest rate, and time period to see the final amount, total contributions, and interest earned. Includes a visual growth chart and year-by-year breakdown table.
FAQ
- What is compound interest?
- Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. It makes your money grow faster than simple interest.
- How does compounding frequency affect returns?
- More frequent compounding (monthly vs. annually) means interest is calculated and added to your balance more often, resulting in slightly higher returns over time.
- What is a realistic annual return rate?
- The S&P 500 has historically returned about 7-10% annually (before inflation). Savings accounts typically offer 1-5%. Use a rate that matches your investment type.
- Does this account for inflation?
- Not directly. To estimate inflation-adjusted returns, subtract the expected inflation rate (typically 2-3%) from your annual interest rate.