Compound interest and savings goal calculator
Compound interest is interest on interest: each period you earn on what you put in and on what you have already earned. With steady contributions over years, the interest portion eventually overtakes the contributions. Enter your numbers and watch it grow year by year, or flip it around and find out how much to save monthly for a goal.
Savings goal
- Contributed
- $49,000
- Interest earned
- $59,224
Growth by year
Return before taxes and inflation. Index funds have historically returned around 7% a year in real terms; that is not a promise.
Savings goal
Save this calculation and follow your plan
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Join the waitlistHow it is calculated
Each month the balance is multiplied by (1 + equivalent monthly rate) and the contribution is added. The equivalent monthly rate honors the chosen compounding (monthly, quarterly, yearly, daily) by first converting it to an effective annual rate.
The monthly contribution for a goal is solved from the annuity formula: (goal − future value of the initial deposit) × r ÷ ((1 + r)^n − 1).
Frequently asked questions
What rate should I use?
It depends on where you save: 4%–5% in high‑yield savings or Treasuries (2025–2026), about 7% a year in real terms as the long‑run historical average of a stock index fund, with good and bad years. Not a guarantee.
Does compounding frequency matter much?
Little compared with rate and time: at 7%, daily versus monthly compounding changes the result by fractions of a percent. What really multiplies the outcome is starting earlier and contributing consistently.
What about inflation and taxes?
The result is nominal and pre‑tax. To think in purchasing power, subtract expected inflation (2%–3%) from the rate. Retirement accounts (IRA, 401k, SEP‑IRA for the self‑employed) defer or remove tax on the growth.
These calculators are educational estimates based on the numbers you enter; they are not a credit offer nor financial, legal or tax advice. Reference rates are reviewed yearly.