See how savings and investments grow over time with regular contributions, and watch compounding do the heavy lifting in the later years.
Your savings plan
See how savings and investments grow over time.
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Future value
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Interest earned
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Growth by year
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The compound interest formula
A = P(1 + r/m)^(mt)
A is the final amount, P the starting principal, r the annual rate, m the number of compounding periods per year and t the years. Regular contributions are added period by period on top of this.
The engine of compounding is time: growth is slow in the early years, then the interest itself starts earning interest and the curve bends upward. In the default example above, more than half of the final value arrives in the last ten years.
Making compounding work for you
Start earlier, not bigger: $300/month from age 25 at 7% beats $600/month from age 40.
Fees compound too: a 1% annual fee can consume roughly a quarter of a portfolio's growth over 30 years.
Reinvest dividends so returns generate their own returns.
Remember inflation: at 3% inflation, a 7% nominal return is about 4% in real purchasing power.
Compound interest is interest earned on both your original deposit and on interest already added. The formula is A = P(1 + r/m)^(mt), where m is how many times interest compounds per year. More frequent compounding and more time both increase growth.
What is the rule of 72?
The rule of 72 is a quick estimate of doubling time: divide 72 by the annual return. At 7% a year, money doubles roughly every 10.3 years. It shows why starting early matters so much.
How do fees affect compound growth?
Fees compound just like returns, but against you. A 1% annual fee can consume roughly a quarter of a portfolio's growth over 30 years, which is why low-cost index funds are popular for long-term saving.
Should I account for inflation in growth projections?
Yes, for honest planning. At 3% inflation, a 7% nominal return is about 4% in real purchasing power. The calculator above shows nominal figures; subtract expected inflation to estimate what the money will actually buy.