The formula
A = P × (1 + r ÷ k)^(k × t), where P is the starting amount, r the annual rate, k the number of compounding periods per year and t the years. Monthly contributions are added at the end of each month.
What you get
- Final balance, total contributions and interest earned
- Effective annual rate (APY) for the chosen compounding
- A year-by-year growth table
The rule of 72
Divide 72 by the interest rate to estimate how many years it takes to double your money: at 6 %, about 12 years.
Frequently asked questions
Does compounding frequency matter?
Slightly: more frequent compounding gives a higher effective rate, e.g. 6 % monthly is 6.17 % per year.
Are taxes and inflation included?
No, results are before tax and in nominal money.
When are monthly contributions added?
At the end of each month.