Calculate investment growth with compound interest. Supports regular contributions, multiple compounding frequencies, and a year-by-year growth breakdown.
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Future Value
$20,096.61
After 10 yr at 7% / monthly
How your balance builds year by year through contributions and compounding.
Detailed breakdown of each year's starting balance, contributions, interest earned, and ending balance.
| Year | Starting Balance | Contributions | Interest | Ending Balance |
|---|---|---|---|---|
| Year 1 | $10,000.00 | $0.00 | $722.90 | $10,722.90 |
| Year 2 | $10,722.90 | $0.00 | $775.16 | $11,498.06 |
| Year 3 | $11,498.06 | $0.00 | $831.20 | $12,329.26 |
| Year 4 | $12,329.26 | $0.00 | $891.28 | $13,220.54 |
| Year 5 | $13,220.54 | $0.00 | $955.71 | $14,176.25 |
| Year 6 | $14,176.25 | $0.00 | $1,024.80 | $15,201.06 |
| Year 7 | $15,201.06 | $0.00 | $1,098.89 | $16,299.94 |
| Year 8 | $16,299.94 | $0.00 | $1,178.32 | $17,478.26 |
| Year 9 | $17,478.26 | $0.00 | $1,263.51 | $18,741.77 |
| Year 10 | $18,741.77 | $0.00 | $1,354.84 | $20,096.61 |
Same inputs — only the compounding frequency changes. The difference between monthly and daily compounding is generally small.
| Frequency | Periods/Year | Final Balance |
|---|---|---|
| Annually | 1× | $19,671.51 |
| Semi-Annually | 2× | $19,897.89 |
| Quarterly | 4× | $20,015.97 |
| Monthlycurrent | 12× | $20,096.61 |
| Daily | 365× | $20,136.18 |
A $10,000 investment at 7% per year with monthly compounding grows to approximately:
$20,097
After 10 years
$40,387
After 20 years
$81,165
After 30 years
Compound interest is interest calculated on both the original principal and the interest that has already been earned. Because you earn interest on your interest, the growth can accelerate over time.
For example, if you deposit $10,000 at 7% per year, after the first year you have $10,700. In the second year, the 7% applies to $10,700 rather than just $10,000, so the interest earned in that year is $749.
For a lump sum with no additional contributions:
A = P × (1 + r/n)^(n×t)
A = Final amount (future value)
P = Principal (initial investment)
r = Annual interest rate as a decimal (7% = 0.07)
n = Compounding periods per year
t = Time in years
Example: Assuming a $10,000 initial investment, 7% annual rate, monthly compounding, no additional contributions, and a 10-year period:
A = 10,000 × (1 + 0.07/12)^(12×10)
A ≈ 10,000 × 2.009661
A ≈ $20,097
Adding regular contributions can dramatically increase the final balance because both the contributions and the interest they generate can compound over time.
The calculator assumes contributions are made at the end of each contribution period.
Example: A $10,000 initial investment at 7% annual interest with monthly compounding and $500 monthly contributions for 20 years produces:
| Scenario | Initial | Contributions | Interest | Final Balance |
|---|---|---|---|---|
| No contributions | $10,000 | $0 | $30,387 | $40,387 |
| $500/month | $10,000 | $120,000 | $170,851 | $300,851 |
Assumptions: 7% annual rate, monthly compounding, end-of-period contributions, 20-year period.
More frequent compounding generally produces a slightly higher final balance when the nominal annual rate is the same. The difference becomes smaller as the compounding frequency increases.
| Frequency | Effective Annual Rate | Final Balance |
|---|---|---|
| Annual (n=1) | 7.000% | $19,672 |
| Semi-Annual (n=2) | 7.122% | $19,898 |
| Quarterly (n=4) | 7.186% | $20,016 |
| Monthly (n=12) | 7.229% | $20,097 |
| Daily (n=365) | 7.250% | $20,136 |
Assumptions: $10,000 principal, 7% nominal annual rate, no additional contributions, and a 10-year period.
Simple interest is calculated only on the original principal. Compound interest also applies interest to previously earned interest.
// Simple interest
Interest = P × r × t
= 10,000 × 0.07 × 10
= $7,000
// Compound interest (monthly)
Interest = Final balance − Principal
= $20,097 − $10,000
≈ $10,097
Over 10 years, the 7% monthly-compounding example earns approximately $10,097 in interest compared with $7,000 from simple interest.
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Everything you need to know about this tool.
Compound interest is interest calculated on both the initial principal and the accumulated interest from previous periods. Unlike simple interest, which applies interest only to the original principal, compound interest allows previously earned interest to become part of the balance used for future calculations.
For a lump-sum investment without additional contributions, 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 compounding periods per year, and t is the time in years.
Annual compounding applies interest once per year, while monthly compounding applies interest 12 times per year. At a 7% nominal annual rate, monthly compounding produces an effective annual rate of approximately 7.229%, compared with exactly 7% for annual compounding.
Yes. Regular contributions can substantially increase the final balance because each contribution can also earn compound interest over time. For example, a $10,000 investment at 7% with monthly compounding grows to approximately $40,387 over 20 years without additional contributions. Adding $500 at the end of every month increases the projected final balance to approximately $300,851.
The difference is relatively small when the nominal interest rate and investment period are the same. For a $10,000 investment at 7% over 10 years with no additional contributions, monthly compounding produces approximately $20,097, while daily compounding produces approximately $20,136 — a difference of about $40.
The Rule of 72 is a quick estimate of how long it may take an investment to double. Divide 72 by the annual interest rate. At 7%, the estimate is approximately 72 ÷ 7 = 10.3 years. The actual doubling time varies depending on the compounding frequency.
Simple interest is calculated using Interest = Principal × Rate × Time and applies interest only to the original principal. Compound interest applies interest to the principal plus previously accumulated interest, which can result in faster growth over longer periods.
No. The currency selector changes the displayed currency symbol only. It does not perform exchange-rate conversion. For example, selecting NPR after entering 10,000 treats the amount as 10,000 NPR rather than converting 10,000 USD into NPR.
Regular contributions are assumed to be added at the end of each contribution period. For example, with monthly contributions, the contribution is added after the growth for that contribution period has been applied.
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