Compound Interest Calculator
Project a lump-sum balance and accumulated interest using a chosen principal, annual rate, duration, and compounding frequency.
Project compound growth
How this tool works
Compound growth applies each period's return to both the original principal and earlier accumulated returns. This tool isolates a lump-sum scenario without contributions or withdrawals so users can inspect the effect of rate, duration, and frequency.
Future value equals principal multiplied by (1 plus annual decimal rate divided by compounds per year) raised to compounds per year times years.
How to use it
- Enter the starting lump-sum principal.
- Enter the annual percentage rate, duration, and compounding periods per year.
- Compare the projected final balance with the separately reported accumulated interest.
Worked examples
Monthly compounding
- Input
- 5,000 at 6% for 10 years, compounded monthly
- Output
- Approximately 9,096.98
The annual rate is divided across 12 periods and applied for 120 total periods. Reinvesting each period's return produces compound rather than linear growth.
Annual compounding
- Input
- 1,000 at 10% for 2 years, compounded annually
- Output
- 1,210
The balance is multiplied by 1.10 twice: the first year produces 1,100 and the second applies growth to that new balance, producing 1,210.
Limitations
- The model excludes deposits, withdrawals, fees, taxes, and changing rates.
- Projected growth is hypothetical and does not guarantee an investment return.