Compound Interest Calculator
See how your money grows over 10, 20, 30 years with compound interest and regular contributions
Calculator
Overview
The Compound Interest Calculator shows how your money grows over time when interest earns interest. Input your starting amount, monthly contributions, expected return rate, and time horizon.
Seeing the actual numbers motivates action. $200/month at 9.92% for 30 years becomes $454,000. The earlier you start, the more compounding works in your favor.
Enter your initial investment, monthly contribution, expected annual return (9.92% is S&P 500 average), and number of years. The calculator shows your total balance, total contributions, and total interest earned.
How It Works
Formula
A = P(1 + r/n)^(nt) + PMT * [((1 + r/n)^(nt) - 1) / (r/n)]Variables
- P: Initial principal (starting amount)
- r: Annual interest rate (decimal)
- n: Compounding frequency (12 for monthly)
- t: Time in years
- PMT: Monthly contribution amount
Best Practices
- Use 9.92% for S&P 500 historical average
- Account for inflation (subtract 2-3% for real returns)
- Be consistent with monthly contributions
- Start as early as possible
Frequently Asked Questions
What return rate should I use?
For stock market investments, 9.92% is the historical S&P 500 average. For a more conservative estimate accounting for inflation, use 7%. For savings accounts, use 4-5%.
How often does compounding happen?
Most investments compound daily or monthly. This calculator uses monthly compounding which is standard for most investment accounts.
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