Compound Interest Calculator
This investment calculator helps you estimate the future value of your investments based on key inputs. You can input your initial investment, the time period you plan to invest, any additional contributions, your expected interest rate, and the frequency at which your interest compounds.
The calculator uses these inputs to estimate how your money could grow over time, providing a total projected value at the end of your investment period. You'll also see a graph that visualizes the compounding effect, allowing you to understand how consistent contributions and compound interest contribute to the growth of your portfolio.
Key Inputs
Initial Investment: The starting amount you plan to invest.
Time Period: The length of time you intend to invest.
Additional Contributions: Regular additions to your portfolio (e.g., monthly investments).
Interest Rate: The expected annual return rate.
Compounding Frequency: How often interest is added to your investment—monthly, quarterly, or annually.
This calculator shows how compound interest can significantly impact your investments, and the graph will illustrate the potential growth over time based on your inputs.
Result:
Understanding Your Results
The total amount shown above represents the projected future value of your investment, considering compound interest and any additional contributions you made throughout the time period. The graph provides a visual representation of how your investment grows over time, demonstrating the "compounding effect" where both the initial amount and accumulated interest contribute to further growth.
As time progresses, the slope of the graph will steepen, showing exponential growth as your returns begin to accumulate. Even if your initial investment was small, regular contributions and interest over a long period can significantly increase your overall portfolio value.
Why Compounding is Powerful: Compounding is the process of earning interest on both your principal and the interest that accrues. Over time, this leads to exponential growth. The more frequent the compounding, the faster your money grows. For example, monthly compounding leads to higher returns than annual compounding.
How Regular Contributions Enhance Growth: Small, consistent contributions to your investment portfolio amplify the power of compounding. Every additional contribution is subject to the same interest rate, meaning that over time, these contributions help to significantly boost your overall returns.
Keep in mind that while this calculator provides a useful projection of potential growth, it assumes constant interest rates and does not take into account taxes or market fluctuations. Always consult with a financial advisor before making significant investment decisions.
