See how savings grow with compounding.
These calculators use standard financial formulas (amortization, compound interest, marginal tax brackets) to estimate results based on the numbers you enter. They don't account for your full financial picture, and results shouldn't be treated as financial, tax, or investment advice. For decisions with real money on the line, check the numbers with a lender, accountant, or financial advisor who can see your complete situation.
Compound interest is interest earning interest. Each compounding period, interest earned is added to the principal, and the next period's interest is calculated on the new, larger balance.
Formula: A = P(1 + r/n)^(nt). More frequent compounding produces a slightly higher end balance. Regular monthly contributions turbo-charge the effect.
The gap between simple and compound growth looks small in year one and enormous by year twenty — this is why starting early matters more than the exact amount you start with.
Investing $10,000 at 6% annual return compounded monthly for 10 years with no additional contributions grows to $18,193.97 — that's $8,193.97 in interest.
Growth is exponential, not linear — the last decade before retirement often adds more in dollar terms than the first two decades combined.
Divide 72 by your annual return rate to estimate the years it takes to double your money. At 6%, about 12 years; at 8%, about 9.
Slightly. Monthly vs. annually adds only a fraction of a percent, but daily vs. yearly matters over 30+ years.
It's a conservative estimate for a diversified stock portfolio, which has historically averaged closer to 7-10% before inflation over multi-decade periods — 6% leaves some margin of safety.