How to use it
- Enter what you're starting with and how much you'll add each month.
- Enter an expected annual return and how many years you'll invest.
- Add an inflation rate if you want to see the final balance in today's purchasing power.
How compound interest works
With compound interest, you earn returns not only on what you put in, but on the returns you've already earned. In the first years most of the balance is your own money. Over a long horizon, the interest bar in the chart overtakes your contributions — that crossover point is why starting early matters more than starting big.
Picking a realistic rate
Use a rate that matches what you'll actually hold: a high-yield savings account, bonds and a stock index fund all have very different long-run returns and risks. If you're unsure, run the calculator with a low, middle and high rate to see the range of outcomes.
Frequently asked questions
When are contributions added?
At the end of each month, after that month's interest. This is the conservative convention most calculators use.
What does 'monthly compounding' mean here?
The annual rate is divided by 12 and applied every month. 'Effective annual rate' instead converts the rate so that a full year of compounding equals exactly the rate you typed.
Does this include taxes or fees?
No. Subtract fund fees from the rate you enter, and remember that taxes on gains depend on the account type and your country.