Compound Interest Calculator
See how a deposit grows over time as interest compounds at any frequency.
Try an example
$18,193.97
About this calculator
How This Compound Interest Calculator Works
Enter an initial deposit, annual interest rate, compounding frequency, and time period, and the calculator shows what your balance grows to — and how much of that growth is interest rather than your original deposit.
Worked Example
$10,000 deposited at 6% annual interest, compounded monthly, grows to $18,193.97 after 10 years — $8,193.97 in interest, more than 80% growth on the original deposit, without adding another dollar yourself.
The Formula
A = P(1 + r/n)ⁿᵗ, where P is the principal, r is the annual interest rate (as a decimal), n is how many times per year interest compounds, and t is the number of years. The exponent nt is the total number of compounding periods — each one applies interest not just to the original deposit, but to all the interest already added, which is what makes growth accelerate over time rather than stay flat.
Why Compounding Frequency Matters
More frequent compounding means interest starts earning its own interest sooner. Daily compounding will always out-earn annual compounding at the same stated annual rate, though the difference is usually modest — a few dollars per thousand over a year, more over longer periods. This is why the same advertised rate can have a slightly different APY (annual percentage yield) depending on how often it compounds.
What This Doesn't Account For
- Regular contributions — this calculator grows a single lump sum. For a deposit plus ongoing monthly additions, use the Future Value Calculator instead.
- Taxes — interest earned in a standard (non-tax-advantaged) account is generally taxable income the year it's earned, which reduces real growth.
- Inflation — the dollar amount grows, but its purchasing power grows more slowly once inflation is factored in.
Worked example
A $10,000 deposit at 6% APR, compounded monthly for 10 years, grows to $18,193.97 — $8,193.97 in interest earned, more than a simple-interest deposit would earn on the same terms.
Frequently asked questions
What does compounding frequency change?
More frequent compounding (daily vs. annually) earns slightly more, since interest starts earning its own interest sooner — the difference is usually small at typical rates.
What's the formula behind this?
A = P(1 + r/n)^(nt) — principal, annual rate, compounds per year, and years.
How is this different from simple interest?
Simple interest only accrues on the original principal; compound interest also earns on previously accumulated interest, so it grows faster the longer the money sits.
Does this account for additional contributions?
No — this calculates the growth of a single lump-sum deposit. Regular contributions would need a separate running calculation.