Compound Interest Calculator: Grow Your Savings & Investments
Money you add every single month.
Free Compound Interest Calculator
Welcome to the Compound Interest Calculator by CalcHub Pro. Albert Einstein reportedly called compound interest "the eighth wonder of the world." Use our free tool to visualize how your initial savings and monthly contributions can exponentially grow over time through the power of compounding.
How Compound Interest Builds Wealth
Simple interest only pays you based on your original deposit. Compound interest, however, pays you interest on your original deposit and on the interest you've already earned. As the years go by, this creates a massive snowball effect. In the later years of a long-term investment, the interest you earn each year will actually exceed the money you contribute!
What Interest Rate Should I Use?
- 4% to 5%: A safe estimate for modern High-Yield Savings Accounts (HYSAs) or Certificates of Deposit (CDs).
- 7% to 8%: A conservative, inflation-adjusted estimate for a diversified index fund tracking the US stock market (like the S&P 500) over a long horizon.
- 10%: The historical average annual return of the S&P 500 before inflation is factored in.
Frequently Asked Questions (FAQ)
How often does the interest compound?
Our calculator assumes your interest is compounded monthly, which is the standard for most savings accounts, investment portfolios, and financial planning projections.
When should I start investing?
Right now. Because compound interest is heavily dependent on time, starting to invest at age 20 with small amounts of money will almost always mathematically beat starting at age 40 with large amounts of money. Time is your greatest asset.