Compound Interest Calculator

See how your investments grow over time with the power of compound interest.

Investment Details

$

Starting amount you'll invest

$

Amount you'll add each month

%

Expected annual return (e.g., 7% for S&P 500)

years

How long you'll invest

How often interest is compounded

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Understanding Compound Interest

Compound interest is the "eighth wonder of the world" - your money earns interest, and that interest earns interest too, creating exponential growth over time.

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Key Information

  • • Interest compounds on both principal and accumulated interest
  • • Starting early maximizes exponential growth potential
  • • Regular contributions accelerate wealth building
  • • Time in the market beats timing the market
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Simple Example

$1,000 invested at 10% annually:

  • • Year 1: $1,100 (+$100 interest)
  • • Year 2: $1,210 (+$110 interest)
  • • Year 3: $1,331 (+$121 interest)

Notice how interest grows each year!

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Typical Investment Returns

  • • S&P 500 Index: ~10% average annual return
  • • Bonds: 3-5% average annual return
  • • High-Yield Savings: 4-5% annual return
  • • Conservative Portfolio: 5-7% annual return