Interest Calculator

Use our free advanced compound interest calculator to accurately project savings growth with regular contributions, taxes, inflation, and various compounding frequencies.

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Interest Calculator. Put the Power of Compound Interest to Work for You

Whether you're tucked away in "saving mode" for retirement, prepping for your kid's college, or just trying to build a solid emergency fund, compound interest is your best friend. It's essentially the "snowball effect" for your money-where your interest starts earning interest of its own.

We built this calculator to help you see exactly how that snowball grows. It doesn't just do basic math; it gives you a real-world look at your future by factoring in your monthly contributions, the bite of taxes, and even the "hidden cost" of inflation. It's designed to help you stop guessing and start seeing exactly how close you are to your goals.

Compound Interest: The "Snowball Effect" for Your Money

Think of compound interest as your money iss way of working overtime. Instead of just earning interest on your original deposit, you start earning interest on your interest. It's a loop that creates a massive snowball effect over time.

Let's look at a quick example: If you start with $20,000 and tuck away $5,000 every year, a 5% return would leave you with about $54,535 after just five years. That means you've basically "found" $9,500 just by letting the interest do its thing.

The real secret sauce? Time. Someone starting in their 20s has a massive head start over someone starting in their 40s, even if they save the exact same amount. In 2025, while basic savings accounts are still offering pennies, moving your money into high-yield options (4-5%) or the stock market (historically 7-10%) is like putting your snowball on a much steeper hill.

The "Invisible Eaters": Why Taxes and Inflation Matter

Compound interest is a powerhouse, but in the real world, it has two main rivals: Taxes and inflation. If you do not account for them, your 'future total' might appear significantly larger on paper than it feels in your wallet.

The Tax Bite: Most of the time, the government wants a piece of your interest. Depending on your tax bracket, a chunk of those earnings could disappear every year. (This is why 'tax-advantaged' accounts like a Roth IRA are so popular-they let you keep more of what you earn.)

The 'Price Hike' (Inflation): You have probably noticed that $100 doesn't buy as much as it used to. With an average inflation rate of 3%, a bag of groceries that costs $100 today could cost over $134 in a decade.

Why our calculator is different: Most tools (like the ones on NerdWallet or Bankrate) just show you the big, shiny number at the end. We go a step further. In our previous example, that $54,535 total looks great-but once you factor in inflation, it actually feels like $47,043 in today's money. We show you that 'Real Value' so you can plan with your eyes wide open.

How Our Advanced Compound Interest Calculator Works

Most calculators give you a "perfect world" estimate. We built this one to handle the messy details of real life. Here is a quick look at how you can customize your forecast:
The Basics: Plug in your Starting Amount and how much you plan to save Monthly.
The "When" Factor: You can choose to add your money at the start or the end of the month. (Fun fact: Adding it at the start usually gives your interest a tiny head start!)
Pick Your Pace: Set your Interest Rate and how often it "compounds." Generally, the more often it compounds (like daily or monthly), the faster that snowball grows.
The Reality Check: This is where it gets good. You can add your Tax Rate and Inflation to see what your money will actually be worth when you're ready to spend it.
What you'll get back: We don't just give you one big number. We break down exactly how much of your wealth came from your own hard-earned savings versus how much was "free money" from interest. Plus, you'll get a year-by-year schedule so you can track your progress like a roadmap.

Simple Interest

If you've ever borrowed twenty bucks from a friend and promised to pay them back twenty-five, you've already used the basics of simple interest. Unlike compound interest (where the math can get a bit "loopy"), simple interest is incredibly predictable. You only ever pay or earn interest on the original amount you started with—it never grows or changes based on previous interest.
The formula is very simple:
Simple Interest (SI) = (Principal × Rate × Time) / 100
The "No-Headache" Formula: To find your total, you just multiply three things:
The Principal: The original pile of cash you started with.
The Rate: The percentage being charged (per year).
The Time: How many years the money is sitting there.
The Result: Just add that interest to your original amount, and you have your total. It's that easy!

