Compound interest calculator

How it works

The calculator simulates growth month by month rather than using a single closed-form formula: each month it adds your contribution to the balance, then multiplies the whole balance by (1 + annual rate ÷ 12), and repeats that 12 times per year for however many years you set. The year-by-year table below is just a running snapshot of that same monthly simulation, showing contributions, interest earned, and balance at the end of each year.

FAQ

Does my monthly contribution earn interest in the same month it's deposited?

Yes — the simulation adds your contribution to the balance first and then applies that month's interest on top of it, so a deposit made in month 1 already earns interest before month 1 closes, rather than sitting idle until the following month.

Why doesn't a 7% rate produce exactly 7% growth over a year?

The calculator divides your annual rate by 12 to get a monthly rate and compounds it 12 separate times, so the effective annual return ends up slightly above the nominal rate you entered — that's standard monthly compounding, not a rounding error.