Compound Interest Calculator
See how a lump sum grows when interest compounds — daily, monthly, quarterly, or annually. This is the core engine behind every savings, investment, and retirement projection.
Compound growth
Example: $10,000 at 6% for 10 years, compounded monthly → $18,193.97.
Interest on interest
Compounding is growth feeding on itself. In the worked example — $10,000 at 6% for 10 years, compounded monthly — the balance grows to $18,193.97, earning $8,194 in interest. Simple interest would add only $6,000 over the same decade; the extra comes from interest that itself started earning interest. Every figure is computed by the same tested engine as the calculator above.
Frequency: real but modest
Compounding more often helps a little. The same $10,000 at 6% for 10 years grows to $17,908.48 compounded annually versus $18,193.97 compounded monthly — a difference of about $285.49. Worth knowing when comparing accounts, but the rate and the number of years move the result far more than the posting schedule does.
Time is the real multiplier
Because each period builds on the last, the growth curve steepens the longer money stays invested — the final years add the most. Doubling the horizon far more than doubles the interest. That is why the most valuable move in compounding is simply starting sooner and leaving the balance alone.
Frequently asked questions
What is compound interest?
Interest earned not only on your original principal but also on the interest already added. Each period’s growth becomes part of the base for the next period, so the balance accelerates over time rather than growing in a straight line. It is the reason long-horizon investing works.
Does compounding frequency matter?
A little. Compounding daily instead of annually squeezes out slightly more growth at the same nominal rate, because interest starts earning interest sooner. The effect is real but modest — the rate and the time horizon matter far more than whether interest posts daily or monthly.
What is APY versus APR?
APR is the nominal annual rate; APY (annual percentage yield) is the rate after compounding is folded in, so it is what you actually earn in a year. At a 6% APR compounded monthly, the APY is about 6.17%. When comparing savings accounts, compare APY to APY.
How do I add regular deposits?
This calculator grows a single lump sum. To project a starting amount plus ongoing monthly contributions, use the Investment Calculator, which layers a contribution stream on top of the same compounding math.
Not financial advice: a general educational estimate. Real savings and investment returns vary and are not guaranteed. Values are processed locally in your browser and never transmitted. See the methodology page.