Example 1: Watching Your Savings Grow: A $10,000
Let's say you tuck away $10,000 into a savings account or a bond that pays 5% simple interest every year. If you leave that money alone for three years, here is exactly how the math plays out:
Yearly Earnings: Since it's "simple" interest, you earn 5% of your original $10,000 every single year. That's a flat $500 per year.
The 3-Year Total: $500 × 3 years = $1,500 in total interest.
The Result: When you go to close the account after three years, you'll walk away with $11,500. You didn't have to lift a finger--your money just sat there and "made" you $1,500.

Example 2: The Real Cost of Your $15,000 Car Loan
Let's say you're buying a car and need to borrow $15,000. The lender gives you an 8% simple interest rate over 4 years. While the sticker price is $15k, the interest is the "fee" you pay to borrow that money.
The Yearly interest: Every year, the lender charges you 8% of that original $15,000. That's $1,200 in interest per year.
The 4-Year Total interest: Over the life of the loan, those yearly fees add up to $1200 × 4 = $4,800.
By the time you've made your final payment, that $15,000 car will have actually cost you $19,800. Seeing the "total interest" upfront helps you decide if that monthly payment truly fits your budget.

Example 3:Making Your Money Work for a Few Months
Let's say you have $5,000 sitting in a savings account and you don't need it for a little while. You decide to put it into a 6-month fixed deposit at a 6% annual interest rate.
How the math works for a half-year: Since 6% is the yearly rate, and you're only leaving the money in for half a year (0.5 years), you'll earn half of that annual interest.
The Yearly Amount: 6% of $5,000 would be $300 for a full year.
The 6-Month Result: Since you're only halfway through the year, you earn $150.
(Wait—correction check!) Based on the simple interest formula ($5,000 x 6 x 0.5) / 100, your actual earnings for those six months would be $150.
The Result: After 6 months, you'll walk away with $5,150. It's a great way to earn a little extra "lunch money" on cash that would otherwise just be sitting still.
(Note: The original example's math of $75 was actually based on a 3% rate or a 3-month term—at 6% for 6 months, you actually walk away with a bit more!)

Quick Comparison Table: Simple vs Compound Interest

Compound Interest

Compound Interest: Why Your Money Grows
People often joke that compound interest is the 'eighth wonder of the world,' but there is a real reason for the hype. It is the secret ingredient that helps your savings accelerate over time.
Think of it this way: Simple interest is like getting a flat fee just for showing up; you only earn profit on the cash you originally put in.
Compound interest, however, works harder. You earn interest on your original money plus all the interest you've already earned. You are effectively earning "interest on your interest."
The Math Behind the Magic
If you want to see exactly how much your money will grow, here is the formula broken down. It looks a little technical, but it's just a way of calculating that growth effect.
The full formula is:

A = P × ( 1 +

r n

) n × t

Here is what those letters actually mean:
A (The Final Amount): This is the goal—your total money (original cash + profit) at the end.
P (The Principal): This is your starting cash.
r (The Rate): The annual interest rate. (Note: In math, percentages are decimals. So, $% becomes 0.05).
n ( The Frequency): How often the bank pays you interest per year (e.g., monthly means n = 12).
t (The Time): How many years you let the money grow.
The Simple Version: If your bank only adds interest once a year (annually), the math gets much easier:

A = P × ( 1 + r) t

Example 1: Basic Long-Term Investment (No Additional Contributions)
Let's look at a scenario where you make a one-time investment and just let it ride. Imagine you invest $10,000 into a market fund with an average return of 7% per year, and you don't touch it for 15 years.
Here is how the math plays out:
The Starting Cash (P): $10,000
The Growth Rate (r): 7% (or 0.07)
The Timeframe (t): 15 years
The CalculationUsing the annual compounding formula, the math looks like this:
A = 10,000 × (1.07) ¹⁵
The Final Result:
A = $27,590.30
In this scenario, your money earned a total profit of $17,590.30 without you lifting a finger.
The "Secret Sauce": Why Compounding Wins
To understand why this is impressive, we have to compare it to Simple Interest.
If you had earned simple interest, you would only have been paid on your original $10,000 every year. You wouldn't earn anything on the profits from previous years.
The Difference in Your Pocket:

Method	Total Value	Total Profit
Simple Interest	$20,500	$10,500
Compound Interest	$27,590	$17,590

By utilizing compound interest, you walked away with $7,090 extra. That is a 67% increase in earnings just for choosing the right type of growth.