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Compound Interest Calculator
Use this free Compound Interest Calculator to see how your savings grow exponentially. Simple, accurate, and easy to use for wealth planning.
Albert Einstein reputedly called compound interest the "eighth wonder of the world," stating, "He who understands it, earns it... he who doesn't... pays it." The Compound Interest Calculator demonstrates this phenomenon in detail.
Compounding occurs when the interest you earn is added to your principal, and then that new total earns even more interest. This snowball effect is the primary engine of wealth creation for retirees and the main reason why debt can spiral out of control so quickly.
Initial amount of money you represent.
Amount you add to your investment regularly.
How often you make contributions.
Expected annual rate of return.
Number of years you plan to invest.
How often interest is added to your balance.
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INPUT VALUES
When to Use This Calculator
Use the Compound Interest Calculator to:
- Compare Frequency: See how much more you earn if interest is compounded monthly vs. annually.
- Visualize Time: Understand why starting to save at age 25 vs 35 makes a massive difference in your final outcome.
Example Scenario
Let's compare compounding frequencies on a $10,000 investment at 8% for 20 years.
- Annual Compounding: Final Value = $46,609
- Daily Compounding: Final Value = $49,521
Just by changing the frequency to daily, you earn nearly $3,000 extra without lifting a finger.