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Compound Interest Calculator

See how your money grows over time with compound interest, inflation adjustment, tax drag, and annual contribution increases. Free, interactive, no login required.

Inputs

Goal Calculator

You'd need $753.16/mo to reach $1,000,000 in 30 years at 7% return.

Results

Future Value
$691,150
$284,745 in today's dollars
Total Contributions
$190,000
Total Interest Earned
$501,150
Inflation-Adjusted Value
$284,745

Growth Over Time

Year-by-Year Breakdown

YearStartingContributionsInterestEndingReal Value
1$10,000$6,000$919$16,919$16,426
2$16,919$6,000$1,419$24,339$22,941
3$24,339$6,000$1,956$32,294$29,554
4$32,294$6,000$2,531$40,825$36,273
5$40,825$6,000$3,148$49,973$43,107
6$49,973$6,000$3,809$59,782$50,066
7$59,782$6,000$4,518$70,299$57,160
8$70,299$6,000$5,278$81,578$64,398
9$81,578$6,000$6,094$93,671$71,791
10$93,671$6,000$6,968$106,639$79,349
11$106,639$6,000$7,905$120,544$87,084
12$120,544$6,000$8,910$135,455$95,005
13$135,455$6,000$9,988$151,443$103,125
14$151,443$6,000$11,144$168,587$111,456
15$168,587$6,000$12,383$186,971$120,009
16$186,971$6,000$13,712$206,683$128,798
17$206,683$6,000$15,137$227,820$137,835
18$227,820$6,000$16,665$250,486$147,134
19$250,486$6,000$18,304$274,790$156,709
20$274,790$6,000$20,061$300,851$166,574
21$300,851$6,000$21,945$328,796$176,744
22$328,796$6,000$23,965$358,760$187,234
23$358,760$6,000$26,131$390,892$198,062
24$390,892$6,000$28,454$425,345$209,242
25$425,345$6,000$30,945$462,290$220,792
26$462,290$6,000$33,615$501,905$232,731
27$501,905$6,000$36,479$544,384$245,076
28$544,384$6,000$39,550$589,934$257,847
29$589,934$6,000$42,843$638,777$271,063
30$638,777$6,000$46,374$691,150$284,745

What Is Compound Interest?

Compound interest is interest earned on both your original principal and on the interest that has already been added to your balance. Unlike simple interest — which is calculated only on the initial deposit — compound interest accelerates your growth over time because each period's interest becomes part of the next period's principal. Albert Einstein reportedly called it "the eighth wonder of the world," and while that attribution is debated, the math is not: compounding turns modest, consistent contributions into surprisingly large sums given enough time.

FV = P × (1 + r/n)nt + PMT × [((1 + r/n)nt − 1) / (r/n)]

Where P is your initial principal, r is the annual interest rate, n is the number of compounding periods per year, t is the number of years, and PMT is the periodic contribution.

The Rule of 72

The Rule of 72 is a quick mental-math shortcut: divide 72 by your annual rate of return to estimate how many years it takes for your money to double. At 7% annual return, your money doubles roughly every 10.3 years (72 ÷ 7 ≈ 10.3). At 10%, it doubles every 7.2 years. The rule works best for rates between 4% and 12% and assumes reinvested gains with no withdrawals.

Why Starting Early Matters

Time is the single most powerful variable in the compound interest equation. An investor who starts contributing $500/month at age 25 and earns 7% annually will accumulate roughly $567,000 more than someone who starts the same contributions at age 35 — even though the early starter only contributed $60,000 more in total. That extra decade of compounding does more heavy lifting than decades of additional savings ever could. The takeaway: start now, even if the amount feels small.

Inflation and Tax Drag

This calculator includes two often-overlooked factors that erode real returns. Inflation reduces the purchasing power of future dollars — a 7% nominal return with 3% inflation yields roughly a 4% real return. Tax drag applies when gains are taxed annually (as in a taxable brokerage account) rather than deferred (as in a 401(k) or Roth IRA). A 15% annual tax on gains can reduce your ending balance by 20–30% over a 30-year horizon compared to a tax-deferred account.

Sources & Methodology

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