About This Calculator
What is Compound Interest?
Compound interest is the process where interest is calculated on both your initial investment and the interest already earned. Over time this creates exponential growth often called the eighth wonder of the world.
Start Early
Investing 5,000 at age 25 grows significantly more than the same amount at 35 even with identical returns. Time is the most powerful variable.
Frequency Matters
Monthly compounding produces higher returns than annual compounding at the same rate. Our calculator lets you compare annual quarterly monthly and daily.
Real vs Nominal
Our inflation adjustment shows what your final balance is worth in today money - a crucial distinction for long-term financial planning.
Worked Example
Sarah invests 10,000 at age 30 and adds 200 per month at 6% annual interest, compounded monthly, with 2.5% inflation. After 30 years her nominal final balance is 214,640 — of which 82,000 is her own contributions and 132,640 is interest earned. In real terms this is worth approximately 131,800 in today purchasing power. Her return multiple is 2.62x.
Common Questions
What is a realistic annual interest rate to use?
For savings accounts in Europe 2-4% is typical. For diversified stock market investments historical averages suggest 6-8% nominal returns or 4-6% after inflation.
Does this account for taxes?
No. Results are gross figures before tax. Tax treatment varies by country and individual circumstances. Always consult a qualified tax adviser.
Is my financial data stored anywhere?
No. All calculations run entirely in your browser. Nothing you enter is ever transmitted to our servers.
What is the Rule of 72?
The Rule of 72 is a quick mental shortcut: divide 72 by the annual interest rate to estimate how many years it takes to double your money. At 6%, money doubles in approximately 12 years (72 divided by 6). At 9%, it doubles in 8 years. It is an approximation, but a useful one for quick comparisons.
Is my data stored or tracked when I use this calculator?
No. All calculations run entirely in your browser using JavaScript. Nothing you enter — amounts, rates, or personal assumptions — is ever transmitted to our servers or stored anywhere. You can use this calculator with complete privacy.