Watch your money do the heavy lifting. See future value, interest earned, and return on contribution.
Enter your principal, rate, and time to see how compound interest works.
Compound interest is interest calculated on both your initial deposit and the interest you've already earned. Each compounding period, your interest earns interest — which is why Albert Einstein is (probably apocryphally) credited with calling it "the eighth wonder of the world." Whether he said it or not, the maths checks out.
Enter an initial investment, an annual interest rate, a time period, and how often interest compounds. You can also add a monthly contribution to model regular savings. The calculator returns the final future value, total interest earned, and total amount you contributed — so you can see exactly how much of the growth came from compound interest versus your own deposits.
A useful mental shortcut: divide 72 by the annual interest rate to estimate how many years it takes to double your money. At 6%, that's 12 years. At 8%, it's 9 years. At 3%, it's 24 years. It's approximate but surprisingly accurate for rates between 2% and 20%.
More frequent compounding produces higher returns, but the differences are smaller than you might expect. The gap between monthly and daily compounding at typical savings rates is a rounding error in practice. What matters far more is the rate itself and how long you stay invested.