Compound savings growth
Plant a starting sum, keep adding to it, and watch interest earn interest. Enter your own rate and compounding to see the balance year by year and how much of it the interest grew.
Balance after 20 years
$84,467.84
37% of it is interest, at an effective 4.074% a year
- Starting sum
- $5,000.00
- Deposits
- $48,000.00
- Interest
- $31,467.84
Balance at the end of each year
- Starting sum
- Deposits
- Interest
Show the numbers
| Year | Deposited | Interest that year | Interest so far | Balance |
|---|---|---|---|---|
| 1 | $2,400.00 | $248.20 | $248.20 | $7,648.20 |
| 2 | $2,400.00 | $356.09 | $604.29 | $10,404.29 |
| 3 | $2,400.00 | $468.38 | $1,072.67 | $13,272.67 |
| 4 | $2,400.00 | $585.24 | $1,657.91 | $16,257.91 |
| 5 | $2,400.00 | $706.87 | $2,364.78 | $19,364.78 |
| 6 | $2,400.00 | $833.44 | $3,198.22 | $22,598.22 |
| 7 | $2,400.00 | $965.18 | $4,163.40 | $25,963.40 |
| 8 | $2,400.00 | $1,102.28 | $5,265.68 | $29,465.68 |
| 9 | $2,400.00 | $1,244.97 | $6,510.65 | $33,110.65 |
| 10 | $2,400.00 | $1,393.47 | $7,904.12 | $36,904.12 |
| 11 | $2,400.00 | $1,548.02 | $9,452.15 | $40,852.15 |
| 12 | $2,400.00 | $1,708.87 | $11,161.02 | $44,961.02 |
| 13 | $2,400.00 | $1,876.27 | $13,037.29 | $49,237.29 |
| 14 | $2,400.00 | $2,050.50 | $15,087.79 | $53,687.79 |
| 15 | $2,400.00 | $2,231.82 | $17,319.61 | $58,319.61 |
| 16 | $2,400.00 | $2,420.52 | $19,740.13 | $63,140.13 |
| 17 | $2,400.00 | $2,616.92 | $22,357.05 | $68,157.05 |
| 18 | $2,400.00 | $2,821.32 | $25,178.36 | $73,378.36 |
| 19 | $2,400.00 | $3,034.04 | $28,212.40 | $78,812.40 |
| 20 | $2,400.00 | $3,255.43 | $31,467.84 | $84,467.84 |
Educational use only — not financial advice
How compound growth is worked out
A = P × (1 + r/m)m × t
For a single sum P at a yearly rate r compounded m times a year for t years, the balance is A. Compounding more often adds a little: 4% compounded monthly is an effective 4.074% a year. The calculator shows that effective rate under the headline.
Regular deposits are added month by month. Interest is applied each month at the rate equivalent to the compounding you chose, (1 + r/m)m/12 − 1, so year-end balances agree with the formula above. Choose Start if each deposit goes in at the beginning of its month (or year) and earns interest straight away, End if it goes in afterwards.
Example: $5,000 plus $200 a month at 4% compounded monthly, deposits at the end of each month, grows to $84,467.84 after 20 years. You put in $53,000; $31,467.84 is interest. The chart stacks the three parts so you can see interest take a bigger share each year.
The rate is yours to enter: the 4% filled in is an example, not a forecast. Savings rates change over time, and the calculator ignores tax and fees. For a second opinion, the SEC's Investor.gov site has its own compound interest calculator.
Sources
- U.S. Securities and Exchange Commission, Investor.gov Compound Interest Calculator.
- Consumer Financial Protection Bureau, Truth in Savings (Regulation DD): the annual percentage yield disclosed for deposit accounts.
Questions
My account quotes an APY. What do I enter?
An APY already includes compounding. Enter it as the rate with yearly compounding and the result matches it exactly. If the account quotes a nominal rate with monthly or daily compounding, enter that rate and compounding instead.
Why does daily compounding add so little?
Each step from yearly to quarterly, monthly and daily compounding adds less than the one before. At 4%, yearly gives 4%, monthly 4.074% and daily about 4.081% a year.
Does it allow for inflation or tax?
No, the figures are before tax and in future money. To get a rough idea in today's money, subtract an inflation rate of your choice from the interest rate before you enter it.