Enter an amount, a rate and a period to see what it grows to — and how much of the final balance is interest rather than your own money.
This is arithmetic on a rate held constant for the whole period. Real returns vary, and taxes and fees are not included. Contributions are added at the end of each month.
Final balance
Below twelve months simple interest comes out ahead, because the two regimes define an annual rate differently: compound uses the effective rate, simple the nominal one. They meet at one year, and compounding pulls ahead from there. Simple interest
Tap or hover a bar for the exact figures. Scroll sideways to see the whole period.
| Year | Contributed | Interest | Balance |
|---|
| Month | Contributed | Interest | Balance |
|---|
The whole difference between the two regimes is what the interest is charged on. Simple interest always applies to the original amount; compound interest applies to the balance, which includes the interest already earned. That single change turns straight-line growth into a curve.
Over a year the two are nearly indistinguishable. Over thirty, they are not remotely comparable: at 10% a year, 10,000 becomes 40,000 under simple interest and passes 170,000 under compound. Almost none of that gap is money you put in — it is interest earning interest.
Because the growth is exponential, the last years contribute far more than the first. That is why the same contribution made early is worth several times the same amount made late, and why a modest rate over a long period beats an impressive rate over a short one.
The year-by-year table under the result shows this directly: watch the interest column overtake the contributions column, and note how long that takes.
One rate, held constant, for the entire period, with contributions never missed. Real returns move; a fund that averages 8% does not deliver 8% every year, and the order in which good and bad years arrive changes the outcome. The figure here is arithmetic, not a forecast.
Taxes and fees are also excluded, and both are substantial over long periods. Use the result to compare scenarios against each other rather than as a number to count on.
The balance is multiplied by (1 + i) every period, where i is the rate for that period. Over n periods the future value is PV × (1+i)ⁿ. What makes it compound rather than simple is that the interest earned in one period joins the balance and earns interest itself in the next.
At the end of each month, which is the ordinary annuity convention. A deposit made in month one therefore starts earning in month two. The alternative — deposits at the start of the period — earns roughly one extra month of interest and produces a higher figure; calculators that do not state their convention usually use that one.
Because the two regimes define an annual rate differently. Compound interest here uses the effective annual rate, so 12% a year means 0.9489% a month. Simple interest uses the nominal rate, so 12% a year means exactly 1% a month. Below twelve months the higher monthly rate wins; at one year they meet, and after that compounding pulls ahead and never looks back.
Whatever annual rate applies to the account or investment you are modelling, before tax. The calculator holds it constant for the whole period, which is exactly right for a fixed-rate product and only an approximation for anything whose return varies.
No. The result is gross. Income tax on investment returns, account fees and fund charges all reduce the final figure, and they differ by country and product, so including a guess would be worse than leaving them out and saying so.
No. The calculation runs entirely in your browser and there is no server to send anything to. The amounts you type are never transmitted or saved.
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