Compound Interest Calculator
See how an initial investment grows over time with compound interest. Compare monthly, quarterly, and annual compounding.
How to Use This Calculator
Enter the amount you plan to invest initially. Set the expected annual interest rate — historical stock market returns average around 7-10% before inflation. Choose how often interest compounds: daily, monthly, quarterly, or annually. Select the number of years you plan to invest. The calculator instantly shows your final amount, total interest earned, and a year-by-year breakdown of your investment growth.
How Compound Interest Works
Compound interest is interest earned on interest. Unlike simple interest which only earns returns on your original principal, compounding means each period's interest is added to your balance so the next period earns interest on a larger base. This creates exponential growth over time. The more frequently interest compounds and the longer your investment horizon, the more powerful the effect. Albert Einstein reportedly called compound interest the eighth wonder of the world. Starting early and staying invested are the two most important factors in building long-term wealth through compounding.