Compound interest
calculator
Einstein’s “eighth wonder of the world”. A $500/month investment at 7% grows to $608,000 in 30 years — $428,000 of it pure interest. See your own number.
Interest on interest — the eighth wonder
Compound interest is the process where your returns start earning returns of their own. The earlier you start, the more dramatic the effect: time matters more than the amount.
The Rule of 72 estimates doubling: divide 72 by your annual return. At 7%, money doubles every ~10 years; at 10%, every ~7 years. Starting 5 years earlier can mean two extra doublings.
Rate
7% is a realistic long-term stock average. Higher returns double money faster — and cost more risk.
Time
The dominant factor. 10 extra years can double your final balance.
Contributions
Regular monthly investing (DCA) smooths volatility and supercharges compounding.
The start-early rule : Investing $300/month from age 25 beats $500/month from age 35. Time is the only variable you can never get back — start today.
How compounding actually grows your money
Four numbers drive every projection.
-
1
Principal
The starting balance. Even $1,000 compounds into a meaningful base over decades.
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2
Contributions
Monthly investing adds new principal every month — and each addition compounds too.
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3
Rate of return
Your average annual return. Use 7% for stocks, 4–5% for balanced portfolios, 3% for bonds.
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4
Time
The exponent. Compounding is exponential — the last decade typically beats all previous ones combined.
What time does to $300/month
At 7% annual return, $300/month invested monthly.
| Years | You contribute | Future value | Interest earned |
|---|---|---|---|
| 10 | $36,000 | $52,000 | $16,000 |
| 20 | $72,000 | $156,000 | $84,000 |
| 30 | $108,000 | $365,000 | $257,000 |
| 40 | $144,000 | $787,000 | $643,000 |
The three levers of compounding
Change one and the outcome shifts dramatically.
Time
- The single biggest factor
- 10 more years ≈ double the result
- Start today — never wait
Rate
- 7% stock average vs 3% bonds
- Higher return = more risk
- Index funds capture the market
Consistency
- Monthly DCA beats market timing
- Automate contributions
- Skip a year = lose compounding
Fees
- 1% fee consumes ~28% of gains
- Index funds keep costs near zero
- The fee is the only guaranteed cost
Compound interest calculator
Move the sliders — see your future value, contributions and interest in real time. (Fee inputs stay at 0%.)
Estimates only, based on your inputs.
What fits your goal
Match the inputs to the outcome you need.
Early saver
Start small but start now. $100/month at 22 beats $300/month at 32 every time.
Retirement
Model 30–40 years at 7%. Let contributions grow with raises for a bigger result.
College fund
18 years at 6–7%. A 529 compounds tax-free and covers the growth.
Conservative investor
Use 4–5% for a balanced portfolio. The calculator adapts to your real return.
Catch-up saver
Larger monthly contributions can offset a late start — the calculator shows exactly how much.
Inflation-aware
Use ~5% real return to see the value in today’s money after ~2% inflation.
Why compounding wins & Where it fails
Why compounding wins
- ✔Returns earn returns — the only free money in investing.
- ✔Time and consistency beat timing and luck.
- ✔Even modest monthly contributions become life-changing over decades.
Where it fails
- ✕Inflation silently erodes nominal gains — plan with real returns.
- ✕Fees and taxes subtract from the growth.
- ✕Interruptions (stopping contributions) break the compounding chain.
Compounding terms decoded
The math of growth, in plain English.
Compound interest FAQ
How do I calculate compound interest?
How often does interest compound?
What return should I use?
What is the rule of 72?
Does starting early really matter that much?
Should I account for inflation?
How do fees affect compounding?
Is monthly investing (DCA) better than lump sum?
Projections assume constant returns and monthly compounding. Past performance does not guarantee future results. Educational, not investment advice.
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See your money grow
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