How to calculate compound interest
- Enter what you have now and how much you will add each month.
- Set the expected annual return and how many years you will invest.
- Read the future balance and open the table to see each year.
Frequently asked questions
How much will $500 a month grow to in 30 years?
At a 7% annual return, about $610,000, of which $180,000 is your own money and the rest is compound growth.
How do I include a 401(k) employer match?
Add the match to your monthly contribution. If you put in $500 and your employer matches 50%, enter $750.
What return should I use?
Savings accounts pay roughly 3–4% today. Broad stock index funds have averaged about 7% a year after inflation over long periods, but returns vary year to year.
What is the formula?
Each month the balance grows by the annual rate ÷ 12 and the contribution is added. Over many years the interest earned on earlier interest is what makes the curve steepen.