Compound Interest & Investment Growth Calculator
Simulate long-term investment growth with monthly contributions, compounding interest frequencies, inflation adjustments, and visual charts.
Growth Trajectory: Principal vs Compound Interest
5-Year Milestone Trajectory
| Horizon | Total Deposits | Compound Earnings | Portfolio Balance | Share from Interest |
|---|
🚀 Einstein's "Eighth Wonder of the World"
Compound interest behaves like a hockey stick: in the first 5 to 7 years, your portfolio grows primarily from your monthly cash deposits. Around year 12 to 15, annual compound interest begins generating more new wealth each year than your total annual salary contributions combined.
About this tool
How to use it
- Enter your starting investment deposit and planned regular monthly contribution.
- Input your expected annual rate of return (e.g. 7-10% for broad index funds, 4-5% for cash HYSA).
- Specify your investment time horizon in years and optional inflation discount rate.
- Inspect total projected portfolio value, interest multiplier ratio, and SVG trajectory curves.
Why it matters
Compound interest generates exponential rather than linear growth because earnings themselves generate subsequent returns. Calculating this dynamic illustrates why starting early—even with modest monthly amounts—is the single greatest mathematical advantage in personal wealth building.
When to use it
Use this tool when planning retirement (401k, IRA, ISA), setting up children's college savings funds, projecting index fund investments, or estimating high-yield savings accounts.
Good to know
Formula used: A = P(1 + r/n)^(nt) + PMT × [((1 + r/n)^(nt) - 1) / (r/n)], incorporating regular monthly deposits and compounding frequency.
Common questions
What is the Rule of 72?
The Rule of 72 is a quick mental math shortcut: divide 72 by your expected annual interest rate to find the approximate number of years it takes for your investment to double. At 8% annual return, your money doubles every 9 years.
What is a realistic average stock market return?
Historically, the US S&P 500 index has returned an average of approximately 10% per year before inflation (roughly 7% annualized after adjusting for historic inflation) over 30-year holding periods.
How does inflation affect my future portfolio?
While your nominal balance grows to large numbers, rising prices erode purchasing power. An inflation-adjusted calculation discounts future dollars back to today's purchasing power so you know what that money will actually buy.
Why does compounding frequency matter?
The more frequently interest is calculated and added to the balance (daily or monthly vs annually), the faster interest begins earning interest on itself, generating slightly higher effective annual yields.