What is compound interest?

Compound interest is interest calculated on the principal and previously earned interest, causing exponential growth over time.

How do contributions affect future value?

Regular contributions increase the principal base that earns interest; earlier and more frequent contributions generally produce higher future value due to compounding.

Is this calculator accurate to the cent?

Yes — all dollar calculations are done to the cent so totals and schedules reconcile exactly.

Compound Interest Calculator

Initial Principal ($)

Annual Interest Rate (% per year)

Years

Compounding Frequency

Periodic Contributions (optional)

Contribution Amount ($)

Contribution Frequency

Contribution Timing

Results

Enter values and press Calculate.

Compound Interest Schedule

Period-by-period breakdown: starting balance, interest earned, contribution, and ending balance. Amounts shown to the cent.
Period	Starting Balance	Interest	Contribution	Ending Balance
Total	—

Compound Interest — SEO-Friendly Definitions & Terms

Short, original, and search-optimized definitions to help both users and search engines understand compound interest concepts and calculator inputs.

Compound interest

Compound interest is the process where interest is calculated on the original principal and also on interest that has been added to that principal from previous periods. This “interest on interest” effect causes growth to accelerate over time, which is why earlier and regular investing can have a big impact on final value.

Compound interest formula (basic)

The typical compound interest formula for principal only (no contributions) is FV = P × (1 + r/n)^(n×t), where P is the principal, r is the annual interest rate (decimal), n is the number of compounding periods per year, and t is years. This calculator iterates per period to remain cent-accurate when contributions or non-integer frequencies are used.

Future value (FV)

Future value is the amount your principal and contributions will be worth after the investment period, assuming the specified interest rate and compounding frequency. The calculator shows FV to the cent so you get exact dollar-and-cent results.

Compounding frequency

Compounding frequency is how often interest is applied to the balance each year (for example monthly = 12, quarterly = 4, daily = 365). More frequent compounding yields a higher future value for the same nominal rate.

Contribution / deposit

Periodic contributions are regular additions to the account (monthly savings, weekly deposits, etc.). This calculator supports contributions at different frequencies and lets you choose whether each contribution is applied at the beginning or end of the period — timing changes the total slightly.

Interest earned

Interest earned is the difference between the future value and the sum of principal plus contributions. Displayed as a dollar-and-cent amount, it quantifies how much value was generated purely by interest and compounding.

Nominal rate vs. effective annual rate (EAR)

The nominal annual rate is the quoted yearly rate (for example 6%). The effective annual rate accounts for compounding and represents the true yearly growth. For example, 6% compounded monthly has a slightly higher effective rate than 6% compounded annually.

Use cases

People use compound interest calculators to plan retirement savings, evaluate recurring investments, compare savings vehicles (accounts, bonds, CDs), and to see how contribution timing and frequency affect final balances.

Why cent-accurate results matter

This calculator performs all dollar math to the cent, so totals and schedules reconcile exactly. That level of precision is important for financial planning, reporting, and CSV exports into spreadsheets.