Compound Interest Calculator
Enter your investment details to see the future value.
Enter your investment details to see the future value.
10,000 invested for 10 years at 7 percent, compounded monthly.
Future value 20,096.61, of which 10,096.61 is interest.
Less than people expect. The same 10,000 at 7 percent for 10 years grows to 19,671.51 compounded annually, 20,096.61 monthly and 20,136.18 daily — a spread of about 465 across the whole decade, or roughly 2.3 percent of the ending balance. Rate and time do the heavy lifting; frequency is a rounding detail by comparison. It matters most on debt at high rates, where daily compounding on a card balance is meaningfully worse than monthly.
There is no field for regular contributions, so the result answers one specific question: what does this amount become if left alone. If you are also adding money every month, this understates the outcome substantially, and you want a savings-goal or contribution model instead. Conversely, if you plan to withdraw along the way, it overstates it.
The 20,096.61 is in future currency, not today’s. Inflation over the same decade reduces what that balance buys. A quick way to see the real figure is to run the calculation a second time using your rate minus expected inflation — at 7 percent nominal and 3 percent inflation, use 4 percent, which gives about 14,802 in today’s money. That is the number to compare against a goal expressed in current prices.
It assumes a single constant rate with no fees, no tax and no volatility. A real investment return varies year to year, and the same average with swings in it does not produce the same ending balance as a steady rate. Treat the output as the arithmetic of a fixed rate — exactly right for a fixed-rate deposit or bond, and an approximation for anything that fluctuates.
Simple interest is charged only on the original principal, so 10,000 at 7 percent earns 700 every year without exception — 7,000 over ten years. Compound interest is charged on principal plus everything already earned, so each year starts from a larger base. In the example above that difference is 10,096.61 against 7,000, and it widens the longer the money is left.
Divide 72 by the interest rate as a rough estimate: at 7 percent, about 10.3 years. It is an approximation that holds well for rates in the mid single digits. For the exact figure, increase the years in this calculator until the future value reaches twice the principal — at 7 percent compounded monthly that happens a little before the 10-year mark, which is why the example above lands just above 20,000.
The one your account actually uses, which is stated in its terms. Savings accounts are commonly monthly or daily, bonds are often semi-annual, and some deposits are annual. Guessing a higher frequency than the real one flatters the result slightly.
Yes — the arithmetic is identical, only the sign of the outcome changes. Entering a card balance as the principal and the card rate with daily compounding shows what the debt grows to if you make no payments at all. Because the model has no repayment field, that is its only debt use; for a balance you are paying down, use a payoff calculator instead.
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