Compound Interest Calculator
See how a lump-sum investment grows over time with compound interest, and how much of the final value is interest.
This calculator provides an estimate based on a fixed rate you enter; real investment returns vary. See our Disclaimer.
The formula
A = P × (1 + r/n)ⁿᵗ, where P is the initial amount, r is the annual rate (as a decimal), n is the number of times interest compounds per year, and t is the number of years.
Worked example
100,000 invested at 8% annual interest, compounded annually, for 5 years grows to 100,000 × 1.08⁵ ≈ 146,932.81 — meaning about 46,932.81 comes from compounding rather than the original deposit.
Why compounding frequency matters
The more often interest compounds within a year, the faster the balance grows, because each compounding period's interest starts earning its own interest sooner. The difference is modest at low rates but becomes noticeable over long periods or at higher rates.
Frequently asked questions
What's the difference between compound and simple interest?
Simple interest is calculated only on the original principal every period. Compound interest is calculated on the principal plus any interest already earned, so the growth accelerates over time.
Does this account for taxes or fees?
No. This is a pure mathematical projection of growth at your stated rate — real accounts may involve taxes, account fees, or a return rate that changes year to year.