Project the growth of savings with compounding, contributions and year-by-year breakdown.
Final balance
After 20 years · monthly compounding
Principal
$10,000
Contributions
$0
Interest earned
$28,697
Interest makes up 74.2% of the final balance.
Calculation details
Compound interest formula:A = P(1 + r/n)^(nt), where P is the principal, r the annual rate (decimal), n compoundings per year, t time in years.
With periodic contribution PMT (end of period):A = P(1 + r/n)^(nt) + PMT · ((1 + r/n)^(nt) − 1) / (r/n). For beginning-of-period contributions multiply the PMT term by (1 + r/n).
Continuous compounding:A = P · e^(rt). With a continuous deposit stream at rate c per year: A = P · e^(rt) + (c/r) · (e^(rt) − 1).
Balance growth over time
Principal
Contributions
Interest
Compound vs simple interest
Compound
$38,697
Interest reinvested each period
Simple
$24,000
Interest on principal only
Compounding earns $14,697 more than simple interest.
Year-by-year breakdown
Year
Start balance
Contributions
Interest
End balance
Saved calculations
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Frequently asked questions
Compound interest is interest calculated on the principal plus any previously earned interest. Each compounding period, the accrued interest is added to the balance, so the next period's interest is calculated on a larger amount. Over long horizons this creates exponential growth, which is why compounding is often called "interest on interest".
Simple interest pays the same amount every period because it is calculated only on the original principal. Compound interest pays a growing amount because each period's interest becomes part of the balance used for the next period. For a 20-year horizon at 7%, compound interest produces roughly 60% more than simple interest.
The Rule of 72 is a shortcut for estimating how long it takes money to double at a given annual compound rate: divide 72 by the rate (as a percent). At 6% money doubles in about 12 years, at 8% in about 9 years, and at 12% in about 6 years. It works best for rates between 4% and 12% and assumes the interest is reinvested.
Yes, but less than most people think. Going from annual to monthly compounding typically adds a fraction of a percent to the effective return. Going from monthly to daily adds even less. The difference between daily and continuous compounding at 7% over 20 years is only about 0.2%. What matters far more is the rate and the length of time.
Contributing at the start of each period (an annuity due) earns slightly more because each deposit has an extra compounding period to grow. Over 20 years with monthly contributions at 7%, starting at the beginning adds roughly 0.6% to the final balance versus end-of-period contributions. Payroll deductions are usually end-of-period, while direct deposits on the first of the month behave like beginning-of-period.
The math is exact for a constant rate and a fixed contribution schedule. Real-world results will differ because market returns vary year to year, fees reduce returns, inflation reduces purchasing power, and taxes apply to interest income. Use this tool for planning and comparison, not as a guarantee of future balances.
For educational and planning purposes. Not financial advice.
This compound interest calculator projects how an investment grows when interest is reinvested each period. Enter an initial amount, annual rate, investment period in years and months, and pick a compounding frequency (daily, weekly, monthly, quarterly, semi-annually, annually, or continuously). An optional panel adds regular contributions — monthly or yearly, at the beginning or end of the period. The result box shows the final balance, principal, total contributions and total interest earned, plus a year-by-year breakdown table and an SVG growth chart that visualises principal, contributions and interest. A side-by-side compound vs simple interest comparison highlights the gain from reinvesting. For example, 10,000 at 7% compounded monthly for 20 years grows to roughly 40,387 — about 13,987 more than simple interest on the same principal.