Compound Interest Calculator
Calculate compound interest and see how your money grows over time with the power of compounding.
Compound Interest Calculator
Enter your investment details to calculate future value and see year-by-year growth
Understanding Compound Interest
What is Compound Interest?
Compound interest is often called "the eighth wonder of the world" because of its powerful ability to grow wealth over time. Unlike simple interest, which is calculated only on the principal, compound interest is calculated on both the principal and the accumulated interest from previous periods.
The Power of Compounding
- Start Early: Time is your greatest ally
- Be Consistent: Regular contributions amplify growth
- Reinvest: Let your returns earn returns
- Be Patient: Growth accelerates over time
Compounding Frequency
- Daily: Maximum growth, common in savings
- Monthly: Standard for most investments
- Quarterly: Common for bonds
- Annually: Simplest calculation
The Rule of 72
A quick formula to estimate how long it takes to double your money. Simply divide 72 by your annual interest rate. At 6% interest, money doubles in approximately 12 years (72 / 6 = 12).