Compound interest calculator
Calculate how your wealth builds through compound interest. Flexible as a lump sum or a savings plan, exactly before and after tax.
Ending balance
54,075.29 $
After tax 48,780.43 $
| Year | Paid in | With compounding |
|---|---|---|
| 1 | 12,400.00 $ | 13,190.06 $ |
| 2 | 14,800.00 $ | 16,603.42 $ |
| 3 | 17,200.00 $ | 20,255.72 $ |
| 4 | 19,600.00 $ | 24,163.68 $ |
| 5 | 22,000.00 $ | 28,345.20 $ |
| 6 | 24,400.00 $ | 32,819.42 $ |
| 7 | 26,800.00 $ | 37,606.84 $ |
| 8 | 29,200.00 $ | 42,729.38 $ |
| 9 | 31,600.00 $ | 48,210.50 $ |
| 10 | 34,000.00 $ | 54,075.29 $ |
- Contributions
- 34,000.00 $
- Interest
- 20,075.29 $
- Compounding edge
- 4,605.29 $
- Doubling
- 10.2 years
What is compound interest?
Compound interest is the continuous earning of returns on returns that have already been reinvested. That produces exponential growth in wealth, and the leverage rises exponentially as the holding period gets longer.
Compound interest formula
Ending balance = starting amount × (1 + rate) ^ years
The rate is the effective annual rate. With monthly compounding the calculator sets the monthly rate so the year still matches that rate. In a savings plan each contribution arrives at the start of its interval.
How the calculation works
Lump sum
You invest a fixed amount at the start. Each year’s interest is reinvested right away and earns interest of its own from the following year.
Savings plan
Every regular contribution, added at the start of its interval, keeps increasing the capital that earns interest.
Comparison
The calculator also shows simple interest next to the total. You can see at a glance how much of the return comes purely from compounding.
Worked example: 10,000 at 7% for 10 years
10,000 × 1.07^10 = 19,671.51. Simple interest would leave 17,000. Compounding adds 2,671.51. After 26.375% tax on the gain, 17,120.65 remains.
- Ending balance
- 19,671.51
- Simple interest
- 17,000.00
- Compounding
- 2,671.51
- After 26.375% tax
- 17,120.65
Compound interest table at 7% a year
Lump sum, annual compounding, no tax. The last column is the lead over simple interest.
| Amount | Term | Compound | Simple | Advantage |
|---|---|---|---|---|
| 1,000.00 $ | 10 years | 1,967.15 $ | 1,700.00 $ | 267.15 $ |
| 10,000.00 $ | 10 years | 19,671.51 $ | 17,000.00 $ | 2,671.51 $ |
| 10,000.00 $ | 30 years | 76,122.55 $ | 31,000.00 $ | 45,122.55 $ |
| 100,000.00 $ | 10 years | 196,715.14 $ | 170,000.00 $ | 26,715.14 $ |
Compound interest with stocks and ETFs
With stocks and ETFs, compounding works once price gains and reinvested dividends stay in the account. An accumulating ETF reinvests distributions on its own. With a distributing ETF you reinvest the payout so the effect continues.
Returns move from year to year, so run the same amount with a cautious rate and a higher one. The DCF calculator and the P/E calculator estimate what a single stock is worth.
Assumptions
Constant rate
The rate stays fixed for the whole term. Stock and ETF returns move from year to year.
Tax at the end
The charge is taken once from the gain. The field starts at 26.375%, German capital-gains tax plus the solidarity surcharge. You can type another rate. The saver’s allowance and costs stay out.
Nominal figures
Inflation is not included.
A model
The calculator is a guide, not investment advice.
Compound interest calculator questions
What is compound interest in simple terms?
Compound interest is the earning of returns on returns that have already been reinvested. Wealth then grows exponentially, and the leverage gets larger the longer the money stays invested.
What is the compound interest formula?
Ending balance = starting amount × (1 + rate) ^ years. 10,000 at 7% for 10 years is 10,000 × 1.07^10 = 19,671.51.
How much is 10,000 after 10 years of compound interest?
At 7% a year, 10,000 becomes 19,671.51 in 10 years. Interest is 9,671.51, of which 2,671.51 is the extra from compounding.
How does the calculator handle a savings plan?
Each contribution arrives at the start of its interval and compounds from then on. 10,000 starting capital plus 200 a month at 7% is 54,075.29 after 10 years, before tax.
How many years until compound interest doubles the money?
About 10.2 years at 7% and 7.3 years at 10%. The calculator shows the time for your own rate.
Is monthly compounding better than yearly compounding?
For a lump sum the ending balance after full years stays the same, because the calculator keeps the effective annual rate fixed. For a savings plan, monthly is better because each contribution starts earning sooner.
Does compound interest apply to stocks and ETFs?
Yes. Price gains and reinvested dividends compound as long as the money stays invested. An accumulating ETF reinvests distributions automatically.
How much compound interest is left after capital-gains tax?
At 26.375% German capital-gains tax plus the solidarity surcharge, 10,000 at 7% for 10 years leaves 17,120.65. The field starts at that rate, and you can type another one. The saver’s allowance is not deducted.