Annual Compound Interest Calculator

1. Enter the amount you are starting with in Initial investment. 0 is allowed.
2. Enter the rate you want to assume in Annual return. For 10% a year enter 10.
3. Enter the Investment period as a whole number of years.
4. Enter the Annual contribution you add once a year, or 0 to add nothing.
5. Select Calculate to see the final balance, total contributed, estimated gain, cumulative return and the year-by-year breakdown.
6. Select Reset example to restore the values shown when the page opened, or Clear to set every field to 0.

Reset example and Clear are two separate buttons and do different things. Reset example puts back the illustration you saw first; Clear empties everything to 0 so you can start from a blank sheet.

The values shown when the page opens are a hypothetical example chosen to show how the calculation works. They are not a real product return or a market forecast. This calculator holds no return, tax or fee figures of its own.

Compounding happens once a year. The balance is multiplied by one plus the annual rate at the end of each year, and nothing is applied in between. There is no monthly or daily step on this page, so a period of 3 years means the return is applied exactly three times.

The order of events inside each year matters, and it is fixed: the year’s return is applied first, and the annual contribution is added afterwards. Written out, each year is:

balance = balance × (1 + annual rate) + annual contribution

That means a contribution made in a given year earns nothing in that same year; it starts earning from the following year. A calculator that adds the contribution at the start of the year would show a higher balance for the same inputs, which is one reason results differ between sites. This page states its rule so you can compare like with like.

Without any contribution the whole calculation collapses to the familiar formula final balance = initial investment × (1 + annual rate)^years, and each contribution simply compounds for the number of years remaining after it lands.

These are the same values the calculator shows when the page opens. They are a hypothetical example, not a real product return or a market forecast, and you can check every step by hand.

1. Initial investment 10,000, annual return 10%, investment period 10 years, annual contribution 1,000
2. Year 1: 10,000 × 1.1 = 11,000, then the contribution is added → 12,000
3. Year 2: 12,000 × 1.1 = 13,200, then the contribution is added → 14,200
4. Repeating that to year 10 gives a final balance of about 41,874.85
5. Total contributed = 10,000 + 1,000 × 10 = 20,000, so the estimated gain is about 21,874.85 and the cumulative return is about 109.37%

Notice that the first contribution compounds for nine years and the last one for none at all, because it lands at the very end of the final year. That is exactly what the year-by-year breakdown shows, row by row.

The cumulative return is measured against everything you put in, not against the initial investment alone. With contributions turned on, that denominator grows every year.

• Final balance — what you would hold at the end of the last year, after that year’s return and contribution.
• Total contributed — the initial investment plus every annual contribution. It is money you put in, not money you earned.
• Estimated gain — final balance minus total contributed. When the return is negative this becomes an estimated loss, and the label on screen says so in words rather than by colour alone.
• Cumulative return — estimated gain ÷ total contributed × 100, for the whole period rather than per year.
• Same rate without compounding — the same inputs with simple interest, shown so you can see how much of the balance came from compounding.
• Year-by-year breakdown — the start (year 0) and the end of each year, with total contributed, estimated gain or loss and balance. On a narrow screen the table scrolls sideways and can be reached with the keyboard.

• An initial investment of 0 is allowed. With an annual contribution the balance simply starts from the contributions.
• A period of 0 years is allowed. Nothing has happened yet, so the balance equals the initial investment and the breakdown has a single starting row.
• An annual return of 0% is allowed. The balance grows only by what you put in, and the estimated gain is 0.
• Negative returns are allowed above −100%. Exactly −100% would wipe the balance out in a single year, so it is not accepted, and the result card then reports an estimated loss.
• The period must be a whole number of years from 0 up to the limit shown next to the field, which is 100 years.
• Empty fields, letters, negative amounts and values above the limits are not calculated, and the calculator tells you which field is wrong and why while keeping the previous result on screen.

• The return is assumed to be exactly the same every year for the whole period. Real returns move up and down.
• The return is applied once a year, and the contribution is added once a year, at the end.
• Taxes are not automatically included.
• Fees are not automatically included.
• Inflation is not automatically included.
• Exchange rates are not automatically included. No currency conversion happens anywhere on this page.
• No statutory tax rate, fee rate or market return is ever guessed or applied automatically.
• No live market data and no external service are used. The page calls no pricing service of any kind.
• Results are informational estimates based only on the values you enter.
• They do not guarantee any return and are not investment, legal or tax advice. No specific product is recommended.
• Intermediate values are not rounded; only the numbers on screen are rounded for display.
• Your inputs are calculated only in this browser and are never sent to or stored on a server.

Compounding more often does not create money out of nothing, but it does change the arithmetic, so it helps to know which question you are asking.

• Annual compounding (this page) applies a return once a year and lets you add money once a year, at the end. It suits plans you think about in whole years.
• Monthly compounding applies a return twelve times a year. The Monthly Compound Interest Calculator counts the period in months and adds a contribution every month.
• A more general setup — choosing the contribution frequency, the compounding frequency and the timing yourself — is what the Compound Interest Calculator is for.
• Looking backwards instead of forwards is a different job. The CAGR Calculator turns a change that already happened into one equivalent annual rate.

For the same annual figure, compounding monthly on an effective annual basis lands on the same balance after a whole number of years; the difference shows up in between, and whenever contributions are involved, because the timing of each payment changes how long it earns.

To choose the contribution frequency, the compounding frequency and the payment timing yourself, the Compound Interest Calculator opens all of those settings. To plan in months instead of whole years, the Monthly Compound Interest Calculator counts the period in months. Both are hypothetical simulations and guarantee no return.

This page looks forward from a return you choose. To look backwards at a change that already happened, the CAGR Calculator smooths it into one equivalent annual rate. Putting a past rate into the annual return field here shows what the same pace would look like if it continued, but a past rate does not mean the same rate will continue.

• Compound Interest Calculator — choose the frequency and timing yourself
• Monthly Compound Interest Calculator — the same idea month by month
• CAGR Calculator — restate a past change as one annual rate