What is compound interest?

Compound interest means you earn interest on both your original principal and on the interest already accumulated. Over time this creates exponential growth — often called "the snowball effect." The more frequently interest compounds, the faster your balance grows.

How does compounding frequency affect my returns?

More frequent compounding leads to slightly higher returns. Daily compounding yields slightly more than monthly, which yields more than annual. For most long-term investments the difference is modest, but it compounds meaningfully over decades.

What does inflation adjustment mean in this calculator?

The nominal future value shows what your account balance will read in future dollars. Inflation erodes purchasing power, so the inflation-adjusted (real) value tells you what that future balance is worth in today's dollars. For example, $500,000 in 30 years at 3% inflation is worth roughly $206,000 in today's dollars.

What interest rate should I use?

Use an expected average annual return for your investment type. Historical averages: S&P 500 index funds ~10% nominal (7% after inflation), high-yield savings accounts 4–5%, bonds 3–5%. Be conservative — markets fluctuate, and past returns do not guarantee future results.

Does this account for taxes?

No. The calculator shows gross growth before taxes. In taxable accounts, capital gains and dividends are taxed annually or on withdrawal. For tax-advantaged accounts (401k, IRA, Roth IRA) the tax treatment differs. Consult a financial advisor for a tax-adjusted projection.

What is the difference between beginning and end of period contributions?

Beginning-of-period contributions (annuity due) are added at the start of each period so they earn interest for that full period. End-of-period contributions (ordinary annuity) are added at the end, so they start earning interest in the next period. Beginning-of-period contributions produce a slightly higher future value.

Investment Calculator

Name: Investment Calculator
Availability: InStock
Author: Nham Vu

Enter a principal, interest rate, duration, and optional regular contributions to instantly see your investment's future value — with optional inflation adjustment.

Investment Details

Initial Investment ($)

Annual Interest Rate (%)

Duration (Years)

Compounding Frequency

Regular Contributions (optional)

Amount ($)

Frequency

Contribution Timing

Inflation Adjustment

Future Value

—

Real Value (Today's $)

—

Total Contributions

—

Interest Earned

—

Principal & Contributions Interest Earned

50% 50%

Year-by-Year Growth

Balance Contributions

Year	Contributions	Interest	Balance

Fill in your investment details and click Calculate.

Summary

Enter a principal, interest rate, duration, and optional regular contributions to instantly see your investment's future value — with optional inflation adjustment.

How it works

Enter your initial investment (principal) amount.
Set the expected annual interest rate and the investment duration in years.
Choose how often interest compounds: annually, quarterly, monthly, or daily.
Optionally add regular contributions — monthly or annually — and set when they are made.
Enable inflation adjustment and enter an expected annual inflation rate to see real value.
Read the results: future value, total contributions, total interest earned, and the year-by-year growth chart.

Use cases

Projecting how much a savings account or index fund will be worth at retirement.
Comparing different compounding frequencies to understand their effect on returns.
Determining how much to contribute monthly to reach a savings goal.
Seeing the inflation-adjusted purchasing power of a future sum.
Modeling the growth of a lump-sum college fund over 18 years.
Quickly estimating the long-term impact of starting to invest earlier vs. later.

Frequently Asked Questions

Last updated: 2026-06-10 · Reviewed by Nham Vu