Compound Interest Calculator
Enter your initial investment, regular contributions, expected rate of return, and investment timeline to see how compound interest can grow your money over time.
What is Compound Interest?
Compound interest is 'interest on interest' — the interest you earn gets added to your principal, and then earns more interest in the next period.
Snowball Effect
Imagine a small snowball rolling down a mountain, getting bigger and bigger because it's not only growing in size, but also picking up more snow. Compound interest is like this snowball. Your money (principal) is the initial snowball, interest is the snow it picks up, and the longer it rolls (time), the bigger your total wealth becomes.
Apple Orchard Growth
You plant an apple tree (principal), and it bears apples (first period interest). Instead of eating the apples, you plant the seeds to grow more little trees (interest added to principal). These little trees grow up and also bear apples, so your orchard keeps getting bigger and bigger.
Simple Example: $1,000 Compound Interest Magic
Year 1
$1,100
+$100 interest
Year 2
$1,210
+$110 interest
Year 5
$1,611
Interest is growing!
Year 10
$2,594
More than doubled!
See that? Each year's interest keeps increasing because interest is apart of the initial amount of next year
Why Compound Interest Matters
Discover how compound interest can transform your financial goals into reality
Real-World Example
• Initial Investment: $10,000
• Monthly Contribution: $500
• Annual Return: 7%
• Time Period: 30 years
Final Result
$1,219,971
Breakdown: $190,000 invested + $1,029,971 compound interest
Exponential Growth
Unlike linear growth, compound interest creates exponential wealth accumulation. Your money doesn't just grow—it accelerates its growth over time, creating a snowball effect that becomes increasingly powerful.
Time Advantage
Starting early gives you an enormous advantage. Even if you invest less money but start earlier, you can often end up with more wealth than someone who invests more but starts later.
Real-Life Applications
Retirement Planning
Build substantial retirement wealth through decades of compound growth in 401(k)s, IRAs, and investment accounts.
Home Ownership
Save for down payments and build equity through compound interest on your savings and home appreciation.
Education Funding
Plan for children's college expenses by leveraging compound interest in education savings accounts.
Emergency Fund
Build financial security with an emergency fund that grows through compound interest while providing peace of mind.
“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn't, pays it.”
While this quote is widely attributed to Einstein, its actual origin is uncertain. Regardless, the wisdom remains profound.
What Makes Compound Interest Grow?
Three simple things that control how much money you'll make
How Much You Start With
The more money you begin with, the more you'll earn
$1,000 start → More growth than $100 start
How Fast It Grows
Higher percentage means more money each year
8% growth → Much better than 3% growth
How Long You Wait
Time is the secret ingredient that makes compound interest magical
20 years → Way more than 10 years
See The Difference For Yourself
Notice how a little more growth rate or time makes a HUGE difference!
Lower Growth
Starting money: $1,000
Growth rate: 5%
Time: 10 years
Final amount: $1,629
Higher Growth
Starting money: $1,000
Growth rate: 8%
Time: 10 years
Final amount: $2,159
More Time
Starting money: $1,000
Growth rate: 8%
Time: 20 years
Final amount: $4,661
The Bottom Line
You can't control the stock market, but you CAN control how much you start with, how long you invest, and where you put your money. Focus on what you can control and let time do the heavy lifting!
How to Make More Money
Four simple rules that can make you rich
Start Today
Don't wait for the 'perfect time' - it doesn't exist. Even $10 is better than $0.
Starting at 25 vs 35 = $100,000+ more money!
Add Money Every Month
Set up automatic transfers. Even small amounts add up to huge wealth over time.
$50/month for 30 years = $113,000+ total
Don't Touch It
The magic happens in years 15-30. Early withdrawals kill your compound interest.
Patience turns $72,000 into $566,000
Pick Good Investments
Put your money where it can grow. Savings accounts won't make you rich.
8% growth vs 1% = 4x more money over time
Real Example: How $200/Month Becomes $566,416
Monthly savings
$200
Time period
30 years
Final amount
$566,416
You put in $72,000 total, compound interest adds $494,416 for free!
Ready to Start Building Wealth?
Use our calculator to see how much you could have in 10, 20, or 30 years.
Calculate My Future Wealth