What will compound interest earn?
See what your money could grow to, and how much of it is interest.
- You’ll have
- $16,470.09
$10,000.00 now for 10 years at 5% a year grows to $16,470.09, of which $6,470.09 is interest.
- Your savings plan
- $10,000.00 now for 10 years
- Your money
- $10,000.00
- Interest
- $6,470.09
- Interest in the last year
- $801.63
- Years to double your moneyAt this rate, with no top-ups
- 13.9
- In today’s moneyIf prices rise by the inflation rate each year
- $12,255.30
- Ends in
- October 2036
- Months
- 120
Answer for the example date Monday, October 5, 2026. It changes to today's date when the page loads.
You’ll have: $16,470.09. $10,000.00 now for 10 years at 5% a year grows to $16,470.09, of which $6,470.09 is interest.
How much of it is interest?
How does it grow?
What does each year look like?
The results are estimates for information only. They are not financial, tax, or legal advice. Check the numbers with your lender or a qualified professional before you decide. Terms of use
How to calculate
Computes the balance of savings that earn compound interest, with optional monthly top-ups, and how much of it is interest.
Example with the default inputs (Starting amount $10,000.00, Regular top-up $0.00, Interest rate 5%, For how long? (years) 10, How often is interest added? Monthly, Start date October 5, 2026, Prices rise each year by 3%) on the example date Monday, October 5, 2026: $10,000.00 now for 10 years at 5% a year grows to $16,470.09, of which $6,470.09 is interest.
Method: Each month, add interest at the monthly rate (1 + r/m)^(m/12) − 1, where r is the yearly rate and m the compounding times a year, then add the top-up.
- The rate does not change.
- Top-ups are added at the end of each month; a yearly top-up is split into 12 equal monthly ones.
- With quarterly or yearly compounding, interest builds at the equivalent monthly rate, so the balance matches A = P(1 + r/m)^(mt) at every compounding date.
- Tax and fees are not included.
- “In today’s money” divides the final balance by (1 + inflation)^years.
Worked examples
Each example is checked against the calculator on every build.
- Starting amount $10,000.00, Interest rate 5%, For how long? (years) 10, How often is interest added? Monthly gives You’ll have $16,470.09, Interest $6,470.09.Source: SEC Investor.gov formula A = P(1 + r/n)^(nt)
- Starting amount $1,000.00, Interest rate 5%, For how long? (years) 10, How often is interest added? Yearly gives You’ll have $1,628.89.
- Starting amount $0.00, Regular top-up $100.00, Interest rate 6%, For how long? (years) 10, How often is interest added? Monthly gives You’ll have $16,387.93, Your money $12,000.00.
- Starting amount $10,000.00, Interest rate 6%, For how long? (years) 5, How often is interest added? Yearly, Start date 2026-10-01 gives You’ll have $13,382.26, Years to double your money 11.895661, Ends in 2031-10-01.
How the balance is worked out
The calculator runs month by month. Each month:
- Interest is added: balance × monthly rate.
- Your top-up for the month is added.
The monthly rate comes from the yearly rate r (as a decimal) and how often interest is added, m times a year (12 monthly, 4 quarterly, 1 yearly):
monthly rate = (1 + r/m)^(m/12) − 1
With monthly compounding this is simply r ÷ 12. With no top-ups, the balance after t years is the familiar A = P(1 + r/m)^(mt). With a top-up of PMT each month and monthly compounding, the top-ups add PMT × ((1 + i)^n − 1) ÷ i, where i = r ÷ 12 and n is the number of months.
The other results:
- Your money is the starting amount plus every top-up. Interest is the final balance minus your money.
- Years to double your money is ln 2 ÷ ln(1 + EAR), where EAR = (1 + r/m)^m − 1. There is no answer at 0%.
- In today’s money is the final balance ÷ (1 + inflation)^years. It is left out when the inflation rate is empty.
- Your savings plan puts the inputs in words for the answer sentence: the starting amount (“$10,000.00 now”, left out when it is $0 and there are top-ups), the monthly top-up (“plus $500.00 a month”, left out when there is none), and the years (“for 1 year”, “for 30 years”). A yearly top-up shows as its monthly twelfth.
Assumptions
- The rate does not change, and there is no tax or fee.
- Top-ups are added at the end of each month. A yearly amount is split into 12 equal monthly top-ups.
- With quarterly or yearly compounding, interest builds at the equivalent monthly rate above, so the balance matches A = P(1 + r/m)^(mt) on every compounding date.
Worked examples by hand
$10,000 at 5% for 10 years, compounded monthly. A = 10,000 × (1 + 0.05/12)^120 = 10,000 × 1.647009 = $16,470.09, so the interest is $6,470.09.
$1,000 at 5% for 10 years, compounded yearly. A = 1,000 × 1.05^10 = $1,628.89.
$100 a month at 6% for 10 years, starting from $0. i = 0.06 ÷ 12 = 0.005 and n = 120. FV = 100 × (1.005^120 − 1) ÷ 0.005 = 100 × 163.8793 = $16,387.93. Your money is 120 × 100 = $12,000.
$10,000 at 6% for 5 years, compounded yearly, starting October 1, 2026. A = 10,000 × 1.06^5 = $13,382.26, reached in October 2031. The money doubles in ln 2 ÷ ln 1.06 = 11.9 years.
Best practices for compound interest investing
- Start investing early to maximize the power of compound interest.
- Make regular contributions, even if they're small amounts.
- Reinvest your earnings to keep the compound effect working.
- Choose investments with competitive interest rates.
- Be patient: compound interest works best over long periods.
- Consider tax-advantaged accounts like IRAs or 401(k)s.
Other questions people ask
What is compound interest?
Compound interest is interest earned on both the principal amount and any previously earned interest. Unlike simple interest, compound interest grows exponentially over time, making it a powerful tool for long-term investments and savings. The interest you earn each period is added to your principal, so you earn interest on your interest.
How do I calculate compound interest?
The compound interest formula is: A = P(1 + r/n)^(nt), where A is the final amount, P is the principal, r is the annual interest rate (as a decimal), n is the number of times interest is compounded per year, and t is the time in years. For example, $1,000 at 5% compounded annually for 10 years becomes $1,000(1 + 0.05/1)^(1×10) = $1,628.89.
What's the difference between simple and compound interest?
Simple interest is calculated only on the principal amount, while compound interest is calculated on both the principal and any previously earned interest. Simple interest grows linearly, while compound interest grows exponentially. For example, $1,000 at 5% simple interest for 10 years earns $500 total, while compound interest earns $628.89.
How often should interest be compounded?
The more frequently interest is compounded, the more you'll earn. Daily compounding provides the highest returns, followed by monthly, quarterly, and annually. For example, $1,000 at 5% for 10 years: annually = $1,628.89, monthly = $1,647.01, daily = $1,648.66.
What is the Rule of 72?
The Rule of 72 is a quick way to estimate how long it takes for an investment to double. Divide 72 by the annual interest rate to get the approximate number of years. For example, at 6% interest, it takes about 12 years to double your money (72 ÷ 6 = 12). At 8%, it takes about 9 years (72 ÷ 8 = 9). The calculator above gives the exact figure: ln 2 ÷ ln(1 + rate).
How does compound interest affect debt?
Compound interest works against you with debt. Credit cards and loans use compound interest, meaning you pay interest on both the principal and accumulated interest. This is why it's important to pay off high-interest debt quickly. For example, a $1,000 credit card balance at 18% APR, compounded monthly, grows to over $2,000 in 4 years if no payments are made.
What is continuous compounding?
Continuous compounding is when interest is calculated and added to the principal an infinite number of times per year. The formula is A = Pe^(rt), where e is Euler's number (approximately 2.718). While theoretical, it's used in some financial models and provides the maximum possible compound growth.
How do I calculate compound interest with regular contributions?
For regular contributions, use the future value of an annuity formula: FV = PMT × [(1 + r)^n - 1] / r, where PMT is the regular payment, r is the interest rate per period, and n is the number of periods. Add this to the compound interest on your initial principal for the total future value.
What is the effective annual rate (EAR)?
The effective annual rate is the actual interest rate earned when compounding is considered. EAR = (1 + r/n)^n - 1, where r is the nominal rate and n is compounding frequency. For example, 5% compounded monthly has an EAR of (1 + 0.05/12)^12 - 1 = 5.12%.
How does inflation affect compound interest?
Inflation reduces the real value of compound interest returns. To estimate real returns, subtract the inflation rate from the nominal interest rate. For example, if you earn 6% interest but inflation is 2%, your real return is roughly 4% (exactly 1.06 ÷ 1.02 − 1 = 3.92%). This is why it's important to consider inflation when planning long-term investments.