Compound interest calculator

This calculator shows how a starting amount and regular monthly contributions grow over time once interest is added back and starts earning interest of its own. Enter your figures above and it returns the future value, the total you paid in, and the interest earned on top — plus a chart that separates the two so you can see compounding at work.

How to use this calculator

The initial amount is your starting balance, the principal you already hold on day one. The monthly contribution is the amount you add at the end of each month from then on. The annual rate is the nominal yearly interest rate you expect to earn, entered as a percentage. The years field sets how long the money stays invested and compounding. The compounding frequency tells the calculator how often interest is added to the balance — monthly, quarterly or yearly — which changes how quickly interest starts earning interest.

Reading the results

Three numbers describe the outcome. The future value is what the balance is worth at the end. The amount paid in is your principal plus every contribution you made — the money that came from your own pocket. The interest earned is the future value minus what you paid in, and it is the whole point: money the balance generated on its own.

The chart plots two lines. One is your running balance; the other is the cumulative total you have contributed. Early on they sit close together, because the balance is mostly your own money. Over time the balance line pulls away and curves upward. That widening gap between the lines is compounding — it is interest earning interest, and it grows faster the longer you leave it.

A worked example

Take a starting balance of nothing, €100 added at the end of every month, a 5% annual rate compounded monthly, over 30 years. The future value comes to €83,226. Of that, you paid in €36,000 — thirty years of €100 a month. The remaining €47,226 is interest. So more than half the final balance is money you never contributed; the account earned it.

The rate matters enormously over a span this long. Keep everything the same but drop the rate to 3% and the same €36,000 of contributions grows to €58,274. Raise it to 7% and the balance reaches €121,997, of which €85,997 is interest. Three points of annual return roughly doubles the interest earned across three decades, because each year’s gain compounds on every year before it.

Assumptions and method

Contributions are treated as landing at the end of each month, so a fresh contribution earns nothing in the month you make it. The nominal annual rate you enter is converted to an effective monthly rate, then applied according to your chosen compounding frequency, so that frequency is honoured exactly rather than approximated. This effective-rate approach is the same logic behind an AER figure, which restates a rate to reflect how often interest is added.

The results ignore fees, tax and inflation. They show the mechanism, not a promise. Real returns are rarely a fixed rate year after year, tax reduces what you keep, and inflation erodes what the final figure will buy — so treat the output as a model of how compounding works, not a forecast of your actual balance. For a decision that affects your money, a qualified financial adviser weighs those factors against your own circumstances.

Nothing you enter leaves your browser. The calculation runs entirely on your device, so your figures are never sent anywhere or stored.