Compound Interest Calculator
See how money grows when interest earns interest, with or without monthly contributions.
The compound interest formula
For a lump sum, the future value is:
A = P (1 + r/n)nt
where P is the starting amount, r the annual rate as a decimal, n the number of compounding periods per year, and t the years. Monthly contributions are added at the end of each month and then compound along with everything else.
Why starting early beats saving more
Growth is exponential, so time matters more than the amount. $200/month at 7% becomes about $104,000 after 20 years, but about $243,000 after 30. The last decade alone adds more than the first two combined. That is the whole argument for starting now.
Does compounding frequency matter?
Less than people think. $10,000 at 7% for 20 years gives $38,697 compounded yearly and $40,547 compounded daily, about a 5% difference. The rate and the time horizon dominate.