Compound Interest Calculator
Estimate how your investment could grow over time. Set your interest rate, compounding frequency, and optional regular deposits or withdrawals to see a full year-by-year breakdown as a table or chart.
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Calculation for 5 years
| Year | Deposits | Withdrawals | Interest | Accrued interest | Balance |
|---|
- Initial balance
- Net contributions
- Accrued interest
- Balance
How compound interest works
Compound interest is interest calculated on both the initial investment and the interest that has already been added to it. The more frequently interest compounds, the faster an investment grows.
A = P(1 + r/n)nt
Where P is the initial investment, r is the annual interest rate, n is the number of times interest compounds per year, and t is the number of years.
Regular contributions
Adding regular deposits alongside compound interest can significantly increase an investment's future value, while regular withdrawals reduce it. This calculator supports both, along with an optional annual increase to keep pace with rising income or expenses.
Frequently asked questions
What is compounding frequency?
Compounding frequency is how often interest is calculated and added to your balance, for example daily, monthly, quarterly or yearly. More frequent compounding produces a higher effective annual rate.
What is the effective annual rate?
The effective annual rate is the actual yearly return after accounting for the effect of compounding, which can be higher than the nominal rate you entered.
Is this calculator accurate?
This calculator is for illustrative purposes only and does not constitute financial advice. Actual investment returns depend on many factors and are not guaranteed